HYSA

NickMc53

There are a handful of HYSA paying an APY of 4.25%+ right now that beat SGOV unless your state income tax rate is like 10%.

artificial_organism

My credit union's HYSA gives the same return but I don't have to put an extra line into TurboTax for every time I move money in/out of it. 

wlaxboy1

is my HYSA account rate gonna go up

-IQ200

Cash gang we thrive! HYSA cooking.

Last-Worldliness7351

24M, making about $95k/year in the US and looking for some advice on how to position my taxable brokerage account for the long term. Current situation: * Roth IRA + Roth 401(k): \~$35k total, 100% VOO * HYSA: Usually keep around $10k-$15k * Schwab taxable brokerage: \~$23k * About 95% of the brokerage is currently in QQQ * No major debt that is affecting my investment decisions I'm comfortable with risk and market volatility. I don't see myself panic selling during a downturn, and I'm generally looking to invest for the long term. My main concern is that I'm probably too concentrated in QQQ, especially considering my retirement accounts are already 100% VOO. I like the growth exposure of QQQ, but I'm wondering if having almost my entire taxable account in it is taking on unnecessary concentration risk. The one thing making my time horizon a little difficult to define is that I may want to buy a house in the next 3-5 years. That's definitely not set in stone, though, and I don't necessarily consider the entire $23k brokerage account to be my future down payment. If you were in my position, how would you think about diversifying the taxable account? Would you keep some QQQ and start directing new contributions toward something broader like VTI? Add international exposure? Actually sell some QQQ and rebalance now? Or leave the existing position alone and diversify with future contributions? I'm mostly interested in hearing how others would approach the concentration issue and what kind of allocation you would consider for someone my age who is comfortable taking risk.

Whole-Reserve-4773

It always takes weeks or months to raise, but banks always cut the HYSA rate immediately

Aggravating_Storm835

Interest rates go up, costs of short term borrowing go up, borrowing gets more expensive, spending/investing cools, economic growth slows, inflation slows. A HYSA return is likely to increase. This is a big reason why stocks are likely to go down. If you can guarantee 3.5-4% in something like a HYSA, you’re less likely to take more risk buying stocks. Fed doesn’t directly control treasury yields. 10 year treasury yields are a reflection of future rates/inflation/growth.

ImpossiblePromise363

The easiest way to think about it is that interest rates are basically the price of borrowing money. When the Fed raises rates, borrowing generally becomes more expensive. Mortgages, business loans, credit, etc. tend to get more expensive, which discourages borrowing and spending. Businesses may invest less, consumers may spend less, and economic growth can slow. That’s largely the point: the Fed raises rates to cool demand and inflation. The flip side is that savers generally benefit. HYSA and money market yields tend to rise because short-term interest rates are higher, although banks don’t necessarily pass the full increase on to customers. For stocks, higher rates are generally a headwind, but they don’t automatically mean stocks go down. Companies have higher borrowing costs, and investors can suddenly earn attractive returns from relatively safe assets like Treasuries. That makes risky assets less attractive by comparison. Growth/tech stocks can be especially sensitive because much of their valuation depends on profits expected far into the future, which are worth less today when rates are higher. Treasury yields are connected but separate. The Fed directly controls a very short-term policy rate, while Treasury yields are determined by the bond market. Short-term Treasury yields are heavily influenced by expectations for Fed policy, while longer-term yields also reflect expectations about inflation, economic growth, government borrowing, and other factors. The biggest thing to understand is that markets are forward-looking. They don’t simply react to “Fed raises rates = stocks fall.” They react to what happened relative to what was already expected. If everyone expects a 0.25% hike and the Fed hikes 0.25%, there may not be much reaction because it was already priced in. If they unexpectedly hike 0.50%, that’s different. Likewise, they could hike 0.25% and stocks could rally if the Fed signals that future hikes are less likely.

Non-mon-xiety

Dunno about you but I’ll at least be happy to see interest rate in my HYSA go up after the rate hike tomorrow

DanTaude599

Fwiw, take the 401k match, then build the 3-month cash fund in a HYSA before ramping investing back up. One lighter year out of 35 probably matters less than being forced to sell stocks during a layoff or car repair.

Big-Instance-7750

Assuming you have around a 20% savings rate which is very strong for a younger saver, there are some strategies that you can incorporate outside of the typical rule of thumbs. First of all, I would at least have a month's worth of expenses in a HYSA so that every little unexpected expense doesn't make you go into debt or into your investments and make sure you are saving enough into your 401K to get your employer match. After that, you could prioritize your Roth IRA and keep the funds in safer assets like money markets since contributions can be withdrawn tax/penalty free. Then whatever is left can be added to your emergency fund until it's the size you want. You only get one chance per year to contribute to your Roth and those early years are so valuable. If you don't have an emergency, you've taken advantage of the Roth's tax free growth. As your emergency fund grows, you can start investing more aggressively inside the Roth.

