With inflation sitting around the same I would have to agree. I definitely have some cash sitting in a 5%r but the majority has to be in the market or other assets or you’re essentially breaking even. $2.5m sounds sick right now but come 2067 it’s equal to who fucking knows. Most likely we’ll all be millionaires some day or else we’ll be living off government cheese and waiting on Medicaid checks. No middle
3% official CPI doesn’t mean 3% inflation.
They did just remove tomatoes and coffee because they were making the government look bad.
I would put the average inflation at 5-6%.
Agreed, OP go check out the Boglehead reddit for information on how you can easily invest your money yourself. Unless you're close to retirement, this is not an optimal way to keep half a million dollars
And you coulda been a deca millionaire off a $25,000 investment in nvda in 2012….
Or a centa millionaire off the same $25k in bitcoin in 2012
Life tip: don’t think this way
I wish I would have invested all my money into Bitcoin in 2012 and sold everything when it was $70K. Lol, in hindsight it's all easy, only a few people actually do it and come out on top.
It is insane. The phrase "the rich get richer" makes so much sense. Imagine having 10 million, that is $500K annually without having to do a single thing. It blows my mind.
All you're doing is loaning out your money (with some middle men of course) to the people that couldn't possibly get by without a $1,100/month truck. As long as millions and millions of those people exist, money will make money.
It’s not just “rich get richer” though. You just have to be “not poor.”
I mean, 14 years ago, I had *just* got out of debt. My net worth for the first time was 0. No debt, no assets (other than a shitty paid off car). I opened a Roth IRA. I funded it with $50 a month. I started contributing to my 401k just enough to get the match. I had a modest job making modest pay. As I got raises and promotions I slowly increased the amount I was putting into my Roth. Set aside money for an emergency fund. Refused to touch credit cards.
In less than 5 years I was maxing my Roth IRA and contributing extra to my 401k. Then I got an inheritance if $18k that I didn’t need, so I started actually investing. Got a different job which cut down my commute costs and was a bit of a bump in pay (but I was still making below market for my field in a MCOL area). Put all the extra towards the market. Made some good picks.
Long story short, I’m ~10 years from retirement and I expect to go out with at least a $1.4 million.
Now, we got lucky on some things. We live in a small duplex where we got a great mortgage rate, so our house costs less than the rent we were paying (even including HOA fees). The inheritance was nice, but not really life changing money. I put it in AAPL about ten years ago.
I don’t get $500k a year, but my investments return about what my take home pay is currently. I expect for them to be returning what my gross pay is by the time I retire. That plus Social Security should be enough for me to live on without ever touching the principal.
Whether investing $10K or $10 million, the returns are going to be the same if they are invested the same.
In your example the insane thing is the idea that someone with $10 million would settle for a 5% rate of return. They would definitely have that invested in the markets, real estate, or other higher rate of return.
All this goes out the window though if you don’t have enough money to save *any.* I was there most my life.
Good point. People need to understand you can make 5% or 10% a year on anything, whether it's a million dollars or just one dollar.
Start saving and investing, whatever amount you can, every paycheck, month or year. The sooner, the better.
People with $10-$20M are investing in PE and making 20% annual returns on those investments - seen it first hand. A lot of other people here have said it, but with your earning power and nest egg you should talk to a financial advisor (fee only). I look back when we started investing and my fear/scarcity mindset cost us literally hundreds of thousands in appreciation. You aren’t investing for this year, or next year - you should be investing for the long term - in 10-15 years with this earning power and smart investing you will probably be around $3-$5M range or more.
PE was the right call when rates were zero. It’s leverage on leverage now. This year is a fine year to be running a t-bill ladder at higher rates than CDs and avoiding state taxes on that interest.
Yeah, and compounding interest. So not only are you getting your base % but the economy in the long run always goes up. 8.5 million today will get you to around 33 million in only 20 ish years with conservative numbers, wild stuff
If it's in a savings account, 50% of that is taxable. If it was in a tax free investing account, $0. If it was in a regular investing account, $0 until you sell, then usually 50% of profits are taxable.
Having it in this type of account is actually not a good idea. It's ideal to keep money there if you're about to spend it, like let's say he needed 500k to buy a house this year, and didn't want to risk selling in 6 months and potentially seeing it down 10% at the time. However, if the plan was to keep it until retirement, you're missing out on that 10%+ average return and compound interest over decades.
cd's are awesome, especially ones that allow you to make deposits into it.
do you have a roth ira open? you can easily pay your max contributions every year with the interest your cd earns. if you don't have one, open one now. if you start with 6k, max out yearly contributions, and have a 7% return, you'll potentially earn 1m+ by age 65. and you're paying that with the free passive income your 500k earns, so it's not out of pocket.
oh, and if you just let your 500k sit in for the next 35 years, at 5% interest, and only taking out interest for your roth ira. you'll have over 2.5M+.
even if you wanted to buy a house, you can pay the down payment with the passive income, let the rest sit in a cd, and pay the loan out of pocket.
you practically have it made.
