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by toast0
1307 days ago
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As a young person living with your parents and having "0" expenses, you probably should keep most of your income liquid because at some point you are likely to move out and have both ongoing expenses, but also start up expenses (deposits, furnishing, household equipment, etc) If you can put together a rough plan for the budget for that, you might cap your liquid savings at 6-12 months of ongoing expenses plus an estimate of your one time expenses. After that, responsible long term investments. Of course, it's not a bad idea to put some amount into long term responsible investing now. Not knowing what country you're in makes it hard to recommend specifics. For your short term savings, you want something safe (government guaranteed if you live in a stable economy) but shop around to different banks and see if any give better interest than others. For your long term savings, you want some sort of brokerage and investing in a broad index fund of some sort; if you have access to Vanguard funds in a tax appropriate way, their index funds are more or less the benchmark for low cost index funds. Depending on your local tax laws, it may be better to have a locally domiciled fund, or an Ireland or a US domiciled fund. Ideally, you're able to use a brokerage that is low cost, but established. The US benchmark is zero fees for the brokerage account and near zero fees for trading ETFs, and a broad stock index expense ratio should be around 0.1% or less. That's not available in all countries, but look around and see. There's also plenty of US options with more fees and bigger expense ratios, but IMHO, those expenses don't get you anything worthwhile. |
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