These_Country_7689

You have lots of runway to take on volatility and risk but always keep some liquid in something like a HYSA. It can serve as a emergency fund while still getting 3-4% to mitigate inflation

Longjumping_Iron8826

I never had an EF when I was young. Didn’t make much back then and wanted to get started compounding. If you need to sell some equities in an emergency so be it. If you need to sell at a loss, fine, it will help your tax return. As long as it’s in an account you can access (post tax), start investing now. My daughter had a good amount m HYSA earning 3% for her some day house. I’ve pointed out how much she’s passed up doing so. But she also puts money in her 401K and Roth, so at least she’s doing both. Maybe try that route

Massive_Charity_7198

This is why I full port HYSA. I beat the average Nvidia investor 😎

Silly-Interest1977

What should I do with $600? Hey all, I have $600 saved from random income, gifts, extra money I had, etc. I have a roth IRA and standard savings account with Citizens (through my account). I want to invest this money into the best way possible. As a recent college grad who is finally not broke, yes this is a decent amount of money for me and I want to allocate it in the best way. HYSA? For reference, I'm a year out of college, living at home working full time with some hefty monthly student loan payments, and of course gas, groceries, etc. - I would love to move out into my own place within a few years, which is my main savings goal right now. Need advice, TYIA

Stonk_Trader69420

i'd like to see 5% HYSA again...

No_Presentation9490

an HYSA yielding 4.5% or similar on a 1.8M balance is not the same as your average joe with only 250-300k in an HYSA In 10 years that risk-free 4.5% on 1.8M is 1 million dollars. If fed cuts interest rates you can start looking at equity markets but if you have 1.8M I'd be looking at capital preservation, not aggressive positioning, right now.

cmmargulis

Hey Dummy, maybe I have money and don't want it eroded by inflation or would believe a higher yeild on my HYSA and CDs is long overdue

dope-a-meanie

If I’m understanding your argument, you’re saying money is money. Why not just keep it growing? You’re not incorrect in your thinking, in my opinion but the point to an HYSA is ease of access in case of an emergency. If you decide you can get the same effect using credit cards and maybe a small savings account for that odd check writing situation, yeah go ahead and just use the market.

Departure_Fun

Let's see, we have wars driving energy prices, circular economy between hyper scalers and chip/memory guys, impending AI labs IPO, Elon holding 1T, midterms, AI bubble and AI related layoffs, high inflation, Tarriffs - no matter how you see it, we are screwed. Best is to go back to fundamentals, raise cash and have it in HYSA for a 12 month cushion, sell off risky bets or minimize and stay the course. Just close your eyes and pray all this is over in 1-2 years, so we can get on with our lives.

Sensitive-Exam649

The brokerage equivalent to HYSA is money market account. Money market accounts are insured like HYSA. But since a money market acount is in a brokerage you can use a dividend investment to fill your money market account. For example you can put money in your taxable brokerage into a fund like QQQI 13% yield and it tax efficient. . So you could gradually build up QQQI so that is has 57K invested. At that level the yearly dividend is 8K. Which is enough to deposit into the Roth without using your work income to make the deposit. To get enough interest from a HYSA to get 8K you need to invest 200K. So with QQQI in your taxable account you you could turn off dividend reinvestment so the sad dividned are not reinvest and show up as cash in a money market acount. Eventually the taxable account could be also used as your HYSA. with QQQI filling the money market account. And at that point you won't need to put your work income into your Roth or your HYSA. And if you count to build up the dividned income with QQQI or other dividned funds you could eventually get enough taxable income to cover all of your living expenses. And you can have growth investment in your Roth I have QQQI, SPYI, BTCI, KGLD, EMO, UTF, UTG, PFF. to maintaning 6 month cash emergency fund and enough income to cover all of my living expenses (about 5K a month). It allowed me toretire early.

BugHistorical1614

For comparison: We have a very small 6mo, late June purchased CD @ 4.0% apr, at local regional bank. We have laddered 3 & 4 yr MYGAs, 5.0-5.2%. Last purchase July. Low band, A,A- rated. HYSA @3.3%. I'd like to move this to brokered MM to get 3.9%. However, it's not a worthwhile battle, at this time. CDs and MYGA are principal and interest guaranteed. However you lose liquidity and incur interest rate change risk. Retired. 76/79. Multiple income streams.

