HYSA

FuzzyDynamics

Also money flows based on risk and return. I think most of these companies are solid investments, same as I think government bonds are or an HYSA. But why put money there when I see relatively low risk and huge return potential elsewhere.

skrrtouttamia

> but when you're just using a brokerage account as a savings account that doesn't really matter as much. this sounds like an oversimplification. I take it that you have a fully funded emergency fund sitting in a HYSA, as well as contributing the max to your 401k and IRA?

Over-Computer-6464

How set are you on buying a house in ~18 months. If it is a firm plan, then you need to put the downpayment is safe assets like HYSA, or money market fund, or 3 month treasury bills (or SGOV which is an ETF that holds 3 months T bills). The advantage of treasuries is that you do not owe state income tax in the interest. Only if your timing of house buying is uncertain or flexible should you leave the money invested in the stock market. OTOH, if your house purchase is some indeterminate point in the future, then I would lean to staying invested in S&P500 or total US market ETF. You would be accepting the risk of a market downturn around the time you want to buy forcing you to delay the house purchase.

hoodieguy18

If you need the money soon, then put the money into something safe like HYSA, or T bills Otherwise make sure you have enough savings for X amount of months so you don’t have to sell stocks if you get laid off and wait. For me I invest in total market USA and also International, not just SPY like a lot of people which could reduce volatility during some AI pop. But supposedly thats the correct thing to do AI bubble or not.

DoinIt4DaShorteez

I think at 30, after setting aside an emergency fund in something safe like HYSA or a goverment money market fund or ETF, putting the rest in equities is OK if you're diversified. You could allocate some of it to dividend payers, that'll provide you with a little dry powder for a dip if you're really itchy to catch one.

bank_truth

I would go with a HYSA in your case. The timeline's a bit too tight right now to risk anything in the market. Rates can always rise or fall depending on the Fed, so don't just lock something in and forget about it. We update our website regularly, and banks adjust all the time. So if you're curious about the rates, you can take a look. A 0.5 or even 1% difference adds up when you're parking that much for about 18 months.

MolassesMysterious65

I'd say enjoy your "boring" 3.4% in the HYSA, especially if it's money you're going to be using in the next 12 months. Nobody ever went broke on a short profit. Don't gamble with your down payment for a home.

19mambo85

Over the long run, commodities can be a useful hedge, but not a place to park *all* your cash. HYSA = safety and liquidity; commodities = volatility but protection against inflation and currency decline. For a long-term mix, keep enough in your HYSA for emergencies and short-term needs, then gradually move some into diversified, real-asset ETFs if you want inflation protection and don’t need that money soon.

Sweetycherryx

this is a perfect stage to start diversifying. you already know how to save, so now it’s just about allocating better. maybe: 10k–15k in a HYSA for emergencies, keep the CDs for short-term goals, and put more into retirement or index funds. I keep my HYSA rate in check using BankTruth they post updated APYs and it helps me move my savings when a better deal shows up.

Sweetycherryx

if you’re not sure when you’ll invest, just mix it up: some in VUSXX, some in a high-yield account. the rates are almost neck and neck lately. I found my HYSA through BankTruth, they track which banks are actually keeping their APY stable instead of dropping it after a month.

RoughThat5778

Agree with what everyone saying about S&P being too risky for a 2-3 year timeframe. I’m saving up for some renovations and using SGOV ETF instead. It currently gets higher yield than my HYSA (I have one for easy liquidity but there’s less money than my SGOV investment).

Heyhayheigh

Open a Fidelity account. Use SGOV instead of savings accounts/HYSA. Invest auto and weekly. Whatever you can afford. Yes Roth is awesome. But the important thing is to automate and prioritize auto investing. Only sell when you have something urgent to pay for. You will learn as you go. Rome wasn’t built in a day. You will have setbacks. You will make common rookie mistakes: seduced by dividends. You will panic sell. You will buy individual stocks that require constant research. In my opinion the most important concept of investing is to understand to have auto weekly investment. Getting off the fence. Making it a non negotiable. Either hire a pro to make a balanced plan, or just buy VOO or QQQM. Set to auto. Work to increase. Spend less, invest more. Best of luck.

AskAskim

Thanks for the advice. I currently put like 70% of my RIRA into SPY & about 30% into QQQM. My individual stocks are just NDVA, GLD, & BTC. My HYSA is about 30% of my total investments/savings which is also pretty much all of my net worth. I would like to not only save money for when I am 65, but also maybe have a couple lucky trades and end up in the green at the end of it all.

