Robby,
How much of what you are talking about is considered "liquid" ?

Readily accessible within 24 hours ? With penalties ?

^Typically, MMAs don't have withdrawal penalties. The whole point is to have a liquid account that still gets a decent return. Some even come with checking and debit cards.

quote:

Originally posted by tatortodd:
They invest in Senators and Congressman

+1

Silent

Check out how much Berkshire Hathaway earns each year in dividends.

Many brokerages, including mine, will take a large sums of cash and spread it amongst several banks keeping the maximum under the FDIC limits but still managed by the client as one money market account.

Easy peasy.

How do the charge for that ?
What's that cost ?

The main cost of a typical money market fund, called the Expense Ratio, is a percentage of the fund's average net assets. It's comparatively low, like around 0.1% a year (i.e. $10 per every $10,000).

Some accounts will have other fees, like a monthly service fee if the account value falls below a certain minimum. There can also be withdrawal fees (not typical), account closure fees, overdraft fees, etc.

quote:

Originally posted by smlsig:
Many brokerages, including mine, will take a large sums of cash and spread it amongst several banks keeping the maximum under the FDIC limits but still managed by the client as one money market account.

Easy peasy.

^^^^
They probably utilize a ICS OR CDARS account. Anyone can do it, you don’t need a brokerage account to do it although it might be easier.

https://www.intrafi.com/ics-cdars

The wealthy don't run their stuff the way regular folks do as you would imagine. It's a different world entirely. My guess is unless you work at a high level on Wall Street or international finance you wouldn't understand hardly any of it no matter how plainly it could be explained to you. There are some guys on this forum who probably do understand those things and know others that do, but you'd have to meet minimum qualifications before you could make an appt with them.

quote:

Originally posted by bendable:
Robby,
How much of what you are talking about is considered "liquid" ?

Readily accessible within 24 hours ? With penalties ?

All of that type of investment is liquid. The money market I'm thinking of, Federated, has to be sold a day in advance to have the funds be "good cash". The deadline is noon eastern time, and the funds are available the next morning - early. No penalties. Sometimes there is a minimum "investment", about $250k for Federated, but the brokerages can waive that. The fund expense is near zero. The brokerage fees can vary, but if you're wealthy they will be reduced or waived. Some accounts are charged by AUM (assets under management), but that normally doesn't include money markets.

Morgan Stanley has a "bank deposit program" which spreads money out between different banks to keep under the guaranteed levels. Some firms also provide "insurance" up to a higher amount. I've always thought that if this insurance becomes necessary then there has been a financial meltdown and no one would be able to collect.

When reality meets your dreams...

I am learning stuff , thank you to those helping out