Schwab Government Money Fund (SNVXX) Review (2026)
Quick take: SNVXX is Schwab's government MMF, higher headline yield than the Treasury-only SNSXX (because it includes repo and agency paper), but a smaller state-tax exemption. For residents of no-income-tax states (TX, FL, NV, WA, TN), SNVXX is the higher after-tax choice. For high-state-tax states, SNSXX usually wins after tax.
| Item | Figure | Source, as of |
|---|---|---|
| 7-day yield (with waivers) | 3.57% | schwabassetmanagement.com, 09/25/2026 |
| Net / gross expense ratio | 0.34% / 0.35% | schwabassetmanagement.com, 09/25/2026 |
| Minimum initial investment | None | schwabassetmanagement.com, 09/25/2026 |
| Weighted average maturity | 36.78 days | schwabassetmanagement.com, 09/25/2026 |
| Compare: SNSXX (Treasury) 7-day yield | 3.51% | schwabassetmanagement.com, 09/25/2026 |
| A-rated 5-year MYGA (benchmark) | 5.50-6.05% | public carrier rate sheets, 10/14/2026 |
Schwab’s official fund name is Schwab Government Money Fund (Investor Shares).
| Fund family | Charles Schwab |
| Holdings type | U.S. government securities, agency debt, and repo collateralized by Treasuries |
| Weighted avg. maturity | 36.78 days (09/25/2026) |
| State tax on dividends | Partial and state-dependent: 36.20% of 2025 dividends came from U.S. government obligations, but SNVXX did not meet the minimum required by California, Connecticut and New York, so it was fully state-taxable there (details) |
Money market fund vs MYGA, after tax
What $100,000 earns in 5 years: money market fund vs MYGA, after tax
Rates used: Money market fund 3.76%, the highest 7-day yield we tracked (VUSXX, fund sites, September 23, 2026); yields change daily; change it to the rate you are offered. MYGA 5.95%, the best A-rated rate we track as of October 13, 2026: Delaware Life Pinnacle Plus 5-year (AM Best A-, negative outlook, 7/31/2026), $100,000 and up, effective October 6, 2026 (Delaware Life rate sheet).
| Money market fund, interest taxed every year | $115,550 |
|---|---|
| MYGA, tax-deferred, before tax | $133,507 |
| MYGA after paying tax on all the interest at withdrawal | $126,136 |
| Tax deferral alone adds about | $674 |
| MYGA ahead of the money market fund, after tax | $10,586 |
Assumes 22% federal and 0% state income tax, no withdrawals, rates held for the whole term. MYGA interest is taxed as ordinary income when you withdraw it, not as capital gains. Gains taken before age 59 1/2 can owe a 10% IRS penalty, and cashing out early can cost a surrender charge. In an IRA both grow tax-deferred, so the edge there is the rate alone. A MYGA is backed by the issuing insurer's claims-paying ability and your state's guaranty association up to its limits, not the FDIC. General education, not tax, legal or financial advice.
How Schwab Government Money Fund actually works
SNVXX is the right Schwab MMF for no-income-tax-state residents (TX/FL/NV/WA/TN) and the wrong one for high-tax-state residents. The roughly 6 bps of extra headline yield from including repo and agency paper (3.57% vs SNSXX’s 3.51% on 09/25/2026) gets eaten by state tax for a Californian. Match the fund to your state.
Every U.S. money market fund operates under SEC Rule 2a-7, which dictates portfolio quality, weighted average maturity (60 days max for the WAM, 120 days for the weighted average life), and daily/weekly liquid asset minimums. The differences between funds are at the margin: which short paper they hold, what expense ratio they charge, and what tax treatment the dividends qualify for.
All eight Schwab taxable money funds are ranked on best Schwab money market fund.
Rates expire like milk.
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Holdings overview
Holdings type: U.S. government securities, agency debt, and repo collateralized by Treasuries.
Weighted average maturity (WAM): 36.78 days as of 09/25/2026. WAM determines how fast the fund's yield repositions when the Fed moves. A 30-day WAM means within roughly one month of a Fed rate move, the entire portfolio has repriced, that's why MMF yields chase the Fed funds rate so tightly.
