I turned 18 earlier this week and received a very generous gift from a family member, 10,000 dollars. So I currently have around 15,500 saved right now. What is the smartest thing to do with this money. I want it to grow, not just sit in my low interest bank account. I would appreciate any advice 🙏
I Just Turned 18 and I Received 10,000 dollars
byu/Ok_Bread_2465 ininvesting
Posted by Ok_Bread_2465
19 Comments
Keep some cash for emergencies and life, then invest the rest in a few businesses you truly believe in. Start small, pick wisely, and hold long enough to let compounding work, exactly the framework layed out in The Only Bet That Counts.
If you don’t know anything just buy $VOO, few dollars a week every week. If it goes down buy more, if it goes up buy more. Don’t sell it till you want to make a big purchase, retire, or die.
RothIRA $VOO, don’t touch it til you’re ready to buy a house
Hysa
I did too, about 30 years ago. Bought a 280z. Please do not buy stupid things. I’d do anything to go back in time and invest that money.
Just put everything in an index fund and dont look at it for 40 years.
Invest in your education. Longest term return.
If you are employed you can put it in a Roth IRA, which is a tax sheltered retirement account. You can only withdraw when you retire otherwise you are penalized.
Alternatively an investment account is a good choice. I’d put it all in VOO.
Register with charles Schwab you can have regular brokerage account and a Roth IRA on their platform. So if you aren’t employed currently start a regular brokerage account now and put that money in.
When you get a job you can put 7k per year in the Roth IRA.
TLDR Invest in VOO and forget about it for 30 years and thank me later.
Use it towards a degree or certificate. invest in your education at this age. That will have the biggest ROI
Go to college
If you simply want to turn 10k into a bigger number, max out your Roth IRA in voo then maybe put in the rest in bitcoin? You probably have other goals and needs tho, like a maybe a car, education, saving for other endeavors
Do you work?
If yes do you have access to 401k?
If yes take the match.
If no move on to Roth IRA.
Open Roth IRA. Deposit up to $7000 annually.
Think of a Roth IRA as a folder.
You have to open the folder and then buy something like stocks or etfs in the folder.
You want an index fund like $VTI. It tracks the index and annually gains 8-10% on avg. Some years up some down averagjng out to 8%.
Once that moment crosses the imaginery line from bank to Roth its gone till you retire. Very few exceptions.
Keep 2-3k out as an emergency fund.
Put the rest in a money market account that gains a bit of interest.
Then in January youll be able to start investing in next years Roth. Invest $600 monthly till you reach the $7000 cap.
Starting at age 18 with $25,500 in VOO (SP500 ETF) would need to contribute monthly (assuming ~7% average annual return) to reach $1,000,000 by age 40 (22 years), about $1,411 per month. By age 50 (32 years), about $533 per month. By retirement age 65 (47 years), about $73 per month. Wish I started investing when I was your age. I didn’t really get started til I was 33 (5 years ago). Don’t let it sit in a bank account, it will lose value! Good luck!!!
you’re 18 with 15grand. you have your whole life to be boring. 15grand could give you a weekend you’ll never forget for the rest of your life. money is nice but time is on your side. some of the best memories are made because of bad money decisions.
I’m happy for you, but realistically investing this money in financial assets isn’t going to change your life. By the time you are 65 it may turn into 150-300k in today’s dollars. Which is great, but at 65 is not going to be enough to live off.
Instead I would recommend you invest in yourself. Whether it’s education or the initial money to move to a new city for a job, keep this money handy for taking risks to develop your career. Being able to land a great job will pay off far better than putting this in the stock market for a few decades.
Someone on here said invest in your education… I second that. Invest in getting really good at something, focus on that and make yourself marketable. That will help ensure your future savings won’t be depleted due to lack of marketability.
Probably all in on open
Invest in a scheme
I was in the same exact position at 18, it was approx $9800. About a decade later majority of my chip stocks and other nasdaq up 1000%. I got a half a milly house by the beach, a wife and kid. I don’t even have a doctorate or a law degree, but I’m making as much as them just in my daily P/L alone.