Here’s The Very Safest Place to Put Your Money Right Now

Believe it or not, I’m not always a harbinger of doom.

Today I have a recommendation for you that’s nothing but positive.

My suggested portfolio is 10-20% cash (the same amount I allot to gold, so you know I’m a cash fan). Here’s what I suggest you do with yours.

The securities I’m about to discuss are far safer than the bank. (Especially if you have cash in one of these disasters.)

They’re extremely liquid.

And I prefer them to cash because when you hold cash at a bank or a brokerage firm, you can become a general creditor if the firm goes bankrupt. But if you own these securities, you are a creditor of the U.S. Government. That makes them virtually risk-free (at least for now).

They are low return (after all, there is no yield on cash these days), but still better than you’ll get from the bank.

And they’re very, very safe.

Here’s what they are, and here’s how to get them…

My Favorite Place to Put Cash Right Now

My favorite “alternative” place to put cash is in 1-month or 3-month Treasury bills. Not bonds; not notes; bills. Remember that this is not an “investment,” but a sort of secure parking area. I’ve discussed my dislike for bonds as an investment here.

1-month and 3-month T-bills are available in denominations of $1,000 up to $5 million. Here’s how they work.

As I said earlier, you won’t get a great return on T-bills because they’re so exceptionally safe. They’re considered virtually risk free, and they’re also exempt from state and local income taxes (though still subject to federal tax). You buy them for less than the face value (also called the par amount) and then hold them until maturity, at which point you cash them in for the full value. So you might buy a $1000 bill for $990 and then cash out for the full $1000. If you cash out before maturity, obviously you don’t get the full value.

If someone cashes out a bill before it’s matured, there’s some money left over, which you can bid for on the “secondary market.” You can ask your broker to help you with this, or you can do it yourself if you have a brokerage account with someone like Fidelity or Schwab.

How to buy:

1-month (4-week) bills are normally auctioned on Tuesdays, and 3-month (13-week) bills are auctioned on Mondays. You can purchase them through the U.S. Treasuries website, (You can open a TreasuryDirect account here.) There’s no such thing as a paper Treasury bill anymore; you have to get them electronically. Here’s the schedule for upcoming auctions.

You can choose whether to make a non-competitive or a competitive bid on Treasury bills.

  • “Non-competitive” means that you agree to accept the government’s discount rate upfront. (Hint: You probably won’t be getting much of a return.) The upside of this is that individuals can purchase non-competitively all by themselves through TreasuryDirect – no broker needed – and they’re also guaranteed to get the full amount.
  • In order to make a “competitive” bid, you have to go through your broker or financial institution, or have a TAAPS account. This avenue offers you the potential for a bit more return, but there’s also more uncertainty. You specify the minimum discount rate you are willing to accept. If it’s less than the discount rate the government has already decided on, you win the bid. If you come up with the same number as the government, you may win the bid, but in a lesser amount than you were hoping to get. If your discount rate is higher than the government’s, then you lose.

There’s no fee to open a TreasuryDirect account, and there’s also no fee for individual investors to buy Treasury bills from TreasuryDirect.  If you buy Treasuries on the securities market through a broker or dealer, however, you’ll pay a commission and possibly a transactions fee.

Redemption and reinvesting

You don’t have to do anything to redeem your Treasury bills – the government takes care of it for you. (This is one of the few times that’s ever going to happen!) On the day the bill matures, they deposit the proceeds automatically into your bank account, using the banking information you gave them when you set up your account.

But of course, the point of this exercise is that you DON’T want to put that money in the bank.

So instead of “cashing out” at the end of the 1- or 3-month period, you set up your account to roll the proceeds over into buying a new bill of the same term and type for the next month (a process called reinvestment). You can schedule a reinvestment when you buy your initial bill, or you can wait until up to 4 days before it expires. And when you set up your account, you can schedule bills for reinvestment for up to two years.

I hope you find this helpful.