State-tax treatment: Partial and state-dependent: 36.20% of 2025 dividends came from U.S. government obligations, but SNVXX did not meet the minimum required by California, Connecticut and New York, so it was fully state-taxable there (details).
What we like
- Higher headline 7-day yield than SNSXX (3.57% vs 3.51% on 09/25/2026).
- $0 minimum.
- Same Schwab ecosystem, instant trade settlement.
- Government-backed collateral.
What we don't
- Partial state-tax exemption only, loses to SNSXX after tax in high-tax states.
- NOT the Schwab default sweep, must be actively purchased.
- 34 bps expense ratio.
- Yield resets fast on Fed cuts.
Tax notes
Money market fund dividends are reported on Form 1099-DIV as ordinary income and taxed at your marginal federal rate (10%-37%). For high earners in 32%+ brackets plus state tax, the after-tax yield on a 4.20% MMF can drop to 2.50-2.70%.
If the fund holds U.S. Treasury obligations, the portion of dividends attributable to those holdings is exempt from state and local income tax in most states (CA, NY, NJ, MA, OR enforce this strictly, CT, IL have minimum percentage thresholds). The fund publishes a year-end disclosure showing what percentage of dividends qualify. For a Californian in the 9.3% state bracket, the state-tax exemption on a Treasury-only MMF is worth ~40 bps of effective after-tax yield.
By contrast, multi-year guaranteed annuity (MYGA) growth defers tax until withdrawal. For a high earner who doesn't need the income, that deferral compounds into a meaningful effective-yield bump.
SNVXX vs SNSXX, SNOXX and SWVXX: yield and state tax side by side
For tax year 2025, Schwab reported that 36.20% of Schwab Government Money Fund's dividends (all share classes, SNVXX included) came from U.S. government obligations. The fund is not among those Schwab marks as meeting the minimum-investment requirement of California, Connecticut and New York, so for residents of those three states SNVXX dividends were fully state-taxable. Schwab U.S. Treasury Money Fund (SNSXX) reported 99.99% and did meet it (Schwab Asset Management, 2025 Supplementary Tax Information).
| Schwab fund | Type (per Schwab) | 7-day yield, 10/07/2026 | Net expense | Minimum | 2025 share from U.S. government obligations | Exempt in CA, CT, NY? |
|---|---|---|---|---|---|---|
| Government Money Fund (SNVXX) | Government: U.S. government and agency securities | 3.58% | 0.34% | None | 36.20% | No |
| U.S. Treasury Money Fund (SNSXX) | Treasury: full-faith-and-credit securities | 3.55% | 0.34% | None | 99.99% | Yes |
| Treasury Obligations Money Fund (SNOXX) | Treasuries plus repo backed by them | 3.61% | 0.34% | None | 31.30% | No |
| Prime Advantage Money Fund (SWVXX) | Prime: U.S. and foreign issuers | 3.70% | 0.34% | None | 0% (not listed) | No |
Sources: Schwab Asset Management fund pages (7-day yield with waivers as of 10/07/2026; net expense ratio; minimum initial investment), checked October 7, 2026, and Schwab Asset Management, 2025 Supplementary Tax Information. Schwab states that funds not shown in that document had 0% income from U.S. government obligations.
Worked example: a California resident in the California 9.3% bracket (2025 single filer taxable income $72,724 to $371,479, per the FTB 2025 tax rate schedules) holds $100,000 for one year at the October 7, 2026 yields above, held constant:
| $100,000, one year | SNVXX 3.58% | SNSXX 3.55% | SWVXX 3.70% |
|---|---|---|---|
| Dividends | $3,580.00 | $3,550.00 | $3,700.00 |
| CA-exempt part | $0.00 | $3,549.64 | $0.00 |
| CA tax at 9.3% | $332.94 | $0.03 | $344.10 |
| After California tax | $3,247.06 | $3,549.97 | $3,355.90 |
For this Californian, SNSXX keeps $302.91 more per $100,000 a year than SNVXX and $194.07 more than SWVXX, despite the lowest headline yield of the three. In Texas or Florida the order flips: SNVXX's 0.03-point edge over SNSXX is worth $30 a year and SWVXX leads both. Outside CA, CT and NY, most income-tax states let you exclude SNVXX's 36.20%. Federal tax is the same for all of them; the example ignores any federal deduction for state tax. Schwab publishes 2026 percentages after year-end.
