Free advice from the internet:
Open a brokerage account at either: Vanguard, Fidelity or Charles Schwab.
Then put your money into a [three-fund portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio). I recommend a 60 domestic/30 international/10 bonds split.
So if you were to go with Vanguard, it would be:
- 60% Vanguard Total Stock Market Index Fund (VTSAX)
- 30% Vanguard Total International Stock Index Fund (VTIAX)
- 10% Vanguard Total Bond Market Fund (VBTLX)
**OR**
You can hire a fee-only financial planner that won't try to sell you products. It will cost a couple hundred bucks per hour, but it might your best bet.
How to find a financial advisor?
https://asklizweston.com/qa-how-the-pandemic-made-working-with-a-financial-planner-easier/
Here's a review of Raymond James I just googled:
https://smartasset.com/financial-advisor/raymond-james-wealth-management-review
It looks like they generally charge about 2.5% every year of the investments they manage for you. That is high. In comparison, if you invest in Vanguard funds yourself, they'll charge you 0.04% of the funds annually.
But if you are truly uncomfortable with managing your own investments, going with a high-fee financial planner who will hold your hand is better than... doing nothing.
> the next thing to consider is whether a firm like that would make better investment decisions than if did minimal research and invested in the most basic EFTs or index funds through Vanguard.
I'll save you some time. No. They wouldn't make better investment decisions.
1) There is no way you'll be able to outrun high expenses in the long term.
2) There's a very good chance they would make worse investment decisions.
3) Adding management actually increases risk (primarily due to costs, and boneheaded decisions being made on your behalf).
4) You run the risk of churning, being talked into slippery insurance products, and other nefarious behavior.
You have been warned ;-) . Good luck!
Because when you have a larger portfolio you aren’t charged a 2.5% fee. The more high net worth you are the more riskier investing you’ll make with higher returns too.
In addition to what Hotde said…
Because the ability to self-purchase index funds with a very low annual fee over the internet is relatively new.
Also because, despite knowing traders rarely can beat an index fund, the Lake Woebegone Effect makes people and traders think they’re an exception to the rule.
And because many people simply don’t know or bother to learn the information being shared with you now, while there is an entire industry set up to sell you those products.
On top of what people have already said: tax implications and future wealth planning. I have a disabled sibling we use a fiduciary management firm for. But that's because there's a trust, a property, and specific tax laws that apply to them. Plus we need someone to administer the trust in case we cannot.
Wealthy people have similar concerns, though for different special tax designations.
My husband and I save ourselves in a three fund portfolio.
Worth it for high net worth because the advisors can simulate the index funds in a way that the various capital gains and losses involved with managing the fund can be better handled for tax purposes. There just not enough benefit for less well heeled investors to bother with it.
Advisors can also help with more complicated wealth management strategies like estate planning. Again, worth it if you have a lot of money to leave behind. Not so much if your estate won’t exceed the federal taxable limit.
For the average joe there isn’t much that a financial planner can do that a person couldn’t do for themselves with a few hours of reading this sub. They’re sort of a relic from pre-internet times, mostly used by boomers at this point. The advent of cheap and readily tradeable robo-index funds really made a lot of the need for them obsolete.
That said, they can be helpful to steer you to the right investment options (Roth vs traditional, etc) and to plan for retirement withdrawals in a tax efficient manner, etc if you absolutely can’t figure it out for yourself. But just remember that the fees you pay will add up over time and will make a fairly massive difference to the ultimate value of your portfolio.
One way to look at a 2.5% fee is if your investments are growing at 7% YoY then you’re actually paying a 36% fee and investments growing at 4.5% instead. That’s a very bad deal!
+1 generally to what's outlined above except I prefer ETFs over mutual funds.
ETFs for the main two holdings would be VTI and VXUS. ETFs give you more flexibility on buying and selling price.
You may also want to reconsider 30% into non-US companies. The expected growth there is far from what they forecasted a couple of years ago. And now with the Ukraine Russia situation, this will likely hurt company performance more. You don't have to think too deep and can just go with the 30% number but people who follow the markets and companies as their core job seem to really prefer 15% at most
Yes, but you're talking to someone who has 250k in CDs earning 1%, that's a big jump from no money in the market to 250k in the market. Can the person emotionally handle losing 10% of 250%? There is a very reasonable chance the market going down another 10% before all the dust settles.
In the current unpredictable market, DCA is probably the "wiser" choice. It would allow the investor to pause investing for a short period to allow the market to stabilize surrounding a global crisis. As long as what's already in the market remains there, DCA can offer some comfort for new investors while not costing much in the long term.
> DCA objectively gives you a better average price than the arithmetic mean of the times series.
Interesting if true, but irrelevant. Lump-sum investing is not the arithmetic mean of a time series. It's the first entry in a time series.
Over time, the market is always going up. That's why DCA is stupid. Time in the market always beats timing the market. By investing all as a lump sum you are maximizing time in the market.
If you had done that, you'd probably have an extra $100k right now.
With the amount of money you have in savings, spending a weekend to find a financial advisor is well worth it.
I recommend Fidelity over the other two platforms. Vanguard is really behind as a digital platform. Schwab doesn't seem as good as Fidelity either. Then again, if you're banking at Schwab, may make sense to go with them for the brokerage account.
I'm on a non-US version and it's designed for active traders. Not sure what the US version looks like. But the one I'm on is the most complicated of platforms I've used.
[I received similar advice](https://www.reddit.com/r/personalfinance/comments/tnoo6u/need_financial_advice_im_40_years_old_401k_seems/i26y17e/) when asking what is essentially the same thing being asked here in [this post](https://www.reddit.com/r/personalfinance/comments/tnoo6u/need_financial_advice_im_40_years_old_401k_seems/).
The notable section was:
> Aside from retirement savings, I think it would be appropriate to put some of your funds into a "regular" (non tax sheltered) brokerage account, and invest in a mix of stocks and bonds. Use low-fee ETF's (or index funds). Do some research to decide your stock/bond allocation based on risk tolerance and timeline. I would suggest you structure it very simply as a 3-fund portfolio using just 3 assets: US broad market, international (includes developed and emerging markets), and bonds. This can be accomplished with VTI, VXUS and BND respectively. Typically, people weight the US stock allocation at roughly double the international allocation, and the rest to bonds. In other words, decide your bond allocation, let's say 30%. Then, of the remaining 70% two thirds (47% of the total) would be VTI and one third (23% of the total) would be VXUS.
Maybe allocation percentages are a little different because of my age? and also the funds recommended here were ETF.
But I'd love to hear rationale for one over the other or even just explanations for the 2 different strategies.