Cultural-Ad678

There’s no difference in tax treatment with bonds and a HYSA there is with treasuries and munis tho

__redruM

At the very least 100% SGOV, but some portion in index funds really makes sense. SGOV is basically a HYSA without state taxes. VT or VOO, at even 25%, would be safe, as in never go to 0, and would demonstrate what stocks return compared to a HYSA. A good HYSA does 4%, at best. VOO is up 11% this year so far and 16% on the 1 year. That’s 4 times the return for a low risk index fund. Baby boomers and GenX know this trick and how to make generational wealth from index funds.

LuciusQ2020

In your case, I would move the money to a brokerage account like Schwab and buy one year treasury bills with auto-roll. In MA, you pay 5% income tax on the interest you earn at HYSA, but not on the interest from treasury bills. Municipal bonds will avoid federal tax but they have complications like interest rate risks. I would only keep $50K cash in a HYSA. In what situation would you need that much money immediately? Almost none. In a pinch, you can sell your treasury bills to get money in 4 days.

winterrules91

I would just sell cash secured puts on that cash every week. It'll blow HYSA interest out of the water. They're taxed at the same rate too so why not just make more money!

Grendel_82

SGOV for now. It will be as safe as HYSA, better tax treatment and better interest earnings. Don’t invest until you and wife are emotionally ready to buy and hold through a paper loss of value (meaning your investment went down in value, but you haven’t sold it to lock in the loss). All the advice in here is worthless if you are going to sell in fear at a market drop/crash. And lots of folks will do that, so no shame. Just recognize that you might do that.

agaunaut

Unless you need immediate access to the money treasuries are going to provide a better rate and are state tax exempt. That means 5% less tax on gains in Mass. I would suggest taking whatever amount you are comfortable not being able to get at instantly and buy a 2 year treasury. A 2-year comparison gives you: * HYSA: $554*24 = $13296 (with full state tax burden). * 2-Year treasury: $200K * .0463 * 2 = $18520. That's an extra $5224 over 2 years and a lower task burden as well.

PhiladelphiaLawyer

You didn’t mention yields but the difference in yield + tax treatment between a HYSA and bonds on $200K probably won’t make a worthwhile difference if it gives your wife anxiety. If your retirement horizon is 6-7 years it would be risky to invest it in equities. I don’t think your wife should worry about investing in bonds but I’m considering my own situation and HYSA v. bonds + potential argument seems like picking pennies up in front of a steamroller. You may consider maxing your wife’s 401K contributions regardless of how it’s invested. Her plan may have the equivalent of CDs. You contribute 24.5K/year pre-tax then draw down the inheritance as “income”. You’re saving taxes on 24.5K of income and you have 24.5K invested when drawing down 18-20K from the inheritance. (depending on tax). It’s like self-generated leverage with minimal risk.

MikeWPhilly

Do some research on inflation and show her the money. The HYSA is literally 3.32% and barely keeping pace with inflation. So all you asre doing is storing your money to stay flat. That means it’s not helping you with retirement, it’s not helping you with anything. It’s just $200k. She does know her 401k is in markets too right?

itsallmeaninglessto

She invest in her 401k. So she ain’t that scared of investing in stocks.  Slowly peel some of that off and start putting it in safe investments. Not a HYSA.  

zwizzardz

If you’re not in a position where you have enough extra cash every month to invest, then you might as well just park that money in a HYSA. You’ll never get over your jitters unless you can build up the investing muscle by making it a repeated event in your life.

Forded_Fiction24

I'm up 31% YTD on my portfolio which contains some AI investments. Not sure what you're talking about "not profitable"  You can always settle for 4% in an HYSA though I guess

phd2k1

Personally, I would lump sum $120 into VOO, and keep the other $20 in a HYSA. You could go 100/40 if you’re more cautious and want more liquidity. Definitely don’t just sit on the cash though.

Cristian_Cerv9

I would 100% place that gain all onto an CD or HYSA. Or in NVIDIA if you’re feeling crazy and can just hold for months

Valkanaa

I think a lot depends on *what* you have in your brokerage. I have some components like BRK.B that are unlikely to cliff dive in value. I have other stuff that will likely sell off...but I don't have to sell those if I have stable assets available. The other factor is leverage. If your brokerage account is sufficiently large you can borrow against it and strategically sell equities during upswings without worrying about being called. I have not even considered the "cash drag" of a HYSA in recent years, not when I can get a margin rate @ 4.5

ThatAmericanGyopo

If you're this scared, self-admittedly, you need to park at least half of your port into a HYSA or a CD where you can't touch it without severe penalties. You're going to be trading your pride and emotions, not your edge or "system" (as others have said: you're absolutely gambling - you got lucky this time but over a large enough sample size, you're going to blow up your account). Don't end up next year making one of those "I had $400K and lost it all, don't be like me.."

