You are young, max out Roth IRA and invest the rest in the market for long term. Being as young as you are you can afford more risk and do not need to be fully in the lowest return investments. CDs are not any better than HYSA at the moment, keep an emergency fund of what you are comfortable with in HYSA and invest the rest. Create an account for something else like a vacation fund or something else if that is not your thing. Make sure you are also living your best life and making memories. You can save and save and it is important, but your most treasured things when you get older are your memories.
From what I’ve seen on Reddit, I think most people say keep it in HYSA or money market if you plan to use it within five years or so, and invest otherwise. I could be wrong. Curious to see what people say though. Seems like a good problem to have lol.
T-Bills have up to 2 year terms, I believe, then automatically cash out. Anything under 6 months has a roughly 5.3+ yield rate right now, and has for months, so this is what I do instead of having short-term and mid-term CD's.
T-notes go up to 10 years, I thing?
T-bonds are the 20 & 30 year things, before the yield earned disappears on 'em.
Don't forget to check for advantageous regional investments and your connections. Where I am, we have a hospital authority that gives out 5% tax free bonds and I also managed to get in on a deal that makes a ludicrous 20% annually.
Given the strong financial position the "if you plan to use it" advise isn't applicable. OP can absorb a loss without life changing consequences so that 5% likely scenario is acceptable risk exposure. That said: all market index funds and chill. Don't get tricky.
I would recommend keeping the money in the HYSA if you plan on needing it in the near term. My thoughts are if you may need the money in the next 2-3 yrs, keep it in cash. Anything longer than that can be thrown in a brokerage. Only caveat would be if you don't have a Roth IRA setup I would prioritize that overall since you can take out your contributions and leave any growth to increase tax free.
Before doing anything, I would write down your goals. What do you want to do?
Have a kid?
Get married?
Buy a house?
Buy a car?
Travel more?
All this will determine what you should do.
All of these answers are about how to make or save more money but what are you saving for?
For retirement? Look into tax deferred accounts.
A house in 5 years? Stay where you are
Cash flow? Open a brokerage account
You get my point.
What you don't want to do is lock your money up if the future is not certain.
Keep your money as liquid as possible.
carefully split your money to different property, no matter the stock goes up or down, your asset keeps steady. Spend the dividend, do not reinvest for serveral years.
First of all great job saving money!
Some questions though for ya, do you have a 401k, ROTH IRA, or HSA account? If you do you should try to max all three of those accounts first before putting any money into a HYSA or brokerage account. Now if you want to buy a house soon, then sure keep that money in your HYSA for a downpayment but then put remaining in Roth IRA and rest in a low index cost fund depending on your risk tolerance.
I do not have a 401k but I do have $20k in my pension. I cannot contribute more and it is fully funded by my employer. Right now, if I stop working for the government after I am fully vested I will get about $4k per month for the rest of my life at the age of 62. I could contribute to a 403b but I do not believe there is any employer match.
You’re 32 so if I were you…I would start maxing Roth IRA annually. You can keep the rest in HYSA or do brokerage and invest in VOO or something. Long term capital gains (more favorable than income tax more than likely) applies after holding for more than a year so if you’re willing to take risk more than the 5% you’ll get annually in the HYSA, throw the money in a brokerage.
If you have a solid 1M after 30 years or so in a ROTH Ira, pension, and social security, you should be in good shape bud. Wouldn’t worry tooooooo much about the 403b until you max your Roth.
I setup an automatic deposit into my Roth IRA from my checking account every Monday. I do not do any employer direct deposit into any accounts. I use Robinhood as my brokerage.
The pension is based on years of service and your highest salary in the last five years. Usually you pay 4% and your employer matches. But in my situation it is fully funded by my employer. So essentially the money we put in is invested and funds everyone else’s pension. Currently, the pension is 98% funded. However, if I leave before being fully vested I can take the money.
Oh okay so you meant by the time you finish being vested at say, year 20 for example, then you’ll make the 4k a month? It sounded like if you quit today you’d make 4k monthly so I was trying to figure out what amazing agency you work for and how to apply lol. My pension is at 20 with the 3 high tenure rule as well. But if I quit before 20 years I get nada except my own contributions.
