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What is the best way to invest 300k without significant risks?
What should I do with the money I have and what are the next steps in my financial journey?
What should I do with the money I have and what are the next steps in my financial journey?
Experience with Private Alternative Funds and P2P?
Assuming interest rates will come down in the 2024/2025 time frame
How do I convince my wife that she is keeping too much in HYSA?
HYSA Or REIT not sure which one is the better option. Please see description below.
I have an infant and two year old and want to take the family on some sort of awesome vacation when they are old enough to appreciate it, say 7 and 9. Would creating a brokerage account for a specific ~6 year goal make sense?
What to do with $300,000 just sitting in my checking account?
I feel like I’m leaving so much money on the table. Talk some sense into me.
Choosing between a CD or HYSA to allocate 15% of investments..
Thoughts on 31yo investment portfolio - big pay raise next year and questions
Is it worth holding money or paying off an auto loan?
Short term investment/ saving options to financially support parents
Maxed Roth IRA 2024.... invest or save money held for 2025 Roth IRA?
What "asset class" has the lowest IQ investors?
Where to invest 10k leveraged from CC cash advance (5% fee)?
400K investing advice with keeping it safe as only condition
Any HYSAs that are still offering 4.5-5.5% APY other than Marcus?
I have 60K sitting in my bank account and my salary is 60K. HYSA vs ETF vs ??
Reinvesting $30k in HYSA - are T-Bills my best option?
Reinvesting $30k from HYSA - are T-Bills the best low-risk option?
Looking into CDs, but I need an explanation on if I am understanding this correctly
Can a non-guardian set up a savings/brokerage/HYSA account for minor?
Possible opportunity of a lifetime that I'd like an opinion on.
42M - Seeking Insight on My Investment Strategy
British expat living in the US. Thoughts on my investing and saving strategy
Is my retirement outlook reasonable or is this out of sight?
Starting first "real" job after graduation soon and plan on maxing my Roth IRA Contributions and enough to get my employer's 401k match yearly. I'm looking at possibly buying a house around next spring and am contemplating whether to do something safer like a HYSA or throw it in index funds/etfs.
I am afraid to stop contributing towards my investments to build 6 month emergency fund because of my portfolio manager
British expat in the UK, want to run my logic past some 3rd party people
Where should invest $125,000 as a 25 year old in 2024?
Back in 12/31/1999, I was short YHOO.......then this happened
Back in 12/31/1999, I was short YHOO.......then this happened
Where to park money for a down payment for about 1-1.5 years?
SPAXX (MMF) vs Marcus by Goldman Sachs (HYSA) Which one should I use?
Investing When Young is Always Suggested, But How Do We Know Market Will Be Strong in The Future?
Dump in large amount or slowly add into holdings?
What are your views on moving out of cash investments and into bonds, etc. at this point in time?
Investing advice for moving around 100k into ETFs
Schwab vs E-Trade vs SoFi vs Robinhood for Trading Stock
Is maxing out my Roth IRA towards the end of this year worth it?
One Year Rolling “Escrow” Investment Strategy Feedback
Max out 401k, pay off debts or keep in HYSA for down payment on a house?
How to DCA a large sum of cash? How long is too long to space it out?
If you were gifted $50,000, how would you divide it up between S&P500 and HYSA?
If you were gifted $50,000, how would you divide it up between S&P500 and HYSA?
SGOV a good place to hold cash for liquidity?
Mentions
I keep $20k in Fidelity Cash Management so I can just set up automatic credit card payments and automatic brokerage account investments without having to check my balance to make sure it has enough money in it before withdrawals are processed. It's worth getting a slightly lower interest rate vs the highest available HYSA for the simplicity and stress free banking a Fidelity CMA provides. I keep like $500 in a Chase checking account in case I ever need a physical bank location for some reason. I go 1-2 times a year.
