What to do with my paycheck?

Feb 9, 2019 17 Comments

Junior eng. here who is really confused on what to do with his paycheck. I've heard of things like betterment/vanguard, low cost index funds, bonds, etc. What's the best way to invest money so I can save for the future reliably with peace of mind?

Dont know much about finance or economics in general.

TC: 145k

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TOP 17 Comments
  • New
    IAmPepe

    Go to company page New

    IAmPepe
    day trade crypto
    Feb 9, 2019 0
  • Here is something that I would do if I could go back 15 years at the start of my career:
    1. Create a rainy day fund of 6-9 months of expenses. Mostly cash and money market
    2. Put 80% of intended savings in S&P500 and Nasdaq every month. With the rest 20%, buy some brands that you use daily and love (at that time it would’ve been Netflix, Apple, Nike, Google etc).
    3. When you have enough savings, buy a house and rent out one/two bedrooms if you are still single.
    Feb 9, 2019 3
  • Amazon / Eng
    DynamoDB

    Go to company page Amazon Eng

    DynamoDB
    Throw it all in index funds if you don't know. Otherwise it's best to read a few things on investing.
    Feb 9, 2019 0
  • Google
    tsukino

    Go to company page Google

    tsukino
    passive/long-term investing in S&P with developed market bonds ETFs as primary hedge (depending on your personal risk profile), and optionally a small percentage of real estate and gold if you are really paranoid about black swan events; example of semi-aggressive portfolio: 60% equities, 25% bonds, 10% real estate, 5% gold

    to better understand risk (which is different from volatility), consider looking at graphs of how cointegrated pairs and return correlations break down in crises; illiquidity premium becomes very expensive during such times, so make sure you can ride out the waves
    Feb 9, 2019 1
    • Google / Eng
      yuyu

      Go to company page Google Eng

      yuyu
      This is the best answer here.

      Most are giving advice and throw out suggestions without ever talking or understanding risk, optionality, Black Swan events, randomness, etc.
      Feb 9, 2019
  • Throw one egg each in all the below buckets and you will thank yourself and me in the future. :-)
    1. Kids education bucket even if you don't have kids as of today,like 529 plan.
    2.retirement
    3. Term life insurance
    4. Stock market
    5. House
    6. Improving your skills
    7.Fun and travel
    8.health

    Happy to know if I missed any bucket.
    Feb 9, 2019 0