When a MYGA beats this MMF, $250,000 math
Schwab Government Money Fund had a 7-day yield of 3.57% on 09/25/2026. That yield resets within days of any Fed move, up or down. A multi-year guaranteed annuity (MYGA) locks a rate for the entire term. Comparing both on $250,000:
| Scenario ($250,000, annual compounding) | 5-Year Term |
|---|---|
| Schwab Government Money Fund @ 3.57% (held constant for illustration) | $297,927 |
| A-rated 5-year MYGA @ 5.50% (low end of the 5.50-6.05% range, public carrier rate sheets 10/14/2026) | $326,740 |
| MYGA advantage (before tax) | +$28,813 |
And the MYGA math above understates the gap, because:
- The MMF yield is held constant. In reality MMF yields move with the Fed funds rate, the Fed raised its target range to 3.75-4.00% on September 16, 2026, and the next move could go either way.
- MMF dividends are taxed every year as ordinary income. MYGA growth defers tax until withdrawal. For a 32% federal + 9.3% CA earner, annual tax drag is ~30-40% of the yield.
- The MYGA rate is contractually guaranteed; the MMF yield is not guaranteed at all.
For money you don't need within 3 years, the math almost always favors a MYGA, not because MMFs are bad, but because MMFs were never designed for multi-year money.
Who this fund is best for
Short-term cash you may need within the next 6-12 months. Brokerage cash that would otherwise sit in a low-yield sweep. Emergency reserves. Any cash position where liquidity and current yield matter more than rate certainty.
Who should consider an alternative
If you have $50K+ that you reliably won't touch for 3+ years, the MMF is the wrong vehicle. The usual vehicle for 3-5 year money is a top-rated MYGA; A-rated 5-year MYGAs topped out around 5.50-6.05% on October 14, 2026 (public carrier rate sheets). The math is in the table above, and it's not close. See current MYGA rates →
FAQ, Schwab Government Money Fund
Q: Is my money market fund FDIC-insured?
A: No. Money market funds are SEC-regulated mutual funds, not bank deposits. They are not FDIC- or NCUA-insured. Government and Treasury MMFs invest in extremely safe collateral (T-bills, repo backed by Treasuries, agency paper) but are not guaranteed to maintain the $1.00 NAV.
Q: What is the 7-day SEC yield?
A: The 7-day SEC yield is the annualized net yield earned by the fund over the prior 7 days, after expenses. It is the industry-standard yield disclosure and is updated daily. It is roughly forward-looking for the next week, not a guarantee of forward yield.
Q: How quickly does the yield reset when the Fed changes rates?
A: Very fast. Government MMFs hold paper with a weighted average maturity (WAM) of roughly 7-45 days, so within a month of a Fed move the entire portfolio has repriced. A 25 bp cut typically shows up in the 7-day yield within 2-4 weeks.
Q: Can I lose money in a money market fund?
A: Realistically, almost never on government and Treasury funds. Twice in history a U.S. money market fund has 'broken the buck' (NAV below $1.00): the Community Bankers U.S. Government Fund in 1994 and the Reserve Primary Fund in 2008. Both were edge cases. Government and Treasury MMFs are the safest tier.
Q: Are Treasury MMF dividends state-tax-exempt?
A: Generally yes, the portion of dividends attributable to direct U.S. Treasury obligations is exempt from state and local income tax in most states. Funds publish a year-end 'U.S. government interest' percentage. For high-state-tax residents (CA, NY, NJ, OR), this can boost effective yield by 30-50 bps.
Q: How is a MMF different from a high-yield savings account?
A: HYSAs are FDIC-insured bank deposits; MMFs are SEC-regulated mutual funds. HYSA APYs are set by the bank and tend to lag the Fed. MMF 7-day yields move with the Fed within weeks. Top MMFs typically out-yield top HYSAs by 30-80 bps in a stable rate environment.
Q: Why would I ever choose a MYGA over a money market fund?
