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What should I do with my money?

CalBoy said:
You can open a Roth or Traditional IRA at most banks, financial institutions, and large investment companies (ie Vanguard, Fidelity).

If your current taxable income is on the lower end and you project making more money in retirement (you have a government pension or other assets that will be worth a lot by age 59 1/2) the Roth is for you.

In my situation for example, I paid very little in taxes this year, so it made sense to put money into a Roth IRA (limited to the amount you earn or $4,000-whichever is less- for 2007) because by the time I retire, I'll have other retirement savings working for me (401k, other assets).

If you are making good money now but don't forsee making that much in retirement (high salary at the moment but no pension plan), a traditional IRA will allow you to take a tax credit for the year you open it that's equal to the amount you put into it. However, there is a limit on this that's tied to your 401k (assuming you have one). With a Roth IRA, you can maximize both your 401k contributions and your Roth IRA contributions.

When it comes to where to invest your money in an IRA, I think an investment firm like Vanguard is a good idea. They offer a lot of funds that you can diversify your money with. Target Funds are a great idea if you don't know what else to do with your money. They are managed by a fund manager and meant to adjust the risk:safety ratio as you age (Target Funds are named by the year you want to retire, eg, Target Fund 2030 or Target Fund 2045).

I highly recommend speaking with someone from an investment firm. If you're interested in opening an IRA, they will be willing to offer you advice and tips, which is always valuable. :)
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Thanks! I will bring it up the next time I am with my $ adviser, it hasn't come up yet, but we've only met twice.

I'll look into it!

Many thanks!
 
Xfujinon said:
Thanks! I will bring it up the next time I am with my $ adviser, it hasn't come up yet, but we've only met twice.

I'll look into it!

Many thanks!
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No problem. :)

Also be sure to be investing in your and your wife's 401k at work. Most employers offer a certain "match" amount, and you'll want to contribute enough to get the match at the very minimum. Usually most people find that this is quite enough where they don't have much more to spare towards retirement. But, this all depends on your circumstances. Look into it and ask your coworkers what they do.
 
Open a CD (6 - 12 months) -- which ever back has the highest yield and is FDIC insured.
 
IRA is probably the best way to go. I REALLY need to start putting money into an IRA. Remember, you can put money in one every month starting now and quit in 10 years and have more when you retire than if you wait ten years and then put money in monthly UNTIL you retire. I just wish I could afford to do it most months. Usually I'm barely scraping by.
 
CalBoy said:
You can open a Roth or Traditional IRA at most banks, financial institutions, and large investment companies (ie Vanguard, Fidelity).

If your current taxable income is on the lower end and you project making more money in retirement (you have a government pension or other assets that will be worth a lot by age 59 1/2) the Roth is for you.

In my situation for example, I paid very little in taxes this year, so it made sense to put money into a Roth IRA (limited to the amount you earn or $4,000-whichever is less- for 2007) because by the time I retire, I'll have other retirement savings working for me (401k, other assets).

If you are making good money now but don't forsee making that much in retirement (high salary at the moment but no pension plan), a traditional IRA will allow you to take a tax credit for the year you open it that's equal to the amount you put into it. However, there is a limit on this that's tied to your 401k (assuming you have one). With a Roth IRA, you can maximize both your 401k contributions and your Roth IRA contributions.

When it comes to where to invest your money in an IRA, I think an investment firm like Vanguard is a good idea. They offer a lot of funds that you can diversify your money with. Target Funds are a great idea if you don't know what else to do with your money. They are managed by a fund manager and meant to adjust the risk:safety ratio as you age (Target Funds are named by the year you want to retire, eg, Target Fund 2030 or Target Fund 2045).

I highly recommend speaking with someone from an investment firm. If you're interested in opening an IRA, they will be willing to offer you advice and tips, which is always valuable. :)
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Ya, I like the idea of that, but I'd like to own commercial real estate and rent it to businesses which would continue to bring in money after I retire. :) So I'd rather have something that I could spend in ten years on my first building, like a CD or stock.

jb60606 said:
no offense, but working for family usually means you'll get roughly half of what you're expecting, unless they're relatively rich. Never work for family kid :)

(unless you can get them to sign a contract or something)
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It's all official as my dad does make a lot of money so he's in a high tax bracket so everything I make is tax deductible.
 
techlover828 said:
It's all official as my dad does make a lot of money so he's in a high tax bracket so everything I make is tax deductible.
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good deal then. You're young - I'd keep rolling it into a CD every year until a "rainy day" scenario - compound interest is a thing of beauty.