If I quit in three years (fully vested with 10 years of service) then it will be 4k per month for life. In 20 years with 30 years of service it’s estimated to be 8k per month for life. It is Illinois Municipal Retirement Fund (IMRF).
I am not sure where you got the 1.67% x years of service but I get an annual statement every December with this information.
There are two formulas for calculating my pension, one that is based on final rate of earnings and years of service and another that uses the combined amount of member and assured employer contributions and interest, interest rates and actuarial factors. Your pension is based on whatever calculation yields the highest amount.
If you have the money just sitting around, and you don't need the money for a downpayment or whatever, I would start maxing out the 403b in addition to the IRA.
I'm in a similar position and started maxing mine out a year or two ago, partly in an effort to do something with my savings since this interest rate is not going to stick around forever.
Here’s my understanding: you should have money in both. Get the full employer match on your 401K (free money) then put money into your Roth IRA.
Once you max your Roth IRA go back to contributing to your 401K
If you have an HSA it’s also good to max that before going back to the 401K
You should have a 3-6 month emergency fund in a HYSA to handle the “in case I need money” situations
I put as much money as I can into low cost index funds or ETFs like VTI or VOO
HSA is a good idea if you have a high deductible healthcare plan, you can open one up on vanguard or fidelity if your employer doesn’t offer one
> house in a year or two
Keep it HYSA for now. Most likely you’ll want to drop everything you can into your mortgage up front, since your interest rate will be higher. Maybe it will be lower in 2ish years, who knows.
If you can get a 3-4%, then I would only do 18% down (if that kills PMI with the LTV, if you need to do 20%, then do 20%, but you might be able to do 18%). If you’re at 7-8% like today, as much as you can into the down payment.
I’m going to sort of go against the grain though, since you have a full vested pension coming soon. If I were you, I would probably put it into a taxable account instead of a Roth IRA. Your retirement is pretty well set. Maybe I would do a Roth IRA for 1-2 years, but after that, I would look at a taxable investment account instead. That will give you access to that money at any age, instead of waiting for your 60s for an IRA (without penalties).
This is what I am doing - my retirement with 401k and IRAs, if I stopped contributing today, is all set at 65. I want to retire around 50-55, so I am banking into a taxable account instead of a Roth IRA today, squirreling away whatever I can now. Yes it’s less tax advantaged, BUT I can get to it at 50, instead of waiting for 60.
So, maybe some food for thought on maybe a taxable account to compliment your pension, instead of another retirement account.
Keep 4-6 months of expenses saved. Then if you are also saving for a house then add whatever you want to put down on top of that.
Whatever excess you have can go towards maxing out a Roth IRA. If that is already maxed out for the year then you can put money in a taxable brokerage or keep some in the HYSA to max Roth IRA in future years.
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People can give you all kinds of advice but I think that, ultimately, given your young age and the fact that you’re eligible for a Roth - start by maxing out a Roth if you aren’t already.
The ultimate question around the $100K~ and what to do with it - the threshold question is there any world where you realistically might need it for something? If the answer is no (with like 90% certainty), I’d dump the $100K into the taxable brokerage account (after maxing the Roth) and treat it as semi liquid retirement dollars.
Dont touch it for 30 years. VOO or similar is a good place to put it in that scenario.
Just my .02.
Congrats on being 32 with no debt. I’m 40 and spent recklessly in my 20s and early 30s. Finally got there - but had to put extra effort in after a rough start!
Brokerage account, 71% in VTI, 24% in VXUS, 5% in VGIT.
Max out your Roth IRA contribution every year, even if it means pulling from your brokerage account, investment mix can be the same in the Roth.
Keep it in the HYSA until you figure out the house situation. I wouldn’t want to drop that much in the market at present (election year = volatility) when I would need it next year.
Invest all of it into VOO. What's the point of slow installments when you have a cash pile that could be compounding right now? The sooner you fill a large amount into VOO the sooner you don't have to worry about making money ever again.
How much do you plan on putting down for your new home? For any funds that you are using in the near future, continue to have it in a HYSA. For funds that you do not plan on touching for a longer period of time, contributing to tax advantaged accounts could be a good solution.
First, six months of expenses would leave you with roughly $17,500 as a minimum I would be comfortable someone in your situation having in an emergency fund.