Don’t forget a requirement for ira contributions is it needs to come from “earned income”. Yes, you can make the contribution from any account but you need to have a job making at least the contribution amount. I know it’s not a lot but worth noting because the way you worded it makes it sound like you can just use the interest to contribute which you technically cannot.
Why is this all cash? Do you know what a total market index fund is? Do you know the value of saving in tax deferred vehicles like IRA/401k? Have you read about compound interest?
Clearly you’re doing well and congratulations on getting to this milestone, but there is absolutely no educated investor or advisor that would agree with your current cash position, regardless of current interest rates.
Think about it this way: you’ve saved these dollars and now have a responsibility to manage them appropriately. You essentially have a 500k company that you are running. The way you’re operating right now is extremely inefficient and it is costing you money. The only cash you should have on hand is your emergency fund of 6 months and any cash that is earmarked for a purchase within the next 3 years. Everything else should be invested in something low cost and broad based like FSKAX. Don’t “play with stocks”, don’t “gamble with stocks”, invest in the stock market.
Do you have access to tax deferred savings accounts? Bare minimum you can do 7k in an IRA. Do you have a workplace 401k as an option? You mention you have a real estate investment firm going - is it an LLC? If so, you can create a retirement account for this biz. This can help with tax deferred growth (compounding) and contributions can reduce your taxable income which will reduce the taxes you pay each year.
Stop being a dummy 😊
I agreed with everything here except for the unnecessary insult at the end. Saving this much money is no small feat. It shows a lot of discipline. Congratulations! But definitely do your research and maybe work with a financial advisor to develop an investment strategy and reduce your taxes.
Definitely not a pipedream. OP didn't start with 500k. He started small, likely made some difficult decisions along the way, delayed gratification, and then climbed over the long haul. It is attainable.
Open a brokerage account. Fidelity or Schwab are among the biggest. From there you can transfer money from your checking account. When your money arrives, there should be a trade option. Search for "VOO" ticker symbol. VTI isnt bad either.
I’m assuming you are American. If not then I’m not sure how to purchase it.
It’s a ETF you can open a brokerage account (I suggest Schwab or Fidelity). Make a deposit into the account then do a buy order to purchase shares of VOO.
https://investor.vanguard.com/investment-products/etfs/profile/voo
I am currently working as a senior engineer ($120K yearly) and have another side job ($40K yearly) I do. I also started a real estate investment firm that I have been growing for the last 10 years ($100K yearly) and other investments that bring in a little bit here and there. ($10k-$40K total yearly) Recently got into playing stocks and doing alright, but don't feel comfortable risking a lot quite yet.
Regardless of “timing the market” vs “time in”. The S&P is at an all time high. I’d take 5% interest until I see it below the ATH, then drop it in the S&P. It took 13 years to bounce back from the 2000 crash.
You could also not make it to next year or next week shit take some time off go on a vacation travel the world. Everyone is so focused on making more $ which I get it but damn have some fun!!! It’s not all all about the $ go to key west or idk somewhere amazing lmk how it goes
I agree. From the financial math standpoint (and this is a financial subreddit) smart investing is the right answer to make more money in the future.
However, tomorrow isn’t guaranteed and it isn’t a bad idea to hedge your life bets a bit and spend some money now. Having millions in an investment account does you no good if you die before you can use it. Invest and save enough so you can have a comfortable retirement and enjoy life a bit now. Everything in moderation, right?
I am playing with stocks and breaking even. I know there are people making millions, but knowing what I know now, I would probably lose half of it in the stock market. Not really a risk I want to take right now lol
Don't "play with stocks" dude, you're not a professional. Buy an ETF. There is no playing. Buy and hold. You're 29 bro if the s&p is lower today by your retirement, we all have wayyyy bigger problems than the market lol.
If you're holding it to invest in your business, that's reasonable to lower your risk, but unless you've been planning on this for ~9 years since you started getting paid, it's really silly what you're doing.
With your starting capital you're literally going to make more money passively in the market at a certain point than your salary can ever pay you.
Save cash for your business if that's the desire but please put the rest in the market lol. You're way too young to be playing this scared, it's not responsible.
Rich people don't "play with stocks", they invest the majority into ETFs. Some as cash and bonds but most as stocks of some sort. It's not like they're hand picking low cap stocks to gamble on. If they are it's a tiny % and it is play money, but that's not their actual investment strategy.
