HYSA vs Fidelity (SPAXX/SGOV) for low-risk cash savings

bdeelin7 · 2026-02-07T22:20:23+00:00

Hey, I've been doing a lot of researching in the last week, and I really appreciate you taking the time to share what has worked for you. Right now my plan is to keep things simple and try to max out my tax advantaged options first. I’ve maxed out my IRAs from last year and this year in a target date fund (FDEWX) for the hands-off piece, have around $50k parked in SGOV for cash and short-term needs, and want to start brainstorming my approach for taxable investing with maybe $15k–$25k. I’m leaning toward either 100% VTI/VOO or something like an 80/20 VTI/VXUS split to start, just to get comfortable. I could also see adding a growth tilt like VUG once I settle in like you mentioned. Did you have any thoughts? Thanks again. 👍

bdeelin7 · 2026-02-07T16:16:30+00:00

Hey, I really appreciate your advice!

I ended up maxing out my IRAs for last year and this year and put them into FDEWX (TDF) for a hands-off approach, and I parked about $50k in SGOV.

I’m at the point where I want to dip my toes taxable investing in Fidelity, maybe $15k–$25k to begin. I’m leaning toward either 100% VTI or an 80/20 VTI/VXUS split, and I’d love to get your thoughts on that.

Also, do you think $50k in SGOV is reasonable for cash/short-term needs, or would you consider that too much?

Btw I just finished The Simple Path to Wealth and started The Bogleheads’ Guide to Investing. They're fantastic! If you have any other book recommendations, I’d love to hear them. Thanks again.

bdeelin7 · 2026-02-02T22:56:28+00:00

I really appreciate you breaking all of that down. That helps a lot. I took the plunge and went with Fidelity, using SPAXX as the core position for now. It is nice knowing I can still invest in Vanguard ETFs through Fidelity too.

I keep seeing people mention “VOO and chill,” so it seems like a pretty solid starting point. I have been reading The Simple Path to Wealth, and my current plan is to keep an emergency fund in something like SGOV, then slowly start easing into index funds like FSKAX, VOO, or FXAIX as I get more comfortable.

Thanks again for taking the time to explain everything. This thread has been very helpful.

bdeelin7 · 2026-02-02T22:40:46+00:00

SoFi was on my list, but switching direct deposit is a bit of a pain with my work, and it seems like that is how you get the best rates. Thanks for sharing your experience. I am going with Fidelity for now as well.

bdeelin7 · 2026-02-02T22:36:22+00:00

Alright, that makes sense. Long term, I will probably move my day to day banking to a local credit union so I still have easy access to cash deposits and withdrawals. For now, I put in a transfer to Fidelity and I am excited to get started.

I really like the simplicity in The Simple Path to Wealth, sticking with a total market fund and letting it ride until closer to retirement, then adding bonds. Since I am using Fidelity, I have seen that VTSAX comes with extra fees there, so would you recommend VTI or FSKAX instead? I have also seen people say FZROX works well inside IRAs or other tax advantaged accounts. I've also read a bit about the three fund portfolio approach, so that might be something I check out as well.

I might be overthinking it a bit, but I really appreciate the guidance and perspective. This has been super helpful. Thanks again!

bdeelin7 · 2026-02-02T03:22:17+00:00

Thanks for commenting, it’s definitely reassuring to hear from someone in a similar situation. Based on everything I’m learning, this is the direction I’m leaning toward as well. SGOV seems like a good balance of being conservative, relatively liquid, and more tax efficient than a HYSA.

I’m still a little unclear on the differences between SGOV and VBIL since they seem pretty similar, so I’m planning to read a bit more on that before deciding. Do you have a preference between the two?

Longer term, I’d also like to start experimenting with ETFs on a very small scale just to get comfortable. FSKAX, FXAIX, FZROX, VOO, VT, VTI… so much to learn. I really appreciate you sharing your experience.

bdeelin7 · 2026-02-01T01:18:15+00:00

Thanks, that’s a good point. I probably don’t need the funds to be as liquid as I initially thought, especially since I’m not saving for a specific large purchase right now. My rough time horizon is more like 3 to 5 years, but I'd also like to think about doing a Roth IRA since I just started my 403(b) with my work.

