Aug
17
Importance of 401k / SEP-IRA Money Market Accounts
August 17, 2009 | Comments Off
Last Monday I made a transfer to my SEP-IRA Money Market account. My heart told me to put the money on the SP 500 Index Fund, however my brain told me to put it on the Money Market Account. It wasn’t out of safety concerns, as I believe the SP 500 will continue climbing from today’s levels by end of year. It was because I felt it would drop a bit in the next few days. I deposited the money on the Money Market Account thinking that in the worst case, Cash is King.
I may have been right, it was at 1007 close of last Monday. It may open at the 980 level today. I am not sure if it is the right level to buy, nor I am sure I will buy today. But if I do, it is just a matter of moving the money from the Money Market into the index.
Had it not been for the Money Market holding place, I may have to buy at unpredictable prices waiting for the transfer / check to clear.
Money Markets are great holding places. It may be a good idea to transfer into them before moving into the final destination: assuming no transaction fees.
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