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dozer183e asks,

Rule 1: If you need the money in the next year, it should be in cash.

Rule 2: If you need the money in the next one to five years, choose safe, income-producing investments such as Treasuries, certificates of deposit (CDs), or bonds.

Rule 3: Any money you don't need within the next five is a candidate for the stock market.

According to this, in a hypothetical situation one should put funds into stocks for a goal that is 7-10 years away. Then as that goal gets closer, say 4-5 years away, sell those equities, pay the taxes(assuming in taxable account) and purchase bonds or treasuries, or CDs. Then as the goal is within one year, sell, pay the taxes(assuming in taxable account) and put into MM.

Does this all sound about right? Also, my funds are with Vanguard, so will be looking for something in the Vanguard family that meets the criteria of #2.


To keep things simple, I use the Vanguard Short-term Bond Fund for my 0-5 years money. At 0% interest, I don't see any reason to have anything in a money market fund today.

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