Save $7,051.86, withdrawal $15,593.99 and deposit it into IRA or HYSA! Then wait…
Similar situation but within 20 yrs of retirement. Have a vested pension I'm plan to work out to retirement. A small vested pension that will pay me 300 a month at retirement. 401k 6% match plus 1% free (13%) it has 125k in it. Making 100k a year. According to the planners as long as I don't get fired before retirement I'm set well there status quo. I have 125k in cash doing zero (dumb). I want to break that up into a 60k emergency fund for incase of job loss. 30k for a emergency house/car/human/cat repair fund Then 15-25k for first forey into general investing Then depending on my risk aversion the remaining 10-20k in everyday spending, bills, etc. Was thinking HYSA for each of the 60, 30. Then a Fidelity for the 15k investment with something like an Market ETF or whatever that earns a better return than savings. Thoughts all around.
Do yourself a favor and set aside those cap gains taxes now. Put them in a HYSA or $SGOV until next year. Congrats on the win 🤜💥🤛
34 ETFs: Europe 27.8% North America 58.9% Asia 10.4% Emerging Markets 2.6% Other 0.4% All of that is only 1/3 of my net worth The other two thirds are 1/3 HYSA and 1/3 single stock (employer RSU)
Just retired. I have 3 years expenses in an HYSA/MM - about 12% of retirement portfolio. Going to bed, good night.
I'm 41. I have ~$162k in a military TSP L2050 fund, ~$20k in a Roth IRA at Morgan Stanley, ~$318k in a Morgan Stanley 4% HYSA, and ~$86k in a 4.25% credit union CD.
Depends on the interest rate you get. We got our car with 0.9% interest rate because of a sales event they had. So we just hold onto the money we would have used to buy it, keep it in a HYSA that doubles as an emergency fund, and make payments from the HYSA.
My HYSA is performing better than SPY
Three months expenses in a HYSA, 3 more in a money market fund - slightly better yields than a HYSA, a little bit illiquid and not as safe as the HYSA so don't put the full emergency fund into it. If the 50k is already in index funds just add to that with the rest.
You should be getting monthly interest payments on the money you've put in. You can see it under history in your account. The reason you don't see "unrealized" gains is because all the interest payments are realized gains that you will pay taxes on in the year you get them. There are no unrealized gains in MMFs, just like you don't have unrealized gains in a HYSA.
I wish I kept less than I do. While I have plenty in brokerages, with any of them 30-50% cash. Keep $20k min in checking and even more in HYSA. Should move into brokerage for investing 🙄
Only enough for fixed expenses and a buffer for fun stuff the rest goes into HYSA then investments and some spending is done with credit cards
Same, my checking is extremely minimal and applies to all the things that won’t take my Amex. $500 buffer is my rule of thumb. I use Amex savings to auto-pay my Amex card on the last day it’s due to maximize interest from HYSA.
How? $1,000,000 sitting in a HYSA alone nets you that 40k... Be better, king.
1-2 months worth in checking account, 6 months in HYSA, invest remaining
Even “holding cash” doesn’t really mean you’re in cash. SGOV or HYSA is the minimum. But yes 2.4%, 2022 and 2023 were 6-7% for the full two years. That’s still with us, and people feel inflation is worse than it really is because of that 6-7%.
Compare the rate of return of the S&P over the last year which is approximately 11%. Compare that to the rate of return on a HYSA over a similar period. You’re lucky if you get 4.5%. 11% is more than double that of 4.5% and the 11% doesn’t include DRIP.
Cash in HYSA feels great tbh. All these people talking about speculative commodities like it’ll matter.
Wait so you have 3-6 months of your EF in HYSA but then also have more EF in sgov?
There are long winded answers that you can find on this. But generally your 3-6 months savings isnt ever in your checking account. Its in a HYSA so that the interest can help against loss of money value from inflation. After you have your emergency fund and debt paid off (any debt with interest >5%) you can invest the rest. Very oversimplified but thats the idea for your emergency fund
I'm not who you replied to, but I use a Fidelity brokerage account like a checking account. So it's earning interest in a money market fund similar to an HYSA.
2 months of bills. everything else in HYSA, invested, or in SPAXX.
You make 5% in 2y. That's not infinite money that's worse than a HYSA.
