Not sure what I’m doing
35, 70k salary, no debt
I just put 55k of savings in a 5 month CD for 3.5%
37k just sitting split in my normal checking and savings in my main bank account
3k in another bank account that I’ll probably close out this week
My work matches 4% in my 401k and I put in 6%, not sure if I’m doing that correctly.
I have another 5k in a 401k from a former employer just sitting idk what I’m supposed to do with that
And that’s all of my money. I’d like to start investing? Something that will grow long term.
Zero clue about how any of it works.
I’ve never budgeted or thought about money I’ve always just lived below my means and been able to move money into my savings account. I’d like to maybe learn to invest for long term but honestly lost at where to start and every-time I start to do research I feel like I’m so behind and incredibly poor. Obviously I need to increase my salary but my job is already so demanding and it’s taken me this long to get to this salary.
Any real advice would be helpfu
I would love advice on how to save and invest properly
byu/Far-Incident-1612 inpersonalfinance
Posted by Far-Incident-1612
3 Comments
Start here: https://www.reddit.com/r/personalfinance/wiki/commontopics.
Investing guidance: https://www.bogleheads.org/wiki/Three-fund_portfolio https://www.reddit.com/r/personalfinance/wiki/investing
Great job being debt free and having a really solid emergency fund!
Is there a reason you have so much in a normal checking/savings account? Having the accounts isn’t a bad move, but you may want it in a HYSA.
Good job getting your employer match. As far as your old employers 401k, if the fees are low and the investments are decent it’s okay to keep it there. You can also roll it over to an IRA, which gives you many more options as far as investment funds, many of which are lower cost.
I’d recommend looking at index funds. Index funds follow a market (like the S&P 500 for example) and give you a small piece of each company. They’re typically very low cost and have good long term returns. You can get them many places like Fidelity, Vanguard, Schwab, etc.
Many people recommend investing in a Roth IRA/IRA after getting the most out of your employer’s 401k match. Then if you max that out ($7,500 in 2026) continue contributing to your 401k. You can do this at any of the sites I mentioned earlier (as well as others).
No debt? House, Car, liabilities? Either way you are doing great and 70k is fine if you are in LCOL area.
If you really want to simplify try doing everything in one brokerage i.e. schwab, vanguard, etrade, etc. BUT it may also be helpful to separate them so you have them visually and mentally separate. You can always consolidate later if needed.
Open a Roth IRA brokerage account, throw 7500 into index funds. (32,500 remaining)
In that same account, open a Traditional IRA and transfer your old 401k into it, 5k into index funds.
Determine your living expenses, keep 1-2 months only in your checking lets pretend its 2,500 (30k remaining)
In that same account, open a regular (non-IRA) brokerage (trading) account and toss in the 30k, you guessed it, index funds.
Keep the CD as an emergency fund. You can withdraw anytime for a 3 month interest penalty if absolutely necessary. When the 5 months is up, Move six months of living expenses to a HY savings, the rest to your brokerage. So if your fully funded emergency fund is 15k, that gives you another 40k to throw into brokerage (your brokerage now 70k, 15k emergency fund, 2.5k checking+saving, 5k trad ira, and 7500 roth ira) That’s without factoring what you currently have in your 401k…
The next part is determine your 401k contributions. I like a mix of roth/non-roth. both have advantages. Being a moderate earner you will benefit tax-wise from non-roth because it lowers your taxable income now, and you are likely to pay no tax on it when you retire. 15% is a good number to shoot for, the goal being to max it out yearly (24,500 roughly 35%). You can change this allocation at anytime, so increasing over time is fine.
Anything beyond this goes to your brokerage to try and look to hit that 100k mark
Last, because you are good with money and have no debt, I would recommend credit card with the caveat you have to pay it off every month. You will get cash back on your living expenses, as well as protection on purchases and card theft.
max your 401 and roth ira every year, in 10 years at 8% growth you’d have roughly half a million retirement and you’d be making more yearly in your roth than you currently can contribute…