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Message
How to save 25k with moderate risk
Posted on 6/27/19 at 12:18 pm
Posted on 6/27/19 at 12:18 pm
Let’s say I’ve got my emergency savings in a savings account at 2%. I’ve got my retirement savings contributions at the max level. Now I’ve got 25k I’d like to save for a rainy day. What’s a better option than a 2% savings account?
My retirement is with vanguard but I’ve also got a Schwab account is use to buy SCHD every month. Is there a good ETF/MF with Schwab I could use to store/grow my money?
Any other options?
TIA
My retirement is with vanguard but I’ve also got a Schwab account is use to buy SCHD every month. Is there a good ETF/MF with Schwab I could use to store/grow my money?
Any other options?
TIA
6
Posted on 6/27/19 at 12:23 pm to white perch
depends on how liquid you want it
Posted on 6/27/19 at 12:32 pm to 756
If the $25K is your emergency account, then keep it liquid in a high yield savings.
Posted on 6/27/19 at 12:54 pm to white perch
Bonds would be the first thought, but they’re tax inefficient outside of a Roth/401. 2% ain’t terrible.
Posted on 6/27/19 at 12:55 pm to lynxcat
It’s not my emergency account. It’s just money I’d like to have for peace of mind. My emergency account is already fully funded.
As far as liquidity, as long as I could get to the money within a week or 2, that’d me fine. I don’t need to be able to get to this immediately.
As far as liquidity, as long as I could get to the money within a week or 2, that’d me fine. I don’t need to be able to get to this immediately.
Posted on 6/27/19 at 1:04 pm to jimbeam
quote:
Bonds would be the first thought, but they’re tax inefficient outside of a Roth/401. 2% ain’t terrible.
What about a muni bond etf?
Posted on 6/27/19 at 1:06 pm to white perch
You can yield a little more in a Money Market Account and you'd be fine getting it out in short time. Higher minimums is part of why the yield is higher, but I'd consider that as an option if you don't want to mess with it in slightly higher risk investments. I think you could get it up to 2.75 in MMA, but unsure.
#NB4REALESTATE
#NB4REALESTATE
Posted on 6/27/19 at 1:10 pm to white perch
LINK
That would be an option. At ~3% vs ~2% in a savings account though, you’ll have to decide if that’s worth it
That would be an option. At ~3% vs ~2% in a savings account though, you’ll have to decide if that’s worth it
Posted on 6/27/19 at 2:51 pm to white perch
Moderate risk? There is VBLAX (Vanguard Long-Term Bond Index Fund) 60% of assets in corporate bonds and 40% in U.S. government bonds.
It is something I've eyeing myself, but may just use the Total Bond Market fund in my taxable. It is tax-inefficient, but so is 2.1% with Ally. But the taxes are taxes.
It is something I've eyeing myself, but may just use the Total Bond Market fund in my taxable. It is tax-inefficient, but so is 2.1% with Ally. But the taxes are taxes.
Posted on 6/27/19 at 3:11 pm to white perch
With a fully funded emergency fund, I'd probably just dump this into a brokerage account and let it ride on an index fund. Keep in mind, if shite REALLY hit the fan, you could pull out prior roth contributions without penalty. Another thing to consider since this is just peace of mind money.
Posted on 6/27/19 at 3:15 pm to white perch
I'd ladder between 2yr through 5yr CDs.
Posted on 6/27/19 at 3:34 pm to white perch
Fill in the blank
I don't plan on touching this money for AT LEAST ____ years.
I don't plan on touching this money for AT LEAST ____ years.
This post was edited on 6/27/19 at 3:40 pm
Posted on 6/27/19 at 4:20 pm to castorinho
quote:
Fill in the blank
5 years
Posted on 6/28/19 at 12:37 am to white perch
USBLX looks like a pretty good conservative MF from USAA that is offered through Schwab.
Posted on 6/28/19 at 12:45 am to white perch
FIJEX looks good as well.
Posted on 6/28/19 at 8:22 am to white perch
quote:
USBLX
Ive got a stupid questions for ya.
How would you calculate the return on this one?
Yield 2.37%
Expense 0.62%
(ignore the $4.99 trade expense for now)
Is it 1.75% annually?
Posted on 6/28/19 at 10:41 am to white perch
5 year CDs are over 3.3% if you look around. Not terrible for a guaranteed return and you still have access if necessary.
Posted on 6/28/19 at 1:08 pm to notsince98
Agree, first thought was CD ladder.
Posted on 6/28/19 at 10:18 pm to white perch
T
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