Ask The Compound Where Should I Put Cash After the Fed Rate Cut?
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Sep 24, 2025 The discussion kicks off with advice on where to keep cash after recent Fed rate cuts. Topics include whether parking cash in a Roth IRA is wise and how Social Security may act like bonds in your portfolio. The hosts dive into the impact of Fed cuts on mortgage rates and offer career tips for aspiring CFAs. They also provide strategies for deploying a $107k profit from a home sale, emphasizing the importance of risk management and financial planning.
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Cash Balances Can Be Shockingly Sticky
- Money market balances surged to about $7.3 trillion despite falling Fed rates, showing cash can be very sticky.
- Large, persistent cash holdings may not quickly leave money markets when yields drop.
Roth IRAs Are A Backup, Not A Cash Substitute
- Use a Roth IRA as a backup emergency source only if you understand contribution vs. earnings withdrawal rules.
- Prefer a high-yield savings or brokerage cash position for everyday liquidity and simplicity.
Social Security Is Income, Not A Bond Clone
- Social Security provides income-like characteristics but lacks liquidity and rebalancing features of bonds.
- Treat Social Security as income that may let you take more portfolio risk, not as a direct bond substitute.