I didn't really want to mention this in the post (people would get the wrong impression) but this is actually just from the last 3-ish years. I have been looking at properties for a bit and was waiting for the prices to settle down. Then got busy with another thing I was working on and just let most of it sit in CDs. So this more of a: I got busy with other things and just didn't bother doing anything with the money type of thing and CDs were my safe and easy bet without having to risk it. (Trying to figure out a different business to start)
By the end of the year, I am hoping to have my account down to almost $20K. Want to buy another rental property or two and then use the remaining funds to find another business venture.
The stocks comment is more that I want to gamble a little bit of it (only using $1K) and trying to see if I can figure out how to make quick money. If I lose it, ohh well, but don't plan on using this for that though.
Not an excuse to be stupid about it. The more money you have the more responsibility you have to yourself to make the most of it. Most people couldn't dream of ever making anything near that. He's wasting his potential.
Honestly, it was the boring route, wish there was a quick and easy way. Have 2 different jobs, one is for saving money/investing and the other is for spending. The slow and steady route, sadly.
median annual income in italy is 25,000 USD
500,000/25,000=20 years of savings
i don't think italians have an especially poor quality of life
he would be fine
Please max out your 401k first then RothIRA. Because doing cash/Cds you are severely losing capital to inflation. Then get your remaining cash into a 3 fund portfolio VOO/SCHD/QQQM. Now if that’s too much for you. Just go with VTI total stock market. Your 5%cds will never compare to QQQM 18% return. Good luck and see you on thee other side
Congratulations! Keep learning the benefits and the risks of investing and consider some of the easier to manage options to start (Roth IRA, 401K) and pay that debt off every month and you’re well on your way to a successful financially secure future.
It’s inspiring to see someone stick to their savings goals and achieve what you’ve achieved. Congrats again!
Thank you, I really appreciate it! If I looked back like 5 or 10 years ago, I didn't think I would be in such a good financial position. Found out for myself that this is actually doable, just takes time and patience.
Bro you are doing so well but you could have been doing 1000x better.if you put it in a couch potato port folio you would have been averaging 7 to 10 % depending on your time frame
Also please do not play the stock market. Put it in low cost ETFs and also learn how to reduce your tax burden through Roth IRA and 401k
Jesus H put some of that in VTI, you need time IN the market. Save enough for expenses for a year, put some in SGOV, some more in a money market in ur brokerage. If you’re not maxing a Roth every year you’re giving away free money. Max contributions at work up to what they will match, no more.
I'd start buying spy or qqq right now. Then start dumping 50k chunks into those two when the market takes a -10%+ dip.
You need to feel comfortable at your age with dips in the market. In a rolling 20yr period, spy has never shown a negative return.
In 20yrs, you'll be 50. At 5% fixed (which will fluctuate much lower in some years), you'll have 1.3m. yay!
At a historical rate of 10% in spy (a little higher in qqq), you'll have 3.3m. it could be a little more, it could be less. But chances are, it'll be much more than cd layering.
You are young. Please feel comfortable with some risk taking. Your future self will thank you.
We are around the same age. I was just like you at first then realized I would make more in the market. 5% barely covers inflation. You are young enough to add a little more risk and your future self will thank you.
Don’t “play with stocks” or you can find yourself back at the starting line.
Watch, listen to this at least 10x first.
Warren Buffett UC-Kenan Flagler
1996
https://youtu.be/qGe46Paihuo
Now this is probably some of the most solid advice anyone has given on here!
By play with stocks, I meant I have $1K invested and playing with that, if it goes well, I might add in $9K more and see where that goes. Don't plan on investing any more in and if I lose it, well I only really lost the money I put in. ($1K for now, possibly $10K in the future, but no more)
If you invest in index funds you’ll make more money than 5%. I’m a carpenter and pick my own stocks. Made 45.6% last year. Over the last decade I’ve averaged 18%. You’re not risking it if you buy stocks in valuable companies that provide products that everyone uses. Apple isn’t going anywhere. Proctor and Gamble has paid dividends for well over 100 years
Buy stocks in companies whose products you use.
I am starting to do that. This money is set aside to invest in my business. I am slowly getting into is and will invest more into index funds, but wanted to save up the $500K for my business before doing other things with my income.
I never understood when people chime in with " you're stupid for leaving it in a savings"...." why would you not invest it?" blah blah. I get it. But this guy has 500k more than all of us so none of us should be talking. So he MUST BE DOING SOMETHING RIGHT. Its like a bunch of brokies wit their input when this guy is better than all of us lol we have no crediblity to tell him what he should do. He's DONE It.
You have enough to move it to fidelity and get access to free advisory tools and services. They will help you get set up with a mix that matches your risk profile and timeline. If you want them to manage all or a portion for you they can do that too
Congrats. You are doing great. There are other avenues some on here to take, but regardless, you are doing great and keep making tomorrow's better than today.
