Actuarial Outpost
 
Go Back   Actuarial Outpost > Actuarial Discussion Forum > Finance - Investments > Non-Actuarial Personal Finance/Investing
FlashChat Actuarial Discussion Preliminary Exams CAS/SOA Exams Cyberchat Around the World Suggestions


Reply
 
Thread Tools Search this Thread Display Modes
  #1  
Old 10-06-2019, 04:18 PM
General Apathy's Avatar
General Apathy General Apathy is offline
Revered
CAS AAA
 
Join Date: Jun 2006
Location: St. Kitts
Studying for the Beach
Favorite beer: Carib
Posts: 33,659
Default Where to put a large amount of cash?

Let's say you have an amount of cash that will likely not be touched for 20 years. It needs to remain relatively liquid and accessible don't worry about why.

This site references a checking account with up to 5% at some credit union. I am guessing there are enough conditions and stuff that it is too good to be true.

https://www.thebalance.com/best-high...counts-4164760

Just a high yield savings account?

Some sort of money market.

Looks like i should be able to get something north of 2%?
__________________
Spoiler:
***k Juan
"whore-balls"
curls for the girls

Spoiler:


]
Reply With Quote
  #2  
Old 10-06-2019, 05:18 PM
Colymbosathon ecplecticos's Avatar
Colymbosathon ecplecticos Colymbosathon ecplecticos is offline
Member
 
Join Date: Dec 2003
Posts: 6,167
Default

It really depends on how much (5% on a checking account might be limited to 25K) and how risk-averse you are.

One possibility is to go with CDs. True, you might have to eat an early withdrawal penalty, but they aren't usually that bad.

You say "liquid." Most don't know what that means. It means that you can achieve the current market value quickly --- US major market stocks are liquid, US 30-year treasuries are liquid. It doesn't mean low-risk; you could easily take a bath on either of those.

If you really have a potential 20-year horizon, you might consider something like a broad-based stock index fund (preferably including both US and foreign stocks), planning to use margin to cover short-term cash needs. It really depends on your situation.
__________________
"What do you mean I don't have the prerequisites for this class? I've failed it twice before!"


"I think that probably clarifies things pretty good by itself."

"I understand health care now especially very well."
Reply With Quote
  #3  
Old 10-06-2019, 05:41 PM
Lucy's Avatar
Lucy Lucy is offline
Member
 
Join Date: Sep 2001
Posts: 4,759
Default

I read the title and assumed you wanted suggestions on safe ways to stash a few tens of thousands in currency short term. And my advice is "in a brown paper supermarket bag".
Reply With Quote
  #4  
Old 10-06-2019, 05:58 PM
#Hawaii2019's Avatar
#Hawaii2019 #Hawaii2019 is online now
Member
CAS
 
Join Date: Sep 2017
Studying for Hawaii
Posts: 1,088
Default

Quote:
Originally Posted by General Apathy View Post
Let's say you have an amount of cash that will likely not be touched for 20 years. It needs to remain relatively liquid and accessible don't worry about why.

This site references a checking account with up to 5% at some credit union. I am guessing there are enough conditions and stuff that it is too good to be true.

https://www.thebalance.com/best-high...counts-4164760

Just a high yield savings account?

Some sort of money market.

Looks like i should be able to get something north of 2%?
my venmo is open imo. i'll keep it safe
Reply With Quote
  #5  
Old 10-06-2019, 06:18 PM
Arthur Itas's Avatar
Arthur Itas Arthur Itas is offline
Member
CAS
 
Join Date: Feb 2004
Location: Atlanta
Studying for Prostate exam
College: Hard Knocks
Posts: 21,346
Default

Seems like a strange scenario. What's your risk/reward tolerance?
Reply With Quote
  #6  
Old 10-06-2019, 06:24 PM
The_Polymath The_Polymath is offline
Member
CAS SOA
 
Join Date: Jun 2016
Posts: 3,202
Default

Laddered CDs. Won't be completely liquid though.
Reply With Quote
  #7  
Old 10-06-2019, 08:37 PM
actuarialgenes's Avatar
actuarialgenes actuarialgenes is offline
Member
CAS
 
Join Date: Apr 2017
Location: New England
Studying for 7
Favorite beer: Wine
Posts: 185
Default

I’d suggest a bond fund (unless even the most conservative fund is still too risky for your tolerance).
Reply With Quote
  #8  
Old 10-07-2019, 11:23 AM
redprinceton redprinceton is offline
Member
 
Join Date: Nov 2010
Posts: 23,405
Default

If I really believed I wouldn't need it for 20 years, I'd buy index funds. It's liquid enough. You can liquidate shares and get your money within a few days at the worst. You run the risk of needing the money in a down market and locking in losses. But the alternative is running the risk of missing out on ((20 year CAGR of the index - high yield savings rate)^20 - 1) * principal.
__________________
Quote:
Originally Posted by The_Polymath View Post
Armchair internet economists are the worst.
President Trump is a white supremacist.

Spoiler:
We've been over this many times, but since some people like to pretend we haven't, I'm using my sig as a place to list the fairly obvious examples of treating whites as superior to others.

Now, when lazy and disingenuous people try to claim ignorance, I'm 100% entitled to dismissing them as lazy or disingenuous. Hope it helps!

The short list
Reply With Quote
  #9  
Old 10-07-2019, 11:27 AM
Arthur Itas's Avatar
Arthur Itas Arthur Itas is offline
Member
CAS
 
Join Date: Feb 2004
Location: Atlanta
Studying for Prostate exam
College: Hard Knocks
Posts: 21,346
Default

Quote:
Originally Posted by redprinceton View Post
If I really believed I wouldn't need it for 20 years, I'd buy index funds. It's liquid enough. You can liquidate shares and get your money within a few days at the worst. You run the risk of needing the money in a down market and locking in losses. But the alternative is running the risk of missing out on ((20 year CAGR of the index - high yield savings rate)^20 - 1) * principal.
Agree with this, assuming he can live with the risk for whatever rainy day he might need the money for.
Reply With Quote
  #10  
Old 10-07-2019, 12:13 PM
DyalDragon's Avatar
DyalDragon DyalDragon is offline
Member
SOA
 
Join Date: Apr 2009
Location: Here
Studying for the hell of it...
College: AASU
Favorite beer: This one...
Posts: 33,313
Default

Under your mattress
Several 1 gallon pickle jars buried in the backyard
Large coffee tins stashed randomly around the kitchen
Hidden air vent safe
Duct taped to the insides of your car doors
__________________
P FM MFE MLC C Predictive Analytics
VEE FAP FAP FAP FAP FAP FAP FAP FAP APC
Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off


All times are GMT -4. The time now is 12:46 PM.


Powered by vBulletin®
Copyright ©2000 - 2020, Jelsoft Enterprises Ltd.
*PLEASE NOTE: Posts are not checked for accuracy, and do not
represent the views of the Actuarial Outpost or its sponsors.
Page generated in 0.20385 seconds with 9 queries