Obviously there’s an infinite rabbit hole you can go down, but what I do is pretty straightforward.
Short term money: stored in a relatively normal checking account.
Mid term money: United States Treasury Bills. They typically beat bank interest, are just as safe (if not safer) as an FDIC bank account, and depending on where you live have a lower tax burden than regular bank interest.
Long term: Vanguard ETFs. I don’t have a ton of interest in spending hours every day trying to beat the market. I figure that as long as I can wait out bad economies, it’s better to invest in the total market than basically anything else. If you’re willing to hold onto the ETF longer than a year, typically the capital gains tax burden is lower than the income tax you’d pay in bank interest. Something like VOO or VTI are fairly low risk and since they’re not human-managed they have really low fees.
I am unemployed right now, but typically when I get a paycheck I immediately put 10%-15% of it into some form of the above savings, before I pay any bills. For psychological reasons I don’t really understand, if I pay my bills right away I never have any money left, but if I put 10%-15% aside immediately I still manage to pay my bills while also having savings.
Short term money: stored in a relatively normal checking account.
Mid term money: United States Treasury Bills. They typically beat bank interest, are just as safe (if not safer) as an FDIC bank account, and depending on where you live have a lower tax burden than regular bank interest.
Long term: Vanguard ETFs. I don’t have a ton of interest in spending hours every day trying to beat the market. I figure that as long as I can wait out bad economies, it’s better to invest in the total market than basically anything else. If you’re willing to hold onto the ETF longer than a year, typically the capital gains tax burden is lower than the income tax you’d pay in bank interest. Something like VOO or VTI are fairly low risk and since they’re not human-managed they have really low fees.
I am unemployed right now, but typically when I get a paycheck I immediately put 10%-15% of it into some form of the above savings, before I pay any bills. For psychological reasons I don’t really understand, if I pay my bills right away I never have any money left, but if I put 10%-15% aside immediately I still manage to pay my bills while also having savings.