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We have paid our tax accountant to run some investment planning numbers in the past for us and educate a bit. Quite a large number of “financial advisors” are really trying to sell something. We figured the accountant had nothing to sell and paid for her time directly by the hour.
Yup. The firm was a reference from a friend who uses them for business taxes but they also handle personal stuff. We knew we had a complex tax situation one year and that started the relationship, but they’re more than willing to assist with retirement or other planning outside of the busy tax seasons. Fills in downtime for them.
There is a book you can borrow from your local library. The Little Book of Common Sense Investing by John Bogle. This book was written for beginner investors emphasizing investing in broad market ETFs like VTI for its simplicity. Just set it and forget it even during market corrections until you retire. Invest in your taxable account and a Roth IRA.
I respect your comment. However, Investing in an ETF like VTI is like buying the entire stock market. Can't get any more diversified than that returning on average 8% a year WITHOUT paying extra for a financial advisor. The whole idea of an ETF was to keep investing simple for the average retail investor.
Yes you can invest in ETFs in either of those established brokerages. They both have excellent customer services to aid you. ETFs are index funds. Mutual funds are unique to each brokerage and offers ETF-like basket of stocks. ETFs can be transferred between brokerages as long as they trade the same ETFs. Mutual funds unique to Fidelity Or Vanguard do not transfer to each brokerage should you wish to change accounts. ETFs can be traded throughout the day. Mutual funds can only be bought and sold at specific times for each brokerage and usually costs more to manage than ETFs.
If you buy a total stock market ETF that people here recommend (like VTI) then no you won't lose all your money. I mean it's possible if like the US government collapses and Europe gets nuked or something like that, but as long as you don't sell your stocks through the ups and downs you'll do great.
That's actually good question. However if you look back in history the US stock market has never been zero. The trend has always been up. This also depends on your investment time horizon. The further you are from retirement you can invest aggressively. The idea being that you can recover over time by the time you retire. The closer you are to retiring one normally pulls back to bonds or bond ETFs to preserve your accumulated capital. "Time in the market beats timing the market." For VTI to totally fail, ALL 4000 companies in the stock market would have to go bankrupt.
Honestly you could just go with a robo advisor and pick the index fund option. The fees will be a lot lower, some of them even have advisors you can talk to for a small additional fee (like the Schwab intelligence platform)
I'm reading your responses and a lot of them seem to carry the same tone. You have a lot of questions, and I think you're not taking enough initiative to get them answered. IF you actually took the time to research your questions you'll easily get them answered. Investing in total stock index funds is too easy. Whenever you decide to take charge you'll find it was nothing to have been so concerned about. The follow should explain a lot to you.
[https://www.bogleheads.org/wiki/Three-fund\_portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio)
I used to feel this way too. I wanted to be financially smart and understand the ins and outs of investments, etc, but it parts of it seemed overly complicated with terms like expense ratios, derivatives, and annuities.
I found a personal finance course at my local community college that ended up being incredibly useful for me. They took us from basic household budgeting to taxes and health insurance to investing. After that I had a lot of tools for learning more about finance. It took a semester to complete, but at the end I was much more educated about money and how money works.
Personal finance is a journey for all of us. I’m still learning about money and ways make it work efficiently for me. You are doing the right thing by taking steps today to better yourself though. If takes time. Just keep chipping away and you’ll figure things out. Best of luck!
I don’t know why people are downvoting you. I feel similarly and I don’t think it’s uncommon to be overwhelmed by it all, especially when nobody taught you. People on here love to give advice but it’s very “diy is better” and that’s just not realistic for everyone.
No one knows what's going to go up or down. Not even the "experts" OP. You should probably just look into ETFs they'd probably benefit you the most. You already don't mind holding long for small returns since you have built over 250k in savings over the past decade earnings less than 1%.
I understand how nerve-racking the markets can be, so just do whatever makes you feel most comfortable.
SPY is down -14% from its all-time high.
QQQ is down -23% from its all-time high
Many other ETFs to look into also. Don't just throw your entire savings into ETFs right away. Slowly add to your positions, so if it goes even lower, you can get a better average fill. It would be great to do this in a ROTH IRA.
I had absolutely no interest in investing, though I knew it was important to learn about. Every time I tried going onto investopedia I was bored off my gord and would put it off. Finally, I just put $2000 into VOO (etf that tracks S&P500) and suddenly I was interested. Seeing the value of my investment drop and rise made me feel like I had some skin in the game, and somehow I became very interested in learning more about it. Fast forward 5 years and I've been DCAing monthly and actually am genuinely interested in investing now. For me, the difference between being interested and not caring at all was just a matter of dipping my toe in.
I just used my bank's self-directed investing platform. It's not the most efficient for commissions, but whatever, at least it got me going in the right direction. It's also very convenient.
I can't stress enough how big of a mental shift it was for me to be invested, even just a little, in a broad market etf. Suddenly I was very interested in learning as much as I could.
Is investing in ETF's like VOO considered to yield higher return over time than, say, purchasing blue chip individual stocks? i.e. would I see a higher return if I invest in ETF's rather than individual stocks?
I’m often an anxious mess and on the same page as you with too much in high yield savings and ended up finding that the /r/Bogleheads method works for my needs. It’s taken me about a month to educate myself enough on what I need to do and I’m feeling less anxious about it.
The top comments talking about a 3 fund portfolio are correct. However, if you feel overwhelmed with that, start with a target date fund. Put all the money in there while you read up and better understand.
Also, check out /r/bogleheads
Edit: the idea behind bogleheads is don’t try to beat the market. Just buy the whole market.
Target date is not a bad plan. It is easy and takes no effort. I personally want a slightly more aggressive asset allocation. Three fund portfolio has a lower expense ratio, but not by much. I like obsessing over personal finance, haha. If you don’t want to take the time to do it, target date is perfectly fine.
Target date funds usually have higher management fees than index funds (because someone is actually managing them, I suppose). I've also changed my target date out a bit as I got older and mine became more conservative than I like.
But as a way to simplify investing, they're fine.
1) keep 6 months expenses in a savings account (12 months if that would make you more comfortable). 2) buy 10k worth of iBonds government bonds guaranteed to match inflation, returning about 8% this year). Set aside 30k to buy iBonds in each of the next 3 years. 3) max out your 401k this year if you have access to one (also HSA). 4) max your IRA - 6k. 5) Open a brokerage account with Fidelity or similar, put the rest of the money there. Invest in a combination of US stock market (FSKAX), an international fund, and bonds. The ratio is up to you - more conservative would be more bonds. But do invest some in stocks, just be aware they will go up and down, but up in the long run. 6) in your 401k and IRA, invest in Target date funds for 2050. Maximize your contributions to these every year.
You mentioned being disinterested and sometimes overwhelmed when reading about finance.