soquelrocks

I'm in the same boat and mindset. Retired, 401K rolled to Vanguard IRA - do I just jump in an invest it all in VOO or do I keep it all in a HYSA and pounce when the perceived correction occurs? Also have a lot of cash, but put that in eTrade getting 4.0%, and will be able to jump in. I don't know if anyone else has seen these "Structured Capital Strategies" from Equitable, but they offer downside protection 10%-20% in return for rate caps. I have one that gives me 10% downside protection if there is a correction (they eat it), but max I can get is 12% return (based on S&P 500 index). First year ended July 31st, got the full 12%. Had I just done directly in a S&P 500 index (like VOO), sure I would have probably gotten 18%+, but I like that market correction protection. Downside of course, you better not need that principal for 6 years (it is an annuity).

Intrepid_Cup2765

Just because an ETF fund is large, doesn’t necessarily it means it has massive liquidity. I actually don’t know where SGOV sits, I used to hold some as a HYSA years ago before i started using a SBLOC. Some ETF’s are large and have small liquidity requirements, this only matters for large institutional investors typically, and I normally don’t give a rats ass about it. Relative to the news today, it appears everyone’s temporarily moving into cash (days like this are a good day to buy!) as everything I track (except oil) is in the red. So perhaps the ETF liquidity is lower for the day because of so much selling going on in that end of the market as well?

No_Debt5142

lets all assume the worst. that will get us ahead in life. being 100% in broker has allowed me to diversify too. i just dont have a HYSA. ive diversified with real estate, businesses, bonds. not like ive been holding stocks only for the past decade although if i did i would've had way more to play with.

StepAsideJunior

Think of it this way. The HYSA emergency fund isn't there to grow your wealth. It's there to ensure there are no disruptions to your portfolio. Realistically speaking the larger your portfolio the smaller your Emergency Fund can be. Taking an emergency 20k from a 1 million dollar portfolio is less devastating than taking 20k from your 100k portfolio.

Intrepid_Cup2765

Welcome to the club that most people will never figure out. I ditched my HYSA 2 years ago and haven’t regretted it one bit. I use a SBLOC now for liquidity so i can separate when i decide to sell stocks as well.

greytoc

I don't believe in using a HYSA - so yes - you can keep your emergency fund in a brokerage account. The hugely important caveat is what your emergency fund is invested into - if you are holding treasuries, investment grade bonds, short duration or laddering fixed income products - that's probably a reasonable approach. But if your emergency fund is purely in growth equities - that can be a lot more problematic. There's not going to be a perfect answer - and it's going to depend a lot on a person's financial obligations, net worth, and risk tolerance.

markbraggs

Fun fact $1 million sitting in a HYSA will yield you about $35,000 per year for just sitting there, which is what someone who works full time makes in California minimum wage.

charleswj

If you've already maxed your Roth IRA for the year, say on Jan 1, any money you save/accumulate until next Jan 1 has to go somewhere, so your choices include brokerage, HYSA, mattress, etc. It has to go *somewhere*. On the next Jan 1, you take it from that somewhere and contribute it. The only other option is to not contribute Jan 1, which is ok, but OP doesn't want to wait.

SnS2500

Next year you can take money from your brokerage account just as easily as a HYSA. Assuming you have emergency cash, there is no reason to put money into a HYSA that you want to invest.

DoinIt4DaShorteez

is the Roth at the same place as the taxable brokerage? if so, just put it in the brokerage account so it's ready to go on Jan 1. buy SGOV in the borkerage if you want and sell it on Dec 29 or 30. whaddaya gonna get on $7500 in a HYSA the rest of the year? $70? if the Roth/taxable accounts are in the same place, put it in the brokerage and take a nap for the rest of the year

Vegetable-View-5114

For saving specifically to max out a Roth IRA next year, a high-yield savings account (HYSA) is generally the safer bet. The primary goal here is capital preservation and liquidity, not aggressive growth, because you'll need that cash relatively soon. While a taxable brokerage account offers higher potential returns, it also carries market risk; I've seen years where a 12-month investment horizon in the market would have meant less capital at the end, not more. The tax implications on short-term gains in a brokerage account would also eat into your principal more than the interest from a HYSA.

Worry-Mountain

If the Jan 1 Roth contribution is a hard requirement, I'd keep that slice in the HYSA. The taxable account only makes sense for money you can leave invested through a drawdown; otherwise a bad December can force you to sell at the exact wrong time. I’d separate the buckets: earmark the Roth amount first, keep the emergency fund distinct, then invest any surplus that's genuinely long-term. Since you're already maxing the 401(k), the main tradeoff is flexibility vs. giving the Roth cash a few months of market exposure.

