Buy 10 Babies in Arkansas.
it’s cheaper than surrogacy.
So from what I’ve read after viewing this thread, I make a vanguard account, either get a money market fund or a brokered CD, put the money in, let it sit for awhile, and then profit years down the line?
Vanguard S&P 500 fund.
Pay down your debts first.
Passive global technology index tracking fund
I’m going to need this dumbed down so I can understand
They have low cost to you
Global means they have stock in all markets, so if us is going bad is not necessarily bad for you
Technology means they mostly have stock in technology
Index funds follow the market. They have stock on everything in a segment or general so if market does well, you du well.
I got a 7k bonus 20 years ago in the military. I seriously considered investing it in the Vangard total stock market index fund. In '04 it was trading at $54 per share, today $282. Had I invested that $7,000 I would have $365,555 today. Instead I “invested” it at the strip club because I was a young dumb E-3 in Pensacola and New Orleans was only a weekend pass away. Long story short, index funds are the way to go.
I was considering spending this $10K on an extravagant, international vacation but am trying to make a smarter investment.
Hmmm I see a distinct lack of CDs on here…
(Now I’m considering not renewing my 5% 9 month investment) Lol
I just looked up what a CD is. It seems easier to understand than some of the other suggestions that have been made. I do not understand what a roth ira is or if it’s right for me.
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pay off high interest debt
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top off your emergency fund so you don’t run into expensive short-on-money situations
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take care of deferred maintenance on your car or house that might turn into an expensive repair
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If you have an employer sponsored 401k, increase the contribution amount to get 10k more tax free into it before the end of the year and use the $10k cash in hand for expenses.
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Open a roth IRA and contribute the maximum amount you can (which may vary based on your income)
VT, VTI, and SPY are good broad-market funds with good historical growth.
1-4 are all taken care of. I need to learn more about a roth IRA and what an index fund is. I’m okay with letting $10K sit somewhere for 5-10 years, possibly longer like for retirement.
Read up on Roth IRAs - your future self will thank you! You can open an account anywhere you’d like (Vanguard, Fidelity, Charles Schwab, etc). One thing I’ll mention though: the annual limit is 7K for 2024 (8K if you’re 50+), and you have to have at least that much in income to contribute (i.e., if you only had 5K income for 2024, then that’s your limit).
So, for 10K you’ll have to invest in 2024 and 2025. You also have until tax day to make contributions for the prior year.
Don’t rule out a Roth if you only want to save for 5-10 years. You’re allowed to withdraw the principal (initial 10K) at any time for no penalty/cost, so long as it’s recorded properly with the IRS when you withdraw it.
I like these points. Preventing a future expense by paying less now is always worth it, if you can afford it.
Being poor is expensive.
It’s much more expensive to be poor now than it used to be!
Second vote for VTI.
I used to not have any doubts about a Roth, but I’ve been considering that maybe it’s a little too much like giving the government a free loan. Do you know if there’s a thorough comparison anywhere between a traditional and Roth IRA that takes into consideration the opportunity cost of paying tax on the contributions?
The biggest question is, do you think your tax percentage will be higher now, or higher in the future? If you think your income might increase later (placing you in a higher tax bracket), or that the government might increase your tax burden later, then it’s better to pay taxes now.
Compound interest will far outweigh paying taxes now for a Roth. Especially if you also have a 401k, the taxes in retirement will be potentially large based on the growth of the fund over decades. A Roth makes it so you pay nominal taxes now for potential large tax free growth later.
The exception would be if you think your income will decrease in your later working years, in which case a traditional IRA could make more sense. That however is a unique case. Generally it’s better to take advantage of a Roth if you can for tax free gains later.
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Bees.
I do enjoy beekeeping vlogs but I’m more of a gardener.
Beads?
Peas.
If you don’t have an emergency fund, I would put some or all of it into something like a money market account. It won’t grow very much, but it’s safe and is quick and easy to withdraw when needed.
