Hey, I’m 18 and I have a few thousand dollars saved up and was wondering what you guys would do with it. I don’t like leaving it sitting in the bank. I need something low risk and something that I can get the money out of within 6 months to a year. Was thinking maybe just a high-interest savings account? Opinions. Thanks.
Get a CD
Protein Powder, duh. Isn’t that what money’s for?
A money clip maybe? A couple grand isn’t gonna mean anything to you when you get older and start making more money so you may as well spend it now on having fun. I’m not saying blow it ALL on alcohol and drugs, just some. And spend the rest on something you like such as an older Jeep, dirt bike, boat, ect…
I’d take a 1000 bucks out for you to spend for fun in college and invest the rest in the stock market. CD’s aren’t a bad idea either if you want to be safe.
Rates for CDs suck right now, unless someone can point some out. To get a rate much better than a high-yield savings account, you’d probably have to go for a 5 year CD. I prefer the liquidity of the savings account to the very slightly higher return for the CD. But others may have better sources for CDs than I know of.
I’m 18 and had a few grand a couple years ago, bought up CD’s as guys mentioned. Got a good rate thanks to an uncle in the banking business. I’d say its your safest bet and a good idea. Stock market is a little risky at our age, and you are likely VERY uninformed (as am I) when it comes to investing in stock intelligently.
joburnet is (half) right, the return you would get on a couple of thousand right now is meaningless when compared to future employment earnings. If by some miracle, you can get a 5% return, we’re talking about a $250 return in a year from a 5k investment.
But the question is, why do you need the money within the next year? If you can find a way to do without it, invest it in the stock market! Everyone is retardedly scared of the market right now, and every other day, some really top-notch stocks are trading at ridiculously low prices. On any one of these, you could easily expect earnings increases of 15-20% for the foreseeable future. At 15% a year, the same $5,000 gives is worth over $20,000 in 10 years, and over $40,000 in 15 years.
By the time you are 65, at an average compounding rate of 15%/year, it would be worth 3.5 million. You are potentially sitting on your retirement, right now. So I ask again, do you REALLY need the money within the next year, or can you do without it?
I bought 5 year CDs I think, maybe 10, but I’ll look into stock in the future. My brother made over 70,000 on the stock market before he was 25, he also managed to lose it and then some. Its a tricky business. It will do you will to get educated about it before your invest.
Just stick it a typical high-interest bearing bank account.
You want your money at-call (that is you can get to it within 24 hours).
Its such a small amount at a young age you should be thinking investment to really mean investing in yourself (textbooks? suit for a job interview?).
Excellant attitude toward money, mate.
[quote]Aleksandr wrote:
On any one of these, you could easily expect earnings increases of 15-20% for the foreseeable future. At 15% a year, the same $5,000 gives is worth over $20,000 in 10 years, and over $40,000 in 15 years.
[/quote]
At those levels of returns, you might even beat inflation…
If you need the money soon as you say, in the next 6-12 months, you will make almost nothing unless you choose an investment that has very high risk. You�??re on the right track though, getting started at 18 is awesome, and I wish I had started then instead of at 26, had some money when I was 20 and bought a big truck instead, I got lots of enjoyment out of that truck but now it�??s gone and well you know.
I would recommend the stock market for the long term and Ben Grahams Intelligent Investor as a must read for any beginner. Start there and keep learning everyday, also once you do put some money in the market, you can open a Scottrade account for $500, you�??ll pay attention to what your $ is doing and try to figure out why it�??s going up or down and that is the best education you can get.
[quote]nephorm wrote:
Aleksandr wrote:
On any one of these, you could easily expect earnings increases of 15-20% for the foreseeable future. At 15% a year, the same $5,000 gives is worth over $20,000 in 10 years, and over $40,000 in 15 years.
At those levels of returns, you might even beat inflation…[/quote]
All too true sadly.
Btw, I wasn’t serious about the protein powder. It would go bad before you could use it all.
read two replies and laughed, ignore everyones nosense
i suggest you buy benjamin’s graham’s book the intelligent investor and go from there. greatest book i have ever purchased/read. investing is about risk, if you are unwilling to take any, then dont bother.
[quote]Jacked Diesel wrote:
read two replies and laughed, ignore everyones nosense
i suggest you buy benjamin’s graham’s book the intelligent investor and go from there. greatest book i have ever purchased/read. investing is about risk, if you are unwilling to take any, then dont bother.[/quote]
You missed the point entirely.
The kid does not need any fancy investment stratergies.
He needs to think about what he needs to do to increase his earning capacity (THAT IS HOW TO GET A GOOD CAREER).
He needs to invest in himself.
I’m impressed. The mere fact that you’re thinking about it makes you wiser than 99% of the population. Although the market’s currently so bad that it’s hardly worth trying given the amount of money and time you have. Again, kudos to you mate!
Ok, well to those who said invest in your future/career that is an excellent idea. Right now I’m a first year apprentice electrician, I have a vehicle/tools/money for school ect so the need to invest in myself so to speak is at the moment minimal. Thanks for the help.
[quote]nephorm wrote:
Aleksandr wrote:
On any one of these, you could easily expect earnings increases of 15-20% for the foreseeable future. At 15% a year, the same $5,000 gives is worth over $20,000 in 10 years, and over $40,000 in 15 years.
At those levels of returns, you might even beat inflation…[/quote]
Corporate earnings are also affected by inflation, leaving behind a fairly constant real return. On the other hand, bonds, CDs and GICs are not adjusted for inflation, and can result in negative real returns. If you are concerned with inflation, NOT buying stocks is retarded.
[quote]lixy wrote:
I’m impressed. The mere fact that you’re thinking about it makes you wiser than 99% of the population. Although the market’s currently so bad that it’s hardly worth trying given the amount of money and time you have. Again, kudos to you mate![/quote]
How in the name if all that is wholesome does what you just said make any sense?
The market being “bad” is what makes it an attractive time to invest. There are companies that have had good double-digit earnings growth every year for the last 15 years trading at P/Es well below their yearly average for any one of those years. If he spends a few weeks learning, makes some good choices, and walks away, he may be set.