Realistic_Farm_3558

If the goal is definitely to max the Roth on Jan 1, I’d keep that money in the HYSA rather than investing it in taxable.

Ok-Spell-6812

I’d lean toward keeping enough in a HYSA for your emergency fund, then investing extra cash if you have a long enough time horizon. It really depends on when you’ll need the money.

Direct-Stuff-2469

Not saving a ton after setting aside my fixed monthly stream of investments into taxable, maybe $3-600 of excess money from undershooting my expected monthly spending I budgeted. I have some money in an HYSA already (not an emergency fund) but setting aside some more would allow me to max out Roth on Jan 1st. I am currently maxing out 401k. Any reason you suggest putting excess into taxable and just process to start fresh on Jan 1st? Thanks

ahighkid

Half into a HYSA, half into $SPY

PossibleConclusion1

This is true, but I have enough in a HYSA at any given time that I can pay my bills until a CD matures and then I can use that until the next matures. It's not going to make me rich, but it gives me peace of mind.

Nugggggyo

Keep that in a HYSA account or brokerage money market as part of your emergency fund. That might get you 3%. Choose your emergency fund amount (3 months/ 6 months). Everything over that amount start to slowly invest. As your emergency fund grows keep taking the extra above your number into your investments. I wouldn't jump into throwing it into one fund right now at once. A little bit at a time over months.

Macktologist

I’ve recently looked into where to park money with little to no risk and found the option for a broker held money market savings in lieu of a bank HYSA. Slightly higher interest, and no state income tax on the interest earned. Main difference is how they are backed. HYSA by FDIC and the broker account by federal government. Not sure how those differ and still deciding. I’m currently considering VUSXX instead of Capital One Performance Savings. Another positive is having the money more directly available to sweep to my cash fund with MS/Etrade should I be buying positions. OP may also want to look into this option. I think the minimum deposit is $3k.

Puzzled_Capital_5592

$45k? Put $10k into a brokerage and leave the remainder in a HYSA or SGOV as an emergency fund, and feed the interest into the brokerage.

FreshDiamond

The absolute bare minimum is that it should be in a high yield savings account not your regular bank account. I personally would keep 15 -20k in a the HYSA and dump the rest into an index fund, or etf all at once. Some people will tell you to DCA, either is fine but it’s just as likely that you will cost yourself gains by doing DCAing as not. Again in the long run either will work out fine but I would just lump sum it

MaddRamm

Are you planning on any big purchases soon like a house? If so, don’t risk it losing value in the market and put it into a HYSA. Those are typically earning 3.5-4% right now. Also, if you wanted, you could put it into the taxable brokerage account and just invest in SGOV. It’s an ETF that invests in short term bonds/treasuries and holds its value and pays about the same as a HYSA, maybe a little more. But if you don’t really see yourself needing it within the next 3-5yrs for a down payment, by all means, invest it in the market.

Austanator77

20k in HYSA for an emergency fund 6 months expenses+2k for any emergency repairs. Then invest the rest

NTP2001

Keep 30k as emergency. Make sure it’s in am HYSA, not checking account. Move the rest you investments (preferably low risk broad market etf).

HaiKarate

Pay off all credit card debt Put some in an HYSA for emergencies; quick access if you need it while earning a decent rate. Open a Roth account if you haven’t already and contribute the annual max ($7500 if you’re under 55). Put the rest in a brokerage account. In both accounts, invest it all in a reliable long-term ETF like VOO.

FactorDad

Not financial advice, but you are in a fantastic position. With $2,200 in monthly free cash flow and a low-interest car loan, you have the perfect setup to accelerate your compounding. ​Here is exactly how I would optimize that idle cash: ​Keep the cheap debt: At 2.9%, do not pay off that car early. You can earn more than that risk-free in a standard High-Yield Savings Account right now, and significantly more in the market. Let inflation eat that debt for you. ​Right-size the emergency fund: Your baseline expenses are $3,000 a month. Carve out $15,000 (a solid 5-month runway) from that $45k and park it in a HYSA. That protects your downside. ​Deploy the remaining $30k: You now have $30,000 of pure investable capital. First, max out your Roth IRA for the year to lock in tax-free growth. Push the remainder into your taxable brokerage account. ​Avoid cash drag: Since you don't have any big purchases planned, keeping excess cash on the sidelines is just losing purchasing power to inflation. Get it working in broad, low-cost index funds. ​Once the capital is deployed, the next step is optimizing your asset allocation for long-term growth. (I actually document the granular math and trade-offs behind building a multi-fund factor portfolio on my channel—feel free to check my profile if you want to explore the architecture!) ​Is your current $20k invested entirely in a standard taxable brokerage, or have you already opened and funded a Roth IRA?

