In summary: What investments would you do with 300Kt hat will keep the principal as safe as possible but can generate good income? Imagine this 300K is everything that you have in life. Longer version: I have worked for the past 7 years and I have saved up 300k. I come from a poor family and we don't have any money saved and I've no inheritance no nothing I need to do something for the future for my family myself and my wife. I understand that I cannot be always in the tech and I'm already 40 years old. I want to be able to achieve something and start.a business something that can run on its own and hopefully produce as much as possible with the 300k that I have. The idea is to be able to make money with this investment but ensure that the principal stays safe. Putting it into mutual funds, ETF etc are good in terms of low-risk but the amount of money that they produce is so little so I'm thinking of other ways through business or buying brick-and-mortar business etc I need your opinion on the matter. What would you do if you have 300K and you would want to be super safe because this is everything that you have in life. Thank you so much for your help
Decide to spend 5-10k every year. And commit to one idea. Create business plan and execute it. Don't worry about the 5-10k. You are spending it on business. It can be profitable. At the end is all about numbers. If they match and you break even and earn more you are on a path to even more in the future.
How can I start a business with 5 to 10k. That's such a small amount for any business as in it?
Buy and resell
If I were you I would invest into higher dividend stocks. Some stocks produce up to 10% a year. Also invest into different stocks, diversify to low down the risk.
could you elaborate a little bit please what kind of stocks for example and if someone is so new to this where would I go to learn about it and learn how to invest in these stocks and how to find them?
I would put it in a balanced fund , 60:40. The interest rates are so low that you will barely make any money if you are out of stocks. But given your risk averse nature, maybe you can’t go all in on stocks. That’s my best guess, usual warnings about I not being a financial adviser applies :)
What is a balanced fund what is it exactly mean and how does that relate to interest rates being so low?
A balanced fund is a mix of bonds and stocks. Bonds are generally understood to be principal preserving but low returns. If interest rates are low, money generally flows to stocks because bond returns are very low ( tied to interest rate).
If you need super safe CD with 2 different banks. Or you could a bank stock like CFG and get about 11k+ in dividends alone each year. But based on what you wrote above, CD is really the way to go.
What type of returns would I expect from CD? How does one find stocks that have dividends like the one you mentioned?
Depends on how long you put into CD. The longer in years, the higher the rate. I think it’s about 1.5-2% for 2-5 years. Depends on which bank. For stocks, market price could go down or dividend rate might change. Just open an brokerage account and buy like Bank of America, Jpm Morgan chase, or citizens financial group. They are many pretty stable bank stocks you can buy stock of.
I have been really happy with betterment
Could you elaborate on the Betterment please what have you invested what are the returns what to watch out for
Read bill Bernstein's "if you can ". I have made mistakes trying to invest only in CDs and real estate. Both have not worked as well l as I expected. Invest in 60:40 or 70:30 index: bond funds. Vanguard is what I recommend, vtsax,vbtlx. Promise yourself not to touch the investment for the next decade. Keep an emergency fund for 6 month expenses. Keep investing in the ratio you are comfortable with into the funds. Live below your means, don't try to live and but fancy stuff.
How do I educate myself around the 60:40 vanguard etc as you mentioned. Could you give some guidance as I'm a newbie. Also how would you calculate how much to expect roughly in a decade?
For index funds it will be what the stock market will be. The ratio I mentioned is based on how confident your are with the stock market. Some do 100%. Search for the bill Bernstein's short book I mentioned. Start to read up stuff. Join Bogleheads forum. Read next door millionaire.
Would recommend reading "the simple path to wealth " authors speaks heavily on investing in vtsax. Check out his blogs and videos on youtube in case you r not a book reader. Hope this helps
Thank you so much for your advice. Any other books, videos, courses that I can take that you have had and you recommend?
Bro. Please go to r/personalfinance. Or bogleheads.org. you need to educate yourself on finance before you make any decision.
I'm so grateful that you provided these resources to me. thank you. Any other resurse that I have to be on and learn from?
I would definitely invest in a business if you feel strongly about. As someone who has a finance and investments backgroup, id be happy to direct message with you and provide any advice. There are great alternatives out there that could get you 7-12% a year that is liquid as well.
Buy treasury bills
What's the expected the return on average and where would you go to invest if you have no idea where to start