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I have 1500 ready to put down into something, and ill add 50 a week to it automatically. Not sure where to put it, but I don't want to have to do a thing after the initial setup. Was thinking acorns since I already have the card and account setup. Don't want to put it in my bank, crap returns. I've been reading up on money market accounts, but not entirely sure how they work?
[QUOTE=chalup;1613420481]I have 1500 ready to put down into something, and ill add 50 a week to it automatically. Not sure where to put it, but I don't want to have to do a thing after the initial setup. Was thinking acorns since I already have the card and account setup. Don't want to put it in my bank, crap returns. I've been reading up on money market accounts, but not entirely sure how they work?[/QUOTE]
Could just put it in an ETF that tracks the SP500 or Nasdaq on the next dip and check back in 20yrs
This is what i did but with less starting $$$. I opened a TD Ameritrade account and bought a mutual fund with the money. I then hooked my bank account to my account and set up automatic deposits each week from my paychecks. Like literally $10 a week, poverty amount but whatever.
Mutual Fund trades are free so its not costing me to buy them like it would a regular stock. They pay dividends and the dividends are automatically reinvested which is great and not something Robinhood does. The only manual thing I have do is go purchase more of the mutual fund with the money I put it weekly from my paycheck. I usually login once or twice a month and buy the same fund with the money I have accumulated.
I would like to hijack your thread and ask others what are some good funds to invest in? I'm currently in STVTX (Virtus Ceredex Large-Cap Value Equity Fund Class I) but not that thrilled with its overall performance but it does pay dividends pretty often.
[QUOTE=Heaney;1613422401]Could just put it in an ETF that tracks the SP500 or Nasdaq on the next dip and check back in 20yrs[/QUOTE]
ETF doesn't have insane amount of early WD fees? thats the only caveat for me.
[QUOTE=chalup;1613443221]ETF doesn't have insane amount of early WD fees? thats the only caveat for me.[/QUOTE]
Nah its the same as buying a stock but instead of an individual company it tracks an index so for example if you bought QQQ it tracks the nasdaq so you are getting exposure to the Top 100 tech stocks and you can just withdraw it whenever you want. That is just an example there are tons of ETFs out there and you'll likely see a much better return than a savings account.
M1Finance is hands off. It creates pies for you that track many stocks so you will be very diversified. The safest bet is to buy a stock like SPY that just tracks the all the top stocks, so you own a piece of them all. When the whole market goes up, you go up equally.
It's addicting. In March I added my first $1000, now ive added over $50,000 lol. Made like $10,000 profit already due to Covid19 crash
Id recommend not using Robinhood as most people dont know what theyre doing, including me at first.
There are a several different options.
I'm not familiar with Acorns, so I can't comment on that one.
I've used both TD Ameritrade and Robinhood. I much prefer TDA. Robinhood is fine if you just want to buy and trade regularly on the immediate market, but I see two big flaws. First is the lack of DRIP options, which is important if you are using this as a savings account. Another Robinhood drawback is that you can't lowball to buy stocks. If stock XYZ is trading at $100 you can't tell the program "Buy shares when they drop to $70," because if you put something in that is more than 10% lower Robinhood will delete your order. It's fine for regular traders, but lacking some important features if you want a "Set and forget" option.
There are other savings options that pay (relatively) decent interest, but you have to hunt for them. T-Mobile money is paying 4% (restrictions apply). I'm sure there are others out there.
OP only start investing if you already have some savings that you feel comfortable with if everything's goes to ****.
E.g. If you feel comfortable with $1500, don't save anymore (in savings) and invest the rest.
Since I live in CA, and was afraid they would do something stupid like shutting down the state and putting millions out if a job, I save at least 1 year of rent.
Savings should just be rainy day money if chit hits the fan, doesn't need to gain interest imo. If you're dropping that money, prob a low cost index or a dividend stock with decent return and you can get a share each time you drop 50
You are getting a lot of investing advice because you mention acorns, but you also state you are looking for a savings account so it sounds like you might need this money in the short term. Are you looking to save or invest this money? You shouldn't expect to earn money from savings. You keep money in savings for the security of knowing it will always be there when you need it. Investing requires risk and no guarantees the money will still be there especially in the short term.
If you do want to invest I would highly encourage you to educate yourself to the point you are confident making your own investment choices instead of paying a middleman that will eat away your potential gains for their own profit.
If you are just interested in a basic 'savings account' to stack some cash I'd say just use a regular savings account through your primary bank for ease of transfer from your checking account to savings. If it starts getting to be a large sum. It may be time to look at other options.
I go another route for my emergency fund. I use Vanguard for investing and the default place to store money is the Vanguard Federal Money Market. It requires you have at least 3K in Vanguard and seems to be very stable. Historical average returns of 4%. It pays a dividend directly back into your account.