MayaIsSunshine

HYSA can beat 2.9% with no risk at all

siuzy

Well a HYSA is risk free, so your advice is simply incorrect

MyWorkComputerReddit

Is it at least in an HYSA? If not, I would put it there.

loIll

Rather than make a bunch of assumptions, give actual investment advice in the investing sub. OP could throw half into the SP500 half into a high yield savings account for 3.5%. Or even throwing it all in the HYSA is a better idea than yours.

PossibleConclusion1

I have my investment accounts, but I keep about a years worth of expenses in a few CDs. It gives me a relatively liquid asset that earns more than a HYSA. It personally helps me feel less stress than having everything tied up in investments I would be even further stressed out having to sell if I were to lose my job or something.

galvinb1

Is it on a checking account? My emergency fund is in a HYSA so it at least keeps up with inflation. I keep 6 months of my current take home pay in there.

hymie-the-robot

diversification depends on your age and risk appetite. I'm old and I need to preserve what I have, so I hold multiple asset types (in portfolio theory, we look for assets that have low or negative correlations). this is safe, but return is low. as a young person, you want to grow your wealth, and you may just look to hold different kinds of equities. if I were young, I would probably want to moderate my exposure to IT, but you wouldn't be wrong to just hold the market. if you want to ensure funds are there within 18 months for property, it's a good idea to use something like a HYSA, because you never know if the stock market will decide to shed 25% along the way.

BatCleanUp

Got it. This changes things for me. It also may be in an area you may not be interested in living. I'm kinda on the side of selling now. You can always reduce price in accordance with the buyer fixing these things. If the house is otherwise good all around, this isn't much of an issue and saves you the hassle of managing projects away from where you live now. TBH I think I'm 70/30 in favor of selling the house. Maybe keep $200k of proceeds in HYSA/emergency fund for a few years until you figure kids/job/house out.

Dr_Zoonotikstein

$9M capital at today's rates generates an easy $350K per year in HYSA or CDs, without tapping into principle. Any further risk-taking action explains why you are still posting in WSB.

booyah474

If you have any extra $ just sitting there, why not look at some long shots or penny stocks? I have a HYSA, 401k, and individual IRA. I usually have some $ left to play with after bills are paid and my “savings” accounts are funded. I enjoy going to the casino from time to time so I see nothing wrong with taking a few hundred just sitting in my brokerage and looking at some long shots. It’s how I managed to snag AMD at \~$2, I just wish I got way more but at the time I spent what I felt comfortable losing. I’ve had some dogs (SPCE from several years ago, ouch but fortunately not that much). I don’t see what I do as particularly risky.

LoveIsOnlyAnEmotion

Yea my personal portfolio is strictly my extra money that I don't want sitting in a HYSA. I also have my Roth IRA and 401k at work too. I'm actually any to backdoor my Roth too.

chronicpenguins

There are people out there who don’t understand how people have such “high” risk tolerances for people who buy index funds/stocks  in general? Why risk it in the stock market? Put it in bonds instead. Then, there are people who say why bonds?  HYSA much safer. Then there are people out there who say HYSA from shady neobank, normal bank less risky.  Then, there are also people out there who don’t think banks should be trusted with money at all. Put it in a shoebox, under your bed, much safer. No one else’s touches your money but you.  So once you ask yourself why you put it in the stock market at all, instead of in a shoebox, and accept that people have different goals, emotion response, and personalties, maybe you will understand. 

RuleSafe6767

2.5% in a day? I'll take it bro. At a bank HYSA, that same $800 only earns 1.3 cents every two days.

VarietyLocal

HYSA at cit bank is 4%

UpstairsCheetah235

No they’re not. They have t-bills or a HYSA that pays more than that.

MetalCharacter8431

Lot of options you could go with and there isn't a right answer. If you like playing it safe, park that money in a HYSA through midterms. Midterms historically cause the market to decline quite a bit from uncertainty where policy and agendas can lead us in the future, while on the other hand, many large gains and increases are seen in January with annual filings and sales/purchases made along with tax season. I'd recommend letting it safely build then entering late November /early December.

ap1618

How do people build money in their 30s? By saving bro. You are deferring a lot of cash to the market for tax advantages that would otherwise be creating that savings stack. The plan you have is smart but the answer to your question is to save as much as possible of what’s left of your take home now and chuck it into a liquid vehicle like a HYSA.

SurpiseCurrencyDebas

full port into cash 3mo/6mo cds at the bank and HYSA loaded

silverfisher27

The S&P is up 250% in the past 10 years, so it's not really helping your point for investing in dividend stocks when your own example is lagging behind so much. I'm sure they will be fine as a company, but I'm just not sure how I feel about recommending that stock as an investment just because there's a 3.5% dividend (which is basically the same as putting your money in a HYSA).

