Last week I made my final contribution to my Roth IRA for 2008. So we’ve contributed all we can to both my wife and I’s personal retirement accounts.  This is on top of our individual company sponsored retirement plans.

I’m happy to say that we’ve managed to fulfill this goal about 6 months early this year, which gives us time to start saving for next years $10,000+ contribution limits.

(Starting in 2009, the Roth IRA contribution limits will be indexed to inflation.)

So now I have to figure out where to stash the money for the next six months.  I’m leaning towards the Emigrant Direct account, since they increased the APY to …

Today I noticed that the Emigrant Direct online savings rate is now an even 3%. So it appears that rates may be on the rebound for those of us who are stashing cash away for a rainy day.

Last week I started increasing my position in the Reserve Yield Plus Fund (RYPQX: web, prospectus, fact sheet, Y!).  Two weeks ago I finally started buying in to the fund, which is a no-load fund and does not impose the typical $9.99 transaction fee from Ameritrade.  At the beginning of this month, I received the distribution for those shares, pro-rated for the previous month.

The distribution totaled $0.09 for 250 shares held over 3 trading days in the month of May.  Doing the math, this translates into about a 4.4% return on my money annually.

…

As expected, Emigrant Direct has followed suit on lowering interest rates for its online American Dream Savings Account to 4.30%.  I can’t say that I didn’t see this coming, but the dropping rates are driving me to start maneuvering money back into the stock market.

I’m starting to rethink my goal of having $50,000 in the account to generate some secure passive income.  While it’s still a good goal to have, the money I have allocated for that account may work harder elsewhere, like in high yield ETF’s.

I’ve already got the mandatory 6 months worth of expenses stored up in savings, and am now strategizing on how to put my money …

Emigrant Direct has preempted any fed rate cut Bernanke could throw at us. Within the last couple of days, Emigrant bank has cut their online savings rate to 4.55%. Still better than I can get at Bank of America, but it’s making online savings accounts look less appetizing when compared to Canadian Royalty Trusts.

Sure, the money is guaranteed at Emigrant, so it’s still a great place to stash emergency funds, but the dropping rate could offset some of the risk in investing in stocks.

Question for the day: At what percentage rate do you quit stashing free cash in the savings account and contribute it to a online …

It was only a matter of time I suppose. Emigrant Direct dropped their rate to 4.65%, down from 4.75%. To be honest, it wasn’t nearly as large of a cut as I was expecting considering how much the Fed has dropped rates lately.

Emigrant Direct’s rate is still higher than the best Bank of America has offered me, so the decision on where to stash my emergency fund cash is really a no-brainer.