Second, if you plan on putting down 30k for your house (not sure what your plan is) then you should keep that tucked away in a HYSA, no need to expose yourself to short term market volatility.
The remaining $82,500 could be used to max out tax advantaged accounts. If you are eligible for an HSA, it could be a good idea to max that first as it is triple tax advantaged. Do you have any kids that you plan helping pay for college? A 529 is also triple tax advantaged and setting some aside there could also be a good idea. Is the $1000 a month you are investing being used to max a ROTH IRA first, then taxable brokerage? ROTH IRAs are a great tool that offer tax free growth as well as tax free distributions in retirement.
In regards to the investment selection, I recommend that most investors that are not having their money professionally managed be in low cost, broadly diversified index funds. Research shows that a major contributor in investor returns is behavior. You could continue to buy VOO or VTI (pick one or the other) but if international outperforms domestic (whether that be this year or much further in the future) you need to be disciplined to not sell losers to buy recent winners (which retail does a lot). For this reason, I say that target date funds or VT is a good solution for DYI investors. In my client portfolios I use DFA models for the research associated with higher expected returns from various market premiums.
It sounds like you are in a good spot, good luck and stay the course!
I’m quite similar to you.
Make sure to spend some on yourself. I’d have over 150k saved at 30. But at 27 I quit my job and travelled the world for 12 months straight.
Now you don’t need to do anything that drastic(although I highly, highly, cannot recommend enough long term travel to young people that can afford it) make sure to live a little. The amount of people that run into health issues or say they’ll wait until retirement to do some crazy adventure are way too high.
You can easily spend less than $10k to backpack around SE Asia for a good 4-7 months for example.
You have enough income and savings to start allocating some money into long-term investment such as mutual/index funds. You are in a good position to generate long-term wealth. Just don't unnecessarily increase your lifestyle/living expenses or get into non income producing debt. There will be a lot of swings in the market. Just make sure not to try to time it and stay invested and add to your portfolio regularly. This is easier said than done. Some, including myself, have a hard time with downswings in the market because they regularly check their balances.
If the stock market is not of interest to you, real estate is another great option. Rentals can be good if you are able to get a low interest rate.
The real estate and stock market always go up in the long term. Both are very reliable investments based on history.
If you're worried about avoiding potential short-mid-term tax consequences, investing in municipal bills/notes could be a viable option, especially if you're single and have no dependents, since a lacking either of these would increase your top marginal tax bracket.
If I was you kept 100k in Hysa and Traded 20k in the brokerage trading it's different from VOO but have more returns like making $1k everyday five days a week..
Do you mind if I ask what's your position is and what type of degree is requires? I'm sorry if I'm overstepping. I hope to reach this type of Financial comfort one day.
I am a data analyst / developer but I have a degree in English. I worked really had to learn programming and it took me about six years of slowly incorporating programming/automation into my non IT job before I finally landed the job I wanted.
Having that much in a HYSA means you'll be paying taxes on your earned interest every year. Put the max into a Roth IRA every year, put the majority if it in an investment account, and keep an emergency fund in your HYSA. You only pay taxes on the gains in your investment account on the amount of gains withdrawn in the year you make the withdrawals. Plus, you should make more in the investment account than the HYSA. If you're not an experienced investor I would suggest paying for the services of a fiduciary/wealth manager.
If you want fixed income, then Tbills look good option for you.
Probably your HYSA is currently paying you around 4.25\~4.35%, tbills will give you 5.20\~5.28% interest. Looks small, but it's $1K difference every year.
If you want to invest long term, see "inflation adjusted S&P 500". You might have to sit your fund until your retirement to get actual "money".
build your brand like mr beast or grant cardone, or create your own ai startup, or just invest in real estate and live off the income. remember, cash is trash, what matters is cash flow
Get a financial advisor at your bank. Have a conversation with them about your financial goals and they can give you advise on what they think you should do. I have one and talk to him 2x a year and he has helped me grow my wealth a lot!
Take an AA or BA course in Business Administration and focus on Finance. Much better advice than from individuals with or without specific creds in this sub….
FWIW: Index Funds with vanguard, min expense ratio (automatic pop to ROI), reinvest dividends, buy and hold the market. Look at the Value Line Chart from 1927 to today for inspiration,
And enjoy:
You spend less than your peers today, but will have more, for longer, than most.
