Extra Cash help

[Lwang9276]

Hey I just have a pretty nub style question. I have 1000 in cash at home. Whats the most reasonable thing to do with it? Im thinking savings account, but I am open to any suggestions. Thanks.

[NoSoup]

Well, what are you planning on doing with it? Using it fairly soon, looking to save long term? Do you need it liquid or can you afford to keep this illiquid in exchange for a higher rate of return?

[gar1976]

As I've said before, booze and chicks. I mean, you COULD spend it on groceries or some crappy Type R stickers for your car, but what would you remember more? That, or a night of drunken debauchery the likes you have never and will never see again?

[Lwang9276]

lol nice idea gar but I am looking for something longterm, like NoSoup said. (btw love ur sig) Also i have no idea what the liquid business is, so any enlightenment would be nice. So yea if any ideas please share.

[maleficent]

Liquid is will you need to have access to that money immediately -

it's not sexy- -but there are always savings bonds

or a money market - the liquidity comes into play here because there are penalties for early withdrawl -

[Stare At The Sun]

Personally, i'd buy 1000 dollars of lucent stock. and sit on it for a year.

[Lwang9276]

so how does the money market work? and how do i get started on it?

[Warf Rat]

Originally posted by Lwang9276
lol nice idea gar but I am looking for something longterm, like NoSoup said.

If you have any income for this year exeeding $1000.00, I would recomend openeing a Roth IRA. The sooner you start the sooner you will be able to quit. One of my favorite funds is Calamos Growth and income fund http://quote.bloomberg.com/apps/quote?ticker=CVTCX:US
I don't know your age but if you look at the ten year number on this fund it is upwards of 10%. In simple terms your money will double every 7 years at that rate. Plus it's not the most aggressive fund in the world, but it's a great place to start.

Then just add to it when you can. I would recomend that once you exceed $5000.00 you start to spread the money over more than one fund. This helps to take advantage of whatever is hot in any given year.

There are tons of reasons to consider a Roth, but it has been gone over many times here. So if you have any questions PM me.

One last thing, you said long term, so don't even consider a money market fund. They don't keep pace with inflation, and if your money would buy a certain amount of goods today, you certainly want it to at least be able to buy those same goods in the future.

Have you considered using it as a bankroll, start playing cards.

[Merlocke]

Originally posted by Lwang9276
so how does the money market work? and how do i get started on it?

If you're referring to Foreign Exchange (trading currencies) PM me and I can give you a quick overview. It's just another option for what you can do with your money to grow it, although there is a slight risk involved.