Many people invest for growth in index funds and then establish a 6 month emergency cash savings. After that? Some people start saving cash in HYSA, CD or just an ordinary back account and theyjus keep adding to it and occationally I see people online with between 100K and 300K in cash. and at that point they don't know or just continue to save. People have various reasons to hold cash The ammount really doesn't mater. Why maters more. For invests some want cash to jump in after a market crash some fear a long downturn and hold much more cash. But in reality if you have 100K you shouldn't be holding any more cash. Because you would be better off investing it. Some buy grwoth index funds in a taxable acount with the plan to sell that off if needed in. But in my opinion a better option is investing it ins taxable account for dividend income . 100K invested in a dividend fund can generate between 4K a year (at 4% yield. to 10K a year at 10% yield. There are a lot of good investments from 4% to 10%. You can use dividend income to slowly replace your emergency fund .You could get enough dividends per month to cover all of your living expenses which would make work optional and retiring early possible. I discovered this possibility late but was able to retire at 55 with 5K a month of income. And I hav more than enough growths in retirment accounts.
It’s not so bad, basically just have to put half of everything you withdraw in to a HYSA and wait until tax time
Between $3,500-$5,500 My HYSA is with a different bank (AMEX) than my regular checkings (Wells Fargo) and I’m too lazy to always transfer. Because it takes about two days to hit the account from the other. So I transfer once a month. One in the beginning to transfer the “left over” balance after investments, bills, etc have been taken out and all ccs paid, If I have over $4k I transfer the overage to the HYSA and then start over again.
checking at 1% Interest: 1 months expenses. HYSA: attached to checking 3 months expenses. Anything over that I move to a higher yield money market that takes 4-7 days to complete a transfer to. My plan is keep an additional 3 months in this account for a total of about 7 months expenses set aside. But I’m in the process of remodeling my house, buying furniture, and paying for some oral surgery so I keep spending faster than I can accumulate money into my money market. Once the money market is full any extra goes into a taxable brokerage. I fully fund my Roth IRA and traditional 403b before I transfer to the money market as well.
It's not really the 10k checking so much as the "by default it goes into HYSA and the I invest some every month". That's like hundreds of thousands sitting in a HYSA for no reason. That said, having functionally 1 month's float in accessible cash is reasonable to me. But the way this person is describing things, I doubt they're spending 30k/month.
15% in short term bonds (rotating through in 3 month cycles currently, as of Q4 25). Another 5-10% in my HYSA as emergency fund that could be deployed at premium opportunities (highly unlikely). The rest is all staying the course in VT.
My investments are worth like 50% more than if I left my money in a HYSA
We keep more (25k) but our HYSA gives 5% (and until recently more) so I don’t feel as bad keeping a bigger cushion. This represents 6 months of expenses, more if paired with unemployment. A layoff early in my career has me permanently skittish about having emergency money.
$1.00 I pay everything directly from my HYSA. Which really is a couple automatic transactions and my two main credit cards.
For checking, I just keep a $1K balance as a buffer plus my monthly autodraft bill and then move money in and out from other higher yielding accounts (eg. HYSA, MMFs, brokerage) as needed. I rarely pay by check or debit and instead prefer using my credit card for better fraud protection and cashback/rewards. If I need more money in checking, I can easily move funds in and out via a mobile app. I intentionally keep a low balance as a way to maximize interest, but mainly to limit loss in case I'm a victim of fraud, such as my debit card getting swiped or a check writing scam. I also turn off overdraft protection so additional funds can't be pulled from my savings as well as leave my debit card disabled except when needed.
1000 in my bills account, 500 in my daily debit account. Those are minimums. I leave enough to pay bills and spend for 2 weeks. Everything else straight to investing or HYSA.
Yeah they are serving the same purpose basically. The main difference is SPAXX might give you slightly better returns than a typical HYSA right now, and SGOV has a small tax advantage since treasury interest is exempt from state tax. But functionally they are both just safe places to park cash. If your HYSA rate is competitive I would just pick whichever is simpler for you to manage and not overthink it.
+500 over my monthly expected cash flow, for a small buffer. The rest stays in a HYSA.
My checking account pays as much interest as a HYSA. There's no point in having emergency money if you can't get to it in an emergency.