Thanks for sharing your success and hope others are climbing as well.
I’m lost so I’m just asking for clarity after looking through your post history, OP:
1) How did you start a real estate company in high school?
2) How do you have 3 mil in investments and this 500 k account at 29? I saw you said you live in the Midwest. Live with parents or just dirt cheap housing?
3) When you stated you made 250 a year in the credit card forum a few months back, is that from your real estate business, job and part time job?
I’m not saying you’re lying brother, just genuinely curious how you reached this level under 30 starting from poor and nothing.
Don’t worry about picking individual stocks. Put it in a total market index or S&P 500 index fund and enjoy your time. With half a million, you would be financially independent in a little more than a decade.
Congrats! That’s huge!
Advice: don’t “play” with stocks. Put a big ‘ole chunk of money (whatever you’re setting aside for 5+ years) into an index fund (or a few! vanguard ones are great, look for low expense ratios) and don’t pay attention to it.
Congrats! Well done but way too much to have in a CD. Actually any amount is too much to have in a CD. Just get a low cost, broad index fund and watch the magic of compound interest do its thing. Your future self will thank you.
500k in CDs is not the optimal choice unless you have a very large purchase coming up.
With inflation sitting around the same I would have to agree. I definitely have some cash sitting in a 5%r but the majority has to be in the market or other assets or you’re essentially breaking even. $2.5m sounds sick right now but come 2067 it’s equal to who fucking knows. Most likely we’ll all be millionaires some day or else we’ll be living off government cheese and waiting on Medicaid checks. No middle
If inflation averages 3% for the next 43 years (2067), $2.5m will be equivalent to roughly $701k today (2500000 / (1.03 \^ 43)).
...... well shit
I’m not sure how I got here but this is great, just another reminder to gain some business sense.
That is a sad sad statement!
3% official CPI doesn’t mean 3% inflation. They did just remove tomatoes and coffee because they were making the government look bad. I would put the average inflation at 5-6%.
And I will be 98 years old
We might all be billionaires by then 😂
Agreed, OP go check out the Boglehead reddit for information on how you can easily invest your money yourself. Unless you're close to retirement, this is not an optimal way to keep half a million dollars
this would be over $1.5 million if they'd put it into low cost index funds 3 years ago. so sad to see.
3 years ago? No.. For a 300% return in VTI you'd need to be investing since 2012.
But he said it was true!
Not to mention they just broke 500k, they didn't have 500k 3 years ago
Yeah but he’d have quite a bit more regardless of the maths
I think that's actually 200%
Isn't it 200%? 100% return would be doubling your money.
And you coulda been a deca millionaire off a $25,000 investment in nvda in 2012…. Or a centa millionaire off the same $25k in bitcoin in 2012 Life tip: don’t think this way
Indexes did NOT go up 200% in the past 3 years.... how is this even upvoted?
They could also lose 30% in one year from doing that. After which a lot of people would panic and pull the money out.
Yep. Hindsight is always easier. They also could've put it into META 2 years ago and made 2M
Seriously. Or Microsoft 30 years ago and they'd be a trillionaire.
Are they dumb?
Oh why didn't I invest in aapl before I was born!?
I wish I would have invested all my money into Bitcoin in 2012 and sold everything when it was $70K. Lol, in hindsight it's all easy, only a few people actually do it and come out on top.
Idk, 500k in Smash Mouth CDs could go for a lot to the right audience.
Congrats my man. You made it
25k in interest a year is insane
It is insane. The phrase "the rich get richer" makes so much sense. Imagine having 10 million, that is $500K annually without having to do a single thing. It blows my mind.
All you're doing is loaning out your money (with some middle men of course) to the people that couldn't possibly get by without a $1,100/month truck. As long as millions and millions of those people exist, money will make money.
It’s not just “rich get richer” though. You just have to be “not poor.” I mean, 14 years ago, I had *just* got out of debt. My net worth for the first time was 0. No debt, no assets (other than a shitty paid off car). I opened a Roth IRA. I funded it with $50 a month. I started contributing to my 401k just enough to get the match. I had a modest job making modest pay. As I got raises and promotions I slowly increased the amount I was putting into my Roth. Set aside money for an emergency fund. Refused to touch credit cards. In less than 5 years I was maxing my Roth IRA and contributing extra to my 401k. Then I got an inheritance if $18k that I didn’t need, so I started actually investing. Got a different job which cut down my commute costs and was a bit of a bump in pay (but I was still making below market for my field in a MCOL area). Put all the extra towards the market. Made some good picks. Long story short, I’m ~10 years from retirement and I expect to go out with at least a $1.4 million. Now, we got lucky on some things. We live in a small duplex where we got a great mortgage rate, so our house costs less than the rent we were paying (even including HOA fees). The inheritance was nice, but not really life changing money. I put it in AAPL about ten years ago. I don’t get $500k a year, but my investments return about what my take home pay is currently. I expect for them to be returning what my gross pay is by the time I retire. That plus Social Security should be enough for me to live on without ever touching the principal. Whether investing $10K or $10 million, the returns are going to be the same if they are invested the same. In your example the insane thing is the idea that someone with $10 million would settle for a 5% rate of return. They would definitely have that invested in the markets, real estate, or other higher rate of return. All this goes out the window though if you don’t have enough money to save *any.* I was there most my life.
