I'd use it (most of it, unfortunately) to pay off my credit card and car debts. That way, I could actually start saving some of my income, such as it is at present.
Smart. Actually, I've seen some articles recently about retailers being concerned because people were canceling their credit cards and paying for things in cash. Apparently when people have to fork over physical dollars and can see their wallet emptying out, they tend not to buy as much.
It was more of a hypothetical question, though--$10,000 in addition to the amount you would need to pay off debts and set aside a buffer fund to see you through for a while in case of downsizing or a sudden need for expensive car repairs or something.
Even so - I don't really know what I'd do as I've never actually had money beyond paying bills and feeding myself, so should I come into a bunch of money (post-paying off debts), I would probably do some research before investing.
HI, THIS IS A FINANCE LESSON COURTESY OF MY FATHER'S DINNER TABLE CONVERSATION WHEN I WAS A CHILDdarth_cabalOctober 25 2008, 18:45:27 UTC
Yeah, in general you want enough money in highly liquid assets (like gov bonds) to live off of for a year or two, just in case the economy slows/you lose your job and take a few months to find another one/you encounter unexpected expenses. Once you've accumulated that much, you start investing additional savings in things with a higher yield, like stocks. The magic of compounding interest is that a mutual fund with a moderate degree of risk/benefit can double every 8 years or so--makes it a lot easier to retire
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Pfft. I stopped my initial reply as it was getting TMI! Here's a much edited version. I will have in about a week's time some money coming free which I will be investing into companies which have been hit but which should ride out the market. If I don't get in now, I'll lose out on golden opportunities. Or I'll lose a small amount of money I can afford to lose. ;-) But I shall be very, very cautious. Perhaps I'll turn out to be too skittish and re-invest the money in bonds. We shall see how I feel next week. I do have a share-investment ISA which I only started in July. I've already lost about £300 on it :p
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If I had money to spend I would definitely put a good bit into stocks that will surivive (though not quite yet) and wait for the rebound years from now.
If I had alot of money to spend, I'd get a house in the crumbling market..
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It was more of a hypothetical question, though--$10,000 in addition to the amount you would need to pay off debts and set aside a buffer fund to see you through for a while in case of downsizing or a sudden need for expensive car repairs or something.
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I didn't realize I might need liquidity.
Even so - I don't really know what I'd do as I've never actually had money beyond paying bills and feeding myself, so should I come into a bunch of money (post-paying off debts), I would probably do some research before investing.
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I will have in about a week's time some money coming free which I will be investing into companies which have been hit but which should ride out the market. If I don't get in now, I'll lose out on golden opportunities. Or I'll lose a small amount of money I can afford to lose. ;-) But I shall be very, very cautious. Perhaps I'll turn out to be too skittish and re-invest the money in bonds. We shall see how I feel next week.
I do have a share-investment ISA which I only started in July. I've already lost about £300 on it :p ( ... )
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If I had alot of money to spend, I'd get a house in the crumbling market..
But, alas, I'm broke.
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