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August 19, 2023 at 5:01 pm #86881USER
I have 20k in a money market savings account. I should be getting around ~50k next month. I’m not sure what HYSA to move it too, when to move it, and how much. This is all new to me and I’m moreso looking for advice and experience.
Very new at investing (and having money to be honest) and I want to make the best choices with it.August 19, 2023 at 5:02 pm #86882Randy
Why move it from money market to HYSA? Good Money market account yield are equal to or higher than HYSA.August 19, 2023 at 5:03 pm #86883Mark
First off a money market account and a money market fund are 2 different things. Tons of MMF and HYSA paying 5% now. Just pick one. Do u have any debt? Investments? Ira? 401k? What is the actual purpose of this money?
This is going to dictate where you put it. Conventional thinking is once you have zero debt and a 3 to 6 month emergency fund, you should invest the rest. What you do w the money depends on where you are in the order of financial operations.
Would you also like to explore: How can a 20 year old start investing?August 19, 2023 at 5:04 pm #86884Natasha
Our family are not and I cannot become a high income earner, we haven’t FIREd yet and we use a lot of Dave Ramsey (show and articles online and library books free) to help us and our teens/young adults to help build practice with the psychology of money.
We just moved our savings to SOFI for higher interest and in a brokerage account we are moving our ROTH loose money into a Vanguard money market and our brokerage loose money into a Cash Plus account that will be invested after we do a Total Money Makeover focused to see how we can FIRE. SoFi 4+ rate requires direct deposit and has many rules (we wouldn’t choose them again). So, we started our young adult teens in Ally, no minimum fees and a slightly lower HYSA rate and their buckets are excellent for budgeting/categorizing at that rate (example emergency fund, spend, bills, invest, sinking funds).
Doing this might help you gain interest while you determine your risk level, create a monthly budget, decide if you have any debt you want to pay off, fund ROTH IRAS, and select money making funds.August 19, 2023 at 5:05 pm #86885Sean
3-6 months EF in a HYSA or money market fund is fine. Make sure whichever you choose is paying a good rate. After that invest. This is my investing priority.
- 401k to match
- Max hsa
- Max Ira
- Max 401k
- Taxable brokerage
This all assumes you have no high interest debt, or debt with a teaser type low rate they then changed.August 19, 2023 at 5:05 pm #86886Cap
My advice here is to try to get the best yield that you reasonably can while still working with a decent sized bank that has good online banking tools and support. CIT bank is popular now and has a yield over 5%. I’ve had good luck with SoFi and they are paying 4.5% right now. I would not chase a fraction of a percent, which could change at any time anyways.
I would also personally avoid custodial account services like Raisin just to avoid the complexity and extra time involved with moving your money. They’ll get you the highest rate, but most all of the complaints about it come when people try to move their money. If you don’t care about having to wait a few extra days for transactions like that, then I guess it’s NBD.