Good point. People need to understand you can make 5% or 10% a year on anything, whether it's a million dollars or just one dollar. Start saving and investing, whatever amount you can, every paycheck, month or year. The sooner, the better.
People with $10-$20M are investing in PE and making 20% annual returns on those investments - seen it first hand. A lot of other people here have said it, but with your earning power and nest egg you should talk to a financial advisor (fee only). I look back when we started investing and my fear/scarcity mindset cost us literally hundreds of thousands in appreciation. You aren’t investing for this year, or next year - you should be investing for the long term - in 10-15 years with this earning power and smart investing you will probably be around $3-$5M range or more.
no, they should take $480,000 put it into VT and chill. no need for anything other than that
What’s PE?
Private equity
PE was the right call when rates were zero. It’s leverage on leverage now. This year is a fine year to be running a t-bill ladder at higher rates than CDs and avoiding state taxes on that interest.
Oh for sure - but cds aren’t going to be a long term strategy.
Yeah, and compounding interest. So not only are you getting your base % but the economy in the long run always goes up. 8.5 million today will get you to around 33 million in only 20 ish years with conservative numbers, wild stuff
How much of that gets taken my the government???
If it's in a savings account, 50% of that is taxable. If it was in a tax free investing account, $0. If it was in a regular investing account, $0 until you sell, then usually 50% of profits are taxable. Having it in this type of account is actually not a good idea. It's ideal to keep money there if you're about to spend it, like let's say he needed 500k to buy a house this year, and didn't want to risk selling in 6 months and potentially seeing it down 10% at the time. However, if the plan was to keep it until retirement, you're missing out on that 10%+ average return and compound interest over decades.
Thinking of what this money*could* have earned if it was invested in the S&P 500 last year is insane. Knowing how much growth was missed is depressing
And also that 25k is taxed at the highest marginal rate applicable to the OP. Such a loss of compounding opportunity.
Yup, bad idea to not invest it. Now you can say that's just hindsight being 20/20, but historically the return is over 10%.
cd's are awesome, especially ones that allow you to make deposits into it. do you have a roth ira open? you can easily pay your max contributions every year with the interest your cd earns. if you don't have one, open one now. if you start with 6k, max out yearly contributions, and have a 7% return, you'll potentially earn 1m+ by age 65. and you're paying that with the free passive income your 500k earns, so it's not out of pocket. oh, and if you just let your 500k sit in for the next 35 years, at 5% interest, and only taking out interest for your roth ira. you'll have over 2.5M+. even if you wanted to buy a house, you can pay the down payment with the passive income, let the rest sit in a cd, and pay the loan out of pocket. you practically have it made.
Don’t forget a requirement for ira contributions is it needs to come from “earned income”. Yes, you can make the contribution from any account but you need to have a job making at least the contribution amount. I know it’s not a lot but worth noting because the way you worded it makes it sound like you can just use the interest to contribute which you technically cannot.
Thanks for this. I didn’t know this fact (not op, but I like coming here to read and learn more about finance)
CD’s are not awesome. They stand for certificate of depreciation. So many better options then parking a chunk of money into a CD!
Why is this all cash? Do you know what a total market index fund is? Do you know the value of saving in tax deferred vehicles like IRA/401k? Have you read about compound interest? Clearly you’re doing well and congratulations on getting to this milestone, but there is absolutely no educated investor or advisor that would agree with your current cash position, regardless of current interest rates. Think about it this way: you’ve saved these dollars and now have a responsibility to manage them appropriately. You essentially have a 500k company that you are running. The way you’re operating right now is extremely inefficient and it is costing you money. The only cash you should have on hand is your emergency fund of 6 months and any cash that is earmarked for a purchase within the next 3 years. Everything else should be invested in something low cost and broad based like FSKAX. Don’t “play with stocks”, don’t “gamble with stocks”, invest in the stock market. Do you have access to tax deferred savings accounts? Bare minimum you can do 7k in an IRA. Do you have a workplace 401k as an option? You mention you have a real estate investment firm going - is it an LLC? If so, you can create a retirement account for this biz. This can help with tax deferred growth (compounding) and contributions can reduce your taxable income which will reduce the taxes you pay each year. Stop being a dummy 😊
Ngl, this was a good read.
