Makaveli

Hey,

let's say that someone was getting a bit of extra money every month from their job and wanted to save it. What would be the most effective way of putting it away and maximizing the profits if let's say 'they' didn't need it for another 3 years?
Thanks

rodslinger

Pay off your credit cards. Sure you aren't earning 5% on it somewhere else but you won't be paying 15% on the credit cards either. That's actually a net loss putting cash in savings and carrying a balance. With the cards paid off, put what used to be your monthly payment into savings and watch the dollars add up...






Or you could just give it to me.

Makaveli

LOL, I never believed in credit cards... if I need something off the net, I'll just ask my friend to use his.

I guess I should get my own one of these days.

rodslinger, how do I transfer my money onto your account?

fossil boy

Makaveli - it depends how much extra you are getting, i suppose. If you know what you need the $ for in the future (such as house, school) you may consider a Roth IRA which allows you to use money for such purchases, while allowing you a tax shelter for the capital gains (in the US at least).

The stock market seems rather dismal right now, but, the prices are low, so it could be a good time to jump in, but be careful and get good advice from a knowledgable broker. Bonds, such as t-bills or municipal bonds can be "safe", too. Though, i'd stay away from cd's 'til the interest rate goes back up

Real estate has been very stable and with low interest rates, could be a good possibility for you> imagine getting a return on all the $ you **** away in rent. Plus building up equity gives you collateral for future endeavors. Buying a house may seem like a big committment but it can be profitable

Pro_fan

I totally agree. That's why my gf and I bought a house...sure it's a dinky little thing, but it's bigger than our current apartment, and the mortgage payments and property tax will only amount to a slight bit more than our current rent.

And, since our house is a bit cheaper than many in our neighbourhood, when we decide to sell, our house will be a good option for people wanting to move into the neighbourhood, but can't afford the price of the larger houses.

Plus, I've cabled the $hit outta the place and that'll be a great selling feature!! Internet, phone, cable, satellite, alarm, and even stereo speakers in the kitchen and living room. It's wired to the nines!!

rodslinger

I think other than giving me the money and paying off credit cards you don't have, the real estate is a great idea. I'm glad I bought my house. You could get a great deal by being a sneaky bitch too. I suggest starting a search with your local city and county court records. Find out who just got arrested on some good felony charge and see if there are any properties in their name. If they are going down for a while I'm sure they will need to be unloading their debts. You may be able to make a good offer before the bank starts forclosure proceedings on them. Not sure if that will work or not but it sounded good...

reefruner5

haha, i can just see this club turning into some kinda of investment club complete with insider trading, lol

funkdaddysmack

I don't... we drive proteges, we don't have any money, remember? If we did, we'd drive Civics!!!!!!!!!

mito7878

Only thing you gotta watch out for in these dealings is when Jerome the drug lord comes home you may have a new jail trained roommate

Makaveli

Thanks for all the info
I'm basically just starting to put the money away for when my lease is up in three years. Then I'll either buy the car out or maybe buy a newer Protege or the Mazda 6 so I wanna be prepared for then.
Don't think that I'll have enough for real estate even though I know that if you got a small portion of the price, you can probably just rent it out for the monthly payments that you need to make so it's a great investment.
What about mutual funds?

fossil boy

Makaveli, you probably need to talk with a broker - usually the conversation is Free, they like everyone else, just want your money. Mutual Funds (mf) may be an option but you need to be aware that they too are investments into the stock market, but, you have little or no control on choosing the corporations you are financing. you cannot sell or buy individual stocks (usually); these arrangments are only as good as the managers who invest for everyone in the fund. Lately with the accounting scandals, many mf's have taken dire hits since they often were sucked into buying such stock, which was rated highly.
Really it's your call; but check the performance record of any situation you think you desire

sunbyrne

My standard advice on mutual funds is that the S&P 500 index outperforms 75% of the mutual funds out there, and the ones that beat it are not the same year-to-year. So if you're going to go into mutual funds, index funds are a good way to go...