Hands-off smaller investment advice.

[z987k]

Option 1. Open an account t with Capital One and put it all in their high yield savings account. Interest rate will fluctuate based on the Fed rate but it’s far better than a standard savings. Never look at it again.

Option 2. Open a Fidelity brokerage and put it all in SPAXX. Like the HYSA, but with ever so slightly better interest. Never look at it again.

Option 3. Open a Fidelity brokerage and buy VOO. Set dividend reinvestment and never look at it again.

Option 4. Open Fidelity Roth IRA and put max amount in every year until all 20K is in there. But VOO, set dividend reinvestment and never look at it again. Won’t pay taxes on it when you take it out at retirement age.

Option 5. Open Fidelity brokerage and use it to buy TBills. They are easy, safe and no state income taxes, if applicable. Short, mid or long term options. Long term option you could forget about it.

If you need help with any of the options, I can walk you through it.

Edit to add. Just saw this in an emergency fund. In that case, SPAXX, HYSA or short term TBills is the only thing I would do with it.

He can do option 4 with SPAXX instead of an ETF if he want's it liquid and safe.

 

[CorbLand]

He can do option 4 with SPAXX instead of an ETF if he want's it liquid and safe.

Yes, I wrote that before seeing he said it was an emergency fund. That’s why I suggested VOO. For an emergency fund, I would only do a HYSA, SPAXX and/or short term TBills.

Short term TBills wouldn’t be hands off but they are pretty easy.

 

[wildwilderness]

How many people really use the Emergency Fund? If its used all the time is it really an Emergency Fund? or just regular reserves for operating expenses?


I still say buy BTC and HODL for as long as you can. Most likely worst case looking at 20-30% per year over the next 10 years. Probably have $200k worth of BTC by then! Not much else you can passively do that will get you that return. And it is liquid... just have to time it when you cash out .

 

[def90]

Open a trading account and just put it in an index fund.

 

[tony]

Acorns was mentioned, does it really work?
I thought about dropping a few bucks in it.

 

[rookieforever33]

H00kers and c0ke!

 

[HuntHarder]

30 day treasury bills are a better option than Cds currently. Stagger 5k$ bills over 4 weeks. Each week after 30 days, you will get the interest accrued put into your account and you do not have to pay state income tax on the earnings.

 

[CorbLand]

30 day treasury bills are a better option than Cds currently. Stagger 5k$ bills over 4 weeks. Each week after 30 days, you will get the interest accrued put into your account and you do not have to pay state income tax on the earnings.

This is what I do with my emergency fund.

 

[tony]

Treasury bill , that is a T bill?
Can you all explain how one gets involved in those?

 

[fwafwow]

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?

The bold portions are somewhat inconsistent (perhaps on the definition of "healthy"). Your underlined idea and those who have said to go to an advisor are correct. Some of the more specific recommendations are spot on. Others are just bad advice given your parameters. The advisor will help you know which are which.

 

[HuntHarder]

Treasury bill , that is a T bill?
Can you all explain how one gets involved in those?

Go to treasurydirect.gov, setup an account, link your bank account and start buying bills firect from the gov't. There are auctions daily for diffetent time length bills. Interests rates will vary amongst different time length bills. I choose to purchase 30 day T-bills and reinvest every 30 days on an "auto re-invest." Some longer term bills may have a higher rate depending on expected interest rates by the fed.

 

[CorbLand]

Treasury bill , that is a T bill?
Can you all explain how one gets involved in those?

Some brokerage firms allow you to purchase through them. I know Fidelity does and doesn’t charge any fees to do so. If not, follow the advice above.

 

[BravoNovember]

VTSAX, along with recurring investment. Averaging 13% return

 

[ethan]

I would totally plan a cool hunting trip and treat a particular one of your best friends.......but that's just me......hahahahahahahah

 

[Rich M]

Wife and I will be doing something like that. The high yield savings/MM account idea is pretty risk resistant. I just hate the 4%-ness of it all, especially being before taxes. 20k x 4% = $800 - say 20% taxes = $640 Still free money.

Looked at CD rates earlier today and saw 3.65-3.9% for 3 months to 10 yr CDs. A 1-yr ladder is about 3.75%. Bonds are about the same but if you put like $1 mil in you can get 5%.

There are a couple financial advisers on this thread. Can you tell which ones?

 

[LostArra]

Apparently there are widely differing definitions of Emergency Fund.

 

[RockAndSage]

30 day treasury bills are a better option than Cds currently. Stagger 5k$ bills over 4 weeks. Each week after 30 days, you will get the interest accrued put into your account and you do not have to pay state income tax on the earnings.

OP, this advice and that of others related to a HYSAs sound the most solid to me personally. Short-term stuff that's easily exitable, that will at least keep the value of your cash from shrinking from inflation.

With something like one lump-sum right now, I'd personally avoid putting anything into real-estate, gold/silver, or the stock market/equities with everything at peak prices - all of these are cyclical, and we're at the peak of a cycle. It's a global and national asset bubble, that has about 10 different needles pointed at it with each threatening to pop it at any time. Stuff that historically over the last 200 years is around 10 or 15 to one PE ratio is 35 or 40 to one. With the only times you see these big PE spikes being peaks of cycles just before they crash. But will it be tomorrow, or 2027? Nobody knows. But - if you have a nice, accessible lump-sum on hand, you'll be able to buy chunks of the entire economy at firesale prices.

There's an old saying, IIRC from Warren Buffett, that goes something like "Time in the market always beats timing the market," but circumstances like these are about the only exception. You really don't want to put your emergency fund into anything long-term right now, or anything you couldn't easily cash out of. Buffett himself is sitting on the largest percentage of his company's value ever held in cash, right now - explicitly waiting for that firesale to hit.

Even today, the market's crashing about 2% alone based off some unexpected trade games out of China and the Administration's response - will it be a one-day thing, or will it trigger a further collapse of China's economy that could be globally contagious? Lots of stuff going on right now, at the peak of asset prices. Better to sit on that fund in a way that covers inflation and can be easily accessed for emergencies or opportunities as they arise.