25yo. Need Investment advice for 150k+

[Clownshoes]

In a unique situation as far as my job and income. I have been able to save over $150k in the last 2 years by living rent free and couch surfing at parents and friends. I'm only off about 1 week per month working in the oil industry. I will most likely get an apartment here in the next few months and expect rent to be around 1k/mo. The money is sitting in a savings account doing nothing currently and wasting away to inflation.

I have zero debt and monthly expenses totaling around $350 for insurance and cell phone plus entertainment/shopping which varies 500-1k. My income is now around 150k/yr and I will max my 401k and will open an IRA to max as well for this year.I typically save 6-7k per month.

I don't plan on buying a house anytime soon or using it for any major purchase. The only possible reason I would draw on it would be to start a business. For that reason I would prefer to be able to access it should I ever choose to. I plan to keep 50k in cash as an emergency fund. So my question is what would you all reccommend I do with the 100k principle and about 5k to invest each month? I need a plan to stick with for long term investing. I'm almost willing to invest this 100k for long term retirement and never touch it.

[chrisburke21]

Investment Advice

It depends on what you want to invest for. Retirement? or short term? I would recommend that you keep at least three months living expenses in your savings account then start systematically investing in and IRA and 401K (if available at your job). Take a look at the money website there is some good guidance here:

Money 101 - Financial Advice & Lessons Made Easy by CNNMoney.com

[Jwilliamson22]

tips on getting a job like yours???

[Clownshoes]

tips on getting a job like yours???

Sure, I have a petroleum engineering degree and currently have been working as a directional driller. Usually you have either a degree or have worked up from a MWD or have been a driller on a rig to be a DD although I know lots who have no relevant expierence or degree and were hired just due to demand.

I would suggest looking at major oil field service companies like halliburton, slumberger etc. Look for jobs like MWD(measurement while drilling), Mud Engineer, or even Directional driller especially if you have a math/science oriented degree. You might get lucky. Even if you don't have a relevant degree just apply anyway. They are often in high demand for people and they hire all ranges of degreed and non-degreed.

Check out rigzone and oilgrads dot com

[jIM_Ohio]

How much liquidity does the $100k need? You mentioned 50k for emergencies, why is that number so high (33% of portfolio).

Focus on your goals, not the money.

[Ramose]

What kind of business do you want to start? How much capital will you need? How likely is it that you will actually go through with it?

[UnknownXV]

I would actually suggest you consider buying a house outright in cash. You can get modest but definitely nice homes for 100k, leaving you your 50k EF (that's a huge EF)

The ability to buy in cash also gives you leverage in lowering costs since its easier for the sellers.

Rent out the house while you're working. You may even be able to come to an arrangement with certain tenants where you can live there in your brief periods off (on-off roommate type deal) at a reduced cost.

You'd still make a killer. I think housing prices will go back up shortly, probably the best time to buy now.

[bjl584]

Figure out how much of that money you will need to keep in cash. The rest should be invested. It would be a good idea to sit down and talk with an advisor to discuss your goals and plans.

[Wino]

Clownshoes, I've been in the oil patch for about 25 years. I want to warn you that the boom will probably not continue. Usually, at least 40% to 60% of the people in the oil patch are laid off at one time or another.

I suggest you get at least $40K where you can get to it easily (within a week or so). Put another $100K where you can get to it relatively quickly (within a month or so). Then, buy a house and a car for cash or pay it off quickly if you get a loan.

Just because you have a job with a secure and profitable company today, don't count on it tomorrow. If oil drops to even $40 a barrel again, you can count on the easy paychecks going away. Make your money now. Save it. And be ready to retrain when the bust hits.

[Bryan Cranston]

Might be good to allocate some of that, maybe 20%, in stocks, and see how good you are with it or are interested in it. Google 'Casey Research' for an idea of how to invest.