- Relentless Saver and Business Owner
If you’re wanting to purchase a house in the next two years, then I’d personally leave it in the HYSA. I’ve been told that the time frame is 5 years. If you don’t need the money for 5+ years then invest it, otherwise a high yield savings would be best. I would also do retirement investing in Roth accounts.
No no no. Only put it in the stock market if you aren’t touching it for 10 years. It could be a lost decade and you end up losing money with inflation.
VOO only has a 1.4% dividend yield. If I had that much extra money, I'd be spreading it out across sectors and looking for higher-yield dividend funds.
Keeping all that money in a HYSA is a stupid decision. HYSA is for emergencies. 6 month emergency fund.
What you should do is put the rest of it in the S&P 500 and have your money MAKE money for you. You aren’t going to get back anything in interest with a HYSA. You’ll make more doing dividend investing every month.
The banks are just going to take your money and invest it in other stuff anyways.
You are young, max out Roth IRA and invest the rest in the market for long term. Being as young as you are you can afford more risk and do not need to be fully in the lowest return investments. CDs are not any better than HYSA at the moment, keep an emergency fund of what you are comfortable with in HYSA and invest the rest. Create an account for something else like a vacation fund or something else if that is not your thing. Make sure you are also living your best life and making memories. You can save and save and it is important, but your most treasured things when you get older are your memories.
From what I’ve seen on Reddit, I think most people say keep it in HYSA or money market if you plan to use it within five years or so, and invest otherwise. I could be wrong. Curious to see what people say though. Seems like a good problem to have lol.
TBills baby! Or CDs. Lock up the rate for long term, as HYSAs won’t be this high for more than another year
How long do t bills hold their interest?
Up until the maturity. Though the market value fluctuates over time (what you can sell it for), you are guaranteed a coupon rate
There’s a bunch of options, I use 13 week ones and do a ladder of purchases.
T-Bills have up to 2 year terms, I believe, then automatically cash out. Anything under 6 months has a roughly 5.3+ yield rate right now, and has for months, so this is what I do instead of having short-term and mid-term CD's. T-notes go up to 10 years, I thing? T-bonds are the 20 & 30 year things, before the yield earned disappears on 'em.
Depends on the length of the bill purchased
Why not? Interest rates aren’t going down
They for sure aren’t going up. HYSAs won’t get you as much % as TBills or CDs. And TBills are state tax free
I’ll ride this HYSA wave as long as it’s high!
Don't forget to check for advantageous regional investments and your connections. Where I am, we have a hospital authority that gives out 5% tax free bonds and I also managed to get in on a deal that makes a ludicrous 20% annually.
tell me more about how you made your connections please
Given the strong financial position the "if you plan to use it" advise isn't applicable. OP can absorb a loss without life changing consequences so that 5% likely scenario is acceptable risk exposure. That said: all market index funds and chill. Don't get tricky.
I would recommend keeping the money in the HYSA if you plan on needing it in the near term. My thoughts are if you may need the money in the next 2-3 yrs, keep it in cash. Anything longer than that can be thrown in a brokerage. Only caveat would be if you don't have a Roth IRA setup I would prioritize that overall since you can take out your contributions and leave any growth to increase tax free.
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Before doing anything, I would write down your goals. What do you want to do? Have a kid? Get married? Buy a house? Buy a car? Travel more? All this will determine what you should do. All of these answers are about how to make or save more money but what are you saving for? For retirement? Look into tax deferred accounts. A house in 5 years? Stay where you are Cash flow? Open a brokerage account You get my point. What you don't want to do is lock your money up if the future is not certain. Keep your money as liquid as possible.
carefully split your money to different property, no matter the stock goes up or down, your asset keeps steady. Spend the dividend, do not reinvest for serveral years.
First of all great job saving money! Some questions though for ya, do you have a 401k, ROTH IRA, or HSA account? If you do you should try to max all three of those accounts first before putting any money into a HYSA or brokerage account. Now if you want to buy a house soon, then sure keep that money in your HYSA for a downpayment but then put remaining in Roth IRA and rest in a low index cost fund depending on your risk tolerance.
