What to do with 20k? Should I trust the Market? Inflation?

[MaxPowers]

I have 20k in cash in my account and easily get 1.5-2k a month that I save. I have 50k in assorted stocks but have not messed with the stocks in a while. I don't know enough to trust the market. I max out my Roth IRA every year.
So what is a safe thing to do with my money? I am afraid of the US economy and inflation.

[kellogg9]

Have you maxed out your 401k too? If so then maybe a second look into index funds. Although the market is a bit down right now i consider it a bargain to buy in.

[bjl584]

I have 20k in cash in my account and easily get 1.5-2k a month that I save. I have 50k in assorted stocks but have not messed with the stocks in a while. I don't know enough to trust the market. I max out my Roth IRA every year.
So what is a safe thing to do with my money? I am afraid of the US economy and inflation.

You could keep it for an Emergency Fund if you don't have one already.

[snafu]

Yes, there is risk in equities which bounce up and down often on nothing more solid than emotion. On the other hand...I feel inflation every time I work through my grocery list at the supermarket and note increases in my municipal tax, formerly free bank charges, KWH electric rates, and anything in the entertainment category. I figure I'm losing 3% buying power and gaining less than 1% in a tax paying savings instrument. Most important, you must be able to sleep at night without worrying bout your investments.

My Dollar Cost Averaging, low fee Index MF is long term [5+ yrs] and knowing it can be converted to cash in less than two business days remains my safety net. It was hard to continue during the 2008-10 smack down but I kept telling myself I was buying 'on sale.'

I work hard and I care about my money more than salesmen who sell products. I figure we'll all be held responsible for our financial decisions in our later years so it's crucial to be in touch with our financial realities.

[YLTL_Dan]

I would keep 3-6 months of expenses in a savings account - which might be what your $20k is for. You don't want to invest that money in the market because of the volatility.

However, if you already have your emergency fund and no debt, then you might consider investing the money in the stock market. I stick with low cost Vanguard ETFs. Sure, the stock market might go down, but as long as you believe in the long term viability of the US and world economy, there's not many better places to get a return on your money.

[MaxPowers]

I will never go below 10k in my account. So lets say anything above that I am ready to invest. If I do put it in a Vanguard ETF, what is the best way to get into it? Just buy 10k$ of energy ETF in one shot? Vanguard total stock market? Also, I don't have time currently to do research, (I will after october) But from what I understand I don't want to trust the American economy. Is this true?
My brokerage account is zecco

[wesman1299]

I will never go below 10k in my account. So lets say anything above that I am ready to invest. If I do put it in a Vanguard ETF, what is the best way to get into it? Just buy 10k$ of energy ETF in one shot? Vanguard total stock market? Also, I don't have time currently to do research, (I will after october) But from what I understand I don't want to trust the American economy. Is this true?
My brokerage account is zecco

How long are you willing to invest the money? If you want the money back in under ten years and your risk tolerance is not very high, CDs or high-interest savings accounts might be a wise choice for you. Anything longer than ten years calls for a diversified stock portfolio. I say if you don't put all your eggs in one basket you should be okay. Do not let a short-term economic downturn put a bad taste in your mouth. The stock market will bounce back, it's just a matter of when. Maintain a long-term mindset and you should be fine.

[snafu]

It depends on your goals, time frame, Risk tolerance and what you already hold in your Roth. What is the purpose of new investment? It's worth the time to assign a purpose and look after your money. Perhaps do a quick on-line net worth statement now and again in 6 months.

[Gina23]

If you have 20k why not consider a Vanguard Admiral mutual fund rather than the ETF? Extremely low fees and it's simple to exchange into the fund.

[kv968]

If you have 20k why not consider a Vanguard Admiral mutual fund rather than the ETF? Extremely low fees and it's simple to exchange into the fund.

The ETF's have the same expense ratio and no $20k minimium.

[YLTL_Dan]

I will never go below 10k in my account. So lets say anything above that I am ready to invest. If I do put it in a Vanguard ETF, what is the best way to get into it? Just buy 10k$ of energy ETF in one shot? Vanguard total stock market? Also, I don't have time currently to do research, (I will after october) But from what I understand I don't want to trust the American economy. Is this true?
My brokerage account is zecco

Diversification is your friend... I'd spread it out between industries/sectors, exchanges, countries, or all of the above! You could do something like 33% in an international fund, 33% in a small/medium cap, and the remaining 33% in a large cap fund.

Also, there is a lot of doom and gloom talk with the economy and stock market right now... but sometimes that's the best time to get in. You can also put in a percentage now and then another percentage later if you wanted.

[SnapDuck]

The safe thing to do depends on your view. FDIC insured online savings, you won't lose your money but there is inflation to worry about. I think when people say safe this is what they mean.

I'd keep 6 months worth of expenses in an online savings account for an emergency fund. Then start investing in Vanguard ETFs. I'd put whatever your age is as a percentage in the total bond etf and then split what is left with 80% in the total stock market and 20% in the total international market. This is basically what I am doing without the total bond market part because I am comfortable with the higher risk.

[dontgopoor]

First things first, roughly, how old are you and what does your balance sheet look like other than your $50k in stocks. What you do with that $20k depends on where you are now (i.e., your current balance sheet) and what you expect your future demands to be (age, family, future responsibilities/plans, etc. and how those impact your expected future cash flows).

Once you know that, then you can map out a long term strategy and implement with short term tactics.