High Risk Credit Card Accounts
What is the next investment step with my personal finances?
I am 28 years old. I have no credit card debt. I have $18,000 in a high yield savings account (5%). I have $2100 in Mutual Funds (made 8% so far YTD). I have $10,500 in my 401K. I own a house in Texas that I currently rent out. The rent pays for the mortgage. I rent in California and cannot buy as I am here only for a short period of time. I save approximately $1500 to $2000 a month. Where should I put this money? More mutual funds, high yeild savings, 401K or other? Do I have too much money in the high yield savings account? I am willing to take an average amount of risk but nothing too risky. Need some financial guidance world…please help! I know I’m not doing too bad, but I know I could be on my way to financial freedom in the future with some right guidance. Thanks!
Your next step is to open a Roth IRA. Though, I don’t know your adjusted gross income (AGI), so I don’t know if you qualify for a Roth IRA. If you are single and your adjusted gross income (AGI) is above $110,000, you cannot get a Roth IRA. If you are married and filing jointly (or qualify widower) and your AGI is above $160,000, you do not qualify for a Roth IRA. If you are married, but filing separately, and the spouse lives with you, you do not qualify for a Roth IRA if your AGI is above $10,000.
If your AGI is above those limits, then you should open a Traditional IRA. They are not great as Roth IRA, but in 2010, you can rollover your Traditional IRA into a Roth IRA because Congress has removed the AGI limit.
Base on your age, you should put mutual funds into your IRA. I would invest in aggressive growth or large growth funds and large blend funds. Make sure you stick with the same fund family, meaning if you pick Legg Mason Partners Funds only, then pick mutual funds from this company. Why? You will get breakpoints (discounts) on purchases of new shares when the total value of all your mutual funds reaches $25,000.
I personally have a Roth IRA and have LMP Aggressive Growth, LMP Appreciation, and LMP Fundamental Value. I also invest using the dollar cost averaging concept. So I put money in every month. On some months, price per share may be high, so I get fewer shares. On other months, price per share may be low, so I get more shares. By investing this way, I lower the cost per share overtime. Right now, the average rate of return in my IRA is 22.1%. Though, its only a couple years old. I don’t know how it will do in the future. But for now, its off to a good start.
I don’t know how you invest, but you should really invest every month. You maybe able to setup an automatic bank draft with your investments. That way money will be transfered from your checking to your investments automatically.
When Do You Require A High Risk Credit Card Merchant Account