MartiniLAPD

Do half and half. Usually time in market beat timing market. But hey, these are unpredictable time. You can keep the other half in a HYSA account and just wire it automatically every week a certain amount toward Investing Account

lOo_ol

If by "sure", you mean risk-free, then you need contractual obligations, like HYSA. Nothing else is guaranteed. Keeping cash under the mattress is the worst thing you can do at the dawn of a debt crisis, when severe devaluation of currency is on the table. I know it sounds crazy to most on here, who angrily downvote immediately, but many foreign investments would be unimpacted by a US debt crisis. Americans on here like to think that a crash for the US means near-death for everyone else, but that's just another absurd statement that keeps getting upvoted. During the 2008 crisis in the US, Germany for instance saw a drop in unemployment to a historical low. Most people who lived outside the US then know that if it wasn't for hearing it in the news, they wouldn't know there was a financial crisis. Investors will always want to make money, so they'll move it where expected profits are higher, and they have. Many foreign stocks have performed quite well lately. Real estate in regions of the world with net immigration is also a good idea. *"then they never followup"* You don't need confirmation with a portfolio statement from strangers to confirm whether something makes sense or not. You're reaching for ad hominem. You're also making shit up because no one here is showing proof of trade, so we don't know what anyone's doing. And those who suggest anything outisde of the S&P500 are usually downvoted, so we rarely see those posts.

bobdevnul

A guideline for how much to invest for a comfortable retirement at about 65 with a lifestyle comparable to your working years is 20% of your gross (before tax) income. $200 a week is enough for a $52K a year gross income. If you make more you need to invest more. The 401K is usually the best place to do this. Any employer match counts toward the 20%. If you want to retire before \~65 you need to invest more. HYSA/CDs for long term investing is not considered a good way to do it. You can't even get 4.25% now and the rates are expected to decrease in the coming year. Long term investing is generally done with stocks, preferably in the form of diversified stock funds. Long term yield on diversified stocks has been more like 10% on average over decades of holding. That makes a big difference in your compound gains. You have decades to go. The recommended general order of saving and investing is: Emergency fund of at least three months of critical expenses in liquid cash equivalent savings. The $70K you have saved may be that. Contribute to employer 401K to get the full employer match if there is one. Contribute to a Roth IRA up to the $7K a year limit. If you have more to contribute after the Roth, contribute to 401K. Read this and all of the links to become an informed investor: [https://www.reddit.com/r/Bogleheads/comments/1l6j6tj/new\_to\_rbogleheads\_read\_this\_first/](https://www.reddit.com/r/Bogleheads/comments/1l6j6tj/new_to_rbogleheads_read_this_first/) You are looking at accumulating several million in investments over 30+ years. It is worth spending some time learning about it.

pythonidler

38, making 154k USD gross annually, have 180k in cash and no major liabilities besides a credit card. I'm looking to buy a house or condo in the next year or two - nothing expensive, would probably contribute \~150k as down payment. Given all of this, what's a relatively safe investment over this period of time that would beat HYSA rates?

RedParrot94

Well $1.00 today is only worth $.97 next year. The CD/HYSA stops that from happening, so $1.00 today is worth $1.00 (really $1.03) next year. So your current strategy is inflation protection. You don't really make any money. If this money is for retirement then you will want to max out your retirement accounts and buy something like VTI. As far as HYSA from internet banks, I'd be careful. Those are front ended by non-banks and you could lose your money. That happened a few years ago.

nicklebackfan_69

First - Put your cash in a HYSA so you can at least get 4% on it. I would dollar cost average so you aren’t jumping in all at once.

guitarpic69

You should’ve had it in an S&P fund this entire time and move it to a HYSA now. You’re doing it backwards brother

dritu_

Everyone is going to tell you not to put it in the market at all but the reality is you could put some of it in the market and do just fine. It doesn't have to be all stocks. I've been in a similar boat to you before and due to how long it took to find a house, my money was just rotting in the HYSA when it could have instead gained significantly with even a very defensive portfolio. Check out the 12 month inflation adjusted returns for [this portfolio](https://testfol.io/?s=dC058E4qMfh): * VTI: 30% * GLDM: 25% * TLT: 15% * KMLM: 30 All these stats are adjusted for inflation, back tested since 1992: * CAGR: 6.33% * Deepest drawdown: -15.42% 2 Worst year return: -7.5% (great financial crisis) * 25th percentile return: 1.5% * 50th percentile return: 6.4 This simple portfolio has a 12 month lump sum win rate of 77.5%. So, yes, you would be down 22.5% of the time with it. Is that a risk you're interested in taking? Only you can say.

