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High-Yield Savings Optimization
A deep dive on where cash should live. It measures what a low rate and inflation cost, compares high-yield savings, money market accounts and funds, brokerage cash, CDs, Treasury bills and I bonds on safety, access and after-tax yield, and ends with a simple system that keeps your cash in the right place.
Chapters7
Reading time40 min
Worked examples25
Updated2026-10-01
What you will be able to do
- Work out the real, after-tax rate your cash earns and what a low rate costs you.
- Choose between a high-yield savings account, a money market account or fund, a CD and a Treasury bill for each job your cash does.
- Check that your deposits are insured, and fix a low default sweep rate in a brokerage account.
- Build a CD or Treasury bill ladder that matches money to the dates you need it.
- Set up an automated cash system with a sized safety reserve and a twice-yearly review.
Contents
7 CHAPTERS · ABOUT 40 MIN- 01What Low-Yield Cash Really Costs How inflation and a below-market rate quietly shrink a cash balance, why the gap between banks persists, why stocks are the wrong comparison for emergency money, and how to give every dollar of cash a job.6 min5 computed
- 02High-Yield Savings Accounts and Deposit Insurance What APY means, how online banks, credit unions and your own bank compare, the fine print that changes the rate you earn, how FDIC and NCUA insurance really work, and when a better rate is worth switching for.6 min4 computed
- 03Money Market Accounts, Money Market Funds and Brokerage Cash The difference between an insured money market account and an uninsured money market fund, the fund types and their costs, the low default sweep rate many brokerage customers never notice, and how cash management accounts work.6 min3 computed
- 04CDs and CD Ladders How certificates of deposit work, what an early withdrawal really costs, when locking a rate makes sense, how to build a ladder that pays a long-term rate with regular access, and how no-penalty and brokered CDs differ.6 min3 computed
- 05Treasury Bills and I Bonds How Treasury bills are bought, quoted and taxed, why their state tax exemption can beat a higher savings rate, how I bonds protect against inflation, and the purchase limits and holding rules that come with them.6 min3 computed
- 06Taxes on Interest and How to Keep More How interest and money market dividends are taxed, how to work out the after-tax and after-inflation rate you keep, when Treasury or municipal income wins, the Net Investment Income Tax, timing moves, and losses on bond funds.6 min4 computed
- 07Your Cash System Four tiers of cash with a target for each, the automatic transfers that keep them filled, a twice-yearly rate check, when surplus cash should pay down debt instead, and how to consolidate accounts without concentrating risk.5 min3 computed
CALCULATORS USED IN THIS BOOK