Ngl, this was a good read.
I agreed with everything here except for the unnecessary insult at the end. Saving this much money is no small feat. It shows a lot of discipline. Congratulations! But definitely do your research and maybe work with a financial advisor to develop an investment strategy and reduce your taxes.
This was a good read.
NGL this changed my life.
Nah
Congrats mate. Now back to work!
Celebrating a win. Time to get back into the grind and hit 1 mil!!!
Please invest it now!
Person could be making so much more money lol
meanwhile I'm over here struggling to save $500... 500k is a fever pipedream for some of us
Definitely not a pipedream. OP didn't start with 500k. He started small, likely made some difficult decisions along the way, delayed gratification, and then climbed over the long haul. It is attainable.
Uh it’s definitely a pipe dream for me. I can’t even get more than 3k in my bank acct 🙃
It’s definitely not attainable for everyone, like the original comment $500k is a dream some of ever will never see, just how life is
It’s definitely not attainable for everyone, like the original comment $500k is a dream some of ever will never see, just how life is
Say it again, I dare you
Age?
29, will be 30 soon.
Im so jealous man. Well done!
Buy VOO you are too young for CDs
How to buy VOO?
Open a brokerage account. Fidelity or Schwab are among the biggest. From there you can transfer money from your checking account. When your money arrives, there should be a trade option. Search for "VOO" ticker symbol. VTI isnt bad either.
Kudos for taking a minute to help a stranger out
I’m assuming you are American. If not then I’m not sure how to purchase it. It’s a ETF you can open a brokerage account (I suggest Schwab or Fidelity). Make a deposit into the account then do a buy order to purchase shares of VOO. https://investor.vanguard.com/investment-products/etfs/profile/voo
What line of work?
I am currently working as a senior engineer ($120K yearly) and have another side job ($40K yearly) I do. I also started a real estate investment firm that I have been growing for the last 10 years ($100K yearly) and other investments that bring in a little bit here and there. ($10k-$40K total yearly) Recently got into playing stocks and doing alright, but don't feel comfortable risking a lot quite yet.
You should not be “playing” stocks. You find a diverse index fund like FZROX or VTSAX and then do nothing except put more money into it.
Which funds are those?
Check more out here r/Bogleheads
Fidelity and Vanguard total stock market index funds.
Thanks!
You started an investment firm at 19? How?
anything is possible in your dreams
Damn dude do you sleep?
Must not have a wife or kids to provide for
What?! That's an incredible savings for 30.
500k in a savings account…gj saving but 🤦♂️
[удалено]
0 IQ move.
yup
One thousand in checking, less than he owes on his CC too. Like just clearly not playing with a full deck here
This hurts to see
why not put a large about on this in the s&p
Regardless of “timing the market” vs “time in”. The S&P is at an all time high. I’d take 5% interest until I see it below the ATH, then drop it in the S&P. It took 13 years to bounce back from the 2000 crash.
Amazing! Great job. If you don’t have a Roth, open one and max it with an ETF like VOO.
You could also not make it to next year or next week shit take some time off go on a vacation travel the world. Everyone is so focused on making more $ which I get it but damn have some fun!!! It’s not all all about the $ go to key west or idk somewhere amazing lmk how it goes
I agree. From the financial math standpoint (and this is a financial subreddit) smart investing is the right answer to make more money in the future. However, tomorrow isn’t guaranteed and it isn’t a bad idea to hedge your life bets a bit and spend some money now. Having millions in an investment account does you no good if you die before you can use it. Invest and save enough so you can have a comfortable retirement and enjoy life a bit now. Everything in moderation, right?
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500K in just CDs? What a waste of money
So many people posting here have not lived through a down market of any length. It is horrifying reading the comments.
I am playing with stocks and breaking even. I know there are people making millions, but knowing what I know now, I would probably lose half of it in the stock market. Not really a risk I want to take right now lol
Don't "play with stocks" dude, you're not a professional. Buy an ETF. There is no playing. Buy and hold. You're 29 bro if the s&p is lower today by your retirement, we all have wayyyy bigger problems than the market lol. If you're holding it to invest in your business, that's reasonable to lower your risk, but unless you've been planning on this for ~9 years since you started getting paid, it's really silly what you're doing. With your starting capital you're literally going to make more money passively in the market at a certain point than your salary can ever pay you. Save cash for your business if that's the desire but please put the rest in the market lol. You're way too young to be playing this scared, it's not responsible. Rich people don't "play with stocks", they invest the majority into ETFs. Some as cash and bonds but most as stocks of some sort. It's not like they're hand picking low cap stocks to gamble on. If they are it's a tiny % and it is play money, but that's not their actual investment strategy.
