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When I have run the numbers, a 28% Federal Tax Bracket isn't enough to offset the lower interest rates. It takes 33% or 35%. However, interest rates in general have dropped so much that maybe you can find some deals.

Thanks for the reply. The Tax-Exempt Yield (on VMSXX) is around 2.75% right now (though this might not fully reflect the recent Fed rate cut). The online banks are at about 3%. It would appear that the tax-exempt yield is better right now, even at 28%, but I don't know if this is normal.

I'm guessing from your comment that this is not normally the case. I'm thinking that having this fund as a part of my "rotation" where I can place money might make sense. While it has the best after-tax rate, I put money there; if the conditions change in a few months, I move money to the place that gets me the most return.

I don't like to chase TOO much, but I'm ok with having 4 or 5 places that I rotate among based on the rates they are paying.

Thanks again.

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