I keep a tiered financial system. From lowest to highest - -Checking & Cash on Hand -Immediate Savings -HYSA -ETFs
Monthly bills + $50. Whatever doesn't get allocated to bills goes to investments or savings (HYSA).
I don’t use the balance of my checking as any relevant metric. It’s just a function of the amounts i have in to pay bills and certain small sinking funds. It could get down to $0 and that would be fine (more or less lol). The relevant long term balances are in a HYSA.
I have a separate checking account called “double bills” and it is a portion of my emergency fund that covers the mortgage, electricity, water, trash etc. Every month it gets a portion of my paycheck and replenishes it for the next month. Say you calculate it at $2k a month, it never goes below that, and at the beginning of the month it gets a $2k deposit putting it at $4k. Just gives peace of mind for me and is a small portion of my emergency fund while the rest of it sits in a HYSA. Further helps automation if the electric bill or whatever is higher one month. Works well for me 🤷♂️
2k when single, 4k when dating/relationship mode. I have my HYSA with Ally if I need extra cash flow (car purchase/non HSA spendy stuff)
Enough to last between paychecks in checking, then I usually have about $500 as a small cushion that is in a regular savings for quick needs. Then the rest of my cash goes into a HYSA. My goal is to have a year 6 months expenses there.
2022 bear market would've destroyed that debt for you. I'd probably just do something like a combination of short term bonds + gold/equities/long term bonds. Minimize volatility and drawn downs. Earning better yields than a HYSA and worst case scenario during a crash or bear market I'd be down 10%-15% in 6 months.
Curious, what would you do with 0% money? If you like, put in a HYSA for six months. Fear of what could go wrong, costs people large sums of money. The securities I purchase are all trading in North America's most profitable companies.
Checking - like 2 months bills. Everything is on auto pay but that means for random high expenses I don't have to move money around. I check it once in a while and move surplus to HYSA. HYSA and money market has 18 months of living expenses. My industry (tech) people are going 1+ year to find new jobs so I keep a safety cushion.
Yes I get it but the whole stuff about emergency fund in HYSA and not stocks in a brokerage is that when the emergency arise like you just lost your job during a crisis and the market is 50% down, it still hold its value and it still 6 months of expense and not 3. I agree that if your emergency fund is like 30K and you have 1 million invested, it's no big deal even if the 1 million become 500K to sell 30K to pay for your expenses while you are unemployed. You could as well just put it on margin and not sell anything. But it's not the same if you have just 100K invested, 80K in the 401K and 20K in the brokerage, there a crisis and the brokerage is suddenly only worth 10K.
As little as possible and my HYSA set to auto transfer
I have overall an extra paycheck in checking. So if I make X per month, the amount in the checking account move between X/2 and X depending of the moment of the month. I also have 6 months of expenses (in my case 3 month of salary) in an HYSA. The remaining of my assets are in various investments account and in my old primary residence that I rent. I grow the amount of money in my HYSA to cover: * bigger emergency fund seeing current conditions and that my employer started to do layoffs 6 month ago * a down for a house. So the down itself, the cost of moving, the cost of getting a mortgage and some extra margin if the house need extra work or maintenance. So instead of putting most of my saving in investments this days, I end up putting half in investments and half to grow my down/emergency/maintenance funds.
no checking. Keep ~5% of net worth in Cash Management account (basically HYSA)
Has to scroll down way to far to see this. ALWAYS keep the bulk of your funds in vehicles that make money on your money. An attached HYSA is where that is most liquid and easily transferable to the payables account (checking) Keeping the bulk in your checking is losing you money especially if you have more than a few thousand in it. 3-6 months of liquid in a HSYA, the rest in a SGOV or 4%+ APY accounts you can have access to in 2 biz days ( CD, Brokerage, EFT)
too much. I want to take our excess cash and move to HYSA. Push back from the spouse. I then told my spouse I am using XYZ checking to pay property tax. Usually, i pay it out of my account, this time, I am paying it out of one of my spouse's.