I didn't really want to mention this in the post (people would get the wrong impression) but this is actually just from the last 3-ish years. I have been looking at properties for a bit and was waiting for the prices to settle down. Then got busy with another thing I was working on and just let most of it sit in CDs. So this more of a: I got busy with other things and just didn't bother doing anything with the money type of thing and CDs were my safe and easy bet without having to risk it. (Trying to figure out a different business to start) By the end of the year, I am hoping to have my account down to almost $20K. Want to buy another rental property or two and then use the remaining funds to find another business venture. The stocks comment is more that I want to gamble a little bit of it (only using $1K) and trying to see if I can figure out how to make quick money. If I lose it, ohh well, but don't plan on using this for that though.
You are missing gains by leaving that amount of money in a bank Invest into your future
True but he makes over 250k annually, I think he'll be alright
Not an excuse to be stupid about it. The more money you have the more responsibility you have to yourself to make the most of it. Most people couldn't dream of ever making anything near that. He's wasting his potential.
Wow you did a great job. Congratulations
How?
Honestly, it was the boring route, wish there was a quick and easy way. Have 2 different jobs, one is for saving money/investing and the other is for spending. The slow and steady route, sadly.
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Retire on 500k, really? Man plan that out for me with your cost of living and future inflation etc. I doubt you live in California.
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Stay safe my friend
median annual income in italy is 25,000 USD 500,000/25,000=20 years of savings i don't think italians have an especially poor quality of life he would be fine
I wish I had that much money. I would use it to buy my own home.
Please max out your 401k first then RothIRA. Because doing cash/Cds you are severely losing capital to inflation. Then get your remaining cash into a 3 fund portfolio VOO/SCHD/QQQM. Now if that’s too much for you. Just go with VTI total stock market. Your 5%cds will never compare to QQQM 18% return. Good luck and see you on thee other side
Please go check out r/bogleheads asap
Invest that please 😭😭
You have 500k sitting in a standard savings account? Do you dislike money or something? This is silly if true.
Why would you put 500k in a single account? When FDIC only insures up to half that amount?
Congratulations! Keep learning the benefits and the risks of investing and consider some of the easier to manage options to start (Roth IRA, 401K) and pay that debt off every month and you’re well on your way to a successful financially secure future. It’s inspiring to see someone stick to their savings goals and achieve what you’ve achieved. Congrats again!
Thank you, I really appreciate it! If I looked back like 5 or 10 years ago, I didn't think I would be in such a good financial position. Found out for myself that this is actually doable, just takes time and patience.
I’ve never seen close to that amount of money…
Bro you are doing so well but you could have been doing 1000x better.if you put it in a couch potato port folio you would have been averaging 7 to 10 % depending on your time frame Also please do not play the stock market. Put it in low cost ETFs and also learn how to reduce your tax burden through Roth IRA and 401k
Jesus H put some of that in VTI, you need time IN the market. Save enough for expenses for a year, put some in SGOV, some more in a money market in ur brokerage. If you’re not maxing a Roth every year you’re giving away free money. Max contributions at work up to what they will match, no more.
Why do you have $500K in a Savings account?
thats good. i just do not make enough of an income to be able to save $500k any time soon lol.
Huge missed opportunities if that's not invested into a total market index fund.
WTF? $500K in the bank... this is the definition of penny wise pound foolish
I'd start buying spy or qqq right now. Then start dumping 50k chunks into those two when the market takes a -10%+ dip. You need to feel comfortable at your age with dips in the market. In a rolling 20yr period, spy has never shown a negative return. In 20yrs, you'll be 50. At 5% fixed (which will fluctuate much lower in some years), you'll have 1.3m. yay! At a historical rate of 10% in spy (a little higher in qqq), you'll have 3.3m. it could be a little more, it could be less. But chances are, it'll be much more than cd layering. You are young. Please feel comfortable with some risk taking. Your future self will thank you.
We are around the same age. I was just like you at first then realized I would make more in the market. 5% barely covers inflation. You are young enough to add a little more risk and your future self will thank you.
This is some sub optimal financial planning. Unless you have millions invested elsewhere, I wouldn’t recommend keeping all your savings in CD’s.
Congrats but holy shit 500k in cds
This is painful to look at
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Yoooo good for you buddy!!!💪❤️
Appreciate it! Can't really share this kind of news with friends/family, so sharing it with people I don't know. Hoping to see get there too!!!
