Net Worth Challenge

This week I’ve been looking at our various investments and cash reserves. I’m looking to see if there are returns that can be improved by shifting these resources around. After careful evaluation, I’m convinced that we have too much money sitting in money market accounts earning a paltry 5.15%. Sure, this is a decent return — but given the strength of the equities market as of lately, the return should be much higher.

I have had a great year in both mutual funds and individuals stocks. I feel our excess funds sitting in our money market account would best be put to use in these types of investments. Therefore I will begin to move several thousand dollars (around $14,000 to be exact) into different mutual funds and individual stocks starting tomorrow. I expect the process to take up to one week as I pick and choose where I want this money to be allocated. I still plan to leave about $9,000 in our money market account to cover any unforeseen expenses and to have enough in case I need to pay off our 0% balance transfer bills rather quickly.

In a way I feel as though I am “borrowing from myself” in order to squeeze out some additional gains. I expect to put this money back into the money market funds
slowly over time. Although the money is lumped together into a money market fund, in reality my wife and I have allocated these funds to various items such as vacation fund, tenant deposits, credit card balance transfer deposits, wedding gift money (to be used for furniture eventually), and others. Since many of these items represent things we will not purchase until much later, I feel it’s alright to use these funds in more productive ways for the time being.