According to MarketWatch, investors have concerns about the safety of money market funds after one of the first money market funds "broke the buck," meaning its shares were worth less than a dollar after its investments in risky securities dealers collapsed. Kiplinger's Personal Finance reports that funds that hold risky securities or that do not have enough in reserves to survive investor redemptions might not be safe.

On the Other: Vanguard Rated Ultra-Safe.

In a MarketWatch story about risks to money market funds, Vanguard spokesman John Woerth reported that Vanguard's money market funds hold more than half of its securities in Treasury and government agency assets--considered the safest securities on the market--and that none of Vanguard's funds invest in risky securities dealers. Additionally, Vanguard notes that it participates in the Treasury Guarantee Program that guarantees the availability of money invested in its money market funds.

Bottom Line

Personal finance experts agree that Vanguard money market accounts are safe--not only do they invest mostly in the safest securities, but they also participate in government programs that guarantee the safety of investors' funds.

Source:

Kiplinger's Personal Finance: Is Your Money Market Fund Still Safe?

MarketWatch: Three Safe Havens to Stash Your Cash

MarketWatch: Money Market Fund Breaks the Buck

More Information:

Vanguard: Vanguard's Money Market Funds Participate in Treasury Guarantee Program