Three thousand is a lot of money if you save it. It may as well be a roll of pennies if you spend it.
 
jb60606 said:
good deal then. You're young - I'd keep rolling it into a CD every year until a "rainy day" scenario - compound interest is a thing of beauty.

Three thousand is a lot of money if you save it. It may as well be a roll of pennies if you spend it.
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ya, ok, I'll get a cd.

Thanks everyone for all of your help!
 
I've got a savings account with Etrade. I started it last summer when it was at 5.05% apr. I don't know what it is now, but I throw about 250 a month into it and started at 2500. I'm in college and wish I had started when you did, instead of buying a brand new car and all that stuff. You have a pretty good head on your shoulders, but don't spend it... It's very easy to spend money in college, much harder to save. I've learned this in my 3+ years here at college.
 
Oooohhh, Savings Bonds are SO exciting! Good Lord people, the O.P. is 15!!! Go have some fun with it! Spend it on something you're going to remember for the rest of your life! Buy some nice clothes, nice shoes, a little bling, date a cheerleader, get laid! In a couple of years maybe go on a spring break trip that Maxim will be jealous of. C'mon, live a little! Spend your money! Savings bonds are for people my age (who really wish I did all of the above when I was your age!)
 
eRondeau said:
Oooohhh, Savings Bonds are SO exciting! Good Lord people, the O.P. is 15!!! Go have some fun with it! Spend it on something you're going to remember for the rest of your life! Buy some nice clothes, nice shoes, a little bling, date a cheerleader, get laid! In a couple of years maybe go on a spring break trip that Maxim will be jealous of. C'mon, live a little! Spend your money! Savings bonds are for people my age (who really wish I did all of the above when I was your age!)
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I just looked in the mirror, and I can feel every ounce of your statement.

I worked and saved for a car during high school and I'm still driving the damn thing 10 years later. (F U "Fast and the Furious") But now I am still benefiting for the sacrifice I made back then.

The OP needs to remember that in 10 or 15 years he will be fat, balding, married with children and working in a cubicle. (I know I'm not alone here) Its not all bad, you can afford good beer and eat steak every night. But, it's good to act stupid while you can get away with it.
 
Investing in one mutual fund is not going to protect him from much risk. At his age if the mutual fund doesn't perform he is going to be highly disappointed with any sort of loss even $10 is huge to a 15 year old.

I would say put $1000 in a Roth, another $1000 in savings, and keep $1000 for yourself in a checking account. I recommend this because:

Roth: Retirement Savings- You won't be able to touch for many, many years.

Savings: Such as ING or HSBC or short term CD 6-12 months: High Yield Savings Thats Still Liquid At Any Time. (Liquid=means converted).

Checking: If your working hard at the age of 15 reward yourself with small purchases.
 
Plymouthbreezer said:
If I have an extra amount of cash around, I buy U.S. Savings Bonds. Call me crazy, but it's solid and keeps me from spending the cash.
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ZZZzzzzzzzzzz. Savings bond make me think of "Are We There Yet Questions From Kids", you think the damn things are never going to mature.


Also a note about ING and other E-Banks. It may take longer to get your money transferred back to your checking account but I like the delay because it keeps me from withdrawing money for nonsense purchases. When you know it's going to take a couple days, the novelty of the item you were going to buy wears off and you don't buy it.
 
shu82 said:
Good luck in this market! An ING account would be much safer. With 3K you aren't looking at too much interest as a whole. And at your age, if you aren't looking super long term, I would go with an ING. ~ 4.5%
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ING is at 3.1% right now. Interest rates have dropped like a stone in the last 8 months (opened credit union account at 4.5% now at 3.55%).
 
jb60606 said:
no offense, but working for family usually means you'll get roughly half of what you're expecting, unless they're relatively rich. Never work for family kid :)

(unless you can get them to sign a contract or something)
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Not necessarily, I have family members who work for me that get a regular paycheck. Because it is a real company, albeit small, employees should all be treated the same.

As young as the OP is, I think he should go for a shorter term CD @ 12-18 month or money market savings account. I think he'll be surprised how "life comes at you fast" so to speak..;)
 
I'd definitely put the money into a ING savings account . I had a similar amount saved up when I was your age and was dumb enough to blow it on a new computer.. Wish it was still around.
 
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