Financial Advice

[demnan]

The country is going to hell and I have limited means but want to buy a house next year. I have managed so far to save up about $2500.

Here's my question - what's the safest investment I can make for $2500? I've considered buying gold because with the $87 billion being created out of the Treasury I think the dollar is going to hell.

Anybody out there have an informed opinion on this?

[GOPisEvil]

1. Bonds

Not Barry, although he's a good bet, too...

I mean tax-free municipal bonds: low rate of return, but your money is pretty safe.

[jiacinto]

2. A CD or Money Market Fund

If you really want to be slightly agresive an ultra-short bond fund. But even then it would be risky.

$2500 is hardly enough for a downpayment on a home--at least not where I'm from.

[demnan]

3. No it sure isn't

but I want to keep this money safe while I save some more :-)

[rfranklin]

5. Buy gold coins...

because when the house of cards built by Greenspan collapses, only precious metal will be worth anything. We have been printing money like a flim flam artist writes checks--there's nothing there to back it up. When the world wakes up to that fact, it's gonna be catastrophic.

[amazona]

11. gold coins a terrible investment

People have been saying this 1980, and even with all the years of Reagan/Bush, gold coins have never been anything but a loser. You have some huge problems with gold -- high fees when you buy AND when you sell, storage costs, lack of privacy as reports must be filed by the dealer when you buy and sell gold. This individual wants a short-term 1 year investment -- gold coins are almost guaranteed to be a loser over that period because of the high transaction costs.

Most of the truly devoted "Gold Bugs" who put their money where their mouth is have declared bankrupt one or more times; prime example, Howard Ruff. The "Crisis Investing" theory didn't work in 1983, and there is no reason to believe it will work now.

Just my humble opinion. But I don't believe gold will even serve the purpose of allowing someone to flee the country safely (as it did in Vietnam and World War II). Reason--gold is easily detectable, it is heavy, it has privacy issues, and, as far as handing some guard your gold jewelry or coin to look the other way -- these days he's going to assume that it is just a cheap 10 karat piece of junk, there is just too much garbage out there.

My opinion only -- but I follow my own advice. I don't see the value of having more than 5 percent in gold and that is strictly more for the kid in me who likes shiny things, not because it is or will be a wise investment.

[trof]

4. Probably a 1 year CD.

You won't make much, but it's relatively safe.
I agree about gold, but that's a pure speculation investment and IMHO too risky for a parking place for your house down payment.
If you did go that route, gold stocks would pay off much better than the physical metal.
Frankly, there's nothing that will make you a significant amount of money in a year that is "safe".

[freethought]

6. I agree CDs or Money Market

The priority as you have described it is to keep your money safe so you can save more. CDs and Money Market funds are your best bet at this point. The interest rate maybe low but service fees (if any are usually low as well).. Shop around, your best bet may even be at your local bank.

[demnan]

7. Thanks

I already have a $1500 in a short term CD so adding the rest of this money to the fund should be easy and a safe place for the money.

thanks to all for your advice. :hi:

[ender]

8. depends...

how long are you NOT going to need the money for?

if your answer is 5-10 years, then into the stock market with thee. My first suggestion is always KO (CocaCola) - on average, it returns 12.5%/year (this includes enrolling in the DRIP).

If your horizon is less than 5 years, go with a CD or bond strategy. not that either pays anything worthwhile right now...

[amazona]

9. sad to say...ING or other savings account

Greenspan is on a roll to try to destroy all the income-producing instruments that older people rely on by dropping the interest rate to almost nothing. There are really no good options. With CD rates so pathetic, you do just as well to put your money in an ING or similar savings account, because you get the same (crappy) interest rate but at least you have liquidity. Money market funds are under 1 percent at the moment; there is no point.

[northzax]

10. heroin

it's a growth industry.

actually, for one year? either a CD or a savings account, you'll make something, but you might as well put it in your mattress.

[Boudicea]

12. Why not put it all into the house?