Hands-off smaller investment advice.

robtattoo

robtattoo

WKR
Joined
Mar 22, 2014
Messages
3,687
Location
Tullahoma, TN
So, I have 20k sitting in a savings account. It doesn't really do much & is basically just a rainy day/emergency/bail fund.

I'm not au-fait with investments & certainly not well versed enough to imagine playing the markets by myself!
Could any of you wiser folks point me towards a way of increasing that base 20 in a pretty safe & steady fashion? I'm not looking to retire on it or anything, but getting a healthy growth to add to it would be great!

Before I consult an advisor (who I'm almost positive will tell me to just leave it alone) does anyone have any recommendations?
 
You can get 4-5% with no/low risk, in some online savings accounts.
You can get more return from mutual funds. I have accounts at E-trade (Morgan Stanley) they have some tools to look at the different funds for growth vs. risk.
 
The first question would be, do you have a separate "Emergency Fund"? If not, then use that $20k to start that fund up. Our "Emergency Fund" is a base of $50k in a money market account that accrues around 4% interest. The majority of our investments are held and managed by Synovus. What goes into that fund after the $50k is going to be moved to a Globalt account (based out of Atlanta) or into another account for big purchases (going to need to get a truck in the next year or so).

For fun, I put $50 per week into an Acorns account and have it set on the most aggressive investment strategy. I've pulled money out of it for various expenses that have popped up.
 
robtattoo said:
With 20 grand? You can barely buy a carport for that these days! 🤣
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That is no joke. Honestly rentals aren't worth it to me (been down that road), but what is worth it is lending your money with an origination fee ($1200-$1800) and scheduled monthly payments, and short terms, at 7-12% interest through a title company with their home as collateral.

Generally, this is what development companies do (in my area at least). Just some food for thought, it's not for everyone.
 
robtattoo said:
So, I have 20k sitting in a savings account. It doesn't really do much & is basically just a rainy day/emergency/bail fund.

I'm not au-fait with investments & certainly not well versed enough to imagine playing the markets by myself!
Could any of you wiser folks point me towards a way of increasing that base 20 in a pretty safe & steady fashion? I'm not looking to retire on it or anything, but getting a healthy growth to add to it would be great!

Before I consult an advisor (who I'm almost positive will tell me to just leave it alone) does anyone have any recommendations?
Click to expand...
Have you already maxed out all of the tax advantages retirement accounts for the year?
 
Yellowknife said:
I use Fidelity for that purpose. You can set up a cash management account with them, and earn enough to cover inflation (currently 4%) with their default SPAXX money market account. Funds are readily available.
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I second this. A money market account is a pretty safe and easy way to grow money that you still want to access, like an emergency fund. I would first make sure you have any Roth IRA's or other retirement type funds maxed out for the year. If you don't have a Roth, I'd start one and just invest it in an index fund like the S&P 500 or something like that. That's about the extent of my financial knowledge lol
 
If you want dirt simple a robo investor like Betterment works. You can set your risk factor at whatever level you want. You have limited choice in what you're actually invested in though but if simplicity in using the market for gains is the goal that's it. Bank transfers are not a problem and easy to setup an auto investment. I get kids on this easy path since it's so simple and a lot of kids need dirt simple to get them investing in the first place. I'd bet you could have an account setup and linked to your bank in 10-20 minutes.
 
13 posts and no NFT or Crypto suggestions. I'm shocked. Equities (SP500) would also be too spicy for this use case. Emergency funds should be stable and liquid.

In addition to HYSA, Money market and related funds you may want to look at a rolling CD ladder. All of these more or less keep pace with inflation, not so much actually grow your $$$. Be weary of anything that promises stability and high returns. Keep doubling down on the business, that's where you'll really make the $$$.
 
Personally I would put that money into a good ETF like VGT or something similar. Not to many emergencies that you wouldn't be able to wait 2 days for a stock sale to clear.

Sent from my SM-G990U using Tapatalk
 
I would find the best yielding money market/savings account you could(usually online) otherwise you can look at purchasing T-Bills for a slightly higher return but a little more work getting figured out. Considering these are emergency funds I would lean more towards a low risk approach.

Edit to add: considering your proposed retirement plan, it may be worthwhile to visit with a financial advisor.
 
robtattoo said:
I don't actually have a retirement account.
I own a business & property that we plan to sell & cover retirement.
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Put the max(7k) into a roth. There's no reason not to do this every year. Tax free growth.
If you make too much for a roth just do it backdoor.

Assuming you're an employee of your business you should be able to also set up a 401k for yourself.

Tax advantaged money goes farther than money you pay extra taxes on.

Even if you sell a business 20 years from now for 20mil, idk why you wouldnt want to minimize the taxes you pay every year.
 
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