No. of Recommendations: 1
There are money market funds which only invest in US govt debt, e.g VMFXC which yields 4.23%.
investor.vanguard.com - Mutual fundsOr an ETF VBIL which invests in 0-3 month T-Bills, which yields 4.21%.
investor.vanguard.com - Investment productsThere is virtually zero credit risk assuming US government doesn’t default.
Even if bond yields soar, these won’t take much principal loss, due to very short term maturities.
The main risk is from inflation and taxes, if you plan on holding for a multi year period. It is almost certain to give you a negative real after tax total return.
For longer term investments you’ll inevitably need to hold equities, to get a positive real after tax total return.