Sweetycherryx

you can build a story for why a correction might not happen soon soft landing, earnings growth, liquidity, whatever. but your goal isn’t to predict. it’s to buy a home. match the asset to the date. HYSA plus short CDs or treasuries pays fine and keeps the principal intact. if you want one app experience, SoFi works for the cash piece. I still rate shop on BankTruth or similar sites every few months so I’m not leaving yield behind.

pseudonominom

TLDR, same as your HYSA but better interest rate. Not that 12 months is a big enough time frame to matter. People jerk themselves off too much about interest rates on short timeframes like this. They’re used to reading about compounding interest over decades and fail to realize it’s not the same thing. Pick either and move on with your life.

Various_Couple_764

You need to invest your money in ETF to get beyond savings For the 401k you should have selection of funds you can use. Many like S&P500 index ETF or total market ETF That with an international ETF and a bond fund should be a good start in your 401K. As to your HYSA and CD would gradually move money to a taxable brokerage acount. with a money market fund. Money market funds are very similar to HYSA. Now you want about 6mnoth of living expense in Money market fund. But anything above that should be invested. For a taxable brokerage I would use a high yield dividend ETF. QQQI is my choice with its 13% yield and it is tax efficient. Reinvest the dividned back into the fund an gradually add money to it. Eventually it will be as big or bigger than your money market fund. 70K in QQQI would generate $9000 per year or about $753 a month. At this point if you want you can stop reinvesting the dividend and use them to pay bills or other expense. And if you want you could reinvest the dividend into a Roth retirement account. Or start adding other ETF to the taxable account. Eventually you could get enough dividend income to cover all of your bills, mortgage payments, food , car, and medical insurance. I retired at 55 with 5K a month of dividned income. Enough to cover all of my living expense with about 1K of extra at the end of the month, which I reinvest.

lashazior

No one has asked this yet, but how much of a home are you buying, what's your monthly income, and what's the prospects for holding the house long term? That can be very indicative of what you should be doing with your money. I only ask because if you're asking about investing into the market for a short term play, it begs the question if you're going to have a housing expense fund post down payment/purchase in relation to your monthly mortgage requirements in your HYSA after.

Ok_Problem6740

uh, Totally get that fear! If you're risk-averse, maybe just stick wth the HYSA for now. Safer bet.

TaleVisual1068

I’m using SGOV for a reason similar to yours. It’s an easy and safe place to park your cash until you need to use it, while earning a decent dividend. This is separate from my HYSA, which I view as a bucket available for more immediate needs.

Either_Ad7029

I am not an expert, and I started later, investing my money in family, a house, etc. That said. After building my retirement savings for 14 years, I have a few comments based on my experience. I have, as you have, money in a HYSA. It gives you a mental sense of security. You know if it gets tough, you have enough money to move to another state for a job and so on. My wife and I have about 10 % in HYSA. We don't touch it. It just sits there. Because you are young (29), you will see the power of compounded returns. So, my feedback is to keep putting money away, even when you think it is not so easy, and it really adds up. Also, try to max out the Roth IRA. Because when you get older, you realize that Roth doesn't require mandatory withdrawals. It also grows tax free. I totally agree with u/Heyhayheigh comment; "But more importantly, open a Fidelity account and buy an auto weekly amount of sp500 or Nasdaq. Set to auto, don’t rely on self discipline" , that is how I did it. A percentage no matter what else was going on in my life. Also, TSP. I would not move money into TSP because it is so rigid and lack customization, but I would keep what I save during my tenure as federal employee in TSP. Just be sure that you have the money in the funds with an actual return. Some of the TSP funds are essentially zero returns. 70-80 % C and 20-30 % I did well for me, but the market has changed. After I left federal service I rolled it over to Fidelity.

Guccimayne

Honestly friend just leave it in a HYSA if you need it to be liquid and safe. I think SoFi has a special for new customers and you can get over 4% interest for a few months, then it returns to 3.8%.

AlliGalaxy

Discount grocery is one sector to look into, I am considering opening a small position in a few discount grocery stocks like Grocery Outlet $GO, $OLLI and $PSMT. Also slowly rotating some of my profits from tech into international emerging markets, Chinese stocks, international stock ETFs like $VT, a mix of US & international bonds, a bit of sliver and gold, and a small amount of Bitcoin and ETH. And starting to stack a reasonable percentage of cash in a HYSA as well. I am also buying a small number of shares in inverse leveraged ETFs on large tech that I believe is overvalued when they are way up. My current favorite is PLTZ because I despise that company personally. Also $SQQQ when QQQ is pushing ATHs. I don’t think the top is in yet though. I believe we have at least until EOY before everything starts to decline steeply, but I am slowly taking profits and hedging.

donrab87

Market is shaky right now. Might see a pretty big dip in the next 12 months. Keep your cash in HYSA for now here it’s safe since you’re holding for a house.

