Where do you park your money?

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Where do you park your money?

Joe SplitrockPro Member
Moderator
Rental Property Investor 路 Sioux Falls, SD 路 Member since 2015 路 9k+ posts 路 18k+ votes

I am wondering if you built up $10,000 or $25,000 or $100,000 in cash to invest, but were not ready to invest, where would you park your money? Would the "location" change based on the dollar amount?

- Money market (FDIC and available quickly)

- Stock market (good return but some risk)

- Bank CD (FDIC but locks term)

- Private money lending (higher risk)

- Other?

I am trying to see where I could get a good return but still keep my money relatively safe and available if I need it. I am interested in what others are doing. Please share as much detail as you can. (No this isn't an offer to give you money to invest so please don't ask.)

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Logan AllecBusiness Member
Accountant 路 Los Angeles, CA 路 Member since 2014 路 1k+ posts 路 980 votes
8y

I just move around from bank to bank to collect sign-up bonuses.

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  • Justin D.
    simi valley, CA 路 Member since 2017 路 29 posts 路 9 votes
    8y

    Low risk ETF's and high risk stocks with trailing stops.

    1Reply
  • Joe SplitrockPro Member
    Moderator
    OP
    Rental Property Investor 路 Sioux Falls, SD 路 Member since 2015 路 9k+ posts 路 18k+ votes
    8y
    Originally posted by @Mike Dymski:

    Joe, what did you choose?  I'm online right now and going to pick Discover or CIT.

    I signed up with Discover, they give a $200 instant credit for depositing $25K and you can link it to your Discover Card account. I like their cash back program so use that card already. CIT is a little higher rate, but I picked Discover because of the sign up bonus and I already work with them.

    1Reply
  • Justin D.
    simi valley, CA 路 Member since 2017 路 29 posts 路 9 votes
    8y

    TD Ameritrade or Fidelity both offer credit cards with points that can be redeemed into your IRA accounts and used to cover trading fees.

    Just remember to pay them off fast so you don't pay interests just collect points for your trading account.

    I like taking profit from my ETF's and invest it in high-risk stocks with trailing stops. It's worked for me so far.

    I am very diverse globally with my ETF's

    0Reply
  • Mike Dymski
    Investor 路 Greenville, SC 路 Member since 2016 路 5k+ posts 路 13k+ votes
    8y
    Originally posted by @Joe Splitrock:
    Originally posted by @Mike Dymski:

    Joe, what did you choose?  I'm online right now and going to pick Discover or CIT.

    I signed up with Discover, they give a $200 instant credit for depositing $25K and you can link it to your Discover Card account. I like their cash back program so use that card already. CIT is a little higher rate, but I picked Discover because of the sign up bonus and I already work with them.

    Thanks, I went ahead with Discover as well for the same reasons.  I work every day to put this money to work in a real investment but this will do in the meantime.

    1Reply
  • Charles Kennedy
    Rental Property Investor 路 Philadelphia, PA 路 Member since 2015 路 213 posts 路 160 votes
    8y

    @Mike Dymski good choice on Discover. I wasn't aware of their bonus. Extra $200 will likely outweigh those 20 bps.

    1Reply
  • Jonathan Castillo
    Austin, TX 路 Member since 2017 路 17 posts 路 4 votes
    8y

    Hey Guys, I just found out about this coming out soon, no pressure to join but something you can consider. It's like the robinhood of banking. Check out https://meetbeam.com/ its a SF based start up looking to disrupt the banking system and they way they use our money. 

    1Reply
  • Eric C.
    Investor 路 Grand Junction, CO 路 Member since 2017 路 207 posts 路 201 votes
    8y

    Yeah Beam looks appealing.  meetbeam.com/?r=CASH-H1ZhjQpRYM

    0Reply
  • Mark S.Pro Member
    Rental Property Investor 路 KY 路 Member since 2013 路 1k+ posts 路 537 votes
    8y

    2% is good, but 4% is misleading.  I wonder what extra hoops they will make users jump through to get the 4%.  It says everyone starts at 2% base rate.

    0Reply
  • Fradel Schaechter
    lakewood, NJ 路 Member since 2017 路 282 posts 路 156 votes
    8y

    I use discover online banking. When I started with them they were at .95%, they are now up to about 1.15%.

