DamienWayne
Superstar
I have about 20k in savings wat can I do with it? Not looking to take any risk with it but something that can grow slowly
Why bother having an emergency fund at all?
- Thread starter winb83
- Start date
You can put that in an online savings account. Probably gonna fetch you $500 a year (2.5%). Nothing crazy though. Or, you can put a portion of it in the market and look to earn closer to 8-10% in a year.
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ahomeplateslugger
Superstar
just like @phcitywarrior mentioned you can throw it into a high interest savings account and get 2.5% back. an extra $500 a year is a nice return but you can get more if you buy shares of an ETF and just sit on it. VTI is a good and safe one to invest in because it invest in the total stock market. your money moves with the market.
The purpose of an emergency fund is to have quick access to liquid funds.
If you want to invest yours that's cool. But for most people it's impractical, also it's nice not to have to jump through hoops to get your money.
If you want to invest yours that's cool. But for most people it's impractical, also it's nice not to have to jump through hoops to get your money.
DamienWayne
Superstar
Thanks for the info, How secure is buying etf ? I’m new to stocks and investing so I’m doing daily research
ahomeplateslugger
Superstar
it's secure and common. there are a lot of articles and research saying ETFs is the way to invest since it typically pays you 13-18%.
This is a great thread and I’ve been asking myself the same thing.
My accounts are as follows:
401k
Stocks/Crypto
Savings (emergency fund)
Checking (3k-5k on average)
My 401k and stocks/crypto all have been growing but I have around 10k in my savings account that just been chilling. Only time it ever grows is from the money I’m putting in myself and maybe $400 a year from interest?
I just don’t see the point. I mean I see it, but at 28 years old I feel I can take the risk investing that 10k into stocks because had I put that money into stocks a year ago that 10k would have been along the likes of 20k.
Yes I’m taking the risk of the market completely fukking me but the market always shakes back. Even though it’s a last resort my 401k is stacking in a major way and I already have 2 to 3 months worth of living in my checking so having this emergency fund of 10k just doesn’t make sense to me the longer I keep it there.
Am I bugging?
My accounts are as follows:
401k
Stocks/Crypto
Savings (emergency fund)
Checking (3k-5k on average)
My 401k and stocks/crypto all have been growing but I have around 10k in my savings account that just been chilling. Only time it ever grows is from the money I’m putting in myself and maybe $400 a year from interest?
I just don’t see the point. I mean I see it, but at 28 years old I feel I can take the risk investing that 10k into stocks because had I put that money into stocks a year ago that 10k would have been along the likes of 20k.
Yes I’m taking the risk of the market completely fukking me but the market always shakes back. Even though it’s a last resort my 401k is stacking in a major way and I already have 2 to 3 months worth of living in my checking so having this emergency fund of 10k just doesn’t make sense to me the longer I keep it there.
Am I bugging?
I don't think you're bugging. If you'd like to grow your money, I say reduce your emergency fund 20-50% (depending on your lifestyle) and put that money into the market. I do think it's very prudent to have easy to access, liquid cash just for this thing called life.
funkee
All Star
What are some of the best ETFs to invest in? My work 401k has plenty that the advisors are already investing in, but I have personal investment accounts I need to grow. I have some VTI, VTSMX, FCNTX currently and at least 50k that I'd like to move from savings into steady positions in the market.
I agree.
Ended up doing the same thing almost an year ago.
Prided myself for years for keeping up a really big emergency fund, and never needed it.
Right now, I keep about $1K-$3K in checking.
This is something I have done for myself, but it isn't for everyone.
Ended up doing the same thing almost an year ago.
Prided myself for years for keeping up a really big emergency fund, and never needed it.
Right now, I keep about $1K-$3K in checking.
This is something I have done for myself, but it isn't for everyone.
I just see it as if I can get my net worth as high as possible as fast as possible do I really need a fund rotting away from inflation in a savings account?
My net worth is pathetic right now. About 100K mostly just in cash and investments because I don't own a home. I need everything I can to improve that number.
I take that back. The average America's net worth is way worse off than mine
Average Net Worth by Age
Not sure what you heard but emergency fund needs to be cash. It’s simply money you can access easily.
Putting your “emergency fund” in stocks and SP500 is just a plain out not smart idea to me and completely defeats the purpose. You never know what is going to happen, the market can drop overnight and your emergency fund is gone just like that. If you do want to put your emergency fund in stocks then put stop loss at the very least, but even that can be risky. Yea you may just need a surgery or some shyt and can wait for the money to transfer but I really just think that the market is not promised at all, the stock market is not even real money so you shouldn’t rely on that. As the homie up there said, keep money for growth and keep some for emergency.
Putting your “emergency fund” in stocks and SP500 is just a plain out not smart idea to me and completely defeats the purpose. You never know what is going to happen, the market can drop overnight and your emergency fund is gone just like that. If you do want to put your emergency fund in stocks then put stop loss at the very least, but even that can be risky. Yea you may just need a surgery or some shyt and can wait for the money to transfer but I really just think that the market is not promised at all, the stock market is not even real money so you shouldn’t rely on that. As the homie up there said, keep money for growth and keep some for emergency.
Depends on your appetite for risk .... 100k could be a nice downpayment for a commercial building or a business
Can we get an example of the market dropping overnight? When the market declines you can decide to pull your money. Your S&P 500 ETF fund isn't going to lose half it's value in a single day.
If your ETF portfolio worth gets to say $500K and it lost 40% of it's value in a week and you only really need a $20K as an emergency fund are you really sweating that?
Also the S&P 500 has crashed before. Guess what it's at all time highs right now. The market goes in cycles but recovers after crashes. Even if you liquidated $20K and let the rest sit there till the market recovered you'd be fine.
I've pretty much settled on the idea of keeping about $4000-5000 in liquid cash on-hand and investing the rest of my money. My monthly living expenses are about $1000-1200 a month combined right now but I anticipate them going up to $1600. I view that liquid cash as a buffer to pay bills and stuff out of. I might trim that down to about $2000-$3000.
At one point I had $15K sitting in a checking account doing nothing. It was a so called emergency fund. That's beyond the money I had in my online savings account with Discover. It sat there over a year and I never used it nor did I need it.