Looking for Investment and Credit Advice Vol. i don't want to resell drugs

[denni5themenace]

hello NT investment gurus. i'm 25 years old and i currently have about ~$15,000 just sitting in a savings account that i don't touch. i have a stable job and i am able to add more to it every pay period. i also always pay off my credit card in full every month and have no trouble meeting my monthly bills. i plan on stashing some of this into a "rainy day" fund and the rest i was thinking of either investing into something or putting a down payment when the new 4 series comes out

i have a couple questions:

1. i am unsure of my credit score and if i were to buy a new car, i would want the best rate possible. what is a good amount to leave on my credit card to improve my credit score? i always pay everything off in full but i was told that this isn't the best way to improve my credit score. can someone clarify this for me?

2. i was looking into both an IRA and Roth IRA, but i don't want to commit to putting a large some of my savings into it at once. i know it is subjective, but how much do people usually start their IRA with? are there any other long term alternatives investments you suggest?

any other suggestions are welcome as well

thanks for the help in advance

 

[joe billionaire]

http://www.providentmetals.com/1-oz...001-certified-with-qr-code.html?ref=slideshow

if its just gonna sit there, minus whale

 

[rexanglorum]

Unless you are a drug lord, a ball player or trust fund baby, the best way to become wealthy is to spend less than you make and save your money. the fact that you have 15k, in cash, shows me that you have a great fiscal foundation already set.

I would take 1k and buy gold coins (a hedge against hyper inflation), invest 6k in a very wide variety of stocks (the Fed is determined to drive up stock prices so put your money in stocks and stay ahead of inflation). Put another 3k into a down payment for a car. Hold the other 5k so you can get credit cards, pay the balance off every month and every six months, ask the card issuer to raise your limit. A high limit with timely payments is what will really raise your credit score.

I hope that helps.

 

[suberzat1]

^ good stuff but also u should have about 20%(dont quote me) on your card credit after each month. Its better to have money still on the credit card than to play it off. I would look up some articles for u to back up everything im telling u up but im trying to go back to sleep

 

[danger]

bitcoins,

i made $20 in a few days from like $300 investment.

in 1 year the price per bitcoin has gone up 272% from $5.60 to around $22 today

 

[rexanglorum]

^ good stuff but also u should have about 20%(dont quote me) on your card credit after each month. Its better to have money still on the credit card than to play it off. I would look up some articles for u to back up everything im telling u up but im trying to go back to sleep

You are correct, not paying off the balance every month and thus using a small portion of your credit limit will improve your credit score more quickly than paying the balance off every month.

The reason I suggested paying the entire balance every month is because you will still grow your credit score and avoid giving the credit card companies a great deal of money. They charge between 10% to 30% so if you have the cash to pay off your monthly balance you save money.

 

[yanky]

Why would you not pay off your entire balance each month? I always pay the full amount when that statement comes in the mail. I'm not paying a penny in interest and my cc limit is 6K.

 

[shatterkneesinc]

hyper inflation?

 

[teamjordan79]

Why would you not pay off your entire balance each month? I always pay the full amount when that statement comes in the mail. I'm not paying a penny in interest and my cc limit is 6K.

i think rex explained the pro and cons quite well.
Not paying within credit limit = better credit score but ur paying interest
Paying at end of each month = credit score does not improve significantly but u dont pay that interest fee.

 

[nikeairforce1]

^ good stuff but also u should have about 20%(dont quote me) on your card credit after each month. Its better to have money still on the credit card than to play it off. I would look up some articles for u to back up everything im telling u up but im trying to go back to sleep

You are correct, not paying off the balance every month and thus using a small portion of your credit limit will improve your credit score more quickly than paying the balance off every month.

The reason I suggested paying the entire balance every month is because you will still grow your credit score and avoid giving the credit card companies a great deal of money. They charge between 10% to 30% so if you have the cash to pay off your monthly balance you save money.

you guys are close..but still wrong.

Let's say your credit limit is $1000. You spend $500 each month. When your statement closes, your credit card company will report to the three credit bureaus that you utilize 50% of your credit. This is far too high will will lower your credit score. You want your credit utilization rate to be ideally 1%-9% of your total credit limit.

So even though you're paying off your credit card in full each month, the three credit bureaus think you're using too much of your credit. What you want to do is to pay your balance BEFORE your closing date, while still leaving 1%-9% of your credit limit on your account. This way, the credit bureaus see that your credit utilization rate is low, but you're still using your credit. THEN you pay off the rest of the balance before the DUE DATE to avoid incurring interest charges.




cliffs:
pay 91-99% of credit card balance before statement closing date
then pay off the rest before due date to avoid interest charges

 

[rexanglorum]

hyper inflation?

I am an economist and a political advisor and you should be happy that I find the risk of hyper inflation so relatively small that I recomend using only 1/15th of your liquid wealth to hedge against it.

In the next few years inflation will likely stay ocntained and that is why equities is the way to go but it is wise to diversify and having gold coins on hand acts as an insurance policy against 10% to 100% annual inflation (which is technically just "galloping" inflation).

Financial crises can be postponed longer than most expected but when they hit they tend to move much more swiftly than many expected.

 

[night marcher01]

Posting for later. Appreciating every bit of knowledge guys!

