401K

Index funds. Safest most sure bet for the long haul. They represent a group of stocks and/or other securities based on the one you choose. Picking and holding a broad index fund will give you the best possible mix of ROI and safety.

I'm not an expert by any means, but I would think for his scenario, an index fund is not such a good idea. He's talking about short term high security. To me, that means bonds. CDs/cash are also safe, but virtually no returns.

If you're willing to accept some risk for higher growth, Index funds are a good bet. Total market, or even some mix of blue chips and bonds. The market is high, so IMO there's some risk it could fall in that 5 year time frame (presidential turnover as well).

You do realize bonds will drop considerably in value in the next 5 years or so?

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You do realize bonds will drop considerably in value in the next 5 years or so?

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What?

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You do realize bonds will drop considerably in value in the next 5 years or so?

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I think they will as well, although I'm only speculating, and not a bond guy.


To OP: You can do an index fund, but that's gonna be on the risky side for only a 5 year window. I'd suggest a growth and income mutual fund or a balanced mutual fund for a decent return and a little more focus on capital preservation.

I'm sorry, I misunderstood the OP. I thought it to mean that he wanted a five year and ongoing plan since he is talking about a 401k. If he is just talking about where to keep some money then retirement plans shouldn't even come in to play.

If he needs the money for some reason in five years then the money should probably go into something that yields 2-3% anunally like bonds in a diverse conservative portfolio.

Get yourself into a high quality ultra-short bond fund. Duration of less than 2 years. Yes bonds will drop but you will fully recoup your losses via increased interest around duration. People should realize you lose only until the fund reinvests at the higher rate.... All about a short duration.