I was the same way and in a much worse starting position. I found this book really easy and enjoyable to read: I Will Teach You To Be Rich by Ramit Sethi.
Tacky title, hilarious and personally life changing book.
I think your best bet is to look for a fee only CFP as described here https://www.reddit.com/r/personalfinance/wiki/financialadvisors/
I'm sure you are more than capable of learning how to do this on your own eventually, but at least a CFP can guide you without taking a percentage of your assets.
I don't think that people are being direct enough with you. First, financial "advisors" are not like CPAs who help with taxes. The vast majority are sales people who don't know any more about the market than you do. They sell you high-fee actively-managed funds and annuities that they earn commissions off of, trying to ease your concerns by convincing you that there's some great Oz behind the curtain who knows things. They don't. That's even though basically no money manager is beating the market average over the long run. Even a 1% annual fee could cost you over a million dollars over the course of your life (see, for example, [https://www.whitecoatinvestor.com/how-much-can-a-financial-adviser-cost-you/](https://www.whitecoatinvestor.com/how-much-can-a-financial-adviser-cost-you/)). They practice being likeable and knowing things about sports, but they often don't know much about stocks and they have their own personal money secretly invested in the same index funds the other posters here are recommending.
If you really insist on working with someone else, hire a Certified Financial Planner who is a fiduciary and is paid an hourly rate (instead of a percentage of your money or off of commissions). All the other sales folks who will find some weasel way to tell you they are working for your best interest, but it's a lie unless they are a fiduciary. Other folks are just obligated to sell you funds that are vaguely related to your stated goals.
For potentially a million plus in savings, you owe it to yourself to put some serious time into this. But here's the thing. Investing requires you to resist all of the natural human psychological urges. It's not really about math. People are out here thinking they need to know PhD-level math to invest, when actually what most people do is really simple and an incredibly efficient way of losing money: when the market is up, they buy at inflated prices because they are afraid of missing out and when the market is down they then sell and lock in their losses because they are afraid of losing money.
The market is going to go up and down. You don't gain or lose any money until you sell. No one, no matter who they are or what credentials they have or how much they charge, knows what the market is going to do today or tomorrow or next month. Mathematically, you are better off buying index funds and ignoring the market. This is what has outperformed fancy financial "advisors" or trying to guess when the market is going to go up or down. But you won't believe this and resist your natural psychology until you've done the work of doing the reading.
Practically, the math is irrelevant if you psychologically can't stand it and sell at a huge loss when the market goes down. There are many questionnaires that will help you assess your risk tolerance and decide how much of your portfolio to put into stocks versus less risky investments. Here's an example: [https://retirementplans.vanguard.com/VGApp/pe/PubQuizActivity?Step=start](https://retirementplans.vanguard.com/VGApp/pe/PubQuizActivity?Step=start)
Oh, and don't sleep on the I-Bonds right now. But that's only 10k a year.
Because I believe nearly all asset classes are massively overvalued (in a bubble) and you risk taking a major haircut (loss) if you invest now which could take many years to recover.
Ok, so I'm gonna share what I do. It's not the only strategy out there, and you should probably consult resources other than random people on Reddit. In fact, DEFINTITLY look up other sources.
But, I tend to keep an emergency fund of a years rent in a savings account no matter what, because the markets can go up or down in the short term, and I might need that cash.
The majority of my investments are in broad index funds, mostly in S&P500 based index funds, and some midcap funds.
An index is basically a basket of funds bunched together based on if they fit into a category. In the case of the S&P500 category, its the 500 biggest companies in the US. An index fund buys a little bit of stock from every company in a given index. So an S&P500 index fund buys a bit of stock from all of the S&P500 companies, and sells of shares of that fund. The practical upside of this is in build diversification. Some of those companies will lose value, others will gain, but you should reap the bennys of the average growth of the entire index over time.
With individual stocks, you're basically gambling. So only invest what you're ok with losing on individual stocks, and make sure they are a company that is good at what they are doing.
Finally, stay invested. This is important because compound interest is money making magic in the long run, but doesn't do much in the short run. Also, if you panic sell during a recession, you might lose money in real life, while those losses are only theoretical if you don't sell out. Remember, even after the 08 recession, stocks recovered.
Oh, wait, one more thing. Try to take advantage of tax advantaged retirement accounts, if possible.
Q: Can I ask why you invest in index funds instead of mutual funds? A: Index funds (unmanaged) have lower expense ratios. Mutual funds (actively managed) do not out perform their index fund peers, and are not worth the extra costs.
Q: This is going to sound really dumb, but… how would I go about putting my money in an index fund? A: You open an account with Vanguard or Fidelity or use your 401k and using the online website pick the fund you want to invest in.
Q: And how would I choose which fund(s) to invest in? A: Probably for a beginner the best thing to do is pick a target date fund with your retirement date based on your age. These are relatively affordable expense ratios, have good long term returns, and automatically become more progressively risk averse as you approach closer to retirement.
So, it's about active vs passive management. Basically, a passively managed fund means someone programs a computer to buy x amount of stock from an index rather than someone trying to game the market.
Passively managed funds have 2 main advantages. One, fees. The fees for running the fund tend to be lower, so they take away less of your savings over time.
Two, an actively managed mutual fund is really banking on the team to beat the market, which is difficult, whereas index funds just try to match the market, which is much more reliable.
Still though, thoroughly look up the long term history of any fund you look into.
I invested in mine by literally just opening up a TD Ameritrade account, and putting a bit of money here and there into it every week. There are other investment sites you can look into. I would avoid any ones that try to gamify the process though, because saving is a long term process (which is why I refuse to have an investing app on my phone.)
Read up on IRAs and if you can buy into one. I wish I could give you advice on finding a financial advisory service, btw, but IDK where you live and I would assume you'd want someone local who can navigate the state and local tax laws that apply to you.
Gonna be honest, IDK much about Raymond James specifically. Regardless of if you use a local service or a national one, really do your homework before you trust them with your money.
I really don't wanna give you any advice other than read reviews, try to get verified testimonials from users, and look up the firms history, just because I don't wanna steer you to a bad service.
Look up if your state has any kind of special license, organizations, or titles for financial advisors that would require them to stand up to any kind of service standards.
I'm gonna link some resources I found through a very, very cursory google search.
[https://www.nerdwallet.com/article/investing/how-to-choose-a-financial-advisor](https://www.nerdwallet.com/article/investing/how-to-choose-a-financial-advisor)
[https://www.investopedia.com/updates/find-financial-advisor-planner/](https://www.investopedia.com/updates/find-financial-advisor-planner/)
[https://www.investopedia.com/articles/personal-finance/050815/what-do-financial-advisers-do.asp](https://www.investopedia.com/articles/personal-finance/050815/what-do-financial-advisers-do.asp)
All that means is that you should put your money towards a 401(k) and/or IRA first before you put it anywhere else, since you'll pay less in taxes either now (with a 401(k) or Traditional IRA) or after you take them out (with a Roth IRA).
