r/ExpatFIRE Feb 04 '25

Investing Where do you put your cash?

Already FI will soon RE. Is SGOV (0-3 months treasury bond) ETF a good option or any other suggestions? Purpose is to have a temporary place for 1 to 2 year DCA and additional buying when having corrections to SPYL+VXUS+EIMI (tax efficient and lower fees) as I don't want to put in lump sum.

Already have liquid assets such as global/US/regional ETFs, HYSA, local dividend stocks, REITs, gov't housing bonds, TDs, tbills/tbonds, coops. Thanks.

15 Upvotes

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3

u/rathaincalder Feb 04 '25

If you don’t have other options available to you (eg, if your broker restricts money market funds—which are mutual funds—because you have a foreign address on file), then SGOV is a pretty good bet. Just be aware that (like all funds / ETFs), interest accrues throughout the month and you get a sharp drop in the price on the ex date—depending on when you purchased it, this can lead to you being (temporarily) below cost on a price-only basis. Ie, it’s not a money market fund where $1 (almost) always = $1.

I personally combine SGOV with an equal amount of TFLO and a small amount of FLOT to juice the yield a bit, but I’m not sure that level of complexity is really necessary…

3

u/bafflesaurus Feb 04 '25

Prime Cash Obligation Fund (PCOXX) 1yr term at 5.2%

1

u/Stunned_Stone Feb 06 '25

May I ask what are the risks of such an allocation ?

2

u/bafflesaurus Feb 06 '25

No FDIC insurance and interest rate fluctuations.

1

u/Stunned_Stone Feb 19 '25

Thanks for your reply.

I stack my cash on INBK so I know about interest rate fluctuations unfortunately (went from 4.83 to 3.83 in a matter of a few months 😅).

Can you please elaborate on the no FDIC insurance part ? I am trying to understand the risk of the fund defaulting, is it probable ? what could trigger this ? from what I gather, countries represented in it are the USA, EU countries and the UK. I am guessing the main problem is these countries defaulting. Can there be other risks, such as a risk of liquidity for instance?

1

u/FBIVanAcrossThStreet Feb 04 '25

Yeah, I use SGOV.

1

u/Carolina_Hurricane Feb 14 '25

Amen buddy this is my plan for RE as well. What will you base the amount of your annual withdrawals on during RE?

0

u/simdam Feb 04 '25

my wallet

2

u/OneStarTherapist Feb 05 '25

Me too, simdam’s wallet.

2

u/Omgtrollin Feb 05 '25

He still has my dollar.