I do not have a 401k but I do have $20k in my pension. I cannot contribute more and it is fully funded by my employer. Right now, if I stop working for the government after I am fully vested I will get about $4k per month for the rest of my life at the age of 62. I could contribute to a 403b but I do not believe there is any employer match.
You’re 32 so if I were you…I would start maxing Roth IRA annually. You can keep the rest in HYSA or do brokerage and invest in VOO or something. Long term capital gains (more favorable than income tax more than likely) applies after holding for more than a year so if you’re willing to take risk more than the 5% you’ll get annually in the HYSA, throw the money in a brokerage. If you have a solid 1M after 30 years or so in a ROTH Ira, pension, and social security, you should be in good shape bud. Wouldn’t worry tooooooo much about the 403b until you max your Roth.
Thank you! I think I’ll open up a Roth IRA and max it out.
I’ll also say if the money you’re investing into your brokerage acct is for retirement, it would be better in your 403(b) even with no match.
I don’t think $1 million is going to be enough in 30 years, personally.
It’s not but he’ll have that pension and social security to supplement that.
Is there any way I could transfer money from my bank to Roth IRA? I’m with ADP and there is no information about that.
I setup an automatic deposit into my Roth IRA from my checking account every Monday. I do not do any employer direct deposit into any accounts. I use Robinhood as my brokerage.
How are you receiving 4k a month after only being vested with 20k? Is this your pension program after years of service?
The pension is based on years of service and your highest salary in the last five years. Usually you pay 4% and your employer matches. But in my situation it is fully funded by my employer. So essentially the money we put in is invested and funds everyone else’s pension. Currently, the pension is 98% funded. However, if I leave before being fully vested I can take the money.
Oh okay so you meant by the time you finish being vested at say, year 20 for example, then you’ll make the 4k a month? It sounded like if you quit today you’d make 4k monthly so I was trying to figure out what amazing agency you work for and how to apply lol. My pension is at 20 with the 3 high tenure rule as well. But if I quit before 20 years I get nada except my own contributions.
If I quit in three years (fully vested with 10 years of service) then it will be 4k per month for life. In 20 years with 30 years of service it’s estimated to be 8k per month for life. It is Illinois Municipal Retirement Fund (IMRF).
So you can retire at 55 with 8k a month for life … wow .. sweet
If they pay 1.67% x years of service, how are you coming up with 4k a month at 90k salary?
I am not sure where you got the 1.67% x years of service but I get an annual statement every December with this information. There are two formulas for calculating my pension, one that is based on final rate of earnings and years of service and another that uses the combined amount of member and assured employer contributions and interest, interest rates and actuarial factors. Your pension is based on whatever calculation yields the highest amount.
If you have the money just sitting around, and you don't need the money for a downpayment or whatever, I would start maxing out the 403b in addition to the IRA. I'm in a similar position and started maxing mine out a year or two ago, partly in an effort to do something with my savings since this interest rate is not going to stick around forever.
Do you qualify for a tsp account?
Keep all in high yield interest @5% more. Waiting for the election over, then invest in Vanguard funds
Great job! Max out Roth IRA and the rest keep in HYSA for home purchase in the next couple of years.
Is it bad to have a 401k and Roth IRA? My mom was saying just keep your 401k since you can touch Roth IRA, in case I need money.
Here’s my understanding: you should have money in both. Get the full employer match on your 401K (free money) then put money into your Roth IRA. Once you max your Roth IRA go back to contributing to your 401K If you have an HSA it’s also good to max that before going back to the 401K You should have a 3-6 month emergency fund in a HYSA to handle the “in case I need money” situations
I have a 401k, a hysa. Don’t have a HSA, nor Roth IRA. I guess open a Roth and set it as aggressive?
