Im Coming into about $5000 and im just wondering what would be the best thing to invest in?

Question

Should i invest in stocks(and what stocks) or cds or just save it?

Answer 1

It depends on when you might want to use it. CDs are fine if you don't mind be locked in. I have a GE Interest Plus account that has good rates but is still fluid.

I would stay away from stocks if you can't dedicate a lot of time to it and research. I put more than what you have into a Datek account (now Ameritrade) 6 years ago and I still haven't made a profit. Of course that was a bad time for the market.

The bottom line is with 5k it isn't worth the time or headache to give stocks a try. If you plan on doing stocks with larger amounts in the future then go ahead but plan on it being a learning experience. You may do great! But if the 5k is something you don't want to lose, stick with low risk investments. The only question left then is how long you can do without it.

If you have any high interest debt (credit cards, etc.) pay those off first. If you have a low fixed interest home loan and are able to make more on your cash in a CD at current rates then don't apply it toward your loan. Plus once you pay toward the loan you'd have to get an equity line of credit to pull it back, which will be at current rates. Banks would love everyone to pay off that home at a low rate just to turn around and need cash again and borrow at the current higher rates.

Answer 2

Pay off all debt first, before investing in anything...

Short term CDs are in the 5.5% range, but you are locked in for a minimum of 6 months if not longer. Look into High Yield savings/money market accounts. Citibank has a 5% rate on their High Yield savings account. eSavings is the name of it. Plus, it is liquid so you can take it out if you ever need it.

Stocks can earn you a lot if you know what to do, but are more long term investments usually and even the best investment will get you in the 25% return range...but since you are asking which stocks to pick, I'm guessing you don't know how to choose them, in which case you would be better off going for a high yield savings account or a mutual fund and just let it sit.

Answer 3

it depends on how long you plan on keeping it in the investment. if short term, then go with something with little risk like CDs or notes. if long term then you can put it into stocks or bonds because you can take higher risks.

If you have credit card debt, it is best to pay that off if there is a high interest rate on it.

Answer 4

I believe in real estate, at least you have property, rather than a piece of paper. Maybe you can combine and use your IRA or 401k to purchase a rental, if you have a retirement account. Also, depending upon what bills you have, it may be best to invest in yourself by paying off a high interest loan, thus freeing up a monthly payment. You need to talk with a trusted mortgage advisor to help you.
This site has many reports that will most likely answer most of your questions -- www.paynotaxesforlife.com

Answer 5

I'm thinking that some of it should definitely be saved. Maybe if the interest rate is high enough, get a chunk of that into a CD. I'm not very familiar with stocks, so I can't really recommend them, and I dont see why you can't spend a little bit of it also.

Answer 6

I would take a careful look at your finances. If you have any credit cards, store cards, loans, or debt of any kind, you'd be better off just paying that off.

If you are unusual, and have no debt, I'd stick it in an IRA or some other savings plan for retirement.

Answer 7

CD's right now can be up over 5%, short term. Shop around banks for the best rate. They'll even give you free checking sometimes, even though you'll never use it!

Answer 8

Pay off any debts (excluding house & maybe car) -- buy mutual fund(s) in IRA (for retirement) or in a regular account.