Smart Savings

Higher cash savings returns

Based on our comprehensive research and decades of experience, we hold the belief that savers and investors both merit and can achieve significantly greater cash returns than what they would receive from their savings in a bank. Here are three methods to achieve this goal::

  • Best ‘money market’ ETF portfolio: Employ an ultra-short-term bond ETF portfolio that surpasses the performance of money market funds.
  • Best treasury ‘money market’ ETFs: Opt for the following ‘money market equivalent’ Treasury ETFs — as secure as a Treasury money market fund, yet they have lower expense ratios and available in almost every brokerage.
  • Income and savings tips: Make use of the abundant resources available on the Yield Alley website knowned for offering unbiased and extremely helpful savings tips and resources. 

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Money market ETF model portfolio

What?

The ultra short bond ETF model portfolio selects a top performing ETF every month to invest. The portfolio becomes conservative during a financial downturn. This portfolio can be viewed as ‘prime’ money market fund eqivalent.


Candidate ETFs



Ticker/Portfolio Name YTD
Return**
1Yr AR 3Yr AR 5Yr AR 10Yr AR 15Yr AR
ICSH (iShares Ultra Short-Term Bond ETF) 2.5% 5.9% 3.0% 2.4% 1.9%
NEAR (iShares Short Maturity Bond ETF) 1.6% 6.6% 3.1% 2.5% 2.0%
JPST (JPMorgan Ultra-Short Income ETF) 2.6% 6.1% 2.9% 2.5%
BIL (SPDR® Bloomberg 1-3 Month T-Bill ETF) 2.5% 5.3% 2.9% 2.0% 1.4% 0.9%
SHV (iShares Short Treasury Bond ETF) 2.4% 5.3% 2.8% 2.0% 1.4% 1.0%
TFLO (iShares Treasury Floating Rate Bond ETF) 2.6% 5.5% 3.2% 2.2% 1.5%

**YTD: Year to Date

Pros and Cons

Pros:

  • Total returns match or better than a prime money market fund
  • Available in every brokeage

Cons: 

  • Has to follow closely and rebalance as needed, often several months apart

Latest performance of money market ETF portfolio

Ticker/Portfolio Name YTD
Return**
1Yr AR 3Yr AR 5Yr AR 10Yr AR 15Yr AR
MPIQ Ultra ST Bond ETFs 0.8% 5.0% 2.9% 2.5% 1.9%
CASH (CASH) 1.7% 3.8% 2.4% 1.6% 1.1% 0.8%
BIL (SPDR® Bloomberg 1-3 Month T-Bill ETF) 2.5% 5.3% 2.9% 2.0% 1.4% 0.9%

**YTD: Year to Date

AR: Annualized Return. CASH: 3-month Treasury bill daily interest adjusted, BIL: SPDR Barclays 1-3 Month T-Bill ETF. These three funds are for benchmark purpose.

Past 5-Year Total Return Chart

Treasury ‘Money Market’ ETFs

Benefits

The following ultra short term Treasury ETFs can be viewed as ‘money market’ funds as they invest solely in short term Treasury bills (up to 3-month maturity) or floating rate Treasury notes that provide 3-month Treasury bill equivalent yield adjusted weekly.

Latest returns of model portfolios, click on portfolio names for more details

Ticker/Portfolio Name YTD
Return**
1Yr AR 3Yr AR 5Yr AR 10Yr AR 15Yr AR
USFR (WisdomTree Floating Rate Treasury Fund) 2.7% 5.6% 3.3% 2.3% 1.5%
TFLO (iShares Treasury Floating Rate Bond ETF) 2.6% 5.5% 3.2% 2.2% 1.5%
SGOV (iShares® 0-3 Month Treasury Bond ETF) 2.5% 5.4% 3.1%
BIL (SPDR® Bloomberg 1-3 Month T-Bill ETF) 2.5% 5.3% 2.9% 2.0% 1.4% 0.9%

**YTD: Year to Date


AR: Annualized Return. 

Savings tips and resources

Benefits

We highly recommend Yield Alley, a site devoted to resources and tips on how to achieve higher cash returns. This is by far the only dedicated site that provides comprehensive, timely and educational materials on savings products including brokered CDs (CDs available in a brokerage market place), Treasury bills and other fixed income products. 

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