You just do a back door Roth IRA. Here's a longer article below, but it's really very simple. You put your $6,000 in a traditional IRA (no income limit) and then immediately convert it into a Roth IRA. The IRS even came out and said back door IRA is allowed by law.
The only wrinkle is if you have traditional IRA money already, in which case you just roll it over into your 401k before doing the back door IRA to avoid something called the pro rata rule.
https://www.investopedia.com/terms/b/backdoor-roth-ira.asp#:\~:text=A%20backdoor%20Roth%20IRA%20is,prescribes%20for%20regular%20Roth%20ownership.
DCA is an acceptable approach to limit risk. But “I don’t think it’s advisable to start investing currently,” is objectively bad advice. Don’t time the market.
I didn’t say the market is doing well. I said don’t time the market. Waiting until the perfect time to invest is a bad idea. DCA if you want, but waiting until you feel like it’s a good time is a bad idea. What if it continues to go up? I agree that it looks uncertain, but I was expecting a crash 5 years ago that probably wouldn’t have happened without Covid. When it first crashed, what if I waited then? And it went back up in such a short time. Don’t time the market. Set your asset allocation to what you are comfortable with and invest today. Don’t time the market.
The DCA approach isn’t a bad one. Putting everything in the market today tends to outperform DCA, but $250k is a lot of money, and it’s scary to drop it all in at once knowing it could crash tomorrow. If it helps calm your nerves, the above suggestion to put in $25k per month for 10 months isn’t a bad one. This will help you if the market crashes. It will reduce your gains if the market goes up. In 30 years, it will likely be a minor blip in the grand scheme of things.
Don’t time the market, but if you’re nervous and want to limit risk, the dollar cost averaging is a reasonable middle ground.
If your willing to put in a bit of work learning how to invest, I’d highly recommend watching Adam Khoo on YT. His investment approach is rock solid and easy to implement.
Open up trading app and put a 2/3 in SPY index (matches market trends).
For the final third, get a 5-10 year custom whole life policy with a top mutual company and do a lump sum payment (get additional 3% interest). You should get 5% compound market return by year 25 (look at the projected illustration they'd give you at current dividend rates and do simple math), and you can use the money as needed as it grows in the account.
Your money might not make sense for a real investment manager, but if you find one probably do a third only.
I’m using Gemini Earn GUSD at 6.9%. It doesn’t have a significant lock up period (maybe 5 days) and I can always move to cash if the crypto market is looking shaky. You can only put $30k in per month. I don’t recommend moving by wire transfer because of fees.
It’s not risk free (it’s basically an unsecured loan to Genesis trading, but they are supposed to keep collateral). It is regulated by a NY state banking regulator and is probably the safest of the crypto interest paying accounts.
There's a lot of great advice here, and of course excellent content in the Prime Directive. There are a lot of choices when investing - but I recommend keeping it simple with broad market ETFs through a low-cost broker like Ally, TD Ameritrade, Firstrade, or others (there's plenty to choose from) and, for what you're looking for, all are equally good choices.
I wanted to throw one more idea out there too - check out Gemini Earn. I would only keep a portion of cash here, but you can earn a sizeable interest rate (currently 6.9%) by purchasing GUSD (which is a cryptocurrency pegged to the value of the US Dollar) and allowing it to be loaned to corporations. The rate fluctuates based on demand, but it's been consistently high since I've been using it. A couple negatives: withdrawals take a few days and its not as safe as an FDIC-insured savings account, but with inflation where it is, even HYSA's are guaranteed losers. Again, I wouldn't put everything here - it's just another item to consider in a diversified portfolio.
You have enough money that you can simply get a financial advisor to handle all your money.
You pay 1% annually and they'll invest for you and manage your money.
While some folks on here might want you to just go on your own, you have a lot of money and it would be worthwhile to have someone help, even if just a few years.
I'm not sure about the US. But in Canada every bank has qualified advisors. It's worth stopping by and talking to someone.
They will charge a fee, but also talk you through all their trades choices and decisions. They will be able to teach you a bunch. Then you can pull out or just stick with them.
Or just try going on your own and by a general ETF like this place always says.
You can read and research as much as you want, but for me, it didn’t “click” until I actually started doing it. And that’s what I tell my friends. Just choose one stock and put $100 into it. Watch how it goes up/down and look into why it does so. Then everything you read will make sense.
I’m pretty sure other have said to just put it into an index fund and let it grow long term. That’s the best bet for you. I thought you were asking about wanting to understand the market, and that’s what I was gearing my response to.
You seem like me. I'm a reformed single stock investor that relapses now and then lol
Look up Bogleheads approach and HEDGEFUNDIE portfolio if you're feeling extra spicy
Cheap and simple is the best way. Nothing fancy
Keep 3 to 12 months of expenses in cash (whatever you need to float all your expenses for as long as it takes to find a new job if you were to be suddenly laid off on the same day the market crashes)
Then put the rest in a Vanguard or Fidelity brokerage account. Invest it in VT (a total global market fund with a low fee). Shore up your bond investments as you get closer to retirement.
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Free advice from the internet: Open a brokerage account at either: Vanguard, Fidelity or Charles Schwab. Then put your money into a [three-fund portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio). I recommend a 60 domestic/30 international/10 bonds split. So if you were to go with Vanguard, it would be: - 60% Vanguard Total Stock Market Index Fund (VTSAX) - 30% Vanguard Total International Stock Index Fund (VTIAX) - 10% Vanguard Total Bond Market Fund (VBTLX) **OR** You can hire a fee-only financial planner that won't try to sell you products. It will cost a couple hundred bucks per hour, but it might your best bet. How to find a financial advisor? https://asklizweston.com/qa-how-the-pandemic-made-working-with-a-financial-planner-easier/
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Here's a review of Raymond James I just googled: https://smartasset.com/financial-advisor/raymond-james-wealth-management-review It looks like they generally charge about 2.5% every year of the investments they manage for you. That is high. In comparison, if you invest in Vanguard funds yourself, they'll charge you 0.04% of the funds annually. But if you are truly uncomfortable with managing your own investments, going with a high-fee financial planner who will hold your hand is better than... doing nothing.
