What should I do with $20,000? I would like to invest and make money... but mostly short term. Any advice?

Answer 1

I am taking a break from studying for my Estate planning class. As a financial planner, I would suggest that any money you might need within five years should be kept in a money market account or savings account with an online bank or in a short term CD. If you do not know exactly when you need the money, then the money market / savings account with an online bank would be a good bet.

Through April 30th, 6% rate is available at the url below. This is the best rate available at this time:
http://www.us.hsbc.com/1/2/3/personal/savings/online-savings

If you want to look for other banks and see what they offer:
www.bankrate.com

Jack

Answer 2

Just give it to me, I'll take care of it :D.

Wow, I am laughing with the responses you get, from buying house, commodity to restaurant!

Investment options varies based on your risk level, investment experience, total assets you have, your income, time frame and amount available.
Generally speaking, If you have less than year then best bet is to keep in Money market, however do not expect the interest rate to go up, it will more likely come down a bit after summer. If you have over a year to five year time frame than look for some bond funds or you can also diversify portfolio with some value funds.

Feel free to contact me if u need help.

Answer 3

Before you go short term, think about this.

If you are mid-20's, and put your money into higher-risk high growth mutual funds (example: fidelity contrafund II), you can expect over the long run, returns in the 10 - 13% range.

By the time you retire, that 20 grand by itself, will be about 1 million dollars.

If you are early 30's that 20 grand will be 500,000 by the time you retire. Late 30's -- 250 grand. You get the picture.

I tell kids fresh out of college -- do NOT buy that 20,000 automobile, and then I show them the math of how they can take that same 20,000 and be millionaires when they retire -- independant of any other 401k, IRA, social security, or company retirement plans they may get along the way.

.

Answer 4

The market is volatile right now, and not a safe bet to make gains on a short term investment anyway. If you are looking for something truely short term I would suggest You look into a CD with a term of 6 months or a year. There is no risk, and you know exactly what your rate of return will be.

Answer 5

Try setting up C.O.D.'s or any investments that the banks may offer.Find out if they carry plans that will pay you while you're investing within their businesses.Once you have that part taken care of,invest in buying up a small acre of land.Build commodity property on it,lease it to second or third parties,flip those,buy more land,repeat on building or leasing or doing both even(while having banks and lawyers in your corners to take care of the nessasary paper work for you as you repeat these steps).And all the while you should have the second and third parties paying most of the costs through all the leasing payment plan options availible to you so you can take care of any other bills or land tax payments made on your behalf,and still gaining profits for yourself in the meantime.Another way is forming up your own internet web sites for marketing off items over the internet,by buying at wholesale or cheaper rates,then selling them at 10% or more than what you purchased the items for.So between banking/business,real estate,and internet doing trade service investments with you,or you could use all assets above at the same time to profit from whichever you start out with first.Internet and Real Estate usally would pay off on a month to month basis,where Banks/Businesses/Government would usually pay 1-10 years for short term investments.You can decide what works best for you by discussing all these options with a financial advisor.

Answer 6

How short?

60 and 90 day CD's pay the highest interest from banks. I just made 6% on 90 day CD's.

Mutual funds are a good investment because they are diversified. But the best investment you can make is real estate. I don't know what state you live in, but if you can buy a small house and rent it out, you will make appreciation onthe property plus rent. You also get the benefit of all of the tax deductions allowed for rental property. I just sold my last rental property last year. A 20 year inverstment (I sold property every 5 years and bought new property) of $10000 gave me a gross return of $300,000 plus the tax benefits. One house bought with qoK down. Sold, bought 2 houses, sold bought me an apartment building, sold and bought me a bigger building. sold and retired.

Think about it. real estate is a better investment than the stock market, cars, vegas. It never goes down in value, and you can't make any more of it. Just remember, location location location. Just because you wouldn't live there doesn't mean it won't rent.

good luck.

Answer 7

Open a Roth IRA for your retirement if you don't have one already. If you act before April 17 you can make a full contribution for last year ($4000) and you can make a full contribution for this year for an investment of $8000. Put the rest in a high yielding savings account for short term use, you can find rates around 4-5%.

Answer 8

Most of your short term options - safe one will be certificate of deposits - not necessarily the most profitable because of the low risk but will earn more than a regular bank account. I would suggest you start looking a developing an investment strategy with a longer view - you could park some of it in government bonds or US treasuries for a bit more interest but with still a low amount of risk - I would avoid stocks until you have a better understanding of investments - keeping that 20k as working capital cushion to build for a significant purchase such as a house or land - use your employer's retirement options such as 401k as your longer term investment strategy and as gain more knowledge look at further diversification of your portfolio

Answer 9

Don't listen to the old adage of, "SAVE, SAVE, SAVE!!!", as TLB101 said earlier on, with the, "by the time you retire that 20K will be about 1M...". Thing is this... today $1M isn't enough to last a YEAR, considering what even a smart investor will spend it on, especially if you need to buy a new house, cars, etc... won't last a lifetime like it used to, even in the bank. If you are in your 20's NOW, ten by the time you are of retirement age, $1M, with inflation, and future wages will be practically worthless... a 2 bedroom house in the bronx will be about a million by then. DON'T save it... invest in HIGH RISK, HUGE PAYOFF items, like penny stocks, IRAQI DINAR (which is quite logical really, if you truly have $20K to possibly spend, because the possible outcome could be you becoming a multi millionaire in a very short time), or hedge funds. The more logical, yet risky investment(s) would be penny stocks, which I am involved in. It's highly volatile, but if you research which companies you are investing in, that is, what products they are producing/services they provide, you can make pretty sound decisions.

Keep in mind that most any "investment" whether short term or long term, are RISKS/RISKY, as you have no idea of actual/potential profit margins. It's great to ere on the side of caution like MOST people do and NOT do the Iraqi Dinar investment (once in a lifetime opportunity), nor the penny stocks (highly volatile), or any other investment. Also keep in mine, MOST people are not considered by any standard(s) to be "wealthy". So, don't take their advice. Take the advice of someone who has actually made substantial windfalls investing WISELY (me). The operative word being, WISEly. Think before you invest, and always get more than one opinion, ask for second, third, fourth, fifth, so on and so forth.

Here're 2 Great links to how $1 Million isn't what it used to be, and the Top 10 Reasons why you aren't "rich".

http://biz.yahoo.com/ap/070320/business_of_life.html?.v=2&.pf=banking-budgeting
http://biz.yahoo.com/ts/070322/10345796.html?.v=1&.pf=banking-budgeting

Answer 10

High yield savings account, like HSBC. If you invest in anything else, you'll take on too much short term risk. For example, if you buy a few average stocks and hold them just for a month, you'll have just about a 45% chance of losing money. But if you hold a stock for five years, your chances of losing money go down to about 5%.