Michael Lewitt

24 Responses to “Here’s The Very Safest Place to Put Your Money Right Now”

  1. Should we have a separate bank account linked to the treasury direct account? I assume we are giving them the right to ach money out if we buy t-bills. Are there any risks of confiscation from IRS if the gov’t has our bank account #’s?

  2. Thanks Great Suggestion if the banks sequester our deposits. So, then, my next question is how do uou get your money back from your TBills if you don’t have a functioning bank account? Seems unlikely you can cash $100,000 check without a bank.

  3. b. A Doo-b Br.

    ‘Treasure Ee’$’ are a senior debt obligation of Our federal rules based Gov of the people. And being that rich people know made and enforce these rules, of mostly Their cash instruMentality…on this we can be sure: their will-Power prevails to have their kind of cash immediatelty AVAILABLE for the “big sale” event/s coming to a brokerage account near you in short order…and their accounts have been known to be segregated off into holding banks, not commercial,not investment connected…illegal to commingle”Safe Money”2001precrash. But read carefully and “continuous rollover/reinvestment of proceeds *at* maturation” is cautioned by ML so that one of the safer banks never hold that emerging cash in 30 days so you keep it rolling,and what is ‘safe’ if not treasurydirect*duh*GOLD!AG in a hiding spot or australian mint or all over world. the long and short of it is: were u.s interset rates to break ground zero: then that means hyperspeed Deflation all over World, & in whole sectors and Babies screaming on the sidewalk so better have your treasuryDirect accounts with some still-“Living”-money, well worth the tiny negative tax you may pay IF that sad payday[CoLapse] happens for you to score big…..otherwise many/most banks will close ‘your'[THE] window and you will be issued future stock in lieu of your Now-Cash-money-in-the-bank-aint-going-nowhere-cuz-it Taint-worth-the-digital-paper-it-was-never-printed-on,[thanks gerald]. that is:when b a n k s hold the bit$ on their Ledgers, allegedly. But when We the Peeps allege to pay it,-being that We are the senior debtors- we fund the illusion of good money with hierachies of obligations backed by rules based system of law[senior debtors of the us], unknown by most. Thanks Mike. So we have gold!ag for the security of our U>S backed brokerage action packed gambling, including precious miner stocks , to juice our contract asset precious few ‘insurance’ of our “full faith”in Credit$…consider keeping half of them Not in their”street name” where your broker houses might be playing with them ‘naked’ and who knows who borrows how many options to be exercised and mis allocated. take some out. I bet many wonder where a good set of vaults are to keep these before blockchain backup. Michael? how about canadian banks compared to switzerland?

  4. to clarify: just like with common stock that is at risk of going for zero on the wheel of whiff, the holder of a bank’s account-ing-of ‘your’ cash ledger, is akin to holding an empty bag when they go for broke. its as if you are a mini junior partner in a future/s fraudulent business, nothing is left. you may get air fluff stock filling that might be sellable in a quater century from now, maybe… “serves’em right” because buyer beware of what it means to have the f.d.i.corp back you up. :] and all the more power to the more patriotic self-serv partnership of the u.s. gov making you a senior creditor, of nation Importance..full faith , and credit. not the make believe Corp of f.edrl d.ebt-note “i.nsurance”, c/o no One. Take back the Lending/holding power in those we allow power to budget, instead of the ‘big’ banks we complain about making bad business structures that never fail to fail as bad as any crony pork barreler in fiscal legislature. The book Safe Money from 2000 talked about Trust Banks holding funds made of strict Treasury paper, including various durations…and how to ensure they are super safe by not choosing ones that are co-mingled with “federal” [quasi]’agency’ Paper, like freddie & fannie pak etc. american century preservation fund is similar i believe. these holding/trust banks serve as federally regulated custodians of these funds, in a strict sense perhaps like ira custodian institutions, from what i read in that chapter in Safe$. idk if frankdodd or glass steal ing ruptured previous boundaries, i am just the help and can barely afford[time] to read the new papers. With common stock, you are last in line for anything. If you are a bond holder, you get a share* of all things a company has if they skip even partial payments to you…you have a Legal claim to your money…a different kind of contract…guaranteed money , that you invested. not to ride to the moon on a pipe dream stock run, but to compound sure as shits creek money…discounted bonds. Kind of like competing for sure as shit senior credits/ short term bills is what the unlikely emergency fund is for….the coming short term nightmare opportunity where everyone is running for their money>your s is on its way directly from the Treasury, loyal patron that you are. And if they get taxed negatively, thats only because in short order gold and silver will be steaming hot as a result. in the worst case scenario, they will fall in price with everything else AU AG but they will fall the slowest and outbounce everything else in purchase/trade power. in case paper assets still work, thats why juice with best miner stocks. in case no paper asset/electronic trading is DOWN, then you want coins to eat with. Smallest change possible, no waiting for change when the electricity is out. worst idea ever

