I have nearly $5000 in my savings account at my bank, and I would like to know what are my options to do with it. Should I invest in CD's, stocks, mutual funds, Buy my own 401K deposite it in a better savings account, or do what I am doing now and pay off my debt on my cards all together $4000. What should I do. Thanks
2007-01-12 16:08:25 · 8 answers · asked by Day Dreamer 1 in Business & Finance ➔ Personal Finance
If you have $4,000 in credit card debt you are probably paying something like 12 or 18 percent interest on that, so it wouldn't make much sense to put your stash in a CD paying 5 percent because you would still be falling behind. If you are at least making progress on paying off the cards, you could use some of your savings on the debt and hold onto some.
As far as other things to do with the savings, it depends on when you are likely to need it. If you can put some away until retirement, a Roth IRA is great because you don't pay taxes on the investment gains as long as you leave them in there until retirement. But if you might need some of your savings for an emergency, like if your car conks out, I would suggest an online savings account like Emigrant Direct which pay a little over 5 percent but can be withdrawn at any time unlike a CD. They are very easy to do...you link it to your regular bank account and perform all your transactions online.
2007-01-12 16:22:25 · answer #1 · answered by njyogibear 7 · 1⤊ 0⤋
absolutely pay off your credit cards first, since you be saying 18-24% right off the bat. The last $1000 you should save in an internet savings account and build it as a rainy day fund aka. emergency money fund. if you don't have an retirement account then start one and put that $1000 in there. you still have time to contribute for 2006.
2007-01-13 00:29:24 · answer #2 · answered by bluebearstuff 1 · 2⤊ 0⤋
Place an Emergy Fund about $3,500 in an ING Account. You will gauin 4.5% interest and the money is safe.
Take the additional money and invest in an Index fund with low expense fees.
2007-01-13 01:14:43 · answer #3 · answered by traderb550 3 · 0⤊ 0⤋
Well you could send it to a good cause --- ME ! LOL I;m just joking.
I'd chose pay off the highest interest credit card --- and cut it up! Or hide it.
Credit cards on average take 30 yrs to pay off with minimum payments. So you are far better off to pay one off completely!!
Lifes
2007-01-13 00:17:24 · answer #4 · answered by Lifesnadir 3 · 0⤊ 0⤋
Pay off debt and earn more to invest in Stocks etc
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2007-01-13 01:00:16 · answer #6 · answered by cork 7 · 1⤊ 0⤋
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2007-01-13 01:12:49 · answer #7 · answered by thomascook20042003 1 · 0⤊ 1⤋
You don't have any money.
You are broke.
In fact, you are still $1,000.00 short.
2007-01-13 03:59:58 · answer #8 · answered by Anonymous · 0⤊ 1⤋