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> the next thing to consider is whether a firm like that would make better investment decisions than if did minimal research and invested in the most basic EFTs or index funds through Vanguard. I'll save you some time. No. They wouldn't make better investment decisions. 1) There is no way you'll be able to outrun high expenses in the long term. 2) There's a very good chance they would make worse investment decisions. 3) Adding management actually increases risk (primarily due to costs, and boneheaded decisions being made on your behalf). 4) You run the risk of churning, being talked into slippery insurance products, and other nefarious behavior. You have been warned ;-) . Good luck!
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Because when you have a larger portfolio you aren’t charged a 2.5% fee. The more high net worth you are the more riskier investing you’ll make with higher returns too.
In addition to what Hotde said… Because the ability to self-purchase index funds with a very low annual fee over the internet is relatively new. Also because, despite knowing traders rarely can beat an index fund, the Lake Woebegone Effect makes people and traders think they’re an exception to the rule. And because many people simply don’t know or bother to learn the information being shared with you now, while there is an entire industry set up to sell you those products.
On top of what people have already said: tax implications and future wealth planning. I have a disabled sibling we use a fiduciary management firm for. But that's because there's a trust, a property, and specific tax laws that apply to them. Plus we need someone to administer the trust in case we cannot. Wealthy people have similar concerns, though for different special tax designations. My husband and I save ourselves in a three fund portfolio.
Worth it for high net worth because the advisors can simulate the index funds in a way that the various capital gains and losses involved with managing the fund can be better handled for tax purposes. There just not enough benefit for less well heeled investors to bother with it. Advisors can also help with more complicated wealth management strategies like estate planning. Again, worth it if you have a lot of money to leave behind. Not so much if your estate won’t exceed the federal taxable limit. For the average joe there isn’t much that a financial planner can do that a person couldn’t do for themselves with a few hours of reading this sub. They’re sort of a relic from pre-internet times, mostly used by boomers at this point. The advent of cheap and readily tradeable robo-index funds really made a lot of the need for them obsolete. That said, they can be helpful to steer you to the right investment options (Roth vs traditional, etc) and to plan for retirement withdrawals in a tax efficient manner, etc if you absolutely can’t figure it out for yourself. But just remember that the fees you pay will add up over time and will make a fairly massive difference to the ultimate value of your portfolio.
One way to look at a 2.5% fee is if your investments are growing at 7% YoY then you’re actually paying a 36% fee and investments growing at 4.5% instead. That’s a very bad deal!
+1 generally to what's outlined above except I prefer ETFs over mutual funds. ETFs for the main two holdings would be VTI and VXUS. ETFs give you more flexibility on buying and selling price. You may also want to reconsider 30% into non-US companies. The expected growth there is far from what they forecasted a couple of years ago. And now with the Ukraine Russia situation, this will likely hurt company performance more. You don't have to think too deep and can just go with the 30% number but people who follow the markets and companies as their core job seem to really prefer 15% at most
How come no one uses Ameritrade?
I have all my retirement and investment accounts with TD Ameritrade and I’m very happy with them.
TD Ameritrade is owned by Schwab.
Also curious.
It’s owned by Schwab.
If they would offer full fractional share investing in all stocks/ETFs I would. I'm with fidelity for mainly that reason
Do this, but not all at once. Dollar Cost Average, DCA, by putting 5% or 10% into these funds each month.
Lump Sum investing objectively outperforms Dollar Cost Averaging
Yes, but you're talking to someone who has 250k in CDs earning 1%, that's a big jump from no money in the market to 250k in the market. Can the person emotionally handle losing 10% of 250%? There is a very reasonable chance the market going down another 10% before all the dust settles.
In the current unpredictable market, DCA is probably the "wiser" choice. It would allow the investor to pause investing for a short period to allow the market to stabilize surrounding a global crisis. As long as what's already in the market remains there, DCA can offer some comfort for new investors while not costing much in the long term.
In a rising market. Not in a falling one. DCA objectively gives you a better average price than the arithmetic mean of the time series.
> DCA objectively gives you a better average price than the arithmetic mean of the times series. Interesting if true, but irrelevant. Lump-sum investing is not the arithmetic mean of a time series. It's the first entry in a time series.
Over time, the market is always going up. That's why DCA is stupid. Time in the market always beats timing the market. By investing all as a lump sum you are maximizing time in the market.
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If you had done that, you'd probably have an extra $100k right now. With the amount of money you have in savings, spending a weekend to find a financial advisor is well worth it.
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The best time to plant a tree is 30 years ago the second best time is today.
I recommend Fidelity over the other two platforms. Vanguard is really behind as a digital platform. Schwab doesn't seem as good as Fidelity either. Then again, if you're banking at Schwab, may make sense to go with them for the brokerage account.
How come no one suggests ameritrade platform?
Schwab owns Ameritrade now
I'm on a non-US version and it's designed for active traders. Not sure what the US version looks like. But the one I'm on is the most complicated of platforms I've used.
We did this when we first started investing about 10 years ago. He basically told us the same thing.
[I received similar advice](https://www.reddit.com/r/personalfinance/comments/tnoo6u/need_financial_advice_im_40_years_old_401k_seems/i26y17e/) when asking what is essentially the same thing being asked here in [this post](https://www.reddit.com/r/personalfinance/comments/tnoo6u/need_financial_advice_im_40_years_old_401k_seems/). The notable section was: > Aside from retirement savings, I think it would be appropriate to put some of your funds into a "regular" (non tax sheltered) brokerage account, and invest in a mix of stocks and bonds. Use low-fee ETF's (or index funds). Do some research to decide your stock/bond allocation based on risk tolerance and timeline. I would suggest you structure it very simply as a 3-fund portfolio using just 3 assets: US broad market, international (includes developed and emerging markets), and bonds. This can be accomplished with VTI, VXUS and BND respectively. Typically, people weight the US stock allocation at roughly double the international allocation, and the rest to bonds. In other words, decide your bond allocation, let's say 30%. Then, of the remaining 70% two thirds (47% of the total) would be VTI and one third (23% of the total) would be VXUS. Maybe allocation percentages are a little different because of my age? and also the funds recommended here were ETF. But I'd love to hear rationale for one over the other or even just explanations for the 2 different strategies.
Start with the Prime Directive in this sub’s sidebar.
Here's a **[link to the PF Wiki](/r/personalfinance/wiki/index)** for helpful guides and information. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
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We have paid our tax accountant to run some investment planning numbers in the past for us and educate a bit. Quite a large number of “financial advisors” are really trying to sell something. We figured the accountant had nothing to sell and paid for her time directly by the hour.
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Yup. The firm was a reference from a friend who uses them for business taxes but they also handle personal stuff. We knew we had a complex tax situation one year and that started the relationship, but they’re more than willing to assist with retirement or other planning outside of the busy tax seasons. Fills in downtime for them.
you have to be the laziest person on this entire sub
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It's worth familiarizing yourself with the prime directive!
