Places to Keep Money Where it Won't Be Tied Up?

[magnum558]

So I realized I have a lot of money that is doing absolutely nothing - it's upwards of 400K. I'd rather not put it in stocks at the current moment because I think the market is over bought. However, I do plan on investing it in the coming months so I don't want it tied up either.

I was wondering if anyone has any suggestions.

[runj]

Look for any other asset option that is highly liquid with less risks, such that you can make some returns and liquidate the amounts readily.

[bjl584]

So I realized I have a lot of money that is doing absolutely nothing - it's upwards of 400K. I'd rather not put it in stocks at the current moment because I think the market is over bought. However, I do plan on investing it in the coming months so I don't want it tied up either.

I was wondering if anyone has any suggestions.

What are you planning to invest it in? If you have plans for the money in the next few months, then just keep it in a savings or a money market account.

[disneysteve]

To answer your question, I'd agree with Brian. If this is money you plan to use within the next few months or even the next year or two, keep it in money markets or maybe some laddered CDs in you can estimate when you'll need it.

To comment on your plan, though, market timing does not work. What if you sit on the sidelines waiting for a market correction that doesn't come? I'd suggest you start feeding this money into the market now on a regular, consistent basis. Also, be sure to appropriately diversify it and stick to your desired asset allocation.

[JoshuaHeckathorn]

To answer your question, I'd agree with Brian. If this is money you plan to use within the next few months or even the next year or two, keep it in money markets or maybe some laddered CDs in you can estimate when you'll need it.

To comment on your plan, though, market timing does not work. What if you sit on the sidelines waiting for a market correction that doesn't come? I'd suggest you start feeding this money into the market now on a regular, consistent basis. Also, be sure to appropriately diversify it and stick to your desired asset allocation.

I agree with Steve- at least take a nice chunk and start investing regularly now. I would then take the rest and stash it in a high-yield online savings account or two if you want to keep it completely liquid. The rates aren't great these days, but you can still get about 1% from the likes of ING, HSBC, Ally, etc.

Have you thought about buying real estate too? There are some great deals to be had around the country if that's something that interests you.

[disneysteve]

I agree with Steve- at least take a nice chunk and start investing regularly now. I would then take the rest and stash it in a high-yield online savings account or two if you want to keep it completely liquid.

This is an important point that I didn't think of earlier. Remember, there is a limit to the FDIC insurance coverage. You are talking about an amount of money that exceeds that limit so be sure to split up this money among 3 or 4 or 5 different banks so that it is all insured. I don't recall if the limit is still 250K or if it has reverted back to 100K.

[Ima saver]

The limit is 250K and if held in joint names, it will be covered up to 500K by FDIC.