Author Topic: Getting paid just twice a year - how to invest money to live off of it  (Read 2108 times)

Lovey

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We have about $50k in the bank. But this is money we need to live on for the next 6 months-1 year. How do we invest it for the highest earnings without being penalized for withdrawals? We are new to MMM and just learning the ropes. We have stupidly left this money sitting in a bank earning 1% every year. Ugh. We also want to post to get input on living on less. But for now, we want input on earning some employees!

lackofstache

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Re: Getting paid just twice a year - how to invest money to live off of it
« Reply #1 on: October 18, 2013, 12:38:38 PM »
What is your 6 month-1 year spending expectation? This info would help qualify any suggestions.

Lovey

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Re: Getting paid just twice a year - how to invest money to live off of it
« Reply #2 on: October 18, 2013, 12:47:13 PM »
At this point we need all of it for the year. About $1000/mo

StarryC

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Re: Getting paid just twice a year - how to invest money to live off of it
« Reply #3 on: October 18, 2013, 01:10:15 PM »
$1,000 a month is $12,000 a year, not $50,000. 

But, let's say  you need $50,000 a year.  Are you actually earning 1% per year compounding monthly?  (i.e., a monthly deposit of about $42?)  That is better than current 6 month CD rates.  You might try to shop around at credit unions and banks to see if there are money market accounts or checking accounts that are paying more, 1.5% or something.

I don't think anyone would advise stock market investments for money you know you need 100% of in the next year, or even two years.  The real recommendation is to get so you only need $36,000 a year, and invest the remaining 14,000.