    I like using them because I have multiple accounts with them, saving for different categories (about 9 categories to be exact) and am able to nickname the accounts so that I can easily do the transfers I want. I know it is not the highest interest rate, but now that it is all set up I am not likely to switch...

    1Reply
  • Brian Garrett
    Real Estate Investor 路 Palm Beach County, FL 路 Member since 2017 路 3k+ posts 路 2k+ votes
    8y

    American Express high yield savings is up to 1.45% now  :)

    1Reply
  • Brian Dickerson
    Rental Property Investor 路 Delray Beach, FL 路 Member since 2017 路 102 posts 路 44 votes
    8y

    Ally has been great for savings accts

    1Reply
  • Jerry Cinor
    Investor 路 Pompano Beach, FL 路 Member since 2015 路 70 posts 路 20 votes
    8y

    I have a target retirement fund at vanguard. and I just maxed out my Roth IRA for this year last week with my tax return 馃槑 . As mention in this thread, I've also been using ally financial and discover high yield savings account. Both are great. Been trading forex for few months as well.

    0Reply
  • Jerry Cinor
    Investor 路 Pompano Beach, FL 路 Member since 2015 路 70 posts 路 20 votes
    8y
    Originally posted by @Dave Van Horn:

    @Joe Splitrock

    Have you considered insurance contracts? They're a safe bucket, offer a higher yield than most savings accounts, and there's usually liquidity (that's tax free).

    How does that work?

    0Reply
  • Warren Garceau
    Rental Property Investor 路 Clinton, CT 路 Member since 2017 路 29 posts 路 37 votes
    8y

    @Jerry Cinor, Dave's suggestion about life insurance is great and I would have to agree.  Cash value life insurance can be a great option especially for real-estate investors. 

    When properly designed insurance contracts can be used as a tool for you and your business. The type of policy that you would be looking for however is not a one size fits all. This type of policy would need to be custom designed. 

    Keep in mind, depending on your personal situation and goals cash value life insurance may not always be the right fit as you get started as an investor. From my experience you need to connect with someone who will review your personal situation and objectives then design a policy that fits to help reach your financial goals. 

    1Reply
  • Joe SplitrockPro Member
    Moderator
    OP
    Rental Property Investor 路 Sioux Falls, SD 路 Member since 2015 路 9k+ posts 路 18k+ votes
    8y
    Originally posted by @Brian Garrett:

    American Express high yield savings is up to 1.45% now  :)

    Discover Savings is up to 1.5% now! If the fed pushes two more rate hikes this year, I am guessing rates will keep going up. 

    1Reply
  • Joe SplitrockPro Member
    Moderator
    OP
    Rental Property Investor 路 Sioux Falls, SD 路 Member since 2015 路 9k+ posts 路 18k+ votes
    8y
    Originally posted by @Jonathan Castillo:

    Hey Guys, I just found out about this coming out soon, no pressure to join but something you can consider. It's like the robinhood of banking. Check out https://meetbeam.com/ its a SF based start up looking to disrupt the banking system and they way they use our money. 

    This does look interesting with them advertising rates between 2% to 4% and FDIC insured up to $250K. I checked the FDIC website to verify Beam is FDIC and I couldn't find them - maybe because they are new and have not launched yet.

    Do you know when they hope to launch? 

    They say the minimum rate is 2% and you can earn rewards up to 4% - any idea how you earn those rewards?

    0Reply
  • Steve Vaughan
    Rental Property Investor 路 East Wenatchee, WA 路 Member since 2014 路 10k+ posts 路 16k+ votes
    8y

    I didn't realize how bad I was getting shorted until I moved a pile to Vanguard.  My 'high yield savings acct' with Chase 1098d me $23 thru Dec 10. Vanguard gave me $110 in unqualified dividends for 21 days.  I think it defaulted to the s-t govt bond fund.  Eye-opener, right? Plus I can buy MFs or stocks of course. 1 day ach liquidity, too.