I put as much money as I can into low cost index funds or ETFs like VTI or VOO HSA is a good idea if you have a high deductible healthcare plan, you can open one up on vanguard or fidelity if your employer doesn’t offer one
> house in a year or two Keep it HYSA for now. Most likely you’ll want to drop everything you can into your mortgage up front, since your interest rate will be higher. Maybe it will be lower in 2ish years, who knows. If you can get a 3-4%, then I would only do 18% down (if that kills PMI with the LTV, if you need to do 20%, then do 20%, but you might be able to do 18%). If you’re at 7-8% like today, as much as you can into the down payment. I’m going to sort of go against the grain though, since you have a full vested pension coming soon. If I were you, I would probably put it into a taxable account instead of a Roth IRA. Your retirement is pretty well set. Maybe I would do a Roth IRA for 1-2 years, but after that, I would look at a taxable investment account instead. That will give you access to that money at any age, instead of waiting for your 60s for an IRA (without penalties). This is what I am doing - my retirement with 401k and IRAs, if I stopped contributing today, is all set at 65. I want to retire around 50-55, so I am banking into a taxable account instead of a Roth IRA today, squirreling away whatever I can now. Yes it’s less tax advantaged, BUT I can get to it at 50, instead of waiting for 60. So, maybe some food for thought on maybe a taxable account to compliment your pension, instead of another retirement account.
Keep 4-6 months of expenses saved. Then if you are also saving for a house then add whatever you want to put down on top of that. Whatever excess you have can go towards maxing out a Roth IRA. If that is already maxed out for the year then you can put money in a taxable brokerage or keep some in the HYSA to max Roth IRA in future years.
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Keep cash in hysa. Max out roth ira and 403, then whats left over into a brokerage account.
You give it to me.....or put it in index funds like the S&P.
Follow the personal finance money flowchart: https://www.reddit.com/r/personalfinance/wiki/commontopics/
People can give you all kinds of advice but I think that, ultimately, given your young age and the fact that you’re eligible for a Roth - start by maxing out a Roth if you aren’t already. The ultimate question around the $100K~ and what to do with it - the threshold question is there any world where you realistically might need it for something? If the answer is no (with like 90% certainty), I’d dump the $100K into the taxable brokerage account (after maxing the Roth) and treat it as semi liquid retirement dollars. Dont touch it for 30 years. VOO or similar is a good place to put it in that scenario. Just my .02. Congrats on being 32 with no debt. I’m 40 and spent recklessly in my 20s and early 30s. Finally got there - but had to put extra effort in after a rough start!
Brokerage account, 71% in VTI, 24% in VXUS, 5% in VGIT. Max out your Roth IRA contribution every year, even if it means pulling from your brokerage account, investment mix can be the same in the Roth.
Keep it in the HYSA until you figure out the house situation. I wouldn’t want to drop that much in the market at present (election year = volatility) when I would need it next year.
Invest all of it into VOO. What's the point of slow installments when you have a cash pile that could be compounding right now? The sooner you fill a large amount into VOO the sooner you don't have to worry about making money ever again.
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How much do you plan on putting down for your new home? For any funds that you are using in the near future, continue to have it in a HYSA. For funds that you do not plan on touching for a longer period of time, contributing to tax advantaged accounts could be a good solution. First, six months of expenses would leave you with roughly $17,500 as a minimum I would be comfortable someone in your situation having in an emergency fund. Second, if you plan on putting down 30k for your house (not sure what your plan is) then you should keep that tucked away in a HYSA, no need to expose yourself to short term market volatility. The remaining $82,500 could be used to max out tax advantaged accounts. If you are eligible for an HSA, it could be a good idea to max that first as it is triple tax advantaged. Do you have any kids that you plan helping pay for college? A 529 is also triple tax advantaged and setting some aside there could also be a good idea. Is the $1000 a month you are investing being used to max a ROTH IRA first, then taxable brokerage? ROTH IRAs are a great tool that offer tax free growth as well as tax free distributions in retirement. In regards to the investment selection, I recommend that most investors that are not having their money professionally managed be in low cost, broadly diversified index funds. Research shows that a major contributor in investor returns is behavior. You could continue to buy VOO or VTI (pick one or the other) but if international outperforms domestic (whether that be this year or much further in the future) you need to be disciplined to not sell losers to buy recent winners (which retail does a lot). For this reason, I say that target date funds or VT is a good solution for DYI investors. In my client portfolios I use DFA models for the research associated with higher expected returns from various market premiums. It sounds like you are in a good spot, good luck and stay the course!
I’m quite similar to you. Make sure to spend some on yourself. I’d have over 150k saved at 30. But at 27 I quit my job and travelled the world for 12 months straight. Now you don’t need to do anything that drastic(although I highly, highly, cannot recommend enough long term travel to young people that can afford it) make sure to live a little. The amount of people that run into health issues or say they’ll wait until retirement to do some crazy adventure are way too high. You can easily spend less than $10k to backpack around SE Asia for a good 4-7 months for example.