Guccimayne

If you need that money soon, investing it is probably the riskiest thing you can do. HYSA is boring but safe. You could also consider certificates of deposit for guaranteed higher rates but you won’t be able to touch the money in an emergency.

GaylrdFocker

No state taxes in Texas, but it's still a better rate than his HYSA.

LikeAgaveF

Best course is to stay out of equities entirely and keep it in the HYSA

cwitty1988

If you’re planning to use the money soonish I would avoid investing it. There’s nothing preventing the market from tanking in a week and you’re down 30%. I would keep it in the HYSA or something safe like SGOV until you need to use it.

Various_Couple_764

What are you taxes on the HYSA now assuming it has the ammount you want to invest? It isn't likel that much money. For HYSA you are now getting about 4% yield and it is likely dropping. You could open a taxable brokerage account and put your money in a dividend fund like CLOZ you would get 8% yield payed monthly with can be reinvested in the fund or spent. You can make adjustment with your work tax withholding to account for the extra income. if you slowly build up the money in the fund it will eventually produce enough to start covering some of your bills. And eventually it could cover all of your living expense. If you don't like CLOZ you can use QQQI 13% yield, SPYI 11%, EMO 9%, PBDC 9%, PFFA 8%, UTF 7%, JAAA 6%.

Financial-Respond-37

If it is a downpayment for a house, it is smart to put in a place with modest returns and less swings like bonds, HYSA and CD. Otherwise you can put a fixed amount monthly or weekly so you are not putting in everything at one go. Statistically 70% of the time when market is at an all time high it keeps making new all time highs so do with that what you will.

Cool-Strain4061

This is what happens when you invest in the wrong asset class for your time frame. Stocks are not meant to be invested in as short term gain asset. Yes you can make money doing it but its time frame is meant for 5-10 year investment. Any money you investing in with less than 5 years is better off in HYSA. Again some people will say well i made huge profits but in reality u just got lucky and u were just as likely to lose money by investing in the wrong asset class for your time frame. Also note trading and investing are two seperate things, as a trader you would make plays like these but as an investor these are very risky plays to go short term in a long term investment vehicle.

among_apes

If I were you for every $1000 $100 emergency fund HYSA (or SGOV) $500 VOO $350 QQQ $50 (Random stock picks on RH, your young and it’ll teach you some lessons and give you a feel for markets and make you pay attention to companies and market cycles)

Pretend-Mark7377

For OP, set rules, not vibes: rebuild with a core-satellite plan and strict sizing. Keep 6-12 months cash or T-bills, DCA into a broad index, cap specs at 1-3% with preset exits. Vanguard for VTI/VOO and Ally for HYSA worked for me; I also used a small fixed annuity on [gainbridge.io](http://gainbridge.io) for a safe bucket. Small bets, automatic buys, hard stops.

MountainMistCalm

Money management tips: [https://www.reddit.com/r/personalfinance/wiki/commontopics/](https://www.reddit.com/r/personalfinance/wiki/commontopics/) Book suggestion: I Will Teach You To Be Rich by Ramit Sethi You will have plenty of time to invest after you graduate from college, right now you are investing in your education so you can get a well paying career. Stack as much cash as you can now in a HYSA. Cash is king for a new college graduate that may have a lot of expenses coming up (furniture, clothing for work, car, deposits for an apartment, etc). If you can graduate college with little to no debt and a good cash amount, you will be ahead of the game. When you are ready to invest I would open a Roth IRA with Fidelity and just do a simple portfolio: 80% Fidelity Zero Total Market Index Fund (FZROX) 20% Fidelity Zero International Index Fund (FZILX) [https://www.fidelity.com/mutual-funds/investing-ideas/index-funds](https://www.fidelity.com/mutual-funds/investing-ideas/index-funds) The above is a global portfolio that includes large caps stocks (like those in the S&P 500), mid and small cap stocks, growth and value stocks, dividend stocks, tech stocks, international stocks. All that to say you would not need to add any other fund.

HearAPianoFall

It's a matter of risk and how strict your timeline is. HYSA/CD if you want to make sure you can buy the house in 18mo. S&P if you're more flexible and can wait 2-5 years if needed. 4% from a HYSA is nothing to scoff at, we haven't seen rates that high in over a decade.

Bchoisne

If you’ve got $80k+ I’d recommend private lending on real estate deals. Easiest money I’ve ever made. Consistently 16%-20% returns. I typically leave my liquidity in HYSA or ETFs when not in a deal so 5% is my floor value n my money and 22% is the ceiling. Usually end up with a net around 16% for the year. Takes almost no effort (a little more than just letting it ride in an ETF but not much) but requires around $100k to start. Most deals I’m seeing are between $80k and $140k. Shoot me a DM if you have any questions - happy to help.

