Hello,
I was hoping that some people could offer their advice. I am a 22 y.o. grad student who will be moving and starting a new job in the coming months. I have roughly $12,000 cash sitting in my Schwab Roth IRA; it makes up about 85% of my total savings. For the next 2 years, I would say I am fairly risk averse- I cannot afford to lose this money in the case of an emergency or job loss. I recently pulled out of all my positions at a significant gain, but I know the economic loss of leaving cash sitting and not earning.
Because of my large lifestyle change (and geopolitical reasons), I am very risk averse during the Trump administration. While I am willing to return to a more aggressive position in the near future. I would say I am currently aiming for a 70% , 30% split (the minority being more aggressive choices).
Any recommendations for either side- safer or more aggressive? Do not worry, I will not blindly follow all suggestions, but I'd like to hear people's opinions.
Thank you in advance.
Posted by toniravioli73
2 Comments
If you are very risk averse and are relying on it as your emergency savings you are better off just leaving it in a HYSA
It’s probably not advisable to put money you might need in the next 2 years into an IRA… there’s penalties for early withdrawal, so the money is basically stuck. I guess it’s too late now though. 12k dollars probably isn’t even 6 months of expenses however, so if you really think you might need to tap that money it might be worth doing a very conservative split like you said. Generally the idea is to keep 6 months of expenses as cash or short-term bonds, and toss everything else into stocks, so not sure how that would translate to your situation.