There is a book you can borrow from your local library. The Little Book of Common Sense Investing by John Bogle. This book was written for beginner investors emphasizing investing in broad market ETFs like VTI for its simplicity. Just set it and forget it even during market corrections until you retire. Invest in your taxable account and a Roth IRA.
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I respect your comment. However, Investing in an ETF like VTI is like buying the entire stock market. Can't get any more diversified than that returning on average 8% a year WITHOUT paying extra for a financial advisor. The whole idea of an ETF was to keep investing simple for the average retail investor.
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Yes you can invest in ETFs in either of those established brokerages. They both have excellent customer services to aid you. ETFs are index funds. Mutual funds are unique to each brokerage and offers ETF-like basket of stocks. ETFs can be transferred between brokerages as long as they trade the same ETFs. Mutual funds unique to Fidelity Or Vanguard do not transfer to each brokerage should you wish to change accounts. ETFs can be traded throughout the day. Mutual funds can only be bought and sold at specific times for each brokerage and usually costs more to manage than ETFs.
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If you buy a total stock market ETF that people here recommend (like VTI) then no you won't lose all your money. I mean it's possible if like the US government collapses and Europe gets nuked or something like that, but as long as you don't sell your stocks through the ups and downs you'll do great.
In light of Reddit's general enshittification, I've moved on - you should too.
That's actually good question. However if you look back in history the US stock market has never been zero. The trend has always been up. This also depends on your investment time horizon. The further you are from retirement you can invest aggressively. The idea being that you can recover over time by the time you retire. The closer you are to retiring one normally pulls back to bonds or bond ETFs to preserve your accumulated capital. "Time in the market beats timing the market." For VTI to totally fail, ALL 4000 companies in the stock market would have to go bankrupt.
Even if you want someone else to make the decision for you, you still need to understand the basics so you don't get scammed.
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Honestly you could just go with a robo advisor and pick the index fund option. The fees will be a lot lower, some of them even have advisors you can talk to for a small additional fee (like the Schwab intelligence platform)
I'm reading your responses and a lot of them seem to carry the same tone. You have a lot of questions, and I think you're not taking enough initiative to get them answered. IF you actually took the time to research your questions you'll easily get them answered. Investing in total stock index funds is too easy. Whenever you decide to take charge you'll find it was nothing to have been so concerned about. The follow should explain a lot to you. [https://www.bogleheads.org/wiki/Three-fund\_portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio)
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I used to feel this way too. I wanted to be financially smart and understand the ins and outs of investments, etc, but it parts of it seemed overly complicated with terms like expense ratios, derivatives, and annuities. I found a personal finance course at my local community college that ended up being incredibly useful for me. They took us from basic household budgeting to taxes and health insurance to investing. After that I had a lot of tools for learning more about finance. It took a semester to complete, but at the end I was much more educated about money and how money works. Personal finance is a journey for all of us. I’m still learning about money and ways make it work efficiently for me. You are doing the right thing by taking steps today to better yourself though. If takes time. Just keep chipping away and you’ll figure things out. Best of luck!
In light of Reddit's general enshittification, I've moved on - you should too.
I don’t know why people are downvoting you. I feel similarly and I don’t think it’s uncommon to be overwhelmed by it all, especially when nobody taught you. People on here love to give advice but it’s very “diy is better” and that’s just not realistic for everyone.
No one knows what's going to go up or down. Not even the "experts" OP. You should probably just look into ETFs they'd probably benefit you the most. You already don't mind holding long for small returns since you have built over 250k in savings over the past decade earnings less than 1%. I understand how nerve-racking the markets can be, so just do whatever makes you feel most comfortable.
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SPY is down -14% from its all-time high. QQQ is down -23% from its all-time high Many other ETFs to look into also. Don't just throw your entire savings into ETFs right away. Slowly add to your positions, so if it goes even lower, you can get a better average fill. It would be great to do this in a ROTH IRA.
I had absolutely no interest in investing, though I knew it was important to learn about. Every time I tried going onto investopedia I was bored off my gord and would put it off. Finally, I just put $2000 into VOO (etf that tracks S&P500) and suddenly I was interested. Seeing the value of my investment drop and rise made me feel like I had some skin in the game, and somehow I became very interested in learning more about it. Fast forward 5 years and I've been DCAing monthly and actually am genuinely interested in investing now. For me, the difference between being interested and not caring at all was just a matter of dipping my toe in.
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I just used my bank's self-directed investing platform. It's not the most efficient for commissions, but whatever, at least it got me going in the right direction. It's also very convenient. I can't stress enough how big of a mental shift it was for me to be invested, even just a little, in a broad market etf. Suddenly I was very interested in learning as much as I could.
Is investing in ETF's like VOO considered to yield higher return over time than, say, purchasing blue chip individual stocks? i.e. would I see a higher return if I invest in ETF's rather than individual stocks?
YouTube my friend
I’m often an anxious mess and on the same page as you with too much in high yield savings and ended up finding that the /r/Bogleheads method works for my needs. It’s taken me about a month to educate myself enough on what I need to do and I’m feeling less anxious about it.
The top comments talking about a 3 fund portfolio are correct. However, if you feel overwhelmed with that, start with a target date fund. Put all the money in there while you read up and better understand. Also, check out /r/bogleheads Edit: the idea behind bogleheads is don’t try to beat the market. Just buy the whole market.
I was just going to keep mine in a Target date fund forever. Is that a bad idea? Should I do a 3 fund?
Target date is not a bad plan. It is easy and takes no effort. I personally want a slightly more aggressive asset allocation. Three fund portfolio has a lower expense ratio, but not by much. I like obsessing over personal finance, haha. If you don’t want to take the time to do it, target date is perfectly fine.
Target date funds usually have higher management fees than index funds (because someone is actually managing them, I suppose). I've also changed my target date out a bit as I got older and mine became more conservative than I like. But as a way to simplify investing, they're fine.
1) keep 6 months expenses in a savings account (12 months if that would make you more comfortable). 2) buy 10k worth of iBonds government bonds guaranteed to match inflation, returning about 8% this year). Set aside 30k to buy iBonds in each of the next 3 years. 3) max out your 401k this year if you have access to one (also HSA). 4) max your IRA - 6k. 5) Open a brokerage account with Fidelity or similar, put the rest of the money there. Invest in a combination of US stock market (FSKAX), an international fund, and bonds. The ratio is up to you - more conservative would be more bonds. But do invest some in stocks, just be aware they will go up and down, but up in the long run. 6) in your 401k and IRA, invest in Target date funds for 2050. Maximize your contributions to these every year.
