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As an investing noob, most of my money is parked in low interest savings accounts. How much of my life savings should I park in index funds? Any smart investing
by sizzle 8y ago
As an investing noob, most of my money is parked in low interest savings accounts. How much of my life savings should I park in index funds? Any smart investing resources/guides you recommend? Thanks for your time.
- nostrademons 8y agoRule of thumb: 6 months of living expenses in liquid cash (savings accounts, rotating CD ladder, money-market funds, etc.). Any money that you'll need in the next 5 years in low-risk, non-volatile investments (eg. bonds, T-bills). This usually applies to retirees, but also to folks like entrepreneurs or commission salespeople that have unsteady incomes. Only invest in real-estate, individual stocks, crypto, precious metals, foreign currencies, collectibles, etc. if you know what you're doing. If it's not your full-time job (eg. a venture capitalist or real estate developer), no more than 10% of your net worth in these investments. Put the rest into broad-based stock index funds.
- sizzle 8y agoThanks for the info!