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Investing suggestion..

L

Luden

Platinum Member
I have about $10,000 I want to invest mainly for the purpose of paying towards my school loans when I finished with it (about 30 months away). Any suggestions? I'm thinking about a cd..

Thanks
 
You have a ton of options available to you. It all depends on how much risk you are willing to expose yourself to. A CD is a great choice if you are not really concerned with larger gains but with capital preservation. The only thing about CD's is that many of them carry a penalty if you withdraw before its maturity. If you think that you may need to pull some of the funds before the maturity you may want to shop for one that has no penalties for early withdrawal. Again, don't expect a huge return on your funds in a 30 month timeframe with a CD. The only real way to get much of a return is in the stock market. Of course, your risk goes through the roof there but the potential for return is a lot greater. Bonds are also another alternative. Just take your time and do some research into the different alternatives. You'll eventually find the right vehicle for your situation.

Oh and kudos for using the money for debt reduction. A wise choice my friend.
 
How about maybe a Stock Index fund?

Something like the S&P 500 indux fund maybe.

There is still risk involved, as it goes with the flow of the market, however, it's generally much safer than investing in any one specific company.

The long term return is pretty good as well ...

 
Short term it's hard to recommend anything other than ING Direct. I always recommend S&P 500 funds as an essential long term investment, but 2.5 years isn't long term. If you need the money back at a specific time you could be caught in a temporary dip like happened last month (S&P fell from over 1100 down to around 1070, a nce time to buy more 😀 ).
 
Seeing this is money for tuition, my vote goes for a CD. Your planning horizon of 30 months is too short for any risky equity investment.
 
What they said; you can't get much from this in 30 months. Investing your school money in something as fickle as stocks is a bad idea.
 
BTW, at a rate of 2.875% compounded continously, your interest on the principal of $10K will be $591.85 after 2 years.

You need to decide if that guaranteed return is enough for your expectations.
 
I will have the large disclaimer inserted here that I do work for the company I am about to plug.

CD rates now are horrible, but if you are going for a 2 year or longer CD Wells Fargo does have what's called Trade a Rate on their CD's where you can swap in the current rate in place of your old one. Currently in california a 29 month 10k+ CD is a little above ING's interest rate and since rates will probably crawl up a percent or more in the next year this might be a better option in order to squeeze out more money from it.
 
Good suggestion from Smaug as long as the CD interest rate at WF really is higher than ING's CDs., and that getting the new rate doesn't mean extending the CD maturity beyond the original term.

Pretty much everyone is expecting slow but steady interest rate hikes over the next couple of years.
 
Dave, I am specifically limited in my ability to quote rates, for his state of Washington, the website quote( this doesn't cover special rates, which do exist at least in California) is 2.5 for 24-35 months. The special I have seen for the state of california is around ING's. The trade a rate thing is the biggest feature, it does not extend the term from what I understand.
 
invest in amd stock, as they're becoming more and more dominant in the marked daily. expect this to improve even mroe once 90nm and dual core come out for the big tin.
 
That's horrible advice cir. Not only should you not have more then 10% of your portfolio in one stock(that's why index funds are good), but stocks are a good 10 year + investment, not relatively short-midterm. Who knows? AMD could have a huge accounting scandal and boom, stock goes to a tenth of what it was.
 
Originally posted by: cirthix
invest in amd stock, as they're becoming more and more dominant in the marked daily. expect this to improve even mroe once 90nm and dual core come out for the big tin.
Click to expand...
Might as well put it all on red as bet your student loan money on one single stock. For all you know, intel will make 65nm work (after being humbled by Prescott) and/or cut prices until they become more competitive again.

Joe Buyer has a very strong intel/Pentium bias after a decade of slick ads, so moving beyond the enthusiasts is not at all a given.
 
Just put it in a CD. You're guaranteed a return on your money which is what you really want here. Stay far far away from anything such as stocks, that would be just plain stupid.
 
I agree with those who are advising a CD, especially one that allows you to swap-in a higher interest rate later.

Don't put your money in one stock, it would be better to put it on red. At least that way you get free drinks.
 
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