Which Merrill Edge money market fund to use?

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Topic Author
Laundry_Service
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Which Merrill Edge money market fund to use?

Post by Laundry_Service »

There have been a handful of posts in the past but I did not get a conclusive answer. I'm also having a hard time pasting the list in this post so I will attach a link:

https://olui2.fs.ml.com/Publish/Content ... Sheet.pdf

A lot of these pay a similar interest rate and need $100k for minimum investment, but it looks like you can sell the next day and keep a minimal amount but would need $1000 additional investment. I'm trying to figure out which of these I won't have to pay state tax. Any help would be much appreciated.
Blue456
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Re: Which Merrill Edge money market fund to use?

Post by Blue456 »

marstaton4 wrote: Thu Jan 16, 2020 7:22 am There have been a handful of posts in the past but I did not get a conclusive answer. I'm also having a hard time pasting the list in this post so I will attach a link:

https://olui2.fs.ml.com/Publish/Content ... Sheet.pdf

A lot of these pay a similar interest rate and need $100k for minimum investment, but it looks like you can sell the next day and keep a minimal amount but would need $1000 additional investment. I'm trying to figure out which of these I won't have to pay state tax. Any help would be much appreciated.
I use BIL ETF with current yield of 1.57%. It’s based on 3 month treasury bills so it’s as safe as FDIC insured account. It’s as stable fund as you can get in terms of ETF and you only pay federal taxes on it.
Lastrun
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Re: Which Merrill Edge money market fund to use?

Post by Lastrun »

Most ME folks here are using the following ETFs:

BIL
SHV
ICSH
GSY

There are some others mentioned a little less frequently:

NEAR
MINT
JPST

They have a mix of bonds and longer duration. I have also seen the VG short treasury ETF mentioned. You can get BPTXX at ME for a $5K minimum.
BashDash
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Re: Which Merrill Edge money market fund to use?

Post by BashDash »

This thread is of interest to me. Are these etf to be used for any uninvested cash? I have a mix of stocks plus VTI. When any dividends sails in I purchase vti. Sometimes I don't have enough available to purchase a share so it is uninvested. Is this what the OP wants to use these "money market" like ETFs for? Or is this not even worth the headache.

Sorry to jump in.
jayhawkerbeef
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Re: Which Merrill Edge money market fund to use?

Post by jayhawkerbeef »

I used VTEB in taxable, BND in tax deferred space. YMMV.
UpperNwGuy
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Re: Which Merrill Edge money market fund to use?

Post by UpperNwGuy »

jayhawkerbeef wrote: Thu Jan 16, 2020 2:16 pm I used VTEB in taxable, BND in tax deferred space. YMMV.
Neither of those two ETFs are similar to a money market fund.
jayhawkerbeef
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Re: Which Merrill Edge money market fund to use?

Post by jayhawkerbeef »

Then don’t use them.
Topic Author
Laundry_Service
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Re: Which Merrill Edge money market fund to use?

Post by Laundry_Service »

I prefer to use money market funds so I won't have to deal with any accounting issues when it's time to do my taxes. The ETFs are interesting but not what I'm looking for.

I think BlackRock Liquidity Funds Federal Trust Fund Portfolio Institutional - TFFXX is what I'm looking for. I don't think I will need to pay state tax on the distributions. The 7 day SEC yield is currently 1.48% (2020-01-16) and you can sell and purchase stocks with the proceeds on the same day. As I mentioned before it looks like there is a $100k initial purchase but you can immediately sell and keep what I would assume would be as little as $1 and if you would like to purchase more you have to purchase at least $1k. It's not a sweep account but looks like the next best thing for my situation at Merrill Edge.

If you have $5k for the initial purchase it looks like you can purchase BlackRock Liquidity Funds T-Fund Portfolio Cash Management BPTXX which currently pays .99% interest and is available for same-day purchases. It looks like this fund is subject to state tax.

Vanguard and Fidelity both have superior cash management but I'm using my ME account for the BofA Preferred Rewards program to get improved CC rewards and this seems like the best way to hold cash if you can meet the minimum for a short period of time.
Blue456
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Re: Which Merrill Edge money market fund to use?

