How to Best Invest $30K for My Future?
November 22, 2007
I really need some financial advice so I’m calling out to all the Financial Wizards out there!!!
I am a divorced 47 year old woman, permanently disabled, and receive $1683/mo from Social Security Disability Insurance (SSDI) as my only source of income ($1780 – $96.40 for Medicare) .
It’s a long story, but I had to cash out my pension for living expenses while waiting for SSDI and Long Term Disability Insurance to be approved. It was long-ago spent, thus I have no pension other than a lump sum of approximately $30,000 from a medical disability settlement.
I own my home and my mortgage is about $920 and includes insurance and taxes. In 2009 my house is appraised, for tax purposes, at $233K, in 2008 it was $212K, and 2007 was $199K. I currently owe ~ $156K. I cannot currently re-fi it due to a tax lien (another long story).
So, since I’m operating under the assumption that I alone will be responsible for myself and my finances until I die, I am trying to figure out the best way to invest this money. I realize this is a terrible market right now and won’t earn a lot. I can’t have all the money tied up so I couldn’t access it within, say, 30 days, in case of an emergency.
Are any money and retirement savvy folks out there who can give me their opinions? I realize I must make the final decision but some “If it were me, I would ___” scenarios would be greatly appreciated.
Thanks,
Karen
Tax Lien Investing
Comments
3 Responses to “How to Best Invest $30K for My Future?”
Tax Lien Fund
I say you sell the house and take that money and go live somewhere where its cheaper to live so it lasts longer. Theres no better investment then going somewhere where your money lasts 30 times as much. No investment in the world would make you 30 times the amount of money you have. So thats really the best thing if you can bear to leave your country.
I’m 27, and I stay in Thailand half the year. Its just like Hawaii, but much much cheaper(it has twice as many tourists as Hawaii too, so you wouldnt be the only american there, theres entire apartment buildings with nothing but english and americans). Im not talking about the dirty city of Bangkok (which was voted by travel and leisure as the best city to travel to this year), Im talking about on the islands or in the beach towns. Its paradise and its safe. Plus they have all the same things you can find in USA (good hospitals (in the cities at least), shopping malls, mcdonalds, pizza places etc.).
Thats what I would do, because thats what I do do. You can get a condo on the beach, and with food and everything else, it would cost you around $400 per month. If you really wanted to be cheap about it, you could stay far from the beach. Rent is the most expensive thing, everything is extremely cheap so you would really save in the long run.
Just a suggestion.
tax lien investing
Go to your bank. Ask to speak to a financial advisor. Take their advice.
Tax Lien Investing
$30,000 is not a lot of money to retire on, so we have to make it grow first before using it.
$10,000 should go into an emergency fund.
That’s cash in the bank, for real emergencies, such as a leaky roof.
The other $20,000 should go into the stock market, as you won’t be touching it for 15-20 years. Your investment strategy is “buy-and-hold”
Open up a brokerage account, such as etrade, or schwab, and buy four different mutual funds.
$5,000 each goes into 1) growth, 2) growth & income, 3) aggressive growth, 4) international.
Mutual funds are better than single stocks, because there’s less risk. If a mutual fund holds 50 stocks, odds are that at any given time, 25-30 of them will be going up, and 20-25 of them will be going down.
I would not use any of this $30,000 to pay down the mortgage, because if you can’t refi, you can’t reduce your payments.
This is going to be a very tight budget.
But you do have one thing going for you: The only debt is the mortgage.
$1683 – income.
$200 – food
$920 – mortgage
$ 50 – clothes
$200 – transportation (city bus and/or gasoline)
$ 50 – car insurance (it’s a $300 check every six months)
$200 – utilities (electric, water, cable, phone)
$ 63 – fun and/or replenish the $10,000 emergency fund.
Two things will sink this budget quickly: credit cards and car payments. Avoid them both like the plague.
And if there’s anything you can do to get some extra income, do it.