Author Topic: Have money, now what?  (Read 1681 times)

LMSunshine33

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Have money, now what?
« on: August 14, 2013, 01:19:52 PM »
I just found the mustachian way yesterday, and we already live most of the basic rules. What I'm not sure about is how best to use/invest/etc the money we have. Here's some background on us:

My husband and I are doing pretty well. We're in our late 20s, graduated from college, and have about $80k savings (a little less than 50% of each paycheck goes straight to savings.) He has a federal govt job that he loves, and I stay home with our baby. We rent a house 4 miles from work (can't live closer - there's a national forest in the way.) Our little town is 1 hour from the nearest grocery store, so we drive down once a month and stock up. We love where we live and plan to be here a long time.

That $80k of savings is sitting in a crappy money market account, making almost nothing. Not ideal.

Some options I'm considering:
* Let it keep accumulating in the MM until we build a house (can't buy one here, none for sale. Building will cost plenty though, since everything has to be shipped in. We do want our own house though.)
* Invest in the stock market (maybe a total index fund?)
* Buy a rental house (in that city where we buy groceries - the rental market is great there!)

Any ideas appreciated. Thanks!

daverobev

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Re: Have money, now what?
« Reply #1 on: August 14, 2013, 01:37:14 PM »
Seeing as you're not strongly leaning towards any one, I'd say do the numbers - if you can buy a good rental property then do it, lock in a low rate now; if not so much, do the standard bonds/stocks domestic/foreign thing.

Set up mutual fund or ETF purchases so they happen monthly (rather than going to savings) and forget about them. Do this at your risk-adjusted split (ie probably high %age of stocks, low %age bonds), rebalance either once or twice a year, and you're good to go!