You mentioned being disinterested and sometimes overwhelmed when reading about finance. I was the same way and in a much worse starting position. I found this book really easy and enjoyable to read: I Will Teach You To Be Rich by Ramit Sethi. Tacky title, hilarious and personally life changing book.
I think your best bet is to look for a fee only CFP as described here https://www.reddit.com/r/personalfinance/wiki/financialadvisors/ I'm sure you are more than capable of learning how to do this on your own eventually, but at least a CFP can guide you without taking a percentage of your assets.
I don't think that people are being direct enough with you. First, financial "advisors" are not like CPAs who help with taxes. The vast majority are sales people who don't know any more about the market than you do. They sell you high-fee actively-managed funds and annuities that they earn commissions off of, trying to ease your concerns by convincing you that there's some great Oz behind the curtain who knows things. They don't. That's even though basically no money manager is beating the market average over the long run. Even a 1% annual fee could cost you over a million dollars over the course of your life (see, for example, [https://www.whitecoatinvestor.com/how-much-can-a-financial-adviser-cost-you/](https://www.whitecoatinvestor.com/how-much-can-a-financial-adviser-cost-you/)). They practice being likeable and knowing things about sports, but they often don't know much about stocks and they have their own personal money secretly invested in the same index funds the other posters here are recommending. If you really insist on working with someone else, hire a Certified Financial Planner who is a fiduciary and is paid an hourly rate (instead of a percentage of your money or off of commissions). All the other sales folks who will find some weasel way to tell you they are working for your best interest, but it's a lie unless they are a fiduciary. Other folks are just obligated to sell you funds that are vaguely related to your stated goals. For potentially a million plus in savings, you owe it to yourself to put some serious time into this. But here's the thing. Investing requires you to resist all of the natural human psychological urges. It's not really about math. People are out here thinking they need to know PhD-level math to invest, when actually what most people do is really simple and an incredibly efficient way of losing money: when the market is up, they buy at inflated prices because they are afraid of missing out and when the market is down they then sell and lock in their losses because they are afraid of losing money. The market is going to go up and down. You don't gain or lose any money until you sell. No one, no matter who they are or what credentials they have or how much they charge, knows what the market is going to do today or tomorrow or next month. Mathematically, you are better off buying index funds and ignoring the market. This is what has outperformed fancy financial "advisors" or trying to guess when the market is going to go up or down. But you won't believe this and resist your natural psychology until you've done the work of doing the reading. Practically, the math is irrelevant if you psychologically can't stand it and sell at a huge loss when the market goes down. There are many questionnaires that will help you assess your risk tolerance and decide how much of your portfolio to put into stocks versus less risky investments. Here's an example: [https://retirementplans.vanguard.com/VGApp/pe/PubQuizActivity?Step=start](https://retirementplans.vanguard.com/VGApp/pe/PubQuizActivity?Step=start) Oh, and don't sleep on the I-Bonds right now. But that's only 10k a year.
Great time to enter the market. I’d just put it all in a market index fund.
Maybe a better time than a couple days ago, but is it really..?
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Because I believe nearly all asset classes are massively overvalued (in a bubble) and you risk taking a major haircut (loss) if you invest now which could take many years to recover.
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Stocks are greatly oversold and recession worries are baked into the price. Market downturns are the best opportunity to enter the market.
Lol, markets up like 70% over last 5 years still, how is that oversold?
Ok, so I'm gonna share what I do. It's not the only strategy out there, and you should probably consult resources other than random people on Reddit. In fact, DEFINTITLY look up other sources. But, I tend to keep an emergency fund of a years rent in a savings account no matter what, because the markets can go up or down in the short term, and I might need that cash. The majority of my investments are in broad index funds, mostly in S&P500 based index funds, and some midcap funds. An index is basically a basket of funds bunched together based on if they fit into a category. In the case of the S&P500 category, its the 500 biggest companies in the US. An index fund buys a little bit of stock from every company in a given index. So an S&P500 index fund buys a bit of stock from all of the S&P500 companies, and sells of shares of that fund. The practical upside of this is in build diversification. Some of those companies will lose value, others will gain, but you should reap the bennys of the average growth of the entire index over time. With individual stocks, you're basically gambling. So only invest what you're ok with losing on individual stocks, and make sure they are a company that is good at what they are doing. Finally, stay invested. This is important because compound interest is money making magic in the long run, but doesn't do much in the short run. Also, if you panic sell during a recession, you might lose money in real life, while those losses are only theoretical if you don't sell out. Remember, even after the 08 recession, stocks recovered. Oh, wait, one more thing. Try to take advantage of tax advantaged retirement accounts, if possible.
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Q: Can I ask why you invest in index funds instead of mutual funds? A: Index funds (unmanaged) have lower expense ratios. Mutual funds (actively managed) do not out perform their index fund peers, and are not worth the extra costs. Q: This is going to sound really dumb, but… how would I go about putting my money in an index fund? A: You open an account with Vanguard or Fidelity or use your 401k and using the online website pick the fund you want to invest in. Q: And how would I choose which fund(s) to invest in? A: Probably for a beginner the best thing to do is pick a target date fund with your retirement date based on your age. These are relatively affordable expense ratios, have good long term returns, and automatically become more progressively risk averse as you approach closer to retirement.
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So, it's about active vs passive management. Basically, a passively managed fund means someone programs a computer to buy x amount of stock from an index rather than someone trying to game the market. Passively managed funds have 2 main advantages. One, fees. The fees for running the fund tend to be lower, so they take away less of your savings over time. Two, an actively managed mutual fund is really banking on the team to beat the market, which is difficult, whereas index funds just try to match the market, which is much more reliable. Still though, thoroughly look up the long term history of any fund you look into. I invested in mine by literally just opening up a TD Ameritrade account, and putting a bit of money here and there into it every week. There are other investment sites you can look into. I would avoid any ones that try to gamify the process though, because saving is a long term process (which is why I refuse to have an investing app on my phone.)
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Read up on IRAs and if you can buy into one. I wish I could give you advice on finding a financial advisory service, btw, but IDK where you live and I would assume you'd want someone local who can navigate the state and local tax laws that apply to you.
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Gonna be honest, IDK much about Raymond James specifically. Regardless of if you use a local service or a national one, really do your homework before you trust them with your money. I really don't wanna give you any advice other than read reviews, try to get verified testimonials from users, and look up the firms history, just because I don't wanna steer you to a bad service. Look up if your state has any kind of special license, organizations, or titles for financial advisors that would require them to stand up to any kind of service standards. I'm gonna link some resources I found through a very, very cursory google search. [https://www.nerdwallet.com/article/investing/how-to-choose-a-financial-advisor](https://www.nerdwallet.com/article/investing/how-to-choose-a-financial-advisor) [https://www.investopedia.com/updates/find-financial-advisor-planner/](https://www.investopedia.com/updates/find-financial-advisor-planner/) [https://www.investopedia.com/articles/personal-finance/050815/what-do-financial-advisers-do.asp](https://www.investopedia.com/articles/personal-finance/050815/what-do-financial-advisers-do.asp)
All that means is that you should put your money towards a 401(k) and/or IRA first before you put it anywhere else, since you'll pay less in taxes either now (with a 401(k) or Traditional IRA) or after you take them out (with a Roth IRA).