I keep about 2x my monthly bills in my checking (about $5k). Covers mortgage, cc bills, grocery, DCA investments etc. I keep a bit extra liquid in case I need it for something (like beefing up buying shares cause a specific etf dropped in price) or insurance renewals are coming up and I'm expecting a higher than normal CC statement. Otherwise, I keep 6 months emergency fund in my savings, HYSA which is around 4%. The rest in my brokerage account with dividends, etc auto invested.
Same. If I need to access cash it takes 2 seconds to transfer from my HYSA to checking.
$0, any cash I need is in a HYSA. I can transfer money to checking instantly, if needed.
Zero I get paid into my HYSA and I pay bills out of my HYSA at Sofi, and I keep primary emergency fund in short duration treasury ETFs in my brokerage account at Fidelity. Everything extra is invested for the long term.
Just enough to pay bills. Regular savings is for cash that I take out for groceries or going out and having fun. I have a money market to back up the checking. I also have a HYSA for emergencies, and then the rest in CDs for really big emergencies.
Yes. HYSA and MMF are "liquid."
In my business checking (self employed) I don’t go below $100k so I have liquidity for any unexpected stuff or to cover expenses while I wait to get paid I only keep about $500 in my personal checking I put the rest in investments, retirement, and then me and my wife also have like $350k cash in money market and HYSA because we’re looking to purchase a house
HYSA at 3.5% is solid for safety, especially if it's for a house down payment. Index funds like VOO can give higher returns but come with risk if you need the cash soon. Curious, are you leaning more toward keeping it safe for the house, or trying to grow it faster in the market?
I had a feeling leaving surplus cash in checking wouldn’t be ideal. So I can move most of that to either HYSA or Fidelity after researching which I like more. At the worst I can use my credit cards for an immediate emergency, but I do good with those and keep them at $0 before statement closes. But yes, I do have debt from my car and owe 20k. I’ll need to focus on that before I save, gotcha. Currently reading Nick Maggiulli’s “Just Keep Buying” and paying off debt comes before saving. Will research FDLXX and SPAXX considering State tax. Very good, I’ll look into my options for the 401k and Roth. I agree and prefer to diversify but can’t complain with how well it’s been doing. Taxes taxes taxes. Makes perfect sense to avoid taxes as much as possible. Will adjust my monthly savings to max out tax advantaged accounts first. I definitely jumped the gun and started saving before paying off the car, so I’ll stop “saving” and pay that off first. If i mentioned my debt in the post I’m sure multiple comments would’ve recommended the same. Thank you for the comment. You gave me a lot to research and exactly where to look. Much appreciated, thanks 🙏 🙏
That’s so cool to know about the Roth and 401k, very good I’ll leave them alone. So I guess I’m learning that my Fidelity and HYSA are basically the same thing. So now I’ll research which is better and transfer one to the other. Thanks for commenting 🙏
Alright so actual cash in BofA can be whatever you're comfortable with. I keep one month expenses plus enough to pay off whatever I spent on credit cards last month. Whatever it needs to be so that there's no risk of you overdrafting and it doesn't get so low it makes you nervous. After that get any 401k match available to you are work, in full After that pay off all debt above like 5% interest except a mortgage. After that comes savings. You are correct that your HYSA and your Fidelity account are essentially the same thing. Keep whichever you like best. This account has an emergency fund. An emergency fund is typically 3-6 months expenses. This is so if you lose your job or get injured or whatever you have time to figure it out. This can also take care of a major appliance breaking or car repairs or whatever. It's so when the worst happens you are not forced to take on debt. If your position in life is riskier (you have kids, spouse who doesn't work, unstable job situation, etc) you may want to keep as much as a year expenses here or even more. That's personal. You can also keep money here for known upcoming expenses or purchases in the next 5 years such as cars, houses, repairs, weddings, etc. If you go with the Fidelity account SPAXX would be a good place to keep the emergency fund because it doesn't fluctuate and you can get the money immediately. SGOV is a good place to keep everything else. If you live in a state with higher income tax FDLXX is better than SPAXX because it's fully state tax exempt. After that retirement accounts. 401k, Roth IRA, HSA, etc. I do not know the specifics of your pension but will just assume it's interchangeable. Really it's ideal to max these out, and it doesn't make much sense to invest in a taxable account until these are maxed. So contribute what you can. At your age Traditional is probably more tax efficient than Roth. Invest everything in a low fee target retirement date fund, or if you don't want bonds a low fee global index fund such as VT or a VTI/VXUS combo. That T. Rowe retirement date fund has reletively high fees. If it is in an IRA where you can buy anything, find one with lower fees. You want fees around or below ~0.2% ideally. Your entire 401k is currently in a US value fund. It's not the worst thing but you want value and growth, US and international. Diversification. After that comes taxable investments. Currently you are not maxing retirement accounts so I would suggest not having taxable investments. When you invest in tax advantaged accounts you get free money. Probably 20-30% more money depending on your tax rate, for free. So why invest in taxable and take the 20-30% hit? As for what you have in these accounts, there's no need for so many funds. Just buy VT or VTI and VXUS. Retirement date funds are not great in taxable because they generate a lot of dividends.