Digital_Blade

OP said “it’s pretty much all I got given near-minimum wage employment.” And secondly they are concerned they’re down 10% in two days. The reason they’re concerned is THAT’S ALL THEY HAVE. I’m just pointing out that it’s recommended to have some _liquid_ readily accessible savings set aside first (maybe a HYSA) in case of an interruption in income or unforeseen expense before getting involved in the stock market.

Particular-Macaron35

Get a brokerage account. Split your money between HYSA and VOO. With only 20k, it should be more in HYSA than VOO cause HYSA is safer. But it doesn't really matter. It will grow a little better than inflation which is better than losing to inflation. So you will have more money when you want to spend it, but not that much more. And fuhgeddaboudit.

bland-scape

HYSA rates will also go down as interest rates are cut

AegonTargaryen17

Thank you everyone for the advice. I think we’ll go either way HYSA but look at SGOV, as well, to see how that’s projected to do against current HYSA rates. Thanks again.

katrk824

new to this. investing mostly with the intent of long terms gains and a little opportunistic profit harvesting then hardening those profits in an HYSA. im up quite a bit right now but, damn this sub makes me feel like im just waiting for everything to burn down lol

jdcav

Mistake. The real move is to never sell. Time in the market vs timing the market. But good luck! At least throw it in a HYSA…

Mundane-Fan-1545

Selling because you need the money is ok. Selling to relocate to a better stock is ok. Selling to balance your portfolio is ok. SELLING BECAUSE YOU ARE AFRAID IS NEVER EVER OK. STOP PANIC INVESTING. Dude, when you invest, you are supposed to take into consideration crashes. That is why you balance your portfolio according to your risk tolerance. Your fear comes from your ignorance. My. recomendation is that you stick to HYSA and maybe bonds. Stay away from the stock market.

OutlandishnessFew605

For example through Amex I have a HYSA with an APY of 3.80% If you had $50,000 in that same account you would make around $159 a month paid to the account off interest. I can access that money at anytime and never worry about losing it. This is just what I do with a lot of my money. I’m realistic with my trading abilities and like seeing a free money every month even if it’s in the $100-$200 range.

Actual_Stranger_1766

i can get you 3.6% on a HYSA. if you use my link we both get a little something. App is Public

Pinewatch762

Lmao. Can’t even handle a minor dip. Stick to a HYSA

Apollo506

If you have a defined timeframe, HYSA is better. I spent 5+ years saving for a down payment before i realized that housing prices were rising faster than i could save. I missed out on all those years of market performance. Now I'm in the market and will buy a house whenever the funds are appropriate... could be next year, could be in 10. Not financial advice.

lambda_lord_legacy

I'll echo the HYSA. As a rule, if you need the money in the next 5 years, or honestly even in the next 10 years, don't put it in the stock market. The stock market via broad market index funds is the best option for long term growth, but is very risky over shorter periods of time.

Bobba-Luna

Rather than just sit on it, put it in a CD or HYSA. Interest rates aren’t great but if you have a pile of cash, you could still make about $1,000/month or more depending on your stockpile.

harrison_wintergreen

HYSA. >and understand the S&P generally performs well each year it depends. there are more years up rather than down, but the downs can be significant and need time to recover. 2000 to 2002, the S&P 500 dropped a total of about 40% top to bottom, and didn't recover until 2006 or '07.

Financial-Respond-37

For your biggest purchase of your life, it's important to have peace of mind that something out of your control will not ruin your chance of attaining it. Yes, market could be up in 2 years or it can be substantially down. It's better to earn modest returns and live in a dream house than see the market tank, stress over it every night and have to possibly delay it. Like everyone else said, HYSA or t-bills is probably the smart choice.

Successful-Tea-5733

Has to be HYSA. The S&P 500 could be up 20% in 18 months, or it coudl be down 20% in 18 months. Equities need to only be for long term money, 5 years as a minimum.

Some-Rent-7742

Why HYSA?

CasuallyInsecureMan

Thanks, this is helpful. I’m going to transfer it over to a HYSA in the next few days. No sense in having risk right now. This would account for 20-30% of what I consider to be the estimated downpayment, with the rest of it saved in other bank accounts.

sureyeahdude

With 250k sitting in an HYSA and want to move into the market, what ETFs or individual stocks should I buy? This is for long term growth.

OutlandishnessFew605

Take it out, put it all into a HYSA and walk away.