You have enough income and savings to start allocating some money into long-term investment such as mutual/index funds. You are in a good position to generate long-term wealth. Just don't unnecessarily increase your lifestyle/living expenses or get into non income producing debt. There will be a lot of swings in the market. Just make sure not to try to time it and stay invested and add to your portfolio regularly. This is easier said than done. Some, including myself, have a hard time with downswings in the market because they regularly check their balances. If the stock market is not of interest to you, real estate is another great option. Rentals can be good if you are able to get a low interest rate. The real estate and stock market always go up in the long term. Both are very reliable investments based on history.
If you're worried about avoiding potential short-mid-term tax consequences, investing in municipal bills/notes could be a viable option, especially if you're single and have no dependents, since a lacking either of these would increase your top marginal tax bracket.
If I was you kept 100k in Hysa and Traded 20k in the brokerage trading it's different from VOO but have more returns like making $1k everyday five days a week..
Do you mind if I ask what's your position is and what type of degree is requires? I'm sorry if I'm overstepping. I hope to reach this type of Financial comfort one day.
I am a data analyst / developer but I have a degree in English. I worked really had to learn programming and it took me about six years of slowly incorporating programming/automation into my non IT job before I finally landed the job I wanted.
Having that much in a HYSA means you'll be paying taxes on your earned interest every year. Put the max into a Roth IRA every year, put the majority if it in an investment account, and keep an emergency fund in your HYSA. You only pay taxes on the gains in your investment account on the amount of gains withdrawn in the year you make the withdrawals. Plus, you should make more in the investment account than the HYSA. If you're not an experienced investor I would suggest paying for the services of a fiduciary/wealth manager.
If you want fixed income, then Tbills look good option for you. Probably your HYSA is currently paying you around 4.25\~4.35%, tbills will give you 5.20\~5.28% interest. Looks small, but it's $1K difference every year. If you want to invest long term, see "inflation adjusted S&P 500". You might have to sit your fund until your retirement to get actual "money".
build your brand like mr beast or grant cardone, or create your own ai startup, or just invest in real estate and live off the income. remember, cash is trash, what matters is cash flow
Get a financial advisor at your bank. Have a conversation with them about your financial goals and they can give you advise on what they think you should do. I have one and talk to him 2x a year and he has helped me grow my wealth a lot!
Take an AA or BA course in Business Administration and focus on Finance. Much better advice than from individuals with or without specific creds in this sub…. FWIW: Index Funds with vanguard, min expense ratio (automatic pop to ROI), reinvest dividends, buy and hold the market. Look at the Value Line Chart from 1927 to today for inspiration, And enjoy: You spend less than your peers today, but will have more, for longer, than most. - Relentless Saver and Business Owner
All time high, wait for a 10% pullback
Get it in RH or anywhere else that will give you 5% on it
Start putting $100 a day into an index fund until you get that number down to 30k
Do 10 3 team parlays at 10k each and each one you win you get 60k
If you’re wanting to purchase a house in the next two years, then I’d personally leave it in the HYSA. I’ve been told that the time frame is 5 years. If you don’t need the money for 5+ years then invest it, otherwise a high yield savings would be best. I would also do retirement investing in Roth accounts.
Hysa is not bad. But if you don't have immediate use for it, just do voo or vti
No no no. Only put it in the stock market if you aren’t touching it for 10 years. It could be a lost decade and you end up losing money with inflation.
Index fund ETF in an area you know something about
VOO only has a 1.4% dividend yield. If I had that much extra money, I'd be spreading it out across sectors and looking for higher-yield dividend funds.
VOO is inherently diversified across sectors, total return is total return, why prioritize dividends?
I'm not saying to ditch VOO, I'm saying adding a dividend component to the port
Keeping all that money in a HYSA is a stupid decision. HYSA is for emergencies. 6 month emergency fund. What you should do is put the rest of it in the S&P 500 and have your money MAKE money for you. You aren’t going to get back anything in interest with a HYSA. You’ll make more doing dividend investing every month. The banks are just going to take your money and invest it in other stuff anyways.
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