Vanguard Treasury Money Market Fund (VUSXX)

The Vanguard Treasury Money Market Fund (VUSXX) is designed to offer a consistent income stream while safeguarding investors' original capital, ensuring its share price remains stable at $1. This fund primarily allocates its assets to U.S. government debt. Specifically, it commits at least 80% of its portfolio to instruments issued directly by the U.S. government, such as Treasury bills, along with repurchase agreements fully backed by U.S. Treasury securities. As a regulated government money market fund, it must hold a minimum of 99.5% of its total assets in highly liquid investments like cash, U.S. government securities, or repurchase agreements collateralized exclusively by U.S. government securities or cash. This stringent structure makes it one of Vanguard's most secure investment choices. Even though its main holdings are short-term U.S. Treasury bills, the actual income investors receive will largely depend on current interest rate conditions. This fund is an excellent option for individuals with immediate savings objectives who appreciate the enhanced security provided by investments primarily guaranteed by the U.S. government's full faith and credit. Important Note: Income generated from repurchase agreements involving the Federal Reserve is generally subject to state and local income taxes.