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What should a fresh college grad making 70k a year do with all that money?

K

KingNothing

Diamond Member
I'm not posting to brag, believe me. My jaw dropped when I got the offer. My last two jobs were internships making about $15/hr, which was more than enough to live comfortably on. I have no debt and about $8k in the bank and $6k in a mutual fund. I seriously don't know what to do with all this money.

The only thing is, this money is only good for 1-5 years. The place I'm going to be working for pretty much requires a master's degree to work there permanently so I'll be off to get a master's in probably 2-3 years, possibly as little as 1 year. When I go, I'll stop working and do school full time.

I guess the first decision is whether or not it's worth it to buy a house. I'm moving to Albuquerque, NM by the way. It's possible I'll be gone after a year, but if they'll let me stay (have to renew my contract each year) I'd prefer to stay for 3 years. I certainly don't need the extra space, but it seems stupid to throw money away on an apartment when I could easily own a home.

So...there's possibly 25-30% of my monthly income on a mortgage payment. I need to replace my car ('95 Geo Prizm with 120,000 miles) so there's another 25% so I can pay the car (something in the 15-25k range) off quickly. That leaves at least 2 grand a month to play with.

Investments? How and what? 😕
 
If you are planning to go to school full time, why not save some money for tuition and living expense?
 
Originally posted by: Dacalo
If you are planning to go to school full time, why not save some money for tuition and living expense?
Click to expand...

When I go to school it will be paid for through a TA position or something of that sort. I won't go until my job forces me to go or I get someone else to pay for it, whichever comes first.
 
Originally posted by: KingNothing
Originally posted by: Dacalo
If you are planning to go to school full time, why not save some money for tuition and living expense?
Click to expand...

When I go to school it will be paid for through a TA position or something of that sort. I won't go until my job forces me to go or I get someone else to pay for it, whichever comes first.
Click to expand...

first off congrats... what field are you in? sounds about right for compsci...

secondly, i would put it in investments... i don't know how much risk you can tolerate. if not much, i would put them in cd's. otherwise, index funds perhaps. sounds like you can easily max out an ira

thirdly, most schools don't give masters students (at least in compsci) teaching fellowships... unless you plan on entering the phd program and dropping out (in which case they'll give you a masters usually).
 
A house is good, if you make a good investment. Look into what the taxes are on any profits when you sell (based on how long you lived there, I think 2 years and you don't pay tax if you reinvest the money into another residence which will be your primary, look into that)
You're in a great position to pay off any other debt if you have it. Invest wisely (IRA, 401k) and budget for when you go back to school.
 
Originally posted by: KingNothing
Originally posted by: Dacalo
If you are planning to go to school full time, why not save some money for tuition and living expense?
Click to expand...

When I go to school it will be paid for through a TA position or something of that sort. I won't go until my job forces me to go or I get someone else to pay for it, whichever comes first.
Click to expand...

Then it would be prudent to buy house, or even a duplex. You should check what the housing price has been like in that area past 3 years.
 
1. Pay off any debts
2. Get decent/reasonable lodgings and provisions ( house, car, etc.)
3. Invest and/or save

Wow, I'm awesome at reading. So forget #1.
 
max out 401k, pre and after tax. Then, take it out when you buy your house after school.
 
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