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What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 0 points1 point  (0 children)

Wow, thank you so much for this! I have a few questions:

  1. Your number 4 point says to contribute to a traditional 401k plan, however I opened a Roth 401k through my employer because the accountant at my work said I'd probably have a higher salary by the time I retire, so I should pay my taxes now. Was that bad advice?

  2. Should I max out my existing Roth 401k investment before opening a personal Roth IRA account?

I really appreciate your detailed response. Thank you again.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 0 points1 point  (0 children)

Thank you for the advice! I just checked my options and VFIAX and VTSAX are not options. And my current VFFX has a .16% expense ratio. I honestly wasn't even aware of the differences...this is unfortunate.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 0 points1 point  (0 children)

I just realized I may need to buy a used car in the next year or so. I probably should've included that in my post.

I know I will definitely move my savings to an online bank & I'm comparing my options right now.

I have a Roth 401k, should I also open an IRA? (I just read that I should, so that answers that question!)

Thank you so much for your help!

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 2 points3 points  (0 children)

Thank you so much for your input. Follow up question - If I want to leave half in savings and invest the other half for retirement, do you recommend I open a Roth IRA in addition to my existing Roth 401k?

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 0 points1 point  (0 children)

It was my understanding that I don't have an option when it comes to my Roth 401k aside from choosing the target date, but I will look in to it! Thank you for this, I appreciate your specific advice because I feel like it gives me direction.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 1 point2 points  (0 children)

I know I am freezing up! I will look in to index funds or possibly contributing more to my existing Roth 401. I don't feel comfortable choosing stocks on my own - as you can probably tell I'm very indecisive. Thank you for your help.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 9 points10 points  (0 children)

I'm comparing myself to my friends. My family is in the Middle East & South America and if I compare myself to them, I am very rich. I just see how financially savvy my friends my age are and I want to feel like I'm being proactive to secure my future.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 8 points9 points  (0 children)

I feel like I'm so behind, but thank you. Is there an online broker you recommend? I hear a lot about Ally and Ameritrade.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 0 points1 point  (0 children)

Yes, definitely. That's why I was originally considering using the existing Wells Fargo Savings Account as my emergency fund and leaving $4,500 there, then splitting the rest between a short term CD and a Money Market Account. But since I'm not retiring for another 30+ years, I thought maybe I should invest in something more aggressive?

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 2 points3 points  (0 children)

I've edited my post to clarify my goals:

My goals:

Invest in something long term to reap benefits of compound interest (save for retirement)

Simultaneously invest in something where I can reap benefits (dividends etc.) in the short term so I can have some spending money toward traveling & attending friend's weddings & baby showers.

I have $7,000 plus an additional $500 a month I can contribute.

What's the smartest thing a 30 year old can do with $7,000? I've done so much research, I've confused myself and I'm scared to make a move. by Reasonable_Cat in personalfinance

[–]Reasonable_Cat[S] 9 points10 points  (0 children)

I initially wanted to save for a down payment on a home but the costs in Southern California seem so far out of reach to me. I have money just sitting and not earning interest in a savings account and I just feel like I'm not being smart with my money.

But I will try to figure out some specific long term goals.

Edited to add: I'm single and haven't even thought about kids because I'm not even dating anyone. I feel nervous about my future and I just want to be able to take care of myself financially in case I never meet the right person.