    With an extremely low nap tolerance, no way I'm establishing a relationship with a cc co to earn an extra buck or 2. Took years for them all to stop sending me mailers. I'd rather take a nap than have to receive, open and recycle a million mail pieces again. LOL

    1Reply
  • Jonathan Castillo
    Austin, TX 路 Member since 2017 路 17 posts 路 4 votes
    8y
    Joe Splitrock hey Joe, you are correct they have not launched yet. I saw that they actually won鈥檛 be launching until about Q3 so about sometime in September. Apparently the more you deposit the higher the rate I believe. And the more referrals you get the faster you move up in the waitlist with an extra 2-3% for your first 100 Days I believe.
    1Reply
  • Kevin Coggins
    Spring, TX 路 Member since 2016 路 243 posts 路 203 votes
    8y

    I've been using Salem Five for a over a year and their savings account rate just bumped up to 1.85%. I actually messaged them about it since I was getting 1.1% and they updated my account to 1.85%...no complaints with them.

    2Reply
  • Joe SplitrockPro Member
    Moderator
    OP
    Rental Property Investor 路 Sioux Falls, SD 路 Member since 2015 路 9k+ posts 路 18k+ votes
    8y

    Over the last three months since I started this thread, my Discover Savings account has gone from 1.3% up to 1.5% interest. It is nice to be at a bank that actually increases my rate. My old Wells Fargo account was a money market that paid .005% by the time I closed the account. It was a "high yield" account when I opened it 15 years ago. My bad for not watching my money, but at the same time it is pretty shady of Wells Fargo to take advantage like that. They suck, spread the word.

    0Reply
  • Account Closed
    Napa, CA 路 Member since 2017 路 57 posts 路 27 votes
    8y

    @Steve Vaughan  What kind of account do you have w Vanguard?  Something other than their retirement type fund accounts?  

    I couldn't agree more about it not being worth it to get w a cc company for a couple extra bucks - they're so obnoxious.  (and the trees they fell w their endless mailers etc :)

    0Reply
  • Steve Vaughan
    Rental Property Investor 路 East Wenatchee, WA 路 Member since 2014 路 10k+ posts 路 16k+ votes
    8y
    Originally posted by @Account Closed:

    @Steve Vaughan  What kind of account do you have w Vanguard?  Something other than their retirement type fund accounts?  

    I couldn't agree more about it not being worth it to get w a cc company for a couple extra bucks - they're so obnoxious.  (and the trees they fell w their endless mailers etc :)

     I just used this for my extra reserves and opportunity fund (dry powder) so it's a cash account, not qualified or retirement funds.

    You can have IRAs linked to it, so if you already have those, it just takes a sec to establish a new cash account or vice versa. Found out a traditional IRA contribution would be 60% free for me this year, so I established and funded one in literally 2 minutes. I'll convert it to a ROTH during a less budensome tax year.

    0Reply
  • Account Closed
    Napa, CA 路 Member since 2017 路 57 posts 路 27 votes
    8y

    Thanks @Steve Vaughan - looks like its a money market account:  (are we allowed to post links?)

    https://personal.vanguard.com/us/help/FAQVAAConten...

    https://www.bogleheads.org/forum/viewtopic.php?t=2...

    https://www.fool.com/investing/2016/09/07/vanguard...

    0Reply
  • Brendon Woirhaye
    Rental Property Investor 路 Whittier, CA 路 Member since 2014 路 324 posts 路 268 votes
    8y

    I park cash short term in SWVXX at my brokerage, Schwab.  Currently around 1.63%.  If it is going to be longer term, I'll usually find another creative use (like paying down debt).

    1Reply
  • Joe SplitrockPro Member
    Moderator
    OP
    Rental Property Investor 路 Sioux Falls, SD 路 Member since 2015 路 9k+ posts 路 18k+ votes
    8y
    Originally posted by @Brendon Woirhaye:

    I park cash short term in SWVXX at my brokerage, Schwab.  Currently around 1.63%.  If it is going to be longer term, I'll usually find another creative use (like paying down debt).

    I am just curious what your thoughts are on an FDIC insured high yield savings account currently paying 1.55% versus the Schwab account at 1.63%. It seems lower risk in a savings account for very similar returns. Do you expect the yield to go up on SWVXX over the next few months?

    0Reply
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