I have no clue about making money-investing, so apologies for dumb question: is there anyway I could make money from $12k? I knows peanuts for anyone here, but after being out of a job for almost 2 years it is all I have saved up and wondering if investing this sum would help at all - and how to do it. Thank you.
I am not a finance mom, but I would not invest that money if it's all you have saved. It's not enough to make any meaningful return. Keep it as an emergency fund in cash in a savings account or CD. Even if you had other savings, I would not invest in the market now, because it's high (back to pre-coronavirus levels) which seems unsustainable given the surging rates in so many states. Market probably is going to crash again before getting back on track once there's a good therapy / vaccine. If you really want to invest something, keep $10K in cash (meaning in a savings account at the bank) as your emergency fund, and open up a Fidelity account with $2K. Invest that $2K in an S&P tracker fund (i.e., Fidelity 500 Index Fund). And just let it sit for the long term. You can slowly add to it as you have more savings. I still would not invest now -- you can get the Fidelity fund set up, but wait to buy the stock until there's a big dip in the market and then buy that day.
Agree. Except when you do invest, use Vanguard, it has lower fees and fewer conflicts of interest.
op: thank you, this is very helpful. I will look up an S&P fund. Right now I put the money in a savings account... I am hoping to get a job so I can add to that amount.
Good luck, OP. Sending you positive vibes.
I second this - I just put money in the fidelity index fund
Op: thanks again everyone.
If this is really all you have, no, don't invest it in the markets. You need a liquid, easily available emergency fund and it should cover at least 4 months of your living expenses. Build that up and then think about investing.
Op: thank you
And you didn't mention your career but mentioned you've been unemployed for two years nearly. Of course unemployment was at 4% last year which would have made it easier, but jobs are opening up. Is it a question of childcare? Many jobs are allowing work from home situations. I would focus on that...counting on any passive income from your nest egg is not a great strategy with interest rates at historic lows - stemming from the last financial crisis. Do you have anything you might sell? An old engagement ring could bring $500 which is more than you'd get in a year of interest ($120) on $12,000 kept in the bank. That $12,000 could go to $6000 in a month in the wrong investment (airlines in February? commercial real estate?). Good luck you can DO it!