My Personal Investment Strategy
Summary: The finer points of my personal investment strategy including emergency funds, checking and savings accounts, and investing beyond Betterment.<br> An emergency fund is vital as we discussed in <a href="https://www.listenmoneymatters.com/importance-emergency-fund/" target="_blank" rel="noopener">Episode 64.</a> But we define that a bit differently than a lot of people. You should not have a savings account. You need a checking account that contains one month’s expenses plus 150%.<br> So if you spend $2000 a month, your checking account should contain $5000. In lieu of a savings account which makes less than 1% interest, you should use a tool like Betterment to stash your emergency fund. The money here will grow at an average of 7% a year and is liquid within a few days. This is controversial to some but it is not risky. This account should be funded up to $25,000.<br> Should you participate in your company’s 401K? Never turn down free money. If your company matches, you should contribute the same amount into a 401K even if you have credit card debt.<br> Now things are a bit more comfortable. Between your checking account and investment account, you have about $30,000. This is your working capital. We’re comfy now but it’s no time to get complacent. We’re going to take a little risk by investing in something like individual stocks or a fund with a company like Vanguard or Fidelity.<br> The next step is for advanced investors with $100,000 or more invested. You can afford a little more risk. Andrew has had very good returns with <a href="https://www.listenmoneymatters.com/go/lending-club/" target="_blank" rel="noopener">Lending Club.</a> Not for the faint of heart but the rewards can be enormous.<br> Don’t forget, we’ve also put together a list of the <a href="https://www.listenmoneymatters.com/best-vanguard-funds/">top vanguard funds</a> we know about – you should check them out!<br> Now go out and be the best investor you can be!<br> Show Notes<br> <a href="https://www.listenmoneymatters.com/investment-strategy-blueprint/">The Ultimate Investment Strategy Blueprint:</a> Andrew’s recent blog article.<br> <a href="https://www.listenmoneymatters.com/vanguard" target="_blank" rel="noopener">Vanguard:</a> A low fee investment management company.<br> <a href="https://www.listenmoneymatters.com/go/betterment" target="_blank" rel="noopener">Betterment:</a> Where your emergency fund should be stored. Use this link and get six months free investing!<br> <a href="http://www.finconmedia.com/nominate-someone-fincon-spotlight-award/" target="_blank" rel="noopener">Nominate our Podcast for a FinCon Spotlight Award</a>: We all know someone in the FinCon Community or beyond that is doing interesting, far-reaching work to help people with their money.<br>
