When you can't afford to buy...

4

4walls4me_IHB

New member
<p>what do you do with the money you save?</p>

<p>I'm fresh off the farm with my first job. I have an okay salary of 100k which means I cannot afford to buy anything that's not a tiny box and probably never will (I don't see how I could afford anything over $400k with a conventional mortgage). So, I rent. But I'm able to put about $1500 away each month (in addition to 401k money). My savings are not much now, but I want to plan for the future. How do you other boardies who are waiting to buy figure out what to do with your savings in the meantime? I don't mean to wonder too far off the topic of housing into investing...I'm just wondering what would be a good first step towards figuring out what to do. I know nothing about "investing." </p>

<p>Thank you!</p>
 
<p>Spend it. Travel and see the world while you are still young. Have experiences. <a href="http://www.chicagotribune.com/business/yourmoney/sns-yourmoney-0617spending,1,7822245.story">Make memories.</a></p>

<p>Worry about buying a home later, after things blow over.</p>

<p>And check out <a href="http://www.savingsbonds.gov">TreasuryDirect</a>. Good rates and you don't have to pay CA income tax on the interest.</p>
 
4walls4me,





The easiest way to invest -- which you should do with some of your savings -- is to buy market index funds (market ETFs). The fees are very low, and they outperform 75% of mutual funds.
 
ETFs are great especially with the selection out there. I am a big fan of CGM funds but do your own research first.
 
If you're still with little or no commitments (mortgage, wife, kids), you might want to consider saving as much as you can into retirement, and taking a little more risk for higher rate of returns. The highest performing funds in my mutual fund portfolio has been emerging markets equity fund and other international flavor funds like RNWFX, RSLFX, & RWIFX. But be warned that these tend to carry higher risk as well. I recommend talking to a professional financial adviser and do some research on your own. If you'd prefer less-risky index funds, try Vanguard, their fees are very low. I still have $$ in VGHCX & VHGEX there.





Disclaimer: I'm not a professional financial adviser and anything I mentioned in this post are just descriptions of my own investments. If you decide to invest in any fund I mentioned and lose $$, I assume no responsibility!
 
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