GailaMonster

even the 26-week Tbill is over 4%, and that is free from state tax as well. I'm not saying that's making money (that's basically just an inflation hedge), but my HYSA pays 5%, and I frankly suspect the market is set to absolutely tank in November (if the GOP eats shit - and they should if there is election integrity, just based on public sentiment - they will encourage a severe downturn on the markets and immediately try to blame the other guys, because that's a classic move in their playbook). I am not a "time the market" person, but I do have dry powder (growing my family and looking to sell/buy a house in the next 18 months) and i'm not feeling terrible about it sitting in HYSA/Treasuries these last few months...

No-Improvement3164

Leg and Thigh day at KFC. I’m taking my HYSA interest and getting a couple buckets of original recipe.

InvestingNerd2020

In your 401k with pre-taxed money, one Target date fund with an expense ratio of 0.30% or lower. Hopefully, a 2065 fund. After employee benefits and taxes, try to put some money away into a high yield savings account (HYSA) for emergency savings. Make sure it has 3% or higher interest rate. Try to shoot for 3 months of your routine monthly expenses. This will keep you from touching your investments during hard times. Examples: Marcus, Amex, Ally, or Capital One to name a few. An Alternative emergency savings option is a Treasury bond fund that protects you from State and city taxes on interest earned. The only downside is the money isn't available on weekends. Popular options are SGOV and VBIL. After building up emergency savings, start investing into your Roth IRA. Assuming it is with Fidelity, invest into two index mutual funds. - FZROX with 80% allocation. - FZILX with 20% allocation. These two funds offer zero expense ratio and a good track record since inception.

mehdizare

Since the settlement is allocated "for social security purposes" at $880/month, SSA usually just offsets against that number rather than the lump sum, so ask them in writing to confirm the offset amount and the months it covers - having that on paper saves fights later. Timelines for processing are slow and uneven; keep a copy of everything you sent with dates. Park the lump sum somewhere boring (HYSA or T-bills) until the offset is settled, then invest what's left.

BarefootMarauder

Using the 4% rule as a general guideline (NOT a hard & fast rule), you could safely pull around $11,200/year from a portfolio of $280K without fear of running out over a ~30 year period. If you need to spend $1500/month, and you get $410/month from SSDI, you're still pulling more than that (~$13,080/yr). The 4% was recently updated to something like 4.6% now, which definitely gets you a little closer. The 4% rule is also based on the assumption that your portfolio is invested in the market at roughly a 60/40 split stocks to bonds. There are a lot of other variables and nuances to it, so I'm speaking generally. Putting all the money in CD's, HYSA's, or other cash-equivalent investments isn't going to cut it because you'd essentially just be keeping up with inflation. Growth comes with a certain amount of risk. If I was in your situation, I'd probably keep ~3 years worth of living expenses in cash-equivalents (a good MMF or a decent ETF like SGOV), and invest the rest in low-cost total market index funds such as VTI/VXUS or similar. Something like an 80/20 or 70/30 split -- that part is up to your comfort level with international investments. If the markets continue to do well, you can pull profits off the top for living expenses. If we go into a bear market, you can live off your cash bucket until things start to recover. But it gets a little dicey if we would go into an extended bear market that takes longer than 3 years to recover.

enigman83

Usual recommendations is as follow: 1) emergency fund, 3,6,12 months of expenses. HYSA or the like. 2) Tax advantage investment. 3) brokerage account for flexible expenses, but beware of tax obligations when trade. You don't need best portfolio, or at least not yet. Point is, no one can say what really best base on your situation, risk level, or other concerns (house payments or insurance or family to name a few) I would suggest a relatively simple investment, such as 60 stock 40 bonds. You can adjust to be more or less aggressive depending on your risk tolerance. On stock side, go with VT or VTI+VXUS. Is there a better choices? yes there could be, but starting with something simple doesn't hurt. You want to grow your assets with the market, then learn more if you want to take more risk.

Spiritual_Plum581

At 22, I think your biggest advantage is time, not your ability to perfectly time the market. If the money is truly long-term retirement money and you already have a sufficient emergency fund in the HYSA, I wouldn't spend too much energy trying to decide whether this month or six months from now is the perfect entry point. One thing I would think about, though, is the allocation itself. VTI already gives you substantial exposure to the large tech companies that dominate QQQM, so adding QQQM isn't really adding much diversification — it's intentionally increasing your concentration in those companies. That's not necessarily wrong, but it should be a conscious decision. At your age, consistently funding the Roth, keeping costs low, staying diversified, and continuing through both bull and bear markets will probably matter far more over the next 30–40 years than whether you lump sum or spread this particular contribution over a few months.