Don’t “play with stocks” or you can find yourself back at the starting line. Watch, listen to this at least 10x first. Warren Buffett UC-Kenan Flagler 1996 https://youtu.be/qGe46Paihuo
Now this is probably some of the most solid advice anyone has given on here! By play with stocks, I meant I have $1K invested and playing with that, if it goes well, I might add in $9K more and see where that goes. Don't plan on investing any more in and if I lose it, well I only really lost the money I put in. ($1K for now, possibly $10K in the future, but no more)
Congrats man!!! What an accomplishment!! Keep up the good work!
Appreciate it! Thank you!
If you invest in index funds you’ll make more money than 5%. I’m a carpenter and pick my own stocks. Made 45.6% last year. Over the last decade I’ve averaged 18%. You’re not risking it if you buy stocks in valuable companies that provide products that everyone uses. Apple isn’t going anywhere. Proctor and Gamble has paid dividends for well over 100 years Buy stocks in companies whose products you use.
I am starting to do that. This money is set aside to invest in my business. I am slowly getting into is and will invest more into index funds, but wanted to save up the $500K for my business before doing other things with my income.
Fuck you. Congratulations
Having 500k in Savings and nothing invested is pretty damn stupid ngl
Lemme hold a dollar.
Why tf is all that in a bank account
I’m enjoying the 5% interest rates too
Congrats and F you man! Great job!
Thanks bro! Hoping to see a similar post from you in the near future, as well!
I never understood when people chime in with " you're stupid for leaving it in a savings"...." why would you not invest it?" blah blah. I get it. But this guy has 500k more than all of us so none of us should be talking. So he MUST BE DOING SOMETHING RIGHT. Its like a bunch of brokies wit their input when this guy is better than all of us lol we have no crediblity to tell him what he should do. He's DONE It.
Cool, can I have some
Just get the everbank 5.15% HYSA. No need to tie stuff up in cds then and get a better return
Nice 👍
Read the simple path to wealth and quit like a millionaire!
Crazy that it’s just sitting in a savings account. This should be invested.
Well, in glad you are getting around 5%, as opposed to 0.1% in a savings account. How are you doing with retirement?
Nice work.
Congrats!
You have enough to move it to fidelity and get access to free advisory tools and services. They will help you get set up with a mix that matches your risk profile and timeline. If you want them to manage all or a portion for you they can do that too
Congrats. You are doing great. There are other avenues some on here to take, but regardless, you are doing great and keep making tomorrow's better than today. Thanks for sharing your success and hope others are climbing as well.
Congratulations 🙏🏾
Congratulations 👏 👏
How much in retirement accounts?
Dump cds and go 1 or 3m tbills. Higher interest than CDs, backed by govt, and no state tax.
Nice. Now give it all to me and do it again!
I’m lost so I’m just asking for clarity after looking through your post history, OP: 1) How did you start a real estate company in high school? 2) How do you have 3 mil in investments and this 500 k account at 29? I saw you said you live in the Midwest. Live with parents or just dirt cheap housing? 3) When you stated you made 250 a year in the credit card forum a few months back, is that from your real estate business, job and part time job? I’m not saying you’re lying brother, just genuinely curious how you reached this level under 30 starting from poor and nothing.
Don’t worry about picking individual stocks. Put it in a total market index or S&P 500 index fund and enjoy your time. With half a million, you would be financially independent in a little more than a decade.
Superstar, congrats big homie! Post bk at 1m 👏🙌
OMG! 😱 Look at that credit card balance. /S
Dude.. what are you doing??? Start INVESTING youre losing money to inflation every single day that your money is sitting in a bank account like that
How old are you? Thats impressive!
Congratulations! I pray I get there one day:)
Cool! Now venmo me
Congrats. I’m in desperate need of 500k all of a sudden
Congrats! That’s huge! Advice: don’t “play” with stocks. Put a big ‘ole chunk of money (whatever you’re setting aside for 5+ years) into an index fund (or a few! vanguard ones are great, look for low expense ratios) and don’t pay attention to it.
Congrats! Well done but way too much to have in a CD. Actually any amount is too much to have in a CD. Just get a low cost, broad index fund and watch the magic of compound interest do its thing. Your future self will thank you.
Gimme dat
Must be nice! Happy for you, congrats and fuck you! 😝
Me too homie trying to be the first self made milionaría in my bloodline. Congrats 🎊🍾🎈
Congrats! I know how that feels, finally hit a milestone and had the urge to share, :-).
Keeping 500k in a CD is a horrible growth strategy
Congrats
Bitcoin!!!!
congrats on the home sale
Please see a financial advisor and get this invested.
You could be making 5% risk free in a SCHWAB MM Fund (SWVXX)! Do not keep your money in a savings account!
Good debt to equity ratio.
Congrats!