Where to park equity in between home sale and purchase?

[awbowhunter]

I am getting relocated at about the worst time i could back to Ga.

After selling current home i may wait 6 months to a year to purchase another home depending on what i find, housing market and interest rates.

Should I just put the 200k equity in my bank savings account until i purchase another home?

Is there a better or safer place to park that amount of cash and still have easy access when i am ready?

Thanks!

 

[IowaNative]

Most CDs are paying 5% for 6-8 months... Not too shabby for a guaranteed rate

 

[Crowmangler]

I assume your main goal is not to lose any of it by investing in stocks, etc.
There are many places that offer ~5% range for fully FDIC insured Money market funds that are 100% liquid.
Short term CD's are currently paying more than long term ones
Just parking it in a bank savings account will get you about 0.1%

 

[Lee_R]

U.S. gov treasuries in the 3-6 month range are doing in the 5.2-5.4% range.

 

[Hnthrdr]

Money market or similar will be much more liquid, not that you be in too bad of shape paying an early withdrawal penalty, but it’s nice to have it ready to rock when you need it not sure where you are moving but some stuff sits for 2-3 months now and some stuff is still gone in 2-3 days…

 

[thegrouse]

A high yield savings account pays 4.65% now

 

[ODB]

A high yield savings account pays 4.65% now

This would be my suggestion. 200K in a HY at that rate would be nice, and it would be available at the drop of a hat.

 

[Clarktar]

I'm also looking to park some cash.

Wondering if this would be a good approach

FIMM:Treas Only-Select CL (FTYXX) | Fidelity Institutional

See fund information and historical performance for the Fidelity Institutional Money Market Treasury Only - Select Class (FTYXX). Check out our mutual fund lineup.

institutional.fidelity.com

Or this

Earn 4.80% APY with No Account Fees | Wealthfront Cash

Earn 11x more interest on your savings than the average U.S. bank. No account fees. No minimum balance. No strings attached.

www.wealthfront.com

 

[sbaker0029]

I would go the money market account route.

 

[HeavyAssault]

1) How much access do you want to your cash without a "penalty"?
2) Do you need any cash on hand "just in case" something happens sooner than expected?

I'm no expert but I have been in a situation in the recent years where I had to learn about CD's. I'd just make sure there's no "lock-in" requirements to whatever you decide.

 

[PlumberED]

Money market would be my first choice followed closely by a short term CD.

 

[PlumberED]

I have a follow up question: why are you waiting 6-12 months to buy another house?

 

[Tjdeerslayer37]

ive seen HYSA up to 6%, id go that route

 

[Roosterstraw]

I’m using a HYSA that is 5% with CIT bank (not citi). This rate is not locked in and can change if the fed starts lowering interest rates. My personal bank, PNC, is 4% in a money market account locked in until January. If I were you I’d use a money market or HYSA while rates are still high. If you go this route a lot of the online banks offer higher interest due to less overhead. Do your homework before picking one and make sure it’s FDIC insured.

 

[FOS373]

With the current rate on high yield savings / money market accounts - go that route as others have said

 

[Happy Antelope]

I wouldn't park it in a CD, you can get 5% from a Fidelity money market right now. CDs are maybe a quarter-point higher is all. Treasuries are 5.5% for 3 months.

 

[5MilesBack]

Short term treasuries or money market. Vanguard is paying 5.24% on their money market account right now.

 

[Beendare]

My Schwab money market tied to US treasuries is currently paying 4.9%
Symbol SNSXX

I chose that for the safety vs one with a little bit higher rate that has other stuff in there.

its liquid, you can trade out of it in a day with one day to clear.

 

[MallardSX2]

T-bills

 

[N.ID7803]

Most high yield savings accounts are 5%+ right now. That’s where I would park it.

Best High-Yield Savings Accounts for April 2024—Up to 5.50%

Compare today’s best high-yield savings account rates with our ranking of over 100 national banks and credit unions. Today's top rate is 5.50% from Poppy Bank.

www.investopedia.com