I would love for Clark to chime in. I moved most of our money from an online bank getting 2.75% to Fidelity and Vanguard money markets getting around 3.6%. These funds are not FDIC insured. Is this safe and advisable?
Personally I think there is risk in MMs. I use the SGOV ETF, also not insured but the underlying investments are just US Treasury Bills. MMs are a weird soup made up of… Stuff I don’t understand.
SGOV yields about 3.5%
I also moved cash from an online bank to Vanguard Money Market Funds due to the higher yield. Money Market Funds particularly those that invest in U.S. Government securties are safe. Most secure are the Money Market Funds that invest in U.S. Treasuries. Vanguard money market funds tend to have higher yields than those of Fidelity or Schwab due to lower expense ratios. There is a good review article about Money Market Funds by Harry Sit:
Note that Money Market Funds are different than Money Market Accounts offered by banks and credit unions.