I'm still doing way better on CS skins than my "house fund" in an HYSA. A hilarious fact. But when Valve suddenly rugged everyone with a trade up contract on gloves and knives I ended up suddenly bagholding some stuff down 50%-60%. Apparently they wiped out a couple billion in market cap of items and overall stuff is down 30% or so. Now people are afraid to buy because who knows what other nonsense they will pull like that again.
Doubling your wealth in a year is not normal. Also, you should always optimize your investments and savings based on the country you are living in. In the Netherlands, you have the option to realize your gains just before the start of the year to protect it from taxes (you cannot buy back in until after 3 months IIRC). Also, a certain portion of your investment should be high liquidity assets like bonds or HYSA.
$100k is excessive to hold in a HYSA imo. Buy that house ASAP or start putting more in your 401k. Gotta remember that HYSA is safe, but isn't growing relative to inflation. That money invested in VOO will likely double in 7 years. You also don't want to be paying a lot in that 22% tax bracket. That's an auto 10% hit on any income over $48k.
Index funds are not nearly as safe as a HYSA, especially since you plan to use it to buy a house. A bear market will see your portfolio dip about 20% within a year, which can be undone if you keep holding, but only if you dont NEED that money anytime soon. Index funds have a place in long term investing but it's hard to justify if you want to protect that wealth
Learn to use SGOV instead of HYSA. Keep a super small buffer in HYSA if you want. But SGOV is a great habit to get early. Hopefully you’re using a place like Fidelity that does fractionals. Just increase your auto weekly. Maybe find an honest pro to help you. I’m surprised you can even contribute to Roth, I assume your income is high. You’re doing great!! Volatility is a feature to the weekly investor. Sell only when you have something urgent to pay for!!
Honestly, your positioning isn’t irrational it just reflects caution in a volatile environment The real question isn’t whether the market is volatile. It’s what role that $125k in HYSA is meant to play If it’s emergency liquidity or near-term spending, 4% risk-free isn’t a bad place to park it. Stability has value If it’s long-term capital, then sitting fully in cash because of volatility becomes a timing decision and timing based on discomfort tends to be expensive over decades You’re already consistently investing weekly, which is a strong behavioral advantage. The bigger decision is whether you want that HYSA money to remain a stability anchor, or gradually transition part of it into long-term compounding One approach I’ve seen work well is tiering: Core emergency reserve (untouched) Strategic cash (deploy gradually over time) Long-term equity allocation (already in motion) That way you’re not making an all-or-nothing call in a volatile market
Check expense ratios and compare the returns on these assets over the last decade to SPY/VOO/VTI on one hand and BND on the other. I personally would be a bit risk averse because I feel like be markets are overvalued but you should invest it soon in diversified ETFs (not just in VOO but also things like VT, DIA, VGK, some bond ETFs, etc) and some portion in a HYSA so you can take money out and put it in while you’re in college.
I thought about selling 5 an paying off the other 5 but then I still have upkeep and repairs and vacancies and roofs and AC units and all that stuff. It really eats into your returns. I feel like I can get more literally by just investing in the stock market or even a HYSA.
haha will be fascinating to see how much tax is actually collected. If I'm Dutch, I'm moving to HYSA and other risk free investments. The juice isn't worth the squeeze.
