Happy New Year, YieldAlley readers! In this issue:
MYGAs Beat CD Rates, But You're Locked In Without FDIC Protection
U.S. Stocks Decline During Holiday-Shortened Week as 2025 Closes with Double-Digit Gains
Chase Sapphire Calm Subscription Offer (Free Year with Reserve, 50% Off with Preferred)
The Distribution of Household Income in America
And more!
NEWS
Standout Stories
🤖 The Biggest Risk in 2026 (A Wealth of Common Sense)
📉 When You Buy the Hype, Insiders Love to Sell (Morningstar)
🏀 A $2.5 Trillion Sports Opportunity (Apollo)
🎄 The Reflections that Came to Me on Christmas Day (Ray Dalio)
🏝️ I Tried Answering a Big Unknown in Retirement Planning: How Long Will I Live? (WSJ)
MARKET THOUGHTS
U.S. Stocks Decline During Holiday-Shortened Week as 2025 Closes with Double-Digit Gains
ECONOMY
Pending home sales surged 3.3% in November, marking the largest month-over-month jump since February 2023, according to the National Association of Realtors. NAR Chief Economist Lawrence Yun noted that improving housing affordability—driven by lower mortgage rates and wage growth outpacing home prices—is helping buyers test the market. U.S. house prices rose 0.4% month over month in October and 1.7% year over year, with the strongest gains in the Middle Atlantic and East North Central regions. Initial jobless claims fell to 199,000 for the week ended December 27, one of the lowest readings of the year and the third consecutive weekly decline. Continuing claims also dropped to 1.866 million from 1.913 million the prior week.
STOCKS
U.S. stocks declined during the holiday-shortened week, though most indexes closed out 2025 with double-digit gains for the third consecutive year. The Nasdaq Composite was the weakest performer, followed by the Russell 2000 and S&P 500. The Dow Jones Industrial Average and S&P MidCap 400 held up best but still shed roughly 0.7% each. Energy was one of the few sectors to post positive returns as heightened geopolitical tensions drove oil prices higher. Trading volumes were light throughout the week surrounding the New Year's Day holiday.
FIXED INCOME
U.S. Treasury performance was mixed, with shorter-term yields little changed and longer-term yields generally rising. Municipal bonds modestly trailed Treasuries amid minimal activity in both new issue and secondary markets. Investment-grade corporate bonds generated negative returns, while high yield bonds outperformed on significantly below-average trading volumes. The Fed's December meeting minutes revealed divisions among policymakers, with some favoring further rate cuts if inflation declines as expected, while others suggested holding rates steady; market probability of a January cut remained around 15%.
INCOME BUILDING TIP
MYGAs Beat CD Rates, But You're Locked In Without FDIC Protection
Multi-Year Guaranteed Annuities (MYGAs) currently offer fixed rates higher than CDs for terms ranging from 2 to 10 years, functioning essentially like tax-deferred CDs where your lump sum earns a guaranteed interest rate with principal protection against market fluctuations. The appeal is clear: interest compounds without annual taxation until withdrawal, and you can convert the lump sum payout at maturity into a lifetime income stream through a SPIA via a tax-free 1035 exchange if you're planning for retirement. However, MYGAs come with significant drawbacks that CDs avoid. Early withdrawal penalties can be severe beyond the typical 10% penalty-free annual withdrawal allowed after the first year, making them far less liquid than CDs where you usually just forfeit a few months of interest. MYGAs also lack FDIC insurance, instead relying on the insurance company's financial strength and state guarantee associations that provide coverage ranging from only $100,000 to $500,000 depending on your state, compared to the standard $250,000 FDIC protection per depositor per bank for CDs. You receive no regular interest payments during the term, your money is completely locked up until maturity, and if you need access to funds early, surrender charges in the first few years can wipe out much of your return. MYGAs work best for conservative investors in higher tax brackets with at least a two-year horizon who definitely won't need the money and can benefit from tax deferral, but if liquidity or federal backing matters to you, stick with treasuries or FDIC-insured CDs despite their lower yields.
INCOME BUILDING
Cash Rates
Government Money Market Funds (7-Day Yields)
SNVXX (Schwab Government Money Fund - Investor Shares): 3.50%
SPAXX (Fidelity Government Money Market Fund): 3.44%
TTTXX (BlackRock Liquidity Funds: Treasury Trust - Institutional Class): 3.62%
VMFXX (Federal Money Market Fund): 3.71%
Brokered CD Rates (6-Month Rate)
Charles Schwab: 3.63%
E*Trade: —
Fidelity: 3.60%
Merrill Edge and Merrill Lynch: —
Vanguard: 3.60%
ETFs (30-Day Yields)
SGOV (iShares 0-3 Month Treasury Bond ETF): 3.70%
BIL (SPDR Bloomberg 1-3 Month T-Bill ETF): 3.67%
USFR (WisdomTree Floating Rate Treasury Fund): 3.66%
TFLO (iShares Treasury Floating Rate Bond ETF): 3.67%
DEALS AND BONUSES
Chase Sapphire Calm Subscription Offer (Free Year with Reserve, 50% Off with Preferred)
Chase is offering Sapphire cardholders cashback on Calm Premium annual subscriptions through March 31, 2026. Reserve cardholders receive complete reimbursement for a one-year subscription while Preferred cardholders receive half off through a statement credit offer.
Offer Details
Main promotion: Purchase Calm Premium annual subscription through calm.com, receive statement credit (Reserve: $69.99 cashback, Preferred: $34.99 cashback)
Offer window: Through March 31, 2026
Payment deadline: Must make first recurring payment by April 14, 2026
Minimum purchase: $34.99 required
Activation required: Must add offer to your card through Chase Offers section before purchase
Key restrictions:
Cashback applies to first payment only
Must purchase directly through calm.com (not app stores or third parties)
Credit posts within 7-14 business days
Offer may be targeted, check Chase Offers section for availability
Same offer can be added to multiple eligible Chase cards for separate credits
Our Thoughts
This covers the full $69.99 annual Calm Premium cost for Reserve holders and provides half off for Preferred cardholders. The value proposition is strongest if you currently pay monthly for Calm ($14.99/month totals $180 annually versus $70 for annual pricing) or were already planning to subscribe to a meditation app. Households with multiple Sapphire cardholders can claim separate subscriptions on each eligible card. Use the Savewise app to efficiently add offers across multiple Chase cards. Verify offer availability in your account as Chase Offers are sometimes account-specific.
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