Post by Blue456 »

BashDash wrote: Thu Jan 16, 2020 1:59 pm This thread is of interest to me. Are these etf to be used for any uninvested cash? I have a mix of stocks plus VTI. When any dividends sails in I purchase vti. Sometimes I don't have enough available to purchase a share so it is uninvested. Is this what the OP wants to use these "money market" like ETFs for? Or is this not even worth the headache.

Sorry to jump in.
OP needs savings account that pays higher interest than $0 at Merrill Edge. There are multiple reasons why you would want to keep money uninvested from equities and total bond market. Most likely OP, does not want to take any kind of risk and does not want any price fluctuations. For same reasons I keep 33% of my emergency savings in BIL ETF and 33% in Wellesley income fund.
Blue456
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Re: Which Merrill Edge money market fund to use?

Post by Blue456 »

marstaton4 wrote: Thu Jan 16, 2020 4:30 pm
If you have $5k for the initial purchase it looks like you can purchase BlackRock Liquidity Funds T-Fund Portfolio Cash Management BPTXX which currently pays .99% interest and is available for same-day purchases. It looks like this fund is subject to state tax.
BPTXX has expense ratio of 0.69%
MisterBill
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Re: Which Merrill Edge money market fund to use?

Post by MisterBill »

Blue456 wrote: Thu Jan 16, 2020 6:20 pm
marstaton4 wrote: Thu Jan 16, 2020 4:30 pm
If you have $5k for the initial purchase it looks like you can purchase BlackRock Liquidity Funds T-Fund Portfolio Cash Management BPTXX which currently pays .99% interest and is available for same-day purchases. It looks like this fund is subject to state tax.
BPTXX has expense ratio of 0.69%
That probably explains the sub-1% rate.
GoPackGo
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Re: Which Merrill Edge money market fund to use?

Post by GoPackGo »

This blog post mentions Blackrock Liquidity Funds FedFund Cash Reserve Class (BFRXX) as an option. I don't have an ME account so I can't verify that, but something you can look into I guess.

Edit: can -> can't
Last edited by GoPackGo on Thu Jan 16, 2020 8:20 pm, edited 1 time in total.
Blue456
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Re: Which Merrill Edge money market fund to use?

Post by Blue456 »

GoPackGo wrote: Thu Jan 16, 2020 7:49 pm This blog post mentions Blackrock Liquidity Funds FedFund Cash Reserve Class (BFRXX) as an option. I don't have an ME account so I can verify that, but something you can look into I guess.
Expense ratio 0.59.
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Vegomatic
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How We Got Here! / What Does 'Free' Cost? ... Re: Which Merrill Edge Money Fund...?

Post by Vegomatic »

WSJ: Merrill Lynch Joins Brigade Downplaying Money-Market Mutual Funds
Clients’ uninvested cash now will be automatically routed to bank deposits
Jason Zweig - 08-21-2018 https://www.wsj.com/articles/merrill-ly ... 1534880179
  • Starting Sept. 4, Bank of America Corp.’s Merrill Lynch brokerage unit will no longer sweep its customers’ cash into money-market mutual funds, moving it instead into deposits at affiliated banks.
  • In communications distributed to its staff on Monday, the brokerage said money-market funds “will no longer be available as a sweep choice for most new accounts.” Instead, clients’ uninvested cash will be automatically routed to bank deposits...
  • The yield on 100 large money-market mutual funds averages 1.77%, according to Crane Data of Westboro, Mass., which tracks returns on cash investments. Bank sweep accounts at brokerage firms tend to pay about 0.25% on average, according to Crane.
  • Merrill’s brokers will still be able to place their customers’ cash in higher-yielding money-market funds, but only by purchasing them manually...
  • It isn’t unusual for brokerage firms to earn in excess of 1% annually on their customers’ cash in bank sweeps, while passing along a fraction of that to their customers.
isira
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Re: Which Merrill Edge money market fund to use?

