Question:
Where should I put money that isn't covered by FDIC insurance?
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Paul Merriman:
In my business I keep a lot of money in checking and bank money rate accounts.  The latest bank failures have me concerned with how much I should keep in the bank.  Where should I put money that is not covered by FDIC insurance?

Probably the safest and most efficient place to put the excess money is in a no load Treasury backed money market fund or short term government bond fund.  My favorites are Vanguard Treasury Money Market Fund (VMPXX) and Vanguard Short-term Federal Fund.  The Short Term Federal is available in Admiral shares (VSGDX) with a minimum $100,000 investment and regular shares (VSGBX) with a minimum $3,000 investment.  The Admiral shares are currently yielding 3.66 percent vs. 3.57 for the slightly more expensive regular shares. The money market fund is currently yielding 1.65 percent (according to Vanguard). In all cases you can write checks against the accounts, without penalty or cost.

Paul Merriman is a financial educator and founder of Merriman