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  • FIRST POST
    • ExoticHaha
    • By ExoticHaha 11th Jan 19, 5:45 PM
    • 6Posts
    • 0Thanks
    ExoticHaha
    What should I do with an extra monthly 1015 (1305 US dollars)?
    • #1
    • 11th Jan 19, 5:45 PM
    What should I do with an extra monthly 1015 (1305 US dollars)? 11th Jan 19 at 5:45 PM
    Good day,
    So I am a 19 year old and currently earning 1015 monthly (1304 US dollars) for doing nothing, no job or anything, and I will continue getting this money for the next 4 years. There are no strings attached to this money, I have no bills to pay as I am living at home and I will not need to pay this money back at any point. What can I do with this money to increase it? For example I could deposit it into something monthly, however I m not sure into what? I would love some help on what to do with it. I have no knowledge of investments, savings, etc. however I am a quick learner and would appreciate any tips.

    Thank you
Page 1
    • eskbanker
    • By eskbanker 11th Jan 19, 6:27 PM
    • 9,799 Posts
    • 11,661 Thanks
    eskbanker
    • #2
    • 11th Jan 19, 6:27 PM
    • #2
    • 11th Jan 19, 6:27 PM
    See https://www.moneysavingexpert.com/savings/which-saving-account/ and https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/ for info about savings accounts, which are likely to be the best bet, initially at least, for building up a deposit on a property if that's the direction you're likely to head in, and/or an emergency rainy day fund that we should all have.

    There are numerous longer term options once you've put enough away for either or both of those, if you're happy to lock it away for a long time, such as investments or pensions, but walk before you run!

    And ignore anyone who jumps in and recommends bitcoin, etc....
    • ExoticHaha
    • By ExoticHaha 11th Jan 19, 6:34 PM
    • 6 Posts
    • 0 Thanks
    ExoticHaha
    • #3
    • 11th Jan 19, 6:34 PM
    • #3
    • 11th Jan 19, 6:34 PM
    -clip-
    Originally posted by eskbanker
    (before I say anything don't worry, I'm not putting any money into BTC )
    Thanks alot for your reply! Yeah I don't mind the longer investment option as I am not a big spender, if I do spend money it's on the occasional piece of clothing here and there or a new game. I understand how investments work, however how should I start doing it? Are there any recommended websites I should look at for tips or what to invest in etc.?

    Thank you
    • eskbanker
    • By eskbanker 11th Jan 19, 6:50 PM
    • 9,799 Posts
    • 11,661 Thanks
    eskbanker
    • #4
    • 11th Jan 19, 6:50 PM
    • #4
    • 11th Jan 19, 6:50 PM
    I'd still strongly recommend staying well away from investment at this stage, until you've built up a decent buffer of readily-accessible cash savings. Investment is generally considered appropriate for money you won't need for at least seven years and, at the risk of a massive and patronising generalisation, most 19 year olds aren't planning over that sort of horizon and think of long term as the week after next

    However, for research purposes, you can start reading up on investing at:

    https://www.moneysavingexpert.com/investments/
    http://www.monevator.com
    http://diyinvestoruk.blogspot.com/
    https://www.moneyadviceservice.org.uk/en

    Another golden rule is diversification, ensuring that your eggs are spread across as many baskets as possible. That doesn't mean buying loads of shares as individual transactions - there are various global multi-asset funds that provide an ideal one stop shop for the small to medium investor, such as HSBC Global Strategy, Vanguard's LifeStrategy, Blackrock Consensus and L&G Multi-Index, and these are mentioned frequently on here, so read up on some of the newbie investing threads too.
    • ExoticHaha
    • By ExoticHaha 12th Jan 19, 12:05 AM
    • 6 Posts
    • 0 Thanks
    ExoticHaha
    • #5
    • 12th Jan 19, 12:05 AM
    • #5
    • 12th Jan 19, 12:05 AM
    CLIP
    Originally posted by eskbanker
    Thank you very much for the information! Yep I understand what you mean by me jumping too far ahead I will do my research and try and see what I can do for the future. So do you think instead of putting money right now straight into investments, I should rather put money into savings and consider investments in the next years to come when I have a more steady income? And thanks alot for the links I will check them out
    • short butt sweet
    • By short butt sweet 12th Jan 19, 2:04 AM
    • 290 Posts
    • 234 Thanks
    short butt sweet
    • #6
    • 12th Jan 19, 2:04 AM
    • #6
    • 12th Jan 19, 2:04 AM
    the figures you give add up to nearly 50,000. at that level, i'd consider investing part of it. though perhaps not yet, if the cash you have now is much less.

    i started my first investment when i was 19. that was in an investment trust, which wasn't a bad idea at the time, but nowadays i'd agree with eskbanker that a more obvious place to start is a global multi-asset fund.

    i didn't get it all right. i bought an investment trust that invested just in UK companies; a global investment trust would have been a better approach. my point is: don't jump in too quickly.

    also, are you likely to use this cash any time soon as a deposit towards buying your own home? because investments work better if you can leave them for the longer term, i.e 5+ years, or ideally 10+ years.
    • ExoticHaha
    • By ExoticHaha 12th Jan 19, 12:01 PM
    • 6 Posts
    • 0 Thanks
    ExoticHaha
    • #7
    • 12th Jan 19, 12:01 PM
    • #7
    • 12th Jan 19, 12:01 PM
    the figures you give add up to nearly 50,000. at that level, i'd consider investing part of it. though perhaps not yet, if the cash you have now is much less.