  5. My wife & I both have Roth IRAs in a cash account, as it has not been traded for quite some time due to funds needed for home purchase and fear about moving it. But as Dreyfus (NY Bank of Mellon) is on your top 10 worst banks, I am thinking of moving, at least, my IRA funds with Dreyfus to Charles Schwab (my lovely wife doesn’t always listen to me and has been more fearful than I’ve been to move money, but may do so this time, based on what I’ve read w/ you and Money Map Press) Is Schwab where I also have my trading acct) more solvent based on your derivatives chart for my Roth IRA? I am 68 and have not yet signed up for Soc. Sec.& waiting for age 70 to do so where I can lock in a higher amount providing SS is still available. My wife is only age 59. We both probably plan on working until we’re 90! And once my Roth IRA money is transferred to C. Schwab, I am seriously thinking of opening up a T-Bill account as suggested, possibly 50% with Treasury Direct (non-competitive) & 50% w/ C. Schwab. Is this an acceptable course of action, since my wife may be more comfortable, doing T-Bills, with a firm where she can more readily track her funds in an account? She may copy my actions if I do it first. Then if I, myself, feel comfortable with non-paper Treasury Direct T-Bills, I may move my Schwab T-Bills 100% to Treasury Direct. I know there will be fees with Schwab, but since we have no pension, and less than $200K in our combined IRAs, we just want this cash to be safer than it is, more so than getting a big return on our money. Of course, as per your email, Michael, even Schwab is not totally secure in these financially in-debt markets, and it’s probably wisest to move it all into Treasury Direct, with a small portion available to add to my small Schwab trading account (mostly now in short positions) or possibly buy stocks in the future when and if the markets ever improve. Thank you for reading my long email, and any answers to the above few questions, will be great appreciated.
    Manny Stamo

  6. and then again, you cant eat coins. nor can you hurl them at an ransackers. this should be as obvious as portable water filters all the electricity for tap Water ‘ S pumps go out[off]. Dick s sportingly good water filter Store. getm while water is hot on your mind. Your welc0me. if money goes out of whack, what else may occur? there was quite a few good fortunes after the plague, try not to stay thirsty my friends..preferably before the stores are emptied of the most important item. water every 3 hours, forever… try it for the whole family! i can almost guarantee theyll love it, or your money back. drinkable without worms bugs bacteria cryptosporidiums, soot dirt rust foolsgoal’d etc. probably worth 150 beans to insure life without hyde-dry-a-tion. Have fun investing for you or your little ones personal future security without it, just in case things get hairy. Dont tell your story looking around for water at Dicks or Cabellas if the day comes and the powers out, because no more shipments as the gas pumps for the trucks run on electricity. you should have some water until it turns on again. too heavy to carry a creek or canal or bathtub with you on your road trip.

  7. I have read recently that the days for the King Dollar is gone,and it is no more considered a world currency. This will cause the dollar to decline more than 50%. zthe new world currency is consist of US dollar,British Pond and Chinese yuan. If this is true then why leave your money in T-bills and lose 50%. Instead why not buy some other currency like a Canadian dollar or a swiss franc which will at least hold there value if they do not produce ant return?? Please comment
    A. Razvi

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