 

[crcballer55]

First, have at least 3-6 months of your expenses in an emergency fund. You WILL have an emergency at some point. Next, if you have some left over, invest it in a Roth IRA. While an IRA will allow you to deduct your contributions from your income, the balance will be taxed at the end. A Roth IRA grows tax free so you'll end up with much more since you're putting post-tax money in at the end. If you don't want to put it in all at once and want to hedge your bets, Dollar-Cost-Average it out over a couple months or the year. Basically, put a portion in each month and hopefully you'll end up buying some shares on sale.

I'm going to have to disagree with Rex on the CC balance portion. I have never seen the point of carrying a balance on your cards just to get a better interest rate. For one, you're paying ~17% to get a 1-2% advantage on a larger purchase. While it might make sense if the purchase is large enough, I like to stick with the "tortoise & the hare" strategy. Secondly, a car is the fastest depreciating asset you'll ever own. The thought of paying interest on something that's going to be worth 60% less than what you bought it for 5 years earlier doesn't make a lot of sense. Put about $5K of the money (if it's left over) into 2 mutual funds, one small cap & one international). In a couple years, the money should have a nice gain and you can use that towards your car purchase, in addition to whatever else you contribute to it on a monthly basis. Car payments are a HUGE money drain and will cost you big time in the long run. Here's a quick example:

 

[ricky409]

Love that free car video, but famb got a lifestyle to maintain.

Roth Ira >>>

Diversify your investment and jump in while rates are at historical lows.

The way the rich get richer is that they have money to make moves with the economy and know when to invest in stocks or bonds.

Right now, people that copped bonds a 10 years ago are RAKING in dough by selling off the high interest bonds.

Then they'll turn around and cop stocks.

Safe bet is the s&p... but don't pick companies cuz you like their products. Pick companies that have their own risk... for instance, a band aid company annnnd... pillow making company... that's called diversifying.

Also, I think were safe from hyper inflation bro.

 

[crcballer55]

Love that free car video, but famb got a lifestyle to maintain.

Roth Ira >>>

Diversify your investment and jump in while rates are at historical lows.

The way the rich get richer is that they have money to make moves with the economy and know when to invest in stocks or bonds.

Right now, people that copped bonds a 10 years ago are RAKING in dough by selling off the high interest bonds.

Then they'll turn around and cop stocks.

Safe bet is the s&p... but don't pick companies cuz you like their products. Pick companies that have their own risk... for instance, a band aid company annnnd... pillow making company... that's called diversifying.

Also, I think were safe from hyper inflation bro.

I'd rather have 10x the lifestyle later than fake it now... but that's just me.

If someone wants to truly diversity their portfolio, stick with mutual funds & ETF's. If one company goes under, you'll have several dozen others to pick up the slack and you can buy more since you'll be able to diversity better since you won't be buying one share of each company.

 

[slamcity]

Anybody knowledgeable in Forex markets?

 

[ballahb]

Posting for later...to gain knowledge

 

[ricky409]

I'd rather have 10x the lifestyle later than fake it now... but that's just me.

If someone wants to truly diversity their portfolio, stick with mutual funds & ETF's. If one company goes under, you'll have several dozen others to pick up the slack and you can buy more since you'll be able to diversity better since you won't be buying one share of each company.

later in life when he's 55 and can't get an erection to satisfy the yambs that will flock cuz the new BMW?

While I agree you shouldn't fake it... he can enjoy himself a little bit... maybe not an 80k car... but not a 05 Kia optima either...

Moderation is key.

And mutual funds are cool... but the transaction costs plus what's taken off for the fund can be eliminated with a little research.

One thing I've learned early in my financial studies is that there is no sure fire right answer... difering opinions are the only definite...

I respect you doe...

 

[jking0821]

Good stuff in here guys posting for later

 

[niquefreak94]

p4l

 

[retro23j]

Roth Ira >>>

 

 

[do be doo]

Great stuff ITT.

 

[mahnametahrone]

Roth Ira >>>

 

Basically

 

[jthagreat]

First, have at least 3-6 months of your expenses in an emergency fund. You WILL have an emergency at some point. Next, if you have some left over, invest it in a Roth IRA. While an IRA will allow you to deduct your contributions from your income, the balance will be taxed at the end. A Roth IRA grows tax free so you'll end up with much more since you're putting post-tax money in at the end. If you don't want to put it in all at once and want to hedge your bets, Dollar-Cost-Average it out over a couple months or the year. Basically, put a portion in each month and hopefully you'll end up buying some shares on sale.

I'm going to have to disagree with Rex on the CC balance portion. I have never seen the point of carrying a balance on your cards just to get a better interest rate. For one, you're paying ~17% to get a 1-2% advantage on a larger purchase. While it might make sense if the purchase is large enough, I like to stick with the "tortoise & the hare" strategy. Secondly, a car is the fastest depreciating asset you'll ever own. The thought of paying interest on something that's going to be worth 60% less than what you bought it for 5 years earlier doesn't make a lot of sense. Put about $5K of the money (if it's left over) into 2 mutual funds, one small cap & one international). In a couple years, the money should have a nice gain and you can use that towards your car purchase, in addition to whatever else you contribute to it on a monthly basis. Car payments are a HUGE money drain and will cost you big time in the long run. Here's a quick example:

Ill say this everytime when videos like this posted. 12% where? 6% where?

 

[crcballer55]

Ill say this everytime when videos like this posted. 12% where? 6% where?

https://www.americanfunds.com/funds/details/ica/a.html

A 78 year track record with an average of a 12%/yr. return.

You're welcome