Quote:
Originally Posted by Clout
Long term and somenshort term i have 24 thousand
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Good stuff man. Considering you couldn't afford toothpaste last summer I'm very happy for you
The answer is invest it and my advice for that would be start a 401k AND an IRA I believe they're called in your country WITH A ROBO ADVISOR for much lower fees then banks. An American can verify. You want two different investment accounts.
In Canada we have RRSPs and TFSAs...Not sure what there equivalents are in the US but I'm assuming you have registered accounts where you save for retirement that helps with your taxes every year, but that gives you a big tax hit if you take the money out before retiring . These are our RRSPs, I'm assuming these are your 401ks? Maybe IRA?
THESE retirement account is where you want to put all your investment savings that you under no circumstances are going to withdraw until retirement.
Because your very young and you want this money to grow and compound over the next 40 years, you want to be veryyyy agressive with this portfolio. Like 90% stocks and 10% bonds split. Again, you're young and a bad year in the market wont hurt you too bad long term. As you get older and closer to retirement you'll switch from a 90/10 balance but that's what you want at this age.
next you'll want another investment account (either personal that's taxable or an IRA/401k , whichever one there's no penalty for making withdrawals).
This is your shorter term investment account where you have money that's growing but still accessible. You want to be less risk adverse with this money because it's short term.
Here you'll want to go for a 50/50 split or 60/40 split equities and bonds.
These robo advisors invest your money in Exchange Traded Funds which are passive , low-cost and more diverse then picking your own stocks.
If you for whatever reason are worried about investing with a robo advisor like Betterment or Wealth Front (I'm with Wealth Simple but it's Canadian) and want to take your own active approach to investing....
Start your portfolio buy buying VOO, VYM (this will pay you dividends) and keep your 'cash' in a high interest savings account of at least 2%+