What do i do with my first $10k?

[11ducks]

Hi all.

I was looking for some direction please. I've managed to nearly save my first $10k!!!! I realise this is nothing for many of you with giant-staches, but for me, this is huge *tiny victory dance*. I would love knowledgeable mustachian direction as to what to do with it, to start on  the long path to early retirement! Situation is as follows:

-This is long-term savings only (ie I have a separate smaller EF, and slush accounts for expected expenses such as rego, car repairs, dental etc. So, barring an unlikely emergency, I shouldn't need to access it without notice). If I lost this $10k tomorrow, it would suck, but wouldn't affect us really.

-I may look at buying a place (either as investment or to live in) in the next 3-5 years - but where we are right now, renting is cheaper, and we are in a perfect locality/situation, so there's no push towards buying. When I do buy, I would want a hefty (30%+) deposit. 

-I'm 30, secure govt job, 1 tween, no plans for more.

-My superannuation (retirement savings) is quite healthy (I put in 5%, get a govt match of 12.75%), but this superannuation won't be accessible till 65-70 - I'd prefer additional savings to be in something more accessible.

-I'm in Australia, whether that is relevant (?)

- I want to continue adding to this stash, putting in $1000-$1200 a month.

I'm tossing up between a term deposit or investing in shares, but I know very little (read: nothing) about the share market. At present, its earning 3% in a bank account. I'm happy to learn about investing, but so unsure of where to start! Is there an Australian-specific investing for idiots page somewhere? Any advice would be appreciated.

[Kriegsspiel]

Put it in stocks and shit? Some kind of domestic-international fund?

[SteveR]

I'm in the UK, unfortunately, but since you haven't had many responses yet I thought I'd chip in...

If you want a simple but probably pretty good solution, you could consider investing in Vanguard Australia's LifeStrategy growth fund (https://www.vanguardinvestments.com.au/retail/ret/investments/funddetailGRO.jsp ); this automatically splits your investment (very roughly) into 70% shares, 30% bonds. I am giving this as an Australian version of one suggestion from UK investing site Monevator; the UK-oriented version of the article is here: http://monevator.com/vanguard-lifestrategy/ and I highly recommend reading it. You could continue to drip feed your $1000-1200 a month into the same fund; be careful not to pay too much in dealing costs, depending how those work you might be better of saving up your monthly contributions and investing every 3-6 months.

You shouldn't blindly take my advice, of course. If you have the time and inclination, I do recommend browsing around the Monevator site - there's a lot of stuff on there, from a variety of different perspectives, and while the specific tax, broker and fund details mentioned on there are UK-oriented, nearly all of the site is about general investing principles and should apply equally across the world. You just need to find someone trustworthy to fill you in on the cheapest, most tax-efficient ways to invest in Australia.

[11ducks]

Thanks for your help Steve, I'll absolutely do some research into it, I just had no idea where to even start! Its hard to get independent advice and not know what types of investments have huge fees/management costs, and all the 'learning to invest' seminars I've seen had been so expensive. I didn't realise Vanguard was a thing here too.

[forummm]

Why don't you check out this thread. You may be able to get some Australian answers if you ask your question there: http://forum.mrmoneymustache.com/investor-alley/australian-investing-thread/

[Kiwi Mustache]

If you want the money in the next 5 years, longer dated 12-24 month term deposits probably the best at your local Bank (Commonwealth, NAB, ANZ, Westpac, etc).

If you don't want this money for 10+ years, then look at a low cost index fund that follows the ASX 200 or something similar.

Best advice ever... Don't invest in something you don't understand. If you don't understand the stock market, don't try to pick individual companies, if you have no clue about bonds, don't invest in them. If FOREX makes you uncomfortable, stay well clear. There are some good books by Noel Whittiker. He also writes columns for the Sydney Morning Herald.

Good work on the 10k.