Beginner - how to invest 10k?

[swingy]

I've got 10k saved, no debts, and would like to put this money to work as well as possible for myself. My priority is to grow my capital and get a good return in the short term rather than 5+ years as I will be needing it for a house deposit in the next 3-5 years. Obviously I will be continuing to save in the meantime, but my concern is to ensure the 10k I currently have performs as well as possible in the interim.

I'm a novice, work full time, and don't really have the head for the ins and the outs of stocks/bonds and so on, so my plan is to hire a financial services advisor to invest in a range of options for me. A family member is a financial investments person, so I hope will be able to point me towards a good, trustworthy FA who won't just push whatever the commission is in, which I have gathered can sometimes be a problem.

So, has anyone any recommendations? Either for FAs, investment services for a complete and utter novice?

Or I could avoid investing my 10k yet, continue to save and then build up enough capital to invest in some kind of hard asset which would result in income - e.g. commercial property which I could then rent?

[Petunia 100]

Stocks are volatile, and bonds are too to a lesser extent. Over long periods of time, it is reasonable to assume the overall trajectory of stocks and bonds is up. Over short periods of time, it is a gamble.

If you invest 10k now and in 3 years it is worth 7k, how will that effect your home purchase plan? You should consider this carefully, because it is a very possible outcome. Using a financial advisor guarantees nothing.

Stick with savings accounts, CDs, and money market accounts for your house down payment money. Shop around for the best rate you can get.

Do you have any retirement savings? You should be setting aside a bit each month for your retirement. Since it is long-term money, it belongs in a diverse portfolio of stocks and bonds (usually purchased via mutual funds).

[JustBill]

PenFed.org is probably your best option with 3 year CDs (actually, share certificates) at 2.02% APR. 4 year is 2.22%, 5 year is 3.04%.

[disneysteve]

I've got 10k saved

I will be needing it for a house deposit in the next 3-5 years.

Money that you will need within 5 years should not be invested. It should be held in cash instruments like money market accounts or CDs.

my plan is to hire a financial services advisor to invest in a range of options for me.

Nobody cares more about your money than you. Hiring someone else to invest for you is a recipe for disaster. At best, it adds a layer of fees and expenses that cut into your return. When you are ready to invest (and I don't think you are with this money right now), it is not hard to do it on your own at a greatly lower cost.

A family member is a financial investments person

Never invest with family.

Or I could avoid investing my 10k yet, continue to save and then build up enough capital to invest in some kind of hard asset which would result in income - e.g. commercial property which I could then rent?

I'm confused. I thought this money was to buy a house. Are you saying instead of buying a house, you might use the money to buy an investment property?

[feh]

+1 to what all above posters said.

[snafu]

Adding to what others have explained, I suggest you begin to educate yourself on investing to avoid some of the expensive pitfalls that clobber novices. There are excellent, quick reads like Wealthy Barber, Chilton, Automatic Millionaire, Bach for example, easily borrowed on line from your library. Kipplinger's or Money magazine help to keep you up to date with money trends. You work hard for your money and it's smart to make your money work for you. If your employer offers any match for retirement investment it's smart to take FREE money. The trick is to avoid high fee or MER that silently transfers money from your pocket to the custodian.

There are contributors at this site that offer excellent suggestions just to help