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HYSA vs. Money Market Fund — After-Tax Yield Calculator

A high-yield savings account is fully taxable. A Treasury money market fund is partly exempt from state tax. Compare the real after-tax yield for your state.

Quick answer: A money market fund can beat an HYSA after tax when Treasury income is partly state-tax exempt. Compare federal tax, state tax, expense ratio, and liquidity before switching.

Money Market Fund Yield After Tax
3.44%
Money Market Fund Yield After Tax
3.44%
Effective Treasury % for State Tax
80.00%
HYSA Yield After Tax
3.08%
HYSA Annual After-Tax Income
$1,540
MMF Annual After-Tax Income
$1,720
After-Tax Monthly Advantage
$15
After-Tax Yield Advantage
36
HYSA APY Needed to Match MMF
4.92%
State Tax Saved by Treasury Exemption
$110
CA/NY/CT Cliff Penalty
$0
Diagnostic

After taxes, the better option earns $180 more per year on this balance.

The HYSA break-even APY is 4.92%, and the MMF state-tax exemption saves about $110.

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Share this result

My after-tax cash comparison shows $180 per year of advantage, with a HYSA break-even APY of 4.92%.

After-tax cash yield planMMF wins after tax
HYSA after-tax yield
3.08%
MMF after-tax yield
3.44%
Annual advantage
$180
Break-even HYSA APY
4.92%
Next best move

Quantify whether the after-tax yield edge is worth giving up deposit insurance for this cash bucket.

Monthly impact

The monthly after-tax difference is $15, or 36 basis points of after-tax yield.

State tax savings

Effective Treasury percentage is 80.00%; estimated state tax saved is $110.

Dollar comparison

HYSA after-tax income is $1,540; MMF after-tax income is $1,720.

CA/NY/CT cliff

Modeled cliff penalty is $0 if the fund fails the state threshold.

FDIC tradeoff

The MMF yield edge exists, but the selected priority says deposit insurance still matters.

What to do next

Compare High-Yield Savings ->

Your action plan
  1. 1

    Compare after-tax yield

    Use federal, state, and Treasury-exemption assumptions before moving idle cash.

  2. 2

    Check FDIC tradeoff

    Compare the after-tax yield edge with deposit-insurance needs and liquidity policy.

  3. 3

    Build the cash plan in Money Map

    Save HYSA, MMF, CD, T-bill, and cash-bucket decisions together.

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This is an educational estimate, not tax, legal, investment, or lending advice. Tax rules, rates, and eligibility change and depend on your full situation. Confirm with a qualified professional or the provider before acting.

Calculator action path

Turn this result into a decision

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Build this cash-yield plan in Money MapSave cash balance, tax bracket, safety needs, and rate-switching decisions together.
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Check state tax impactCompare taxable cash with Treasury-heavy cash when state income tax changes the real yield.
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Check FDIC coverageConfirm how much bank cash is insured before moving between deposits and funds.
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Measure brokerage sweep dragSee whether idle brokerage cash is earning enough before choosing a cash destination.
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Reviewed Jul 6, 2026 · Methodology

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Frequently Asked Questions

Everything you need to know.

When does a money market fund beat a high-yield savings account?
When your state income tax is high and the fund holds mostly Treasuries. Treasury interest is generally exempt from state and local tax, so a Treasury-heavy government money market fund can deliver a higher after-tax yield than a fully taxable savings account — even when the savings account's headline APY looks higher. In a no-income-tax state, the savings account's higher gross rate usually wins.
Are government money market funds FDIC-insured?
No. Money market funds are investment products, not bank deposits, so they carry no FDIC insurance. They aim to hold a stable $1.00 share price, but that is not guaranteed. A high-yield savings account at an FDIC-insured bank is protected up to $250,000 per depositor. If guaranteed principal matters more to you than a small after-tax yield edge, the savings account is the cleaner choice.
Why does my state tax rate change the winner?
A savings account's interest is taxed at both the federal and state level. A Treasury money market fund's income is taxed federally but is generally exempt from state and local tax. The higher your state tax rate, the more that exemption is worth — which is why the same two products can flip winners between a no-tax state and a high-tax state.
Is after-tax yield the same as APY?
No. APY is the gross, pre-tax rate. After-tax yield is what you actually keep once federal and state taxes are applied to each product's income — and because Treasury and bank interest are taxed differently, the product with the higher APY does not always have the higher after-tax yield. This calculator computes the after-tax yield for your specific tax situation.
Is the HYSA vs. Money Market Fund — After-Tax Yield Calculator free to use?
Yes. SwitchWize calculators are free, and you do not need an account to run scenarios or view the result.
Does using the HYSA vs. Money Market Fund — After-Tax Yield Calculator affect my credit score?
No. Using a calculator does not trigger a credit check. A credit impact can occur only if you apply directly with a lender, card issuer, or provider.
Are the results personalized financial advice?
No. Calculator outputs are educational estimates based on the inputs you enter. Review assumptions and confirm terms directly with providers before making a financial decision.
What should I do after seeing the result?
Use the recommendation module on this page to compare high-yield savings ->, or run Money Map to compare this banking & savings decision with your other opportunities.
How does SwitchWize choose related offers?
Related offers are matched by the calculator surface (savings) and ranked using SwitchWize data such as rate, fees, trust signals, product fit, and switching friction. Paid relationships do not change organic ranking order.
How fresh are the rates and offers shown?
Rate and offer data is reviewed on a recurring cadence and every offer module shows review context or links to the methodology and disclosure pages.
Where can I see the ranking methodology?
The SwitchWize methodology page explains how rate freshness, editorial review, affiliate disclosure, and category ranking factors work.
Can Money Map use this result?
Yes. Money Map is the broader diagnostic path: it compares savings, mortgage, cards, and debt so you can see whether this calculator result is your highest-impact next move.

Why This Matters

In high-tax states, Treasury-heavy money market funds can beat a higher headline HYSA rate after taxes. But if you need FDIC insurance, a savings account may still be the cleaner choice.

How to Use It

  1. 1Enter your balance and your state's income-tax rate.
  2. 2Enter the high-yield savings APY and the money market fund's 7-day yield.
  3. 3Set the fund's Treasury allocation — the share of income exempt from state tax.
  4. 4Compare the after-tax yield for each and see which wins in your state.
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