Keep as much as you plan to put down on a down payment in HYSA or SGOV. In a separate account begin to accumulate a emergency fund (3-6 months living expensez). Once both are funded, invest excess income/savings in an index fund (VT has a good mix of domestic and foreign investments). Consider increasing your 401k contributions above the match and up to the max to alleviate tax burden. Continue maxing out your Roth.
So sell your stock before the 50k realized gains and just put into HYSA to avoid paying 36% capital gains.
I would leave $10,000 in the HYSA for emergencies. 90% in VTI until I’m 45. Then add a few bonds.
I honestly have no idea. I'm going to max out my 401k and hsa at work and max out my IRA then I'm going to keep a little in VT/VTI/VXUS and honestly put quite a bit into my HYSA. Getting a 4% return feels great when I have no idea what is going on. I also want a nice cash pile to get in on whatever the next big thing may be. Trumps policies have killed so many jobs. Hospitals are closing. Schools have less funding. Research is dissapearing. From what I'm seeing the is making so many smaller towns less viable overall which makes me want to avoid them for real estate (rents decreasing). I'm paying attention to cities that I think will continue to thrive like NYC, chicago, San Fran, la, DC, etc for potential get in low opportunities. I really just don't know. Everything feels so backwards right now.
> Because in my experience people spend easier out of their HYSA. I don't know, someone who's been able to save $100K in their HYSA doesn't appear to have a spending problem.
I'm not criticizing but personally I don't like bonds. My Credit Union offers 3.75% HYSA and term Bank Shares. My mother has lost $50k to bonds at 88 years old. I hold a capped percentage in individual stocks that I have trimmed down.
HSA's are all basically identical except for the HYSA rate, fees, and investments available. And considering how high deductibles are and how low the contribution limit is, they are pretty shit
I was in your same position (200K and getting 5%) Also saving to buy a house. I told myself, this risk will dictate how my money is spent. I ended up investing in VT and have a 24% return on my money. Glad I made this decision, however, I made it full well understanding that the market could have dipped 30% and I wouldn't be able to get a property anytime soon. I'm OK with either outcome since my current living situation is just fine, and a house would just be a sweet upgrade. If buying a house is 100% your goal, keep it in the HYSA. Otherwise, feel free to risk it, with the understanding that's it's a big risk.
Use SGOV instead of HYSA. Generally better rate, and in my experience people spend that less. Best of luck!
Make more HYSA accounts since they usually have a cap, or just so you can find one with a higher rate.
The more net worth you have the less you need to keep in an HYSA. Stocks, bonds, ETFs are nearly as liquid as an HYSA.
That's what I'm doing. I put $400 in VOO and $300 in a HYSA every week to save for a house in 5 to 6 years. If i have to wait for the market to adjust I'm willing to wait .
Dude I am in a similar financial situation, just turned 25 but renting with my Fiancé. I had about $100k in my HYSA at the beginning of the year, slowly putting it into QQQI, VTI, etc. Going to keep like $50k in HYSA and stack it back up as we get closer to buying a home. Fiancé finishes grad school in 2 years, probably buying a year after that. Really banking on something happening to mortgage rates or home values in my area. Everything just seems overvalued right now, all things considered.
Bump the 401k cover as much of the 23.5k cap as you can stomach. If you do put $ in brokerage your HYSA should have 6-12 months of life expenses.
If you are thinking only about retirment there are very few reasons not to use an index fund. But say someone a lot of money saved up in a HYSA but they have a hard time making the 7500 roth deposit limit. you could put the money in high yield dividend fund to earn enough yearly income to insure you deposit the full 7500each year. Growth index funds are great for growth but they are terrible at generating incime. Dividend funds have higher yields than bonds which make getting significant income fromm diviend easier than using bonds or growth funds.