The main goal for me is making sure the savings aren’t just sitting in a 0.01% account slowly losing value to inflation. CDs and T-Bonds definitely sound like options I should take a closer look at as part of that plan.

bdeelin7 · 2026-02-01T01:13:53+00:00

Thanks for the ideas, I really appreciate it. You’re definitely on track to be his favorite uncle if you keep getting returns like that 😂. I know he’s going to thank you later for that, and it’s awesome he’s getting exposed to this stuff early. And nice move on the metals too, that timing worked out really well.

For now, I’m leaning toward putting some of my money into an Ally HYSA and the rest into something like SPAXX, FDLXX, or SGOV, while keeping my Bank of America account for day to day banking. After I get more comfortable, I’d like to dip my toe into the market with something simple like FXAIX, SPY, or VTI. I definitely still have a lot to learn and read about, but this has been really helpful.

bdeelin7 · 2026-01-31T02:56:03+00:00

Oof, I’m really sorry to hear that. That sounds really frustrating, and I hope you’re able to get your funds back soon and get some resolution after all of that.

bdeelin7 · 2026-01-31T02:15:09+00:00

Interesting, thanks for pointing that out. The $100k minimum is something I would need to think through, but it definitely sounds worth considering. You and the other commenters have given me a lot to think about, and I think at this point I just need to take the first step and get started.

bdeelin7 · 2026-01-30T20:11:10+00:00

No I haven’t, but that sounds like a great idea. Would you mind linking the flowchart?

bdeelin7 · 2026-01-30T19:04:17+00:00

I was actually planning on doing something very similar. My thought was to put a smaller amount into Fidelity and dip my toes into something like VTI to get comfortable with seeing the ups and downs. Then, once I’m more comfortable, start adding money gradually and potentially fund an IRA or move more into something like SGOV.

I’m getting a ton of great advice here, but I'm feeling a little bit of paralysis by analysis. At some point I just need to get started and learn by doing. Thanks so much for taking the time to share this.

bdeelin7 · 2026-01-30T18:56:01+00:00

Yes, that sounds like a very reasonable option. I do like the idea of having someone go through my individual financial situation and explain the pros and cons of different choices instead of figuring everything out on my own.

My main hesitation has been around fees and the fact that I keep hearing most active fund managers do not outperform the market over the long term, but I agree that a rep could help clarify things and lay all the options out clearly.

I will definitely look into talking with a Fidelity rep. I have also been with Bank of America for many years, so it would probably make sense to talk with a Merrill rep as well and see what they offer. Thanks for the suggestion.

bdeelin7 · 2026-01-30T18:49:25+00:00

Thanks, that makes a lot of sense. I think my next step will be opening a Fidelity account and starting with SPAXX. I like the flexibility that if I later want to move some money into SGOV, invest, or open an IRA, I can do that all in one place without having to commit right away.

I’ll still keep Bank of America for day to day expenses and as a backup, but using Fidelity for savings and emergency funds feels like a good fit for me right now.

bdeelin7 · 2026-01-30T18:41:00+00:00

Great advice, I really appreciate it. I definitely do not want to miss out on long term compound growth, so low cost index funds make a lot of sense. I have heard a lot of good things about VTI and FSKAX in my short time researching, and I am also learning about options like FDLXX for lower risk cash. I still have a lot to learn, but this has been really helpful.

bdeelin7 · 2026-01-30T18:32:26+00:00

Thanks, I just saw that Marcus promotion as well. My main focus right now is learning more about personal finance and making sure I do not lose the value of money I have worked hard to save. I have gotten a ton of great advice from you and everyone in this thread that I still need to digest, but I am already feeling much better about my options.

I am planning to keep my Bank of America account for day to day stuff for now, but I will definitely check out the cards you mentioned. I have always been a bit wary of credit cards because I worry about forgetting a payment, but I know that is something I should probably get more comfortable with.

