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Save or short term-investment?
Posted on 7/17/15 at 4:39 pm
Posted on 7/17/15 at 4:39 pm
I am a recent college grad with no debt. Currently maxing out my employer match to my retirement account. I have been able to save around $20,000 through previous jobs and mainly scholarships.
My question is what I should do with my take home pay after all living expenses are paid? I don't see myself getting married or buying a house for 3-5 years, but I would imagine the money I am saving now would go towards a wedding and a down payment on a house.
While I don't want my money just sitting in a savings account, earning no interest, I also would want it to be in a relatively liquid investment in case I decide to do something with it. So what are my options?
My question is what I should do with my take home pay after all living expenses are paid? I don't see myself getting married or buying a house for 3-5 years, but I would imagine the money I am saving now would go towards a wedding and a down payment on a house.
While I don't want my money just sitting in a savings account, earning no interest, I also would want it to be in a relatively liquid investment in case I decide to do something with it. So what are my options?
4
Posted on 7/17/15 at 4:47 pm to AgMoney2143
The stock market is pretty damn liquid. I keep a lot of cash on hand simply so I can take advantages of opportunities that come up.
Posted on 7/17/15 at 4:58 pm to AgMoney2143
Depending on your vehicle situation id suggest saving towards that to pay cash for the next one. House down payment is also a good idea. Otherwise I'd put it in retirement
Posted on 7/17/15 at 5:02 pm to AgMoney2143
It depends on how soon your big purchases are.
If it's more than ~3 years, put it in the market in a taxable account. And keep adding to it.
If it's more than ~3 years, put it in the market in a taxable account. And keep adding to it.
Posted on 7/17/15 at 5:15 pm to AgMoney2143
Do you currently have a Roth? I would max out a Roth and then save the rest for a house down payment.
Posted on 7/17/15 at 6:02 pm to NewIberiaHaircut
quote:
Do you currently have a Roth? I would max out a Roth and then save the rest for a house down payment.
^This. And since it sounds like capital preservation means more than growth for this money, dump the rest in a higher yielding online savings account. Most are at least 1% APY.
Posted on 7/17/15 at 9:20 pm to Jag_Warrior
IMO, if you absolutely must use this money 3-5 years from now for a major expense no matter what happens in the market then keep it in something no-risk.
If you won't have a mandatory, major expense or if you would be able to cover it anyway through other means even if the market tanked then invest the money.
If you won't have a mandatory, major expense or if you would be able to cover it anyway through other means even if the market tanked then invest the money.
This post was edited on 7/17/15 at 9:21 pm
Posted on 7/20/15 at 3:17 pm to jimbeam
quote:I should be able to use my current car for at least the next 5 years. Its never had any problems (knock on wood) and has less than 100k miles.
Depending on your vehicle situation id suggest saving towards that to pay cash for the next one.
Mainly looking to use it as a house down payment since I am already contributing a decent amount to retirement.
Posted on 7/20/15 at 3:20 pm to Jag_Warrior
quote:
If it's more than ~3 years, put it in the market in a taxable account. And keep adding to it.
Is this as easy as just using the scottrade account I already have set up? I considered using it to buy shares of various vanguard funds. Seems relatively liquid, safe, and I can still earn a 5-10% return.
Posted on 8/15/15 at 1:51 pm to AgMoney2143
What kind of funds are you looking at, equity?
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