Hey everyone, I’m 20 years old and I’ve saved up about $40,000 in cash from lawn care work, junk removal, flipping cars etc and odd jobs over the past couple years. I’m about to ship out on a union merchant marine job for months at a time
I have nowhere safe to put this cash while I’m gone. Maybe I can leave it at home but I’ll be gone for 6 months or more so idk Can I just deposit it straight into my regular bank account? Will I get flagged by the IRS or have any issues depositing this amount? Or should I put it in a safety deposit box at a bank instead I was saving to buy a nice work truck but things changed
I just want my money safe while I’m at sea. Nothing illegal, just honest cash work savings. Any advice appreciated
20 years old, $40K cash saved, about to ship out on a merchant marine union job — what do I do with my cash
byu/TaskForceDoomer96 inpersonalfinance
Posted by TaskForceDoomer96
16 Comments
Just deposit in your regular bank account then put in HYSA to get some value there
Regular ol’ savings account at a bank.
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You might not have earned enough to owe any taxes for the work that you previously did based on the standard deduction but you obviously haven’t done your taxes to know that or not.
Now that you have a union job the government will know how much money you are making so you can’t avoid the paperwork any longer for the upcoming tax year.
You generally won’t be able to use money you can’t explicitly explain as assets related to a mortgage unless it has been in your bank account for at least a year so do deposit what you have if you ever want property.
You will get flagged, I believe the bank is required to report deposits of over 10k. You might have to tell the government when/how you earned said money. If you made enough to have to pay taxes on it, and failed to do so, you could face some penalties for that.
You’re in a great spot. Deposit it into your bank, it’s your money from legitimate work and $40K isn’t going to trigger anything scary. Banks file a CTR at $10K+ but that’s just a form, not an investigation. What you do NOT want to do is break it into smaller deposits trying to stay under $10K because that’s called structuring and that actually is illegal. Just deposit it normally and keep records of your income sources in case anyone ever asks. While you’re at sea, set up automatic transfers into a HYSA so the money is at least earning something while it sits.
Banks are required to report large cash deposits. But given that they are from a 20 year old who has been holding everything he made for years, it won’t be a big deal.
Try to find a bank that can take your cash that has a high yield savings account. Most of the ones I’m familiar with are online, and obviously you cannot use them.
Whatever you do, don’t leave that much cash lying around the house.
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Go to your bank and deposit it. You won’t be doing anything wrong. They may ask you where it came from, and if they do, just say it’s every penny you’ve earned so far.
Just put it in the bank. All of it, all at once. Don’t try to hide it or figure out a way that it won’t get “reported”
It’s going to get reported and it’s going to be fine. Just because the bank fills out a form doesn’t mean you’re going to have to suddenly pay some new tax on it, or that they’re going to come get it. You’ll get in more trouble trying to get around any of that stuff
Don’t put it in a safety deposit box, because that is not insured. If the bank is robbed or goes up in flames or goes out of business you lose your money. If it’s in an actual account your money is safe and guaranteed by the government
You won’t have any issues depositing that amount and the IRS isn’t going to come looking for you
At 20?? Open a ROTH IRA and max out that contribution for 2025 (hurry the fuck up, you have a week) and 2026. Invest in a S&P 500 fund like SPY. The rest should go in a HYSA so you can use THAT money to buy a house when it’s time. Don’t worry about the when, future you will know.
Feel like everyone else is avoiding the important question: why is it not already in the bank?
I get that cash can easier but at some point, you need to “digitalize” it into a bank account. There’s a legal concept called [civil forfeiture](https://www.law.cornell.edu/wex/civil_forfeiture) where if police come across a significant amount of cash, they confiscate it and you have to sue and prove that you gained that money legitimately. The way you avoid this is by not having a pile of $40,000 in cash.
Go deposit it into a bank account. You’ve done nothing wrong, but this world isn’t built to have tens of thousands of dollars on hand.
As for some unsolicited advice: if you have above-board income, consider maxing out your IRA (hurry up, you can still max your 2025 deposit by April 15). That will reduce your taxable income for 2025. Also max 2026. Put that money in an account like Vanguard and buy an index fund. 45 years of growth on $15,000 of retirement savings is on the order of $400,000, which is about 1/10th of what you would need to retire.
Throw the rest in a high-yield savings account (HYSA).
Hopefully you’ll make a decent living as a merchant marine. Throw that money in a bank account, too.
Deposit it into a financial institution SOON. They’ll have to file a report, but it’s NBD. Invest it in SOMETHING. Even if you just buy some 6-month CDs
Someone else mentioned that at your age you should open an IRA account and max out your contribution. Clearly you don’t need the money right now and 50 year old you will thank 20 year old you believe me. You can still contribute to 2025 up till April 15 and get 30+ years of growth and compound interest. Just put it away and forget out it. It will only be a fraction of your cash so the rest I would park in a hysa and go do your trip.
You can open an account with etrade and do all of that and right now they are paying me I believe 3.35% in my hysa.
The bank…. In a savings account…..
Unrelated to your question, but keep an eye on what your new employer is taking out for your state taxes. My husband used to sail on a merchant marine ship and the company withheld federal but not state taxes. I would make quarterly estimated payments and then reconcile what we actually owed when I did our taxes at the end of the year.