New Grad managing money

Oct 17, 2021 24 Comments

I recently joined Microsoft and got my paycheck along with my bonus. Right now I have around $55k in my savings account but I think that I need to reduce it given inflation worries.

I have calculated that my 6 month emergency fund is around $20k (I have very low expenses) but will like a bit more in savings to help family if needed.

I also have around $10k in stocks, not from Microsoft, and $3k in crypto.

I am wondering if anyone has advice on if I should consider investing in index or mutual funds.

I am unable to contribute the full amount to my 401k this year since I started so late and I did not know that my contributions would be the same for my bonus as for my standard pay check.

I am also already on track to max out my HSA.

Are there any other non-Microsoft tax deferred accounts I can open? I don’t want that amount of money parked in my savings account.

I would also like to hear if any of you have any advice for me. Perhaps something you wish your younger self would have known about personal finances.

TC: 180k
YOE: <1 year

#investments #personalfinance

comments

Want to comment? LOG IN or SIGN UP
TOP 24 Comments
  • Do mega back door Roth - which is total 56k per annum you can contribute. This will not have any tax once u retire.
    Oct 17, 2021 12
    • No one can predict future. Whatever you can do now is what you should do. Like you can always rent ur condo in future. And you have to invest 70-80k for a 300-500k apartment with 10% down. So it’s up to you. Key thing is always buying and taking risk. As you are young it’s good to get all learning. If you ask any 35+ old - he has more money but thinks can I handle all the tenant manage Mrn issues etc, do I have mental energy to deal with it. So go for it as early as possible. Nothing is easy but at least u have energy/time to deal
      With if something unexpected goes.
      Oct 17, 2021
    • I would add that you should sell ESPP right away and invest those funds somewhere else to diversify. Your job, location, stocks are all tied to MSFT. Use ESPP as a quick, straight forward return of 10% and then reinvest it somewhere else, ie. FSKAX
      Oct 23, 2021
  • Google
    d0ntb33vil

    Go to company page Google

    d0ntb33vil
    At this point I'd put all of my biweekly base pay into 401k if it's not maxed out yet. It's the highest ROI since you likely or hopefully have employer match

    You have cash / liquid assets that you can live off of until the end of year
    Oct 17, 2021 1
  • Did you enroll in ESPP?
    Oct 17, 2021 5
  • For long term investment, open Roth IRA and start investing in stocks post tax.
    Oct 17, 2021 0
  • New
    cmMN40

    New

    cmMN40
    Why can’t you 401k? It’s definitely not too late to max it. Look into after tax contribution and Roth mega backdoor and don’t take any money from your paycheck. Spend down your savings while everything gets converted to Roth. Thank me later.
    Oct 25, 2021 0