30k+ in savings and don’t know how to invest
I’m 24 and make over 50k a year. I have no debt, no car payments, and pay no rent thanks to my generous parents. I only have a few small bills to pay and then other things I have to get for life and what not. I’m sitting on 30k+ and bringing home around 700 a…
I’m 24 and make over 50k a year. I have no debt, no car payments, and pay no rent thanks to my generous parents. I only have a few small bills to pay and then other things I have to get for life and what not. I’m sitting on 30k+ and bringing home around 700 a week, but I haven’t invested anything. Also, I do put 6% into 401k but I’ve only been working at this job for 3 years. I just want to know what I should do with this money? Should I research a CD? Or government bonds? Or something else? Im nervous that if I put my money in one thing, I could’ve done something better with it and I’ve wasted time or something. I don’t know exactly what each thing is and how to know what’s best.
Collected discussion
Keep 6+ months expenses in a HYSA. This is your emergency fund. Contribute to matching in the 401k Open and contribute to a Roth IRA (max if you can). Then keep going in the 401k if you still have more. You can also add to a taxable brokerage if you would rather have some easier access. Invest in a total market index fund like VTI or VT. Simple and all you need. (CDs are mostly outdated products, ignore them. You're too young for bonds) Read the sub wiki for more info
You should generally always use tax-advanataged space first. Some people like to have some in a taxable for the access as well. Ideally you have both, but don't skimp on the 401k first. Go with a treasury fund like SGOV. Secure, similar rate to HYSA, and state tax deductible (depending on state)
Thanks, this clears things up a bit. I’ll also be looking through the common topics wiki.
Thanks
Thanks
https://www.reddit.com/r/personalfinance/wiki/commontopics
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Sounds like you are asking about a framework for what to do with money. Start with reviewing the Prime Directive in the PF Wiki. It will answer your question and many other questions you didn't realize you should be asking. https://www.reddit.com//r/personalfinance/wiki/commontopics
This. I was about to type "increase 401K contributions and open a Roth IRA". But this answer covers that beautifully. Your 54 year old self will thank your 24 year old self in 30 years for doing this.
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Is it better to put more in 401k or just regular brokerage and have full and easy autonomy? Are T-bonds viable for him if he doesnt want to do hysa? Still liquid
The answer depends on your goals. If you are perfectly happy living with your parents, I would up the 401k and start investing the excess as what you have more than covers you as an EF. If you want to buy a house in a year or two, everything extra to your HYSA. You’re doing great. Keep it up.
Do you know what your 401k is invested in? If don't want to think about it just put more into your 401k unless you were suppose to invest something in your 401k? If you don't know what to invest in? just do a robo advisor with Vanguard or Fidelity. They will ask you some question then put you in portfolio
Sounds like a good emergency fund. Leave it in a high yield savings account. Up your 401k contributions to 15%.