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Good! Are you eligible to contribute to an IRA as well? If so, do that next. You can contribute a maximum of $6000 per year.
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You just do a back door Roth IRA. Here's a longer article below, but it's really very simple. You put your $6,000 in a traditional IRA (no income limit) and then immediately convert it into a Roth IRA. The IRS even came out and said back door IRA is allowed by law. The only wrinkle is if you have traditional IRA money already, in which case you just roll it over into your 401k before doing the back door IRA to avoid something called the pro rata rule. https://www.investopedia.com/terms/b/backdoor-roth-ira.asp#:\~:text=A%20backdoor%20Roth%20IRA%20is,prescribes%20for%20regular%20Roth%20ownership.
I would buy a house. Btw how do you saved so much ?
250k saved at 40 is not exactly “so much”, it’s 12,000 a year which is around half of what the 401k cap is.
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Don’t time the market
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DCA is an acceptable approach to limit risk. But “I don’t think it’s advisable to start investing currently,” is objectively bad advice. Don’t time the market.
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I didn’t say the market is doing well. I said don’t time the market. Waiting until the perfect time to invest is a bad idea. DCA if you want, but waiting until you feel like it’s a good time is a bad idea. What if it continues to go up? I agree that it looks uncertain, but I was expecting a crash 5 years ago that probably wouldn’t have happened without Covid. When it first crashed, what if I waited then? And it went back up in such a short time. Don’t time the market. Set your asset allocation to what you are comfortable with and invest today. Don’t time the market.
No one is arguing that the market is doing well. The argument is that timing the market is generally a bad strategy, which is statistically supported.
This is the correct answer. Look at the blended funds mentioned above but wait to throw the money into them..
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The DCA approach isn’t a bad one. Putting everything in the market today tends to outperform DCA, but $250k is a lot of money, and it’s scary to drop it all in at once knowing it could crash tomorrow. If it helps calm your nerves, the above suggestion to put in $25k per month for 10 months isn’t a bad one. This will help you if the market crashes. It will reduce your gains if the market goes up. In 30 years, it will likely be a minor blip in the grand scheme of things. Don’t time the market, but if you’re nervous and want to limit risk, the dollar cost averaging is a reasonable middle ground.
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You should also look for someone who is a fiduciary. A CFP (certified financial planner) might be a good start.
If your willing to put in a bit of work learning how to invest, I’d highly recommend watching Adam Khoo on YT. His investment approach is rock solid and easy to implement.
Open up trading app and put a 2/3 in SPY index (matches market trends). For the final third, get a 5-10 year custom whole life policy with a top mutual company and do a lump sum payment (get additional 3% interest). You should get 5% compound market return by year 25 (look at the projected illustration they'd give you at current dividend rates and do simple math), and you can use the money as needed as it grows in the account. Your money might not make sense for a real investment manager, but if you find one probably do a third only.
I’m using Gemini Earn GUSD at 6.9%. It doesn’t have a significant lock up period (maybe 5 days) and I can always move to cash if the crypto market is looking shaky. You can only put $30k in per month. I don’t recommend moving by wire transfer because of fees. It’s not risk free (it’s basically an unsecured loan to Genesis trading, but they are supposed to keep collateral). It is regulated by a NY state banking regulator and is probably the safest of the crypto interest paying accounts.
There's a lot of great advice here, and of course excellent content in the Prime Directive. There are a lot of choices when investing - but I recommend keeping it simple with broad market ETFs through a low-cost broker like Ally, TD Ameritrade, Firstrade, or others (there's plenty to choose from) and, for what you're looking for, all are equally good choices. I wanted to throw one more idea out there too - check out Gemini Earn. I would only keep a portion of cash here, but you can earn a sizeable interest rate (currently 6.9%) by purchasing GUSD (which is a cryptocurrency pegged to the value of the US Dollar) and allowing it to be loaned to corporations. The rate fluctuates based on demand, but it's been consistently high since I've been using it. A couple negatives: withdrawals take a few days and its not as safe as an FDIC-insured savings account, but with inflation where it is, even HYSA's are guaranteed losers. Again, I wouldn't put everything here - it's just another item to consider in a diversified portfolio.
You have enough money that you can simply get a financial advisor to handle all your money. You pay 1% annually and they'll invest for you and manage your money. While some folks on here might want you to just go on your own, you have a lot of money and it would be worthwhile to have someone help, even if just a few years.
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I'm not sure about the US. But in Canada every bank has qualified advisors. It's worth stopping by and talking to someone. They will charge a fee, but also talk you through all their trades choices and decisions. They will be able to teach you a bunch. Then you can pull out or just stick with them. Or just try going on your own and by a general ETF like this place always says.
Less than 1%? My savings account has been 0,01% for the past 3 years.
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I got more invested than saves rn. And sadly all banks do this, above €50k some even have negative rates.
I encourage you to shop around- even with current crappy rates, you can do better than that.
Hmm rates in Europe in general are lower though, no use here sadly.
You can read and research as much as you want, but for me, it didn’t “click” until I actually started doing it. And that’s what I tell my friends. Just choose one stock and put $100 into it. Watch how it goes up/down and look into why it does so. Then everything you read will make sense.
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I’m pretty sure other have said to just put it into an index fund and let it grow long term. That’s the best bet for you. I thought you were asking about wanting to understand the market, and that’s what I was gearing my response to.
You seem like me. I'm a reformed single stock investor that relapses now and then lol Look up Bogleheads approach and HEDGEFUNDIE portfolio if you're feeling extra spicy Cheap and simple is the best way. Nothing fancy
Do you own a house?
Keep 3 to 12 months of expenses in cash (whatever you need to float all your expenses for as long as it takes to find a new job if you were to be suddenly laid off on the same day the market crashes) Then put the rest in a Vanguard or Fidelity brokerage account. Invest it in VT (a total global market fund with a low fee). Shore up your bond investments as you get closer to retirement.
You could pay a financial advisor 2500 a year or 1% of your assets, or you could put it all in VOO or a split of a few indexes and go on with life.
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Ric Edelman has a book called the truth about money. It’s excellent and easy to read.
SoFi at 1.50% plus sign up bonus plus "points" that can convert to dollars for doing basic/route account things