If you live in a state with income taxes, and you open a brokerage account and put it in a money market account like SNSXX that invests only in t-bills, you will still have the money available anytime you want it, but you will earn more interest on it because SNSXX is state income tax exempt, whereas HYSA interest is fully taxed as income.
when you have 100K more more in HYSA you should invest it. Now you could investing grwoth index funds but as long you have bills to pay you should invest for income. You stated you are making regular deposits into a Roth IRA That is an expense of 7500 a year. If you invest 100K in QQQI which pays a dividend yield of 13%, you would get about 1K a month of income which can be used: * Pay your roth deposit * Use the dividend income to pay our bills. * The dividend income would make it also easier to maintain your 100K emergency fund. * you can use the dividends to cover living expense in the event you loose a job or are unable to work for any reason * Every dollar of dividend income that is spent on covering bills will allow you to invest more income work income For you now I would consider removing some of the emergency fund to develop dividend income. 57K youwould be enough to cover your Roth deposit commitment. At that point put and equal ammount of money in QQQI and your HYSA And while you are at it invest some money in your roth for dividend income there is no limit as to how much money your investments can earn in a roth you could have 12K in dividends in your roth and still deposit 7500 per year into the roth the more money you have flowing into a roth the faster your portfolio will grow. I would recomend reading the book The Income Factory nd looking at Armchair income on youtube. I am approaching 60 and I get 5K a month from a taxable account And my roth is already able to produce the same amount of income.
One thing I'll say is I kept a lot of money in a checking account, not even T bills or HYSA, because I thought I was going to buy a place. I kept thinking that for YEARS. You sound like you're way further ahead than I was at the time, you are doing the 401k thing, etc. But just be mindful of that, if you're REALLY going to buy a place, or even want to, or think it's the responsible next thing an adult does. Also, I'm assuming you are not thinking about 100,000 being 20%, more like maybe you will put 75,000 down and have some left for closing costs, little things you need to do, furnishing it? Because even for a 450,000 place, putting 20% down, you're looking at a 2100 a month payment or so. Just pulling numbers out my butt, not sure what your tax rate is there. Plus, paying for for your car, utilities, food, etc. 70k a year is maybe 800 a week net/take home? I'd be careful. Again, maybe you're only going to use 40 or 50g's out of that 100,000 for the down payment.
Correct, except instead of a HYSA it’s better off in SGOV. Higher rates and no state tax
> The 100k is for emergency purposes and to save up for a down payment for my future house How long long did it take you to save the 100k and how long until you think you buy the house? The further out it is, the more risk you can afford to take > My HYSA currently is about 3.5% It's a not huge difference (About $500/year) but there are banks offering 4% or more https://www.bankrate.com/banking/savings/best-high-yield-interests-savings-accounts/#best-high-yield-savings-accounts The only one of those I have experience with is Vio. The website/app seem dated, but I haven't had problems with them. Their customer service is good
Bro please don’t have 100k in HYSA, 6 months expenses MAX
There is a strong possibility of a market correction this year with AI doubts increasing. Keep short term money in a HYSA.
Right. The underlying point is the banks are always betting they can earn more than the rate they give you in a HYSA via investing. So, while they’re off earning more with our money, might as well look at our personal specifics like tax rates, timelines, and alternatives (like treasury ETFs, money markets, etc.)
We are definitely losing money in our HYSA with inflation and the dollar losing value, we just don’t see it. I wouldn’t do AI or crypto stocks for anything I need anytime soon. But if you are happy on having that much cash sitting there, then fine. OP wouldn’t be here asking if they knew what they wanted.
The real question is when do you plan to have enough down payment money for house? If it’s five years or more from now, then it maybe consider brokerage. If less, then maybe still consider brokerage with a very conservative portfolio. For example, if you buy SGOV, you will beat any HYSA interest, and SGOV interest will be state tax free because it’s a 0-3 month Treasury ETF
… short-term treasuries can lose value too. And quickly. Was 2022 that long ago?? We just went thru a rapid depreciation of US treasuries in less than 1 year, but ask anyone who has money in a HYSA if they lost money over that time period. Read what OP said, they’re trying to buy a house soon. This is simple risk/reward. Why go for a few hundred basis points of upside when your downside can be catastrophic? Not worth it… objectively.