Input on Investment

[boogieman065]

Hi all,

Situation: I am 26 and have +40k saved up. I'd like to put 20-30k away so that it's not just sitting in my accounts and actually gain money faster than inflation. I have a friend who's a financial adviser helping me through this, but I always like outsiders' perspectives.

I already put $250 a month away with the government's TSP and another $250 away with his financial investment organization. I am planning to do all $500 with him soon because I do not plan to stay in the federal government work much longer.

Plan: Put 20-30k out of my ~40k savings in these 2 funds: HBLCX and JVACX. I can't touch these for 1 year otherwise I'll be penalized 1%, but with over 15-20k in my savings, I do not think I'd have to. The earliest I see myself needing the 40k is when I'm looking to buy a sweet midlife crisis car!!..... just kidding, a house. I'd look at buying a house in 3-5 years.

Any input would be appreciated!

[Petunia 100]

Hi all,

Situation: I am 26 and have +40k saved up. I'd like to put 20-30k away so that it's not just sitting in my accounts and actually gain money faster than inflation. I have a friend who's a financial adviser helping me through this, but I always like outsiders' perspectives.

I already put $250 a month away with the government's TSP and another $250 away with his financial investment organization. I am planning to do all $500 with him soon because I do not plan to stay in the federal government work much longer.

Plan: Put 20-30k out of my ~40k savings in these 2 funds: HBLCX and JVACX. I can't touch these for 1 year otherwise I'll be penalized 1%, but with over 15-20k in my savings, I do not think I'd have to. The earliest I see myself needing the 40k is when I'm looking to buy a sweet midlife crisis car!!..... just kidding, a house. I'd look at buying a house in 3-5 years.

Any input would be appreciated!

If you expect to need this money in 3 - 5 years, it should NOT be invested. Keep it in cash, CDs, and such like. Investing is appropriate for long-term money. Three to five years is short-term.

You have access to the TSP, the very best retirement plan in existence. You want to ditch it in favor of letting your "friend" earn commissions selling you overpriced mediocre financial products. My opinion: do not do this. Keep right on contributing to your TSP and tell your "friend" no, thank you.

If you are willing to put some of your money away long term, consider a Roth IRA with a quality low-cost custodian such as Vanguard, Fidelity, or T. Rowe Price. Choose a target retirement 2055 fund and let it grow.

Just so you know "financial adviser" is not a real credential. Anyone can call themselves that, it is not regulated at all. A person with a real credential will present themselves as "John Smith, CFP" or "Sue Jones, CFA". Those are credentials which mean the person actually has knowledge and is not simply a salesperson looking to profit at your expense. You should avoid all "financial advisers" like the plague.

[ScottRUnderwood]

There are many investment plans with higher returns out there you can consider to invest in to earn some extra money for buying a house. You can also consult to a good financial adviser to have a good investment plan.