Post by isira »

marstaton4 wrote: Thu Jan 16, 2020 7:22 am A lot of these pay a similar interest rate and need $100k for minimum investment, but it looks like you can sell the next day and keep a minimal amount but would need $1000 additional investment.
The $1000 additional investment only applies to Merrill's Preferred Deposit. For money market funds, you can buy/sell any amount after the $100k to open.
marstaton4 wrote: Thu Jan 16, 2020 7:22 am I'm trying to figure out which of these I won't have to pay state tax. Any help would be much appreciated.
Only funds that invest 100% in Federal obligations with no repurchase agreements is fully exempt from state taxes. The last time I looked, TTTXX, GOTXX, and UTIXX meet this criteria. I personally use TTTXX because of its same-day settlement and later cutoff time.
Topic Author
Laundry_Service
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Re: Which Merrill Edge money market fund to use?

Post by Laundry_Service »

isira wrote: Thu Jan 16, 2020 11:56 pm
marstaton4 wrote: Thu Jan 16, 2020 7:22 am A lot of these pay a similar interest rate and need $100k for minimum investment, but it looks like you can sell the next day and keep a minimal amount but would need $1000 additional investment.
The $1000 additional investment only applies to Merrill's Preferred Deposit. For money market funds, you can buy/sell any amount after the $100k to open.
marstaton4 wrote: Thu Jan 16, 2020 7:22 am I'm trying to figure out which of these I won't have to pay state tax. Any help would be much appreciated.
Only funds that invest 100% in Federal obligations with no repurchase agreements is fully exempt from state taxes. The last time I looked, TTTXX, GOTXX, and UTIXX meet this criteria. I personally use TTTXX because of its same-day settlement and later cutoff time.
Thanks! This is what I am looking for.
GoPackGo
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Re: Which Merrill Edge money market fund to use?

Post by GoPackGo »

I just opened an ME Roth IRA and I was looking for what I might do for my small amount of cash between having enough to buy ETFs, so I was looking for a no transaction fee/no load mutual fund with a $0 minimum investment. The closest thing I found was PRWBX, which as a $0 minimum investment. I know it's not a money market fund, but it's fine for what will end up being probably < $100. :sharebeer

Edit: ME has a short term trading fee for selling shares bought within 90/180 days. I’ll stick to whatever their settlement account is, oh well!
billy269
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Re: Which Merrill Edge money market fund to use?

Post by billy269 »

I'm moving my money market account to ME and will be putting it in TOIXX. QUESTION: Can anyone confirm that ME doesn't impose a short-term redemption fee on TOIXX or any other money market fund listed here https://olui2.fs.ml.com/publish/content ... esheet.pdf? I will likely need $ out of the fund within 90 days and I don't want to be charged $39.95. Thank you for your insight!
Bimmer
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Re: Which Merrill Edge money market fund to use?

Post by Bimmer »

Bumping to see if there is an answer to the question above - are there any trading fees on any of the money market funds listed on the Merrill Cash Management Solutions page that is updated daily:

https://olui2.fs.ml.com/Publish/Content ... eSheet.pdf
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Re: Which Merrill Edge money market fund to use?

Post by Bimmer »

Also, I have been investigating money markets, especially treasury money markets. It has been discussed to death in other threads about government repurchase obligations not being state tax deductible. Here is a little data on a few treasury money market funds:

-- Vanguard Treasury MM - VUSXX - Current 7-day yield 5.03% - 43% repurchase obligations

-- Fidelity Treasury MM - FXFXX - Current 7-day yield 4.73% - 93.51% repurchase obligations

-- Blackrock Liq Treasury Trust - TTTXX - Current 7-day yield 4.95% - 0.00% repurchase obligations

It's fascinating how different these three funds are. It suggests the Blackrock Fund at Merrill is the best available treasury money market fund (at least that I can find between these three institutions).

-Bimmer
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vaylie
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Re: Which Merrill Edge money market fund to use?

Post by vaylie »

You might get more detailed/better answers in the main BoA/Merrill Edge Preferred Rewards thread. In regards to their money market funds, I've used multiple ones and can confirm that there are no transaction fees of any sort to buy and sell and no minimum holding period required either. If you live in a state like CA that has % requirements on treasury obligations before it can be state tax-free, then something like TTTXX which does not hold as many repurchase agreements might be more appealing to you. Other than tax considerations though, I don't believe repurchase agreements are any less safe than US treasuries.