Bremen1

It's still up 18% over the last 6 months. As far as times to exit the market now is pretty good (though admittedly worse than last week). If I were buying a house tomorrow and selling my stock portfolio to fund it today I'd be extremely happy with myself. If the plan is to buy a house sometime next year it gets murkier, but lots of people recommend switching money over to a HYSA if you're expecting a big purchase in the next year or two, so it's not unreasonable. Really it comes down to the OP's situation and how much they're counting on buying a house in the coming year vs how much they'd like to maximize potential gains.

ThreeStarMan

Meta is up 1.06% after 10 months. You'd have about 3-4x return with a HYSA, lol

__redruM

Let’s take the HYSA 4% as an example. You put $10,000 in at the beginning of the year. At the end of that year, you have $10,400. Now the IRS wants about 20%, so now we’re down to $10,320. Currently inflation is 3% per year. So that $10,320 buys 3% less at the end of the year than it did at the start. And after taxes and inflation, that $10,000 made you $20.

MrAkimoto

If it gives you 12% it gives you 12%. And the HYSA also give you 4% it gives you 4%. It's what it gives you buys less/more due to changes in prices.

__redruM

Yes, of course. So generally if the S&P Gives you 12% each year, it’s really only 8-9%. And that HYSA that sounded great at 4% is really only keep you even if you consider taxes and inflation.

bkkmatt

I grabbed 150K worth of VOO one month ago. Was up for a while, but one more day like that and I’ll be in the red. Should I have kept it in HYSA? Logically, I know the answer. But red still sucks.

someguyonredd1t

If you plan on investing for 30 years, do not try to time anything. Just keep the contributions up. You'll buy on the way down, buy the bottom, buy on the way up. By the time the market is even again, you've accumulated a ton of cheap shares that will be printing returns. Make sure you have an emergency fund (several months of core living expenses) in a HYSA or similar sorted first. This means you will not be forced to sell investments at a loss to pay your bills if you lose your job in a recession.

hymie-the-robot

you don't lose growth due to a conservative tilt. you lose growth with elevated risk. you want the best risk-adjusted return, not the most growth. use your cash to buy ultrashort government bonds, e.g., USFR or VGUS, or just hold it in a MMF or HYSA. this essentially cuts your maximum drawdown in half, and gives you dry powder to bring your account back into balance when stocks are cheap. when the market recovers, you end up with a bigger balance than before the drawdown started. [https://portfoliocharts.com/2022/04/12/unexpected-returns-shannons-demon-the-rebalancing-bonus/](https://portfoliocharts.com/2022/04/12/unexpected-returns-shannons-demon-the-rebalancing-bonus/)

ballzac69420

The order of decreasing risk, but also potential return, is market etf like spy or voo (~10%), then treasury / investment grade corporate bonds (~4-5%), then normal banking accounts like a CD or HYSA (3-4%). None of these require constant checking

kpeng2

If $2.7K is all you have, put it in a HYSA. All crypto are gambles, don't believe in so called "stablecoin"

Here4Snow

"my bank gives me 0.5%" Put it in a high yield savings account (HYSA) and keep in liquid and available for an emergency. 

Rav_3d

Congratulations on your profits. Since you decided not to keep risk on at these levels, the "safe" investment for you now is cash, getting the highest yield you can find in a money market fund or HYSA. You got lucky not taking on more losses in day trading and averaging down and waiting. The powerful bull market bailed you out. It could have been much, much worse. So, enjoy your gains and sit in cash for a few months and re-assess your risk tolerance. And, stay away from day trading.

sidslidkid

HYSA looking like a decent parking spot.

Flimsy-Space-8724

Good thing I took out my initial investment and put it back into my HYSA because wtf is this shit

Mostly-Toastly22

S&P500 drops 20%+ every 6-10 years on average, but seems like that's been happening more frequently in recent years. If you're saving for a goal within the next year, then the S&P500 is a pretty risky move. If your goal is minimal risk, that's not the best option. You CAN go slightly riskier than HYSA to get a bit more return potential, but know that you'll be increasing your risk at the exact same time.