A: For money you won't need for 3+ years. A MYGA locks today's rate (A-rated 5-year MYGAs topped out around 5.50-6.05% on October 14, 2026, per public carrier rate sheets) for the full term, the MMF yield can fall 200+ bps in a single year if the Fed cuts. MYGAs also defer tax until withdrawal, which is meaningful for high earners.
Q: What happens to a MMF in a Fed cutting cycle?
A: Yield drops in lockstep, fast. In 2020 the Fed cut from 1.75% to 0.25% over 4 months; government MMF 7-day yields fell from ~1.65% to ~0.02% by mid-year. Anyone who locked a 3-5 year CD or MYGA at the 2020 highs out-earned MMF holders by hundreds of bps annually.
Q: Is SNVXX exempt from California state tax?
A: No, not for 2025. Schwab reported that 36.20% of Schwab Government Money Fund's dividends came from U.S. government obligations, but the fund did not meet the minimum-investment requirement California, Connecticut and New York apply, so none of it passes through as exempt in those states (Schwab Asset Management, 2025 Supplementary Tax Information). SNSXX (99.99%) did qualify.
Q: Which Schwab money fund is best after tax for a California resident?
A: On October 7, 2026 yields and 2025 tax percentages, SNSXX: $100,000 for a year nets about $3,550 after California tax at 9.3%, versus about $3,247 in SNVXX and $3,356 in SWVXX. In a state with no income tax, the highest headline yield wins instead.
Q: Is Schwab Treasury Obligations Money Fund (SNOXX) state-tax-exempt?
A: Only partly, and not in California, Connecticut or New York for 2025. Schwab reported 31.30% of its 2025 dividends from U.S. government obligations, and the fund did not meet those three states' minimum. It holds repurchase agreements backed by Treasuries, and repo income is generally state-taxable.
More Money Market Fund research
- Best Money Market Funds 2026 (ranked)
- MMF vs MYGA, when each wins
- MMF vs HYSA, yield spread and risk
- MMF vs CD, liquidity vs lock
- Breaking the buck, 1994 & 2008 cases
- How MMF yields track the Fed funds rate
- High-Yield Savings reviews
- Best MYGA rates 2026
My take
Schwab Government Money Fund (SNVXX) is a competent, reasonably priced money market fund. For short-term cash inside a Charles Schwab brokerage account, it does its job. For money you actually won't need for 3+ years, you can do meaningfully better with a locked rate on a top-rated MYGA, same A-rated insurance carriers, 100+ bps higher rate, tax deferred. Worth a 15-minute independent second opinion before letting six-figure cash sit in this fund for years.
About Hans Goldstein: Independent retirement income specialist. CA Life License #4273294. NPN #20602398. Reviews 30+ carriers and the full menu of cash alternatives. Phone: 213-414-2808. Email: hans@hansgoldstein.com.
Hans is independently licensed as an insurance producer; he does not sell money market funds or other securities. These reviews are based on publicly available fund prospectuses, fact sheets, SEC filings, and SEC-yield reporting requirements.
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Money market funds are great for short-term cash. For money you don't need for 3+ years, a multi-year guaranteed annuity (MYGA) typically pays 100-150 bps more and defers tax. Get an independent side-by-side before you let cash drift in a MMF for 5 years.
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Disclosure
This review reflects publicly available fund prospectuses, fact sheets, and approximate 7-day SEC yields as of the date stated above. Money market fund yields change daily and reset roughly in line with the federal funds rate; always confirm current yield, expense ratio, holdings, and weighted average maturity against the most recent fund disclosure document before committing capital. Money market funds are not FDIC-insured. Government and Treasury money market funds historically maintain a stable $1.00 NAV but are not guaranteed to do so, see "breaking the buck" history. Prime money market funds may impose liquidity fees or redemption gates during market stress. This is general education, not a personal recommendation or an offer of any product. Hans Goldstein is an independent licensed insurance producer (NPN 20602398) and does not sell securities or money market funds; comparisons to multi-year guaranteed annuities (MYGAs) are provided for informational context only. No compensation has been received from any fund company in connection with the publication of this review. Always read the actual fund prospectus and consult a licensed advisor before investing. Past yield does not predict future yield. State income tax treatment of U.S. Treasury obligations varies and is subject to change. Tax discussion reflects federal and California law as of 2026 and is subject to change.