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Home >> Keeping Your Money Safe
Where to Stash My Cash?
Which of the two...the unlimited FDIC insurance accounts available now, paying 0.5% or less, or short term Treasuries, is safer? Which would you recommend to safely park money and have liquidity?
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 Of the two, a checking account that is covered by the FDIC Transaction Account Guarantee (TAG) Program is the more liquid. Just be certain that the bank in question participates in the TAG (it should have a lobby and webpage notice posted), and that the account in question is a checking account that pays no interest or that has a cap on interest at 0.5% or less. You should also be careful to realize that the TAG program is currently due to expire after December 31, 2009. After that date, unless Congress changes the law, the account will be combined with you other accounts in the same bank and be insured in the aggregate to $100,000, assuming only individually-owned accounts.
Both the TAG-covered account and Treasuries are backed by the U.S. government, so they are comparably safe. The TAG account is the more liquid because it's spendable by check or debit card, while the Treasury security, which isn't yielding much these days, requires sale before the funds would be spendable.
Published on BankingQuestions.com 4/13/09
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