Otherwise depends on your age and situation, but an index fund (S&P 500) is almost always the right choice. It’s flexible, doesn’t usually lock you in, and will generally do very well in the mid-to-long term. If we hit a recession you might get stuck holding the shares for several months to a few years. The last thing you want to do is panic sell in that situation.
If you have any debt, paying that down is a very smart move, especially if the debt is charging more interest than your investment can earn. Future you will thank you.
I have my emergency fund, and no debt. If I were to lose this $10K, it wouldn’t impact my life. I’m comfortable with taking $10K out of my bank account and doing something with it but I don’t know how to go about that. I don’t know how to open an index fund or money market account.
Index fund, most definitely. And find one that has low administrative fees, I know that Vanguard has at least a few that are super low.
Leave the country while you still can? 🤓🤘🏽
There is already some good advise, so I will add some of dubious value that might make sense for some people. Buy a better car (or get a motorcycle). I live in the US, so having private transportation is a necessity. I have a car, but mostly I share it with my parents. I do use a motorcycle as my main commute and it is cheaper than a car’s running costs. Just saying that $10k + sale of your current car could fetch you just about any other car. It is kind of hard to do a whole lot of life changing things with only $10k. Perhaps dental work if you need any.
There is no universally good investment - it all depends on your priorities, risk appetite and timeframe.
Depends on your risk tolerance.
A 4% savings account is “safe” but might not keep up with inflation.
An index fund might be “good”, but the value can go down.
IIRC, >6% is the floor to keep up…
The average inflation rate for the last 20 years is under 3%
Edit: why are people downvoting me, refute my statement with a source instead of downvoting because you wish inflation was higher
Oh? That’s actually uplifting news! 😅🖖🏽
Put it in an IRA so you cant touch it and buy high dividedend yeilding stocks that reinvest in more shares and let it sit for the next decade and pray that there is a radical social change in out society so we can save the Planet and Poor from Billionaires.
You can definitely touch an IRA. Had to empty mine since I’ve been unemployed.
What kind of work are you looking for?
I’m a software engineer but can’t even get a call back due to the fact that tons of us are unemployed right now. Many unemployed have more experience than I do.
The best part is that I can’t even get a job at a grocery store because I’m “overqualified” according to one store in my neighborhood.
High yield savings account at SoFi or Ally Bank will give you 4% right now.
No offense, but that sounds like a terrible idea.
Vanguard recently started offering a savings account that currently has a 4.15% APY (their ‘cash plus’ account).
If OP wants to park the money in a savings account for easier access than a mutual fund, that’s both a more reliable institution and a better rate.
$10,000 at 4% gives you $400 interest in one year.
Just about any decent dividend stock will outperform that. Look at PET for example. It is sitting at $3.65/share right now and offers a quarterly dividend of $0.30. That puts you at $1.20/share per year. 10k = 2739 shares = $3,286.80 dividend payout in one year.
Banks are the worst place to put investments. Money in bank accounts are only supposed to be there if you need it liquid, like an emergency fund or your checking account.
*PETS
PETMED EXPRESS INC COM
For all the nay sayers downvoting me as if it is impossible to find dividend stocks that outperform their precious SPY or high yield savings rates, here is a great list I found with shit loads. I count 60 different stocks that offer 10% yields or more. 100 in total all offering over 8% -double what some bullshit ‘high yield’ savings offers.
https://www.tradingview.com/markets/stocks-usa/market-movers-high-dividend/
How much do you personally have invested in stocks like these?
PET? What stock are you talking about?
PETS, sorry, don’t know why my phone cut off the ‘S’.
PETMED EXPRESS INC COM
I just checked the top 3 companies there and every share price is through the floor lol
Have you ever heard of the tbill?
Sure. It is still a lower rate than going into dividend stocks.
Baby steps. Asking someone to go from nothing to investing in stocks is quite a leap.