    i started my first investment when i was 19. that was in an investment trust, which wasn't a bad idea at the time, but nowadays i'd agree with eskbanker that a more obvious place to start is a global multi-asset fund.

    i didn't get it all right. i bought an investment trust that invested just in UK companies; a global investment trust would have been a better approach. my point is: don't jump in too quickly.

    also, are you likely to use this cash any time soon as a deposit towards buying your own home? because investments work better if you can leave them for the longer term, i.e 5+ years, or ideally 10+ years.
    Originally posted by short butt sweet
    Not any time soon for a home, nope. What I was thinking since I will continue to receive this money for a few years to come, I was considering saving up 5000 just now and investing it into something and leaving that money to do its thing. However I wasn't sure what I can do effectively with the rest of the money that I will get.
    So I'm not too sure what a multi-asset fund is, however I will do research. Do you think it's the best thing for me to do just now then?

    Thanks alot
    • short butt sweet
    • By short butt sweet 12th Jan 19, 3:28 PM
    • 290 Posts
    • 234 Thanks
    short butt sweet
    • #8
    • 12th Jan 19, 3:28 PM
    • #8
    • 12th Jan 19, 3:28 PM
    a multi-asset fund is a fund which invests in both shares and bonds (and perhaps other things). shares have usually given higher returns overall, but can also fall in value in the short term; bonds are steadier. a multi-asset fund can still go up and down in value, but in the long run, you'd expect it to go up by more than you'd get from interest in savings accounts.

    putting something in a multi-asset fund, but also keeping some cash savings, has the advantage that you start to get used to investments (and how they sometimes go down in value).

    a couple of articles about Vanguard Lifestrategy (which is one multi-asset fund): https://monevator.com/using-vanguard-lifestrategy-funds-life/ https://monevator.com/vanguard-lifestrategy/

    you can also do a few things with cash savings to get slightly more interest. basic instant-access accounts pay up to about 1.5% now.

    you can get more (up to 5%) on some regular savings accounts, though they have limits on how much you can deposit each month. and then the account usually matures after a year, and drops down to a much lower rate. see other threads in this forum for details. this could be something to do with money coming in monthly; but then you need another plan after a year.

    some current accounts also pay higher rates of interest, but only on a limited balance (e.g. on the first 2,500).

    for less limited amounts, if you can tie part of your cash up for 1 year to 5 years, then there are fixed-rate accounts paying 2.x%.
    • Aliciamilford
    • By Aliciamilford 12th Jan 19, 4:46 PM
    • 6 Posts
    • 12 Thanks
    Aliciamilford
    • #9
    • 12th Jan 19, 4:46 PM
    • #9
    • 12th Jan 19, 4:46 PM
    Save those for future.
    • ExoticHaha
    • By ExoticHaha 22nd Jan 19, 2:45 PM
    • 6 Posts
    • 0 Thanks
    ExoticHaha
    -snip-
    Originally posted by short butt sweet
    Thank you for all the info, I will check out the links and do my research.

    Also, what do you guys think of forex? I understand it is very high risk and depends on if the user understands the market, but it can be rewarding right?
    • eskbanker
    • By eskbanker 22nd Jan 19, 2:52 PM
    • 9,799 Posts
    • 11,661 Thanks
    eskbanker
    Also, what do you guys think of forex? I understand it is very high risk and depends on if the user understands the market, but it can be rewarding right?
    Originally posted by ExoticHaha
    You can make a small fortune from forex trading....




    ....but only if you're starting from a large fortune.

    It's best to treat it in much the same way as you would sticking all your money on red, or the 2:30 at Newmarket.
    • Voyager2002
    • By Voyager2002 22nd Jan 19, 6:38 PM
    • 12,872 Posts
    • 8,822 Thanks
    Voyager2002
    Good day,
    So I am a 19 year old and currently earning 1015 monthly (1304 US dollars) for doing nothing, no job or anything, and I will continue getting this money for the next 4 years.
    Originally posted by ExoticHaha

    Would you care to post something about your life plans and goals? For instance, living at home and not working or anything sounds rather sad: you could use (some of) that money to do a good internship in an exciting part of the world, or to finance a university degree somewhere exotic, or have a pretty good adventure holiday. In terms of investment I tend to think that the best option is to do things that will increase your earning capacity, so anything that involves learning useful skills is likely to show a higher rate of return than just about any financial investment available.
    • ExoticHaha
    • By ExoticHaha 22nd Jan 19, 6:43 PM
    • 6 Posts
    • 0 Thanks
    ExoticHaha
    -snip-
    Originally posted by Voyager2002
    I apologise about my wording there what I meant is that I'm just getting the money for free but I'm still doing things with my life. I'm a computer science uni student. It was bad wording on my part, sorry.
    Thanks for your reply, I am currently learning about investments, global asset funds etc.
    • snowqueen555
    • By snowqueen555 22nd Jan 19, 6:55 PM
    • 821 Posts
    • 544 Thanks
    snowqueen555
    It's really important you find your risk tolerance, because if it is low then investing might not be for you. I think a lot of people like myself include think it will be fine, but when you see your investments go down you really start to see what your tolerance really is.

    Some weeks have sen market indices swing 10-15% in a week, so think about how that might feel to you.
    • atush
    • By atush 22nd Jan 19, 6:59 PM
    • 17,554 Posts
    • 11,066 Thanks
    atush
    unlike eskbanker, i would suggest that alongside cash you should start a S&S isa.

    I would choose a global equity tracker at your age, and with no particualr plans for the money.

    For your cash, look at interet paying current accounts, and regualr savers.
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