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Where Is Your Money Being Stored? A Few Viable Options

Storing Your Money OptionsSince you started working and saving money, where have you kept your money? Most young professionals worry about if their hard earned money is being invested properly. By properly I mean, is the money earning you more money? Nobody wants their money to just sit around in a checking account. We all want to feel like were the doing the most with our money that we can (without risking it all of course). Today I wanted to look at places where young professionals are keeping their money.

A few options for where you can store your money:

High yield Savings account.

Nothing wrong with a standard savings account to store your hard earned money. Online savings accounts [1] are really popular with our generation. These accounts allow us to save our money in a very “hands-off” manner that doesn’t require us to stress about market fluctuations. The interest rates aren’t the most impressive these days but you can rest assured knowing that your money is safe while you focus on other areas of life.

Conservative investments.

Not all of us are risk takers. Yet most of us will want a higher return than what most savings accounts are offering these days. This is why money market accounts, CDs, index-fund investing, and GICs (in Canada) are conservative investments that are a nice safe option to keep our money. This is typically where new investors will start off as they search for ways to invest their money. As you learn more about investing money and become more comfortable you can move on to the next stages.

Real estate.

Many college graduates choose to purchase a home with their savings. Real estate can be treated as an investment in two ways: as your primary residence that you hope appreciates in value or as a rental property. Both have the potential to yield decent returns in the long term if you can bear the risks. Also, there are a few reasons why real estate is such a common invest:

My only warning is to watch out here because this is an investment that comes with a lot of fees. From administrative tasks (lawyer and real estate agent fees) to property taxes, you’ll be paying some decent coin to keep this investment up. Aside from the costs, this can also be a fairly risky investment for young professionals due to the housing market situation. This is why you need to ensure that you know what you’re doing.

Risky investments.

Perhaps you’re willing to take on a little more risk. This is where investing in stocks comes into play. You take on more risk in hopes of earning much greater returns. Below are a few quick tips for young professionals that are new to investing in stocks:

Experiences.

There are things in life you just can’t quantify. I personally prefer balance in my life but I’ve met people that strongly believe in experiencing life in their 20s. None of us are created the same and we all have different things that spark our interest. This option might be a little “out there” but it’s not my position to be judging.

Spending money on experiences can range from:

  1. Going out all the time with friends.
  2. Travelling to new and different parts of the world.
  3. Testing out adventurous and extraordinary sports.

Now I want to ask you guys: where do you keep your money? Do you have balance or is your portfolio heavily shifted in one direction?

(photo credit: timsamoff [2])

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6 Comments To "Where Is Your Money Being Stored? A Few Viable Options"

#1 Comment By Ottawaguy On November 11, 2010 @ 10:35 am

I have only small investments while I’m still paying off my student loan. But I am always saving…. as much as I can for travel. I’m a total junkie, always looking for my next trip. Any extra cash goes in the travel fund!

#2 Comment By The Financial Blogger On November 11, 2010 @ 12:21 pm

@Ottawaguy!

I can’t wait to travel! but I want to do it with my kids and I want them to remember… so I have to wait. In the meantime, I am discovering all the nice place in Qc… probably going to look outside Qc this summer. Any interesting place to visit in Ontario?

#3 Comment By Paul Michael On November 15, 2010 @ 8:50 am

I am saving money right now for a dream vacation with my family, and I am going to make it memorable. It is not easy to save, but thinking about the joy it will bring to my kids, it is worth the effort. I am using a bank deposit with a very good interest for it

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