Author Topic: (Very) Short-Term Investing  (Read 2447 times)

Starstuff

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(Very) Short-Term Investing
« on: May 30, 2013, 07:15:58 AM »
I'm looking to invest some money for the next 14-15 months. After that, I'd like the money to supplement my income for the next 12-24 months. I have $3,500 right now, with $200 monthly contributions for the next few months, increasing to $900-1500 hopefully in 9-10 months. If all goes as planned, I'll have saved up $10,000 by my goal date. (I know this isn't a lot for this community, but I'm working two jobs to pull it off....)

What should I do with this cash? Savings account to avoid risk? Invest and hope for no losses (and some gains)?

Thanks!

arebelspy

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Re: (Very) Short-Term Investing
« Reply #1 on: May 30, 2013, 08:10:14 AM »
We'll need some more details about your situation - risk tolerance, how sure you'll need the principal, how aggressive you want/need to be in order to achieve the desired income, etc.  Mostly just more clear on what you want and when.
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Starstuff

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Re: (Very) Short-Term Investing
« Reply #2 on: May 30, 2013, 10:21:56 AM »
We'll need some more details about your situation - risk tolerance, how sure you'll need the principal, how aggressive you want/need to be in order to achieve the desired income, etc.  Mostly just more clear on what you want and when.

Risk tolerance: I'm generally the "I'll buy the extended warranty" type. So low. But I'm more asking experienced investors what my risk tolerance for this cash should be given my situation. I'm willing to be flexible. There's not much that can keep me awake at night. That said....

I'll need the principal. I'm quitting my day job and keeping a part-time one waiting tables. I should make enough to cover living expenses, but I'll need the principal to cover school costs/enable me to take out smaller loans and pay them down. There will mostly likely be an unpaid internship in the middle, so I may have to cover all costs out of this money for 6 months.

To make timing clearer:
Current balance $3,495
Goal date: Aug 1, 2014
Target principal 8/1/14: $8500-10000
I'll need this money from Aug 1, 2014 until May or Aug 2016, so roughly 24 months. I do not anticipate being able to contribute to this fund during that time, just take out.

Ideally, I'd like to generate a little something off of an investment to make up for some of what I'll have to take out. Minimize the damage to the principal when I have to start drawing. Barring emergencies (or FAFSA...), I think I'll only have to draw enough for books every semester. Otherwise, I want the cushion to make me comfortable putting part of my income into loan payments before I graduate. I don't want this to have a zero balance after two years of draws, if at all possible, even if I have to draw monthly. I also do not want this to be large enough that FAFSA considers it an asset. I do want some loans, although I anticipate covering more costs with scholarships and out of pocket. I just don't want to be forced to give up my cash. (I'd also like a perfect world, while you're at it >.<)

Kriegsspiel

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Re: (Very) Short-Term Investing
« Reply #3 on: May 30, 2013, 11:17:30 AM »
Personall, I'd put it in your savings account or something like that.  Investments that aren't cash can fluctuate pretty wildly, so if you need that money that might hurt.

arebelspy

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Re: (Very) Short-Term Investing
« Reply #4 on: May 30, 2013, 08:21:42 PM »
I'll need the principal.

Yes, if you'll absolutely need the principal, we immediately have our answer.  It's an easy if X, then Y thing, it only becomes tricky when your situation is a tricky Z one.  Yours isn't. You absYou should put it in a safe investment, meaning bank account, CD, short term treasury, etc.

(I'd also like a perfect world, while you're at it >.<)

Well that one's easy; it's already done.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with two kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.