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Investment Advice Needed

P

pepperbegs

Member
Hi,

If you had $200,000.00 and wanted to park it somewhere safe for a while, where would you put it?

A bank advised a cd that's tied to the stock market but still FDIC insured. I'm not familiar with this type of investment.

Any advice?
 
If you have 200k, you need to speak with a financial adviser, or maybe a few. Talking to the average joe at a bank is probably a waste of time and you aren't getting good quality advice.
 
At this stage of the game, lets say not lose value at all (preserve capital).

By a while, lets say keep it liquid (no long term commitment).

Will sacrifice short term return on the theory that preserving principle will open long term opportunities.
 
I don't understand the markets but....

I think things are in flux and don't wish to take on much risk until...

The Euro fails? The U.S. market regains my trust? Zombies attack.... and are defeated?

Basically, lets say that getting the best short term return without taking on much risk is what we are talking about.
 
Since you can't get much of a return in ANY short-term, liquid, safe investment, just buy short-term CDs or put it in Ally Bank savings at 0.84%.

You say you "don't want to take on much risk until..." but there is always going to be risk. If you can't handle the risk of any loss, put it in savings.

If you do go the CD route, be aware that some banks now reserve the right to decline a request for early withdrawal, so don't assume you can take your money out early. I expect more banks to impose such restrictions as they fear massive withdrawals whenever interest rates begin to rise.
 
I'd talk to a advisor for that much.

You could go savings which you can find ~.8% which isnt to bad.

CD's can be found at ~1%

Another option might be an I bond. Currently at 3.06%. only real bad thing is you cant touch the funds at all in the first 12 months. After that its just 3 months interest. BUT on that note you also get screwed as you can only buy 10k worth of them in a year. But since you have a large account that might not be to bad of an option for the 10k.

There are bond funds you can invest in as well. Something like a Vanguard High-Yield Tax-Exempt Fund Investor Shares which has about a 2% YTD return. Is obviously a bit riskier but if you look at past its still done well even with the market slumps.

But again I'd go talk to a pro and see what to do
 
Talk to a pro is probably good advice. (I always thought that if you had some cash it would be easy but its a little intimidating once you hit the bank and start talking to nice young people in really expensive clothes.)

The thing is: How to find a good sure-nuff clever advisor who won't just try to sell you something. I know some are fee based and aren't trying to make a commission. What sort of fee would an advisor charge. I have had a Roth IRA with Vanguard for a few years. Would a phone call to Vanguard be worth while?
 
I am generally quick to tell people to get professional advice, but it doesn't apply in your case. You don't want any risk and you don't know when you might want the money. No advisor can help you. I'm not saying you are stupid or doing anything wrong, but you need to understand what an advisor can do.

What an advisor does is help you meet the goals YOU set, with the amount of risk YOU are comfortable with, in the timeframe YOU want to access the money.

In your case an advisor is going to tell you to put it in a savings account or CDs just like so many of us already did. If you later decide to invest for a longer term, or are willing to accept some risk, or you want to map out a financial plan to guide you in future years, THEN that's when to consult with an advisor.
 
Do your own finance research as much as you can, do not blindly trust someone just because they are highly recommended and from some "elite" Wall Street firm.
 
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