savings & investing

Snoopy2645 · #1 (**permalink**) 06-09-2005, 11:48 AM

I am confused on what to invest in any ideas?? Just looking for ideas I called around & cds & savings bonds pay the same would one be better than the other?? Or is thier stocks or something else one should consider I am just wondering because soon I would like to do something

jmjj215 · #2 (**permalink**) 06-09-2005, 11:56 AM

Snoopy,
What will you be using the money for long/short-term? Is it money that you'll need to have access to for emergencies or is it retirement money? Are you saving for a house down payment or new car? What the money is invested for is crucial to making a decision about where to invest it.

gakline · #3 (**permalink**) 06-09-2005, 12:14 PM

I would suggest CDs, then decide on a maturity. Savings bonds have a much longer maturity life.

obi_positive · #4 (**permalink**) 06-09-2005, 12:15 PM

Are you wanting to make long-term investmesnts and don't want to touch the money? Then try a mutual fund. I like index mutual funds like Vanguard or Fidelity offers because of the low cost and low hassle. Go for an IRA account to reap the tax benefits and reinvest the dividends.

Short-term and need the cash to be liquid? Maybe look at a savings account with a good rate.

Is this just extra money to play with? Maybe research some good stocks or invest in your own business or your education, etc.

If you have credit card debt or other loans, you're better off paying them before you start investing. If you make 3% interest in a savings account and lose 18% on a credit card, your still losing 15% interest on your money.

Cautious Spender · #5 (**permalink**) 06-09-2005, 12:24 PM

In addition, remember that 15% interest gained by paying off credit cards is a TAX free gain.

Snoopy2645 · #6 (**permalink**) 06-09-2005, 02:23 PM

Well our house will be paid for this year & my car is paid for I dont plan on getting a different car for awhile & I pay my ccs every month so no problems thier.

I really just want to save maybe to make improvements on this house someday or something. Or for my kids when they go to college I would say I want to invest for 5-10 years at least my oldest wont be in college for about 10 more years. I just always thought cds were the way to go but the interest on those isnt very good so am sitting her now not knowing what to do.

jmjj215 · #7 (**permalink**) 06-09-2005, 07:01 PM

Check out ESAs, they're flexible education savings accounts that are tax-advantaged. Then I'd pick one or two mutual funds to use inside that ESA.

baselle · #8 (**permalink**) 06-09-2005, 08:09 PM

Time for a little learning!

It sounds like you'd like to put this in a high interest, low risk sure thing that would make money in a smooth even way for 5 to 10 years, and you'd like to know what that is.

If we knew what that was, we'd all be in it.

After starting an emergency fund, it wouldn't hurt to put some of your savings in a short term CD (6 month - 1 year), or even ladder it so your savings earns a little something while you learn. And there are way worse places than an ING/Emigrant Internet bank account.

Check out some of the personal finance advice websites. Don't believe everything you read, but get a lay of the land. My favorite ones are www.fool.com, Michelle Singletary (the Color of Money column in the Washington Post), Humberto Cruz (various). The Detroit News Money and Life section somehow speaks to me - its a good mix of basic and intermediate info.

VJW · #9 (**permalink**) 06-11-2005, 09:58 AM

If you’re saving for college, all interest earnings from I BONDS are exempt from Federal income tax when used to finance an education. All interest earnings from I BONDS are also exempt from State and local income taxes.

http://www.treasurydirect.gov/indiv/...nds_glance.htm

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baselle · #10 (**permalink**) 06-11-2005, 04:08 PM

Quote:

Originally Posted by VJW

If you’re saving for college, all interest earnings from I BONDS are exempt from Federal income tax when used to finance an education. All interest earnings from I BONDS are also exempt from State and local income taxes.

http://www.treasurydirect.gov/indiv/...nds_glance.htm

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Good point. In addition, if in 15 years you discover that your child either doesn't want to go to college, or gets a scholarship, if you have the $ in an I-bond, you could use the money for something else.

Not sure about the constraints with a 529. baselle

jmjj215 · #11 (**permalink**) 06-13-2005, 08:24 AM

If I were in it over a 15-year period I'd probably go with a mutual fund w/ a good track record. I think you're much more likely to get a higher return - even after taking taxes into account. The great thing about VJW's suggestion though - there is virtually no risk. So you really need to decide if the extra potential return is worth the risk, and go from there.