Here is a post that investigates cut-off times and holdings if you want a slightly more comprehensive outlook. You can also ask in the thread which ones people are using at the moment.
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DaveTH
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Re: Which Merrill Edge money market fund to use?

Post by DaveTH »

Bimmer wrote: Mon May 29, 2023 1:37 pm Bumping to see if there is an answer to the question above - are there any trading fees on any of the money market funds listed on the Merrill Cash Management Solutions page that is updated daily:
I have been using TTTXX (Blackrock Treasury Trust) for over 2 years and can confirm there are no trading-related fees including short-term trading.
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DaveTH
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Re: Which Merrill Edge money market fund to use?

Post by DaveTH »

Bimmer wrote: Mon May 29, 2023 2:33 pm Also, I have been investigating money markets, especially treasury money markets. It has been discussed to death in other threads about government repurchase obligations not being state tax deductible. Here is a little data on a few treasury money market funds:

-- Vanguard Treasury MM - VUSXX - Current 7-day yield 5.03% - 43% repurchase obligations

-- Fidelity Treasury MM - FXFXX - Current 7-day yield 4.73% - 93.51% repurchase obligations

-- Blackrock Liq Treasury Trust - TTTXX - Current 7-day yield 4.95% - 0.00% repurchase obligations
In 2022, TTTXX was 96% exempt from state/local taxes. I did not see any repos in the current holdings.
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Re: Which Merrill Edge money market fund to use?

Post by Bimmer »

Thanks for all the responses.
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careerdata
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Re: Which Merrill Edge money market fund to use?

Post by careerdata »

DaveTH wrote: Mon May 29, 2023 3:29 pm
I have been using TTTXX (Blackrock Treasury Trust) for over 2 years and can confirm there are no trading-related fees including short-term trading.
We have been adding funds to our ME account to get the average 90-day balance back to $20k for the free BofA banking and I have just left those funds in TOIXX for quite a while now. Looking at the 7-Day SEC Yields as of 6-2-23 it shows as follows:

TOIXX = 4.95%
TTTXX = 5.05%

We live in Missouri and our effective state tax rate for the 2022 tax year was 5.1% and our effective federal income tax rate was 17.0%. Our combined earnings put us in the 24% federal income tax bracket for the first time and we will be in that for tax year 2023 as well. If I retire later this year, or do something part-time going forward that is not as intense as my current work, then we would likely fall back to the 22% federal income tax bracket for the tax year 2024.

If possible I would like to find the best "set it and forget it" money market fund at ME, and since you have been in TTTXX for over two years, would you classify this fund as a good "set it and forget it" fund that we should consider moving to, especially given that we are in a state with income taxes of approximately 5%?

Regards,

Joe
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DaveTH
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Re: Which Merrill Edge money market fund to use?

Post by DaveTH »

careerdata wrote: Sun Jun 04, 2023 10:58 am
If possible I would like to find the best "set it and forget it" money market fund at ME, and since you have been in TTTXX for over two years, would you classify this fund as a good "set it and forget it" fund that we should consider moving to, especially given that we are in a state with income taxes of approximately 5%?

Regards,

Joe
I honestly have never worried about this fund. The holdings are 100% U.S. Treasury Debt, the yields have always been competitive, and the E.R. of .17% is very reasonable. Also, it is one of the few MM funds that have same day settlement (if you place order before the cutoff time). Hopes this helps.
careerdata
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Re: Which Merrill Edge money market fund to use?

Post by careerdata »

DaveTH wrote: Sun Jun 04, 2023 11:27 am
careerdata wrote: Sun Jun 04, 2023 10:58 am
If possible I would like to find the best "set it and forget it" money market fund at ME, and since you have been in TTTXX for over two years, would you classify this fund as a good "set it and forget it" fund that we should consider moving to, especially given that we are in a state with income taxes of approximately 5%?

Regards,

Joe
I honestly have never worried about this fund. The holdings are 100% U.S. Treasury Debt, the yields have always been competitive, and the E.R. of .17% is very reasonable. Also, it is one of the few MM funds that have same day settlement (if you place order before the cutoff time). Hopes this helps.
Thank you! I will discuss this with my wife before making the move, but it sounds like TTTXX may be, all things considered, an even better fit for us than even TOIXX has been.

Regards,

Joe
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