reviewmynotes

This is just my opinion, but if your budget is that tight, I think you should focus on building an emergency fund first. At least $1,000 in the bank may prevent you from having your life derailed dramatically due to an unexpected bill or medical situation. Investments are great in the long term, but their value fluctuates in the short term. So if your $300 became $200 for a month and then shit up to $400, that's great. But if you have an emergency during that month and you have to cash out, you'd only have $200 to deal with the emergency. Find a high yield savings account (a.k.a. HYSA) and put the spare money there. Over the span of years it will make less money for you than investments would, but if an emergency comes up you will have at least the amount of money you put into it. I can vouch for My Savings Direct and Emigrant Direct as reliable HYSAs. They're both run by the same bank, which has been around long enough that my grandparents used their physical branch in New York City many decades ago. If you want, you could also sign up at etrade.com for a HYSA. If you make an E-Trade amount, it will mean you'll already have an account to use if you get into trading stocks later on. There are other HYSAs out there and each has a different minimum balance requirement and percentage of interest. Many have other features as well. In my case, I started out with Emigrant Direct and configured the account to pull $20 out of my checking account every week. This was enough that I built up an emergency fund quickly and it's been amazing for my peace of mind. I've had emergency medical issues with pets and knew that I could just deal with it and I had the money. If your budget is as limited as you described, I think the peace of mind will be incredibly valuable to you.

ChuckOfTheIrish

Everyone thinks it's going to burst until it does, while it surely could you need to look at the macro aspect. Over 30 years the S&P will average over 10% annually, so each year you sit out you're effectively losing 10%. The market could easily go up by 40+% in the next few years then drop by 20%, and you'll have lost out by waiting. Contribute consistently, keep an emergency fund in HYSA/T-Bills and whenever the market drops, try to cut back on spending and buy more if you can.

cstoner

First off, great job at saving! Honestly, you're doing better than most. The answer to your questions is going to be "it depends". Not satisfying, I know. > At what point should I not buy a bond? You should not buy a bond if you have something "better" to do with the money. What would "better" mean in this context? * Are you saving for a house or other "large" short-term expense? Then putting that money in a HYSA or money market fund might be better * Doing some retirement calculations and realizing you're coming up short and needing more yield than bonds will give you? Then putting more towards equities might be better * Doing some retirement calculations and realizing that you're golden, and that the marginal value of buying more bonds is actually quite low? Then I would urge you to strongly consider hookers and blow (or watches and designer clothes, or muscle cars, or that fancy lego set you never let yourself buy. Whatever your vice of choice is) > What is the floor where it doesn’t make sense to me? There isn't going to be a good answer for this. We could tell you something like 4%, only for the fed to bring back ZIRP and have long-term bond rates drop to 2.5% again. The way I think about bonds is that they help me sleep better at night. If something goes wrong financially, bonds should out-perform stocks meaning that either you'll have more money when you need it or you can re-balance. Have I ever actually done that? No. But lower volatility makes me feel more confident in my portfolio. I would say that treasury direct bonds are kind of a pain to sell on the secondary market if you ever decide to do that. You can usually buy bonds at auction for free from whatever brokerage you use, and they'll be MUCH easier to sell later if/when you decide to.

qthistory

Roughly 20% cash and ready to buy if the market drops. In case of a pullback, putting in a portion every 5% down. If the market corrects 30% or more I will be all in. (Apart from six months salary savings I have in a HYSA away from my brokerage)

Maleficent-Hold-5466

\> MMs ain’t trying to make 3.4% off a HYSA one of the more fascinating things i've ever read on here

zurijer

Every company making record profits. Yall think this shit will dump. MMs ain’t trying to make 3.4% off a HYSA Money goes into the market. SPY 690 EOM

Business-Ad-5344

bernie madoff was a fiduciary and t rowe price had fiduciary duty. they ripped people off. t rowe price ripped people off and got fined for it. just like many other fiduciaries. they get investigated and it is found that they are scamming people. chase got caught doing that recently. schwab got caught. their robo-advisor was allocating to benefit Schwab's revenues over the Customer. annuities are NOT the way to go. those are going to be eaten up by fees and you're going to lose a lot of money. There's a high chance of getting straight-up scammed. they should get part HYSA, part VTI or VT. they should get a rice and beans diet, visit r/frugal regularly. and since they are 54 and not 74, they shouldn't give up on getting a WFH job. they should continue that route, and even grind and pivot into another field. It can take years to get a small business up and running such as teaching english online, or getting the right education/certs.

The_Patsy

1) stop trading 0 dte.  2) actually best to just stop trading options altogether if you were doing 0 dte.  3) save money in HYSA and DCA into index funds until you've offset your loss.

bank_truth

SPAXX is good for cash you might need soon. A MMA or HYSA will not tank like stocks can when the market changes. Rates can always rise or fall depending on the Fed, so if you want to do some tracking, we track updated rates on our website and you’ll notice that a lot of them vary. Sometimes an online bank pays better, other times brokerage MMAs do. The ones that have physical locations have lower rates since they also pay for the overhead costs. My advice is do not try to time the market with money you're planning to invest next year. Park it somewhere safe that pays, then start DCAing when you're ready. Waiting for the perfect moment usually just means missing gains.

