Rebate Check (3) : Invest on your windfall check.
This is the 3rd series on what to you do with your rebate check.
They can be found here :
1. Better place than WalMart
2. Stocks below their 200 MVA (moving average)
1. When will your check arrives :
If you are interested, check on IRS site here for more detail.
2. How much will you get ?
Check on this online calculator.
3. How should you invest with this money ?
My philosophy about wealth is accumulation of wise investments through prudent strategies. Well, if investment is not something you are very familiar with, you might want to learn some income/expense baby steps. This simple worksheet from Kiplinger might help you to jump start your journey.
3.1 Start a rain day fund.
You can put aside some of your money in a CD account or a money market fund. Time is the main consideration for CD because if you withdraw CD prior maturity date, you will have to pay penalty fees. However with money market fund, the big consideration is cost or expense ratio. CD is yielding from 3 to 3.5% depend on duration and money market fund such as Vanguard Prime Money Market VMMXX seven-day yield is at 3.12%. You might want to check out Vanguard money funds here.
3.2 Learn to invest with a long term view.
Open a tax-advantaged account like an IRA which allow tax-free qualifying withdrawals. Bond investment could be something you might consider investing. Average return of bond is around 4% to 6%.
For eg. Vanguard STAR Fund (VGSTX) earned 6% average return over 10 years.
3.3 Diversify
Learn to diversify and you might want to allocate some of your money in commodity fund such as this : PCRDX. This fund is on fire this year. Up 16% year to date through May 2 and 19% annualized over the past five years. Read the article , here.
I do hope I give you something to think about how to invest on your stimulus check. And please read my disclaimer on my blog before you invest.
** This article is submitted to Carnival of Personal Finance.
Hi!! I have got some valuable information through your site.Thanks for some wonderful info.There are no special qualifications required other than self-discipline, effort and motivation. In a vending machine business you are your own boss. You set your own hours and your earning potential is virtually unlimited.
Thanking for dropping by. Which is a reliable vending machine franchise to go with if I am to start one ?
[...] I am not sure if anyone of you have read the serious of rebate check that I have written. Well, if you have pick up the silver stock from both the posts that I have written : 1. Rebate check 1 2. Rebate check (2). 3. Rebate check (3). [...]