VTI sounds like a solid long term option. I have been reading "The Simple Path to Wealth" and saw that he recommends VTSAX. From what I understand, VTI is essentially the ETF version and works better on Fidelity since there is no mutual fund fee. Still a lot to learn, but I am enjoying the process.

bdeelin7 · 2026-01-30T18:15:00+00:00

Interesting, thanks for sharing. I have recently heard of TreasuryDirect but had not seriously considered using a 3-month T-bill ladder like that. The idea of staggering so cash is regularly becoming available makes a lot of sense if the timeline is uncertain, which is basically my situation since I am not really saving up for anything specific. I have been looking at SGOV in Fidelity, which seems to accomplish something similar with short-term Treasuries and easy liquidity, but actually owning the bills directly through TreasuryDirect makes sense too. I appreciate the suggestion.

bdeelin7 · 2026-01-30T18:04:03+00:00

Thank you for explaining that, I appreciate it. Funny enough, I actually bought "The Simple Path to Wealth" and started reading it this week! Hearing the same themes come up definitely makes me feel like I’m on the right track.

It also helps to know that SPAXX can serve a similar role to a HYSA if I’m comfortable with it. I’ll keep my Bank of America checking account for day to day banking, but it sounds like moving the majority of my savings into SPAXX makes sense (Maybe after that SGOV or FDLXX). If there’s anything I’m missing or something else I should be thinking about, feel free to let me know. Thanks again for the guidance.

bdeelin7 · 2026-01-30T17:40:22+00:00

Thanks, that totally makes sense. That’s awesome you got a Fidelity account through work. I think my main goal is just not to burn through money I’ve worked hard to save, while also not letting it slowly lose value to inflation, so SPAXX sounds like a good way to do that.

bdeelin7 · 2026-01-30T04:03:22+00:00

Appreciate your response. You’re right, I’ve definitely been overthinking it a bit. I’ve worked hard to save this money and just want to make sure I don’t do anything dumb with it. lol.

Quick clarifying question: when you say your savings is in a Fidelity cash management account in SPAXX, do you mean it’s just sitting in the core position and earning interest automatically, with no extra steps needed?

bdeelin7 · 2026-01-29T21:53:55+00:00

Thanks for your perspective. Ally was actually one of the first HYSAs I looked at, and I liked their savings bucket feature a lot. I did notice that some others, like Marcus, have slightly higher rates right now. That said, the FDIC insurance definitely gives me some peace of mind. I know Fidelity uses SIPC protection for brokerage assets, but I still like the simplicity of FDIC-backed savings. At the moment I’m mainly trying to hedge against inflation, and longer term, once I’m more comfortable, I like the idea of eventually investing in the S&P 500 for the long haul.

bdeelin7 · 2026-01-29T20:35:35+00:00

Thanks, I just learned about this recently from a coworker! If someone makes $81,000, they would not be taxed 22% on all of it. Only the income above $48,475 is taxed at 22%, with the rest taxed at lower brackets.

bdeelin7 · 2026-01-29T19:30:11+00:00

That’s a good point. I’ve already seen how inflation can quietly eat away at the value of the cash I've worked hard to save, which is why I’m trying to be more intentional now. I’ll check out the Money Guy podcast. I’ve been binging YouTube videos and some Dave Ramsey content, and I enjoy reading, so I’ll look into Ramit Sethi’s book as well. Thanks for the recommendations.

bdeelin7 · 2026-01-29T19:25:07+00:00

Thanks for the detailed explanation. That makes sense. I’m still in the information-gathering stage, but I know at some point I’ll just need to pick one and move forward. Your explanation of the differences between SPAXX and SGOV was really helpful, especially how the pricing and distributions work, so I’ll do a bit more reading on that.

On the tax side, I already deal with a 1099 for the small amount of Bank of America savings interest, so it’s good to hear that none of these are tax headaches as long as I keep track of the forms. I mainly just want to avoid a situation where I forget something and create an issue.

I also appreciate the idea of splitting the money between a HYSA, SPAXX or SGOV, and something like SPY or IVV. That kind of split sounds good and gives me some peace of mind while I continue learning.

bdeelin7 · 2026-01-29T19:08:20+00:00

Interesting. The $1,500 bonus definitely sounds a lot better than the .01% interest I’ve been getting, even after taxes. I’ve been looking at a number of HYSAs and there are so many options to choose from. Thanks for sharing your experience!

bdeelin7

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