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Can you lose money in Vanguard money market settlement fund?

Personal Finance & Money Asked by Travis Reeder on June 29, 2021

Same as the title:

Can you lose money in Vanguard money market settlement fund?

2 Answers

Possible but very unlikely. Money market funds invest in high grade liquid assets and the primary goal is not to lose money. I have not been able to find an example of a Vanguard money market fund ever "breaking the buck" and having the value of a share go below a dollar. It is possible that this could happen in the event of a large scale financial collapse, but even then I would call it possible rather than likely.

Correct answer by zeta-band on June 29, 2021

Yes, you do lose money in VMFXX, because that fund's yield is so much lower than the inflation rate.

(The loss is "hidden", but still real.)

Answered by RonJohn on June 29, 2021

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