Welcome to the first in a series of posts about personal finance for entrepreneurs! This post is about maximizing the returns on your cash. In short, you’re probably leaving a lot of money on the table.

Ditch your bank’s savings account and go with either a high yield savings account or park your money with Uncle Sam by buying short duration treasuries.

Disclaimer: this is not investment advice.

Most people I know keep their cash in a checking or savings account with whatever bank they use for day-to-day expenses (Chase, Bank of America, TD, etc). Unfortunately, to give just one example, Chase is only paying an interest rate of 0.01%! This is almost nothing: if you had $10,000 in a savings account with Chase, you’d make a grand total of $1.00 in interest over a year. This wasn’t a huge deal when interest rates were low because no one was paying high rates but now that the Fed has raised interest rates a lot over the last year, you can do way better elsewhere.

The first better option: online high yield savings accounts. I personally use Ally Bank which has a 3.30% yield but there are many others including Marcus by Goldman Sachs, Discover, and American Express Personal Savings which all pay about the same rate. If you have $10,000 in a savings account with Ally Bank, you’d have $330 in interest at the end of the year (actually a bit more because of compounding interest). Money in a high yield savings account is almost exactly as accessible as money in a normal savings account–you can move funds back and forth between your high yield account and your checking account easily with only a day or two lag.

The second better option: buying US treasuries (federal government bonds). I used to think treasuries as something that only large companies used to park their cash but in reality anyone can buy a treasury bond. You need to have a brokerage account with a company like Charles Schwab or Fidelity but from there, you can buy individual Treasuries just like individual stocks.

Unlike with keeping your money in a savings account, Treasuries fluctuate in price so the value of the Treasuries you buy will technically go up or down each day. But if you buy short duration treasuries–which mature in 3-4 months say–these fluctuations are incredibly unlikely to be meaningful in either direction. And if you hold the bonds to maturity, you are guaranteed to be paid the interest rate you were told upfront and your repayment of principle. And those interest rates are high now. For example, I just went on Charles Schwab and the YTM or Yield to Maturity–effectively the interest rate on the bonds–is as high as 4.66%, significantly higher than even the high yield savings account.

Also, the minimum investment required is 1 bond and because each bond is priced near $1,000, that effectively means you can buy treasury bonds with as little as $1,000. Treasuries are also more tax efficient than savings accounts because treasury interest is not taxable at the state and local level, potentially saving you up to 14% in taxes if you live in high tax states like New York or California.

Finally, and very importantly, you do not need to hold the bonds to their maturity date if you need the cash. If you buy a treasury bond and need the cash to pay expenses, you can always sell the bond on the open market quickly. You are not locked in.

One other benefit of Treasuries specific to business owners: while it’s hard to find good high yield savings accounts available to businesses (for individuals it is easy) businesses can open brokerage accounts and buy treasuries. If your business has cash lying around because you expect to have to pay some bill in a few months (taxes, a supplier, whatever) you are leaving money on the table by not keeping your cash in treasuries.

An important note: while you can take on more risk by buying longer duration treasuries–more than a few months–in that case you actually would be taking on some risk if yields rise. For cash management, I would stick to shorter duration bonds.

Let me know your thoughts in the comments–what are you doing with your cash these days?–and please feel free to DM me if you want to chat about personal finance, startups, or anything at all.