Personal Cash Management

Consumers frequently leave excess cash in checking accounts that earn close to nothing.  Here is a simple cash management strategy that everyone can employ.  

Checking Account

• This is your day-to-day account.  Deposits are received and funds are used for everyday living. 
• I suggest having a checking account at a bank with great technology.  I personally use JP Morgan.  The technology is superior to most, if not all banks. 

United States Treasury Bills/Money Market Fund

• Excess savings can be invested in short-term United States Treasury Bills or a Money Market Fund.
• Each investment can be purchased in your brokerage account and sold immediately if you need funds.  
• You will earn more in these investments than a Bank CD or Bank Savings Account. 

If you think about it, this is what banks do.  Banks have a checking account at the Federal Reserve.  If they have excess funds, they purchase United States Treasury Bills or Mortgage Back Securities.  If this is what banks do, why don't you do the same. 

* This post is for information purposes only.  Please contact a financial advisor before implementing any cash management strategy.