Treasury Money-Market Account
If you still feel uneasy with the idea of money-market accounts, you might consider money-markets that invest (which is to say lend) all their money in U.S. Treasury bills. Treasury bills are guaranteed and backed by the full credit of the government, which means that if the government can’t pay back the money when it is due, they will be forced to raise taxes to do so. When I was training to be a broker—and this still holds—the only time I was allowed to use the word “guaranteed” was when I was talking about a U.S. Treasury bill, note, or bond. In short, even though these kinds of money-market accounts are not insured by the FDIC, they are backed by the taxing authority of the U.S. government, which in my opinion is certainly as safe as, if not safer than, FDIC insurance. U.S. Treasury money- market accounts will not pay as much in interest as regular money-market accounts, but you will still do better than you will with most savings accounts.
Tags: Financial