Amazing_Shopping3035

Marcus has a great HYSA with 3.6% and a rotate CD offers. I just locked in one at 4.2%

ZimZimZay

I’m not sure about best ROI but for such a large amount, I think investing into SPAXX if you have fidelity would be a great option. Right now the 7 day yield is 3.73% with SPAXX and that should be more than any HYSA account.

HealthResearch12

Wealthfront. Besides being a HYSA it has a great app that can pull data from all your financial accounts (bank, mortgage, retirement, etc) and track them all and calculate your net worth.

nbiz4

Best time to sell stock is almost never. If I was planning to use the money within 5 years or eventually for something like a downpayment, I’d just keep it in my money market treasury fund (or HYSA). Anything that isn’t needed in the short term goes into brokerage and equities. Also keep in mind you can use up to 10k from a Roth IRA with no penalties for a first time home purchase.

the-real-batman3

same had it in HYSA

amg-rx7

I should have added a comment about "risk tolerance"... Risk tolerance is a sliding scale... Some people have a "low risk tolerance" and are terrified of having money in equities because of the potential volatility - up/down swings in price - and potentially huge drops if something totally catastrophic happens like the GFC of 2008. They say that if your time horizon is < 5 years that you should be in cash. Some people have a "high risk tolerance" and place bets on wild ass stocks like in wall street bets. Of that sliding scale, I'm probably 75% toward high risk tolerance. Looking at the data, statistically speaking, the probability of the S&P500 continuing to go up an average of 8-10% is higher than alternative outcomes. Yes it will drop 10-20% occasionally after a big bull run. Then it will digest for a bit and slowly increase in value. So if your goal is to have another $100k in the next 4-5 years and you earn $180k, you need to 1) save $ 2) invest that money. If you invest it in the S&P500 and get 8+% growth, you will hit that goal more easily than if you let the money sit in a HYSA at 3.x% which will be decreasing further with rate cuts in throughout 2026. Now it's up to you to research this concept further and decide what your risk tolerance is and make the moves that fit both your goals and your risk tolerance.

Lucky_Platypus341

As others have said, holding treasuries in brokerages (SPAXX, SGOV) or in banks (HYSA, CD) are as safe as you can get. Things that hold treasuries (SPAXX, SGOV) have the benefit of being STATE tax-free. Consider CDs (I just got a 15mo at 4.2% APR) for funds you don't need for however long as PART of your holdings (do pay ordinary income tax on dividends, tho) since it locks in the rate for the term (if you think they'll keep cutting rates for a while). SPAXX is great for instant access, but SGOV (and similar) will give you a little better return (just under 4% atm). If you want to dip your toe into investing outside equities, consider close-end bond funds (like iShares iBonds) that if you hold to maturity (from 1-10 years depending on the fund) you should get the YTM rate. You can get a little better rate going corporate bonds, but there is a risk of default (small on high quietly corp) and you'll pay tax on the dividends (paid out monthly). Or you could consider setting up a bond ladder/tent for short term treasury bonds. The idea is to have the funds from the bonds maturing match when you lan to invest (or need the money). If your timeframe is 30+ years, DCA over 2 years starting now would be fine. If your timeline is shorter or you just do not want to risk it in the short term (hey, Warren Buffet has almost half his cash on the sidelines, too, so not that crazy), that's fine -- you do you. Honestly, it's better to underestimate your risk tolerance than overestimate it and panic sell when things drop.

Particular-Lake-5238

Is 35% vbtlx/HYSA normal for you? Or just because of the frothiness of the current market?

Inspectorcluseau

I get what you’re saying. Very similar for my situation. I’ve actually brought my HYSA down from 50 to now 30 and dollar cost averaged into VGT. It’s been a great decision.. so far anyway.

AverageAngling

Other guy covered it, but basically a HYSA or SPAXX/a similar vessel won’t ever lose the principal amount or decrease in value like stocks can. That’s the trade off, safer investment for lower return

Narezza

If you’re just timing the market, then find a short term CD with a good rate and drop it in there.   That way the return is guaranteed.  In most HYSA’s, the interest rate is variable, and will drop during a recession.

Financial-Respond-37

What do you mean - "HYSA and SPAXX will not."?

AverageAngling

Who knows. If shit hits the fan anything in stocks and funds is gonna go down. HYSA and SPAXX will not. No one knows what’s going to happen so don’t try to time it, just put it in a HYSA or SPAXX or whatever if you need it within a few years, and in the market if you don’t. My general rule is need it within 5 years - it shouldn’t be in the market. If I’m putting anything away for a decade from now, or retirement, it goes into stocks and ETFs not a savings vessel