OkBeat2138

The ETF (non US) I'm invested in has 15% exposure to tech, all of which isn't AI. The rest is financials, energy, health care, manufacturing, real estate, industrials, spread across over 13,500 stocks in ~35 countries. Not sure you can get more diversified than that. I also hold rental real estate, precious metals, Bitcoin, and best of all, a healthy cash reserve on a HYSA. That being said, I do plan to move my equities into a 60/40 equity/Bond ETF this year as retirement is planned for 2027. But either way, I've been through multiple market crashes, didn't attempt to time those and I don't plan to try to time any future ones. You aren't doing the Lord's work, your advice sucks and is tailored based on a couple comments I made which are a tiny sliver of my financial position and life.

TheCheez-It

They know rate hikes won't happen and inflation will remain above the HYSA rate.

__redruM

Ok, so do $10k a month? Or $5k a month, but at the very least get started. Is the money market account giving you over 3%? If not then there are HYSA that can or even SGOV that does over 3% with some tax advantage, depending on state. I’d move it all to fidelity, stick the bulk into SGOV, with $10k in VTI, then slowly migrate from SGOV to VTI until you’re happy with the allocation.

Nope_______

One for expenses, one for savings, one for my spending money, one for wife's spending money, an HYSA, another HYSA because they had a promo deal, another HYSA because I haven't bothered to consolidate them. One for house maintenance savings,one for pet expenses savings. Brokerage for our investments, brokerage her pre-marriage investments have just stayed in, brokerage for my play account. I'm not even rich rich. I don't think this is at all weird or suspicious in the US, I guess it's different in the UK.

ejunior1234

He wants you to stick it in bonds or a HYSA.

daygo449

Listen to the Rich Habits Podcast. I think it would help you. One thing I was going to say is keep 3-6 months for your emergency fund in your High Yield Savings Account. I’d pay off any debt you have assuming it’s high interest debt or really anything over 5%. Take the rest of the money, and dump it into index fund ETF’s in a brokerage account. This way you can still access the money if need be. I’d look at VOO, VTi, QQQM, VXUS, or something like that. Continue to put money into your URA and max it out and continue the custodial account as well. You might want to look at a 529 Plan to help with tax burdens too. I’m not sure where you are with your retirement account, but if you’ve hit $100K at your age, you probably want to start diversifying as well. It might make sense to get a CPA to help you with tax advice, and maybe look at doing an hour or two discussion with a financial advisor to help you with structuring everything. You don’t need to invest with him, but just to get guidance around what to do and where to put things. I think it’s worth a couple of grand, probably less, to figure out where you stand. They can help you get on the right path to hopefully get your net worth up without risking anything or spending too much. I’ll end by saying there’s nothing wrong with leaving your money in a HYSA, but your money is at best gaining a 3-5% interest rate vs something like VOO which will land you 10%+. You are young enough that any investments you make, even if the market dips bad, it will probably never hurt you. You have time to recover. If there are dips, you keep buying because you know it’ll go up again, and you’d have bought while everything was cheap.

Flying-Bulldog

I use Fidelity and Merrill Edge. Have a Roth with Fidelity and use Merrill just as a place to stash any extra investments. Keep an emergency fund and anything needed for a large purchase like a house or car in an HYSA. Invest everything else

Pristine_Fix_3047

I see the BIL average return is 3.6-3.8%, at that rate aren’t I better off in the HYSA?

Dramatic-South-6236

I had 50k and I asked a financial advisor who, given my inexperience in stock market, suggested me to put it into a 3% HYSA. I decided to invest it myself instead and I lost 50% of it in 18 months because I couldn't stomack the downtrend when Trumpnstarted talking about tariffs. I finally learned my lesson and now I am just 30% down. However, once you lose money it is very hard to recover. I suggest you put it on a HYSA and wait tonsee what happens in November after the elections. It may go down and give you a good opportunity to enter the market. It is not true what they say about "time in the market is better than timing the market". My opinion is the opposite: "Timing the market" is gold, if you start going up from the beginning, you will be able to make a lof ot money.

MarkofCalth

Everyone says dump it, but there’s some things to consider: \-do you already own a house? If not and u plan to buy in the next 1-2 yrs, leave it in the HYSA as a down payment. \-do you have emergency savings? Not talking a couple thousand, but 4-6 months of true all expenses covered in the event of an emergency/lay off? If not, build that first. If you already have both covered, then invest the remainder.

InvestingNerd2020

As others have mentioned, invest into an ETF within a taxable brokerage account. My recommendations would be VT or VTI (not both). Leave $50k in the HYSA and the ETF choice you want with the extra $50k.