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I have a savings account with ING (Yes I know it is now Capital One 360). I currently have very close to 100K in it. I also have a 401K, Roth IRA (which I max out each year) and a Scottrade account to buy stocks. I am married and my wife also has a 401K for her job. We own a home and pay more than our minimum for our mortgage, pay our credit cards fully each month. I am just wondering if I should stop putting money in my ING account. If so, where should it go. As of now I put $2,000 per month in my ING account. I am not investment savvy but I have to think I do not really need to put more money in my ING. What do you guys think I should do with the $2,000 per month? I don't necessarily want to put more of it into my Scottrade.

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Over the FDIC limits is definitely too much.

Too much. I can manage it for you instead.

So you're leaving it in cash so it loses 1% per year in purchasing power? that seems like a pretty bad idea.

Are you maxing both of your 401(k)'s? The easiest thing to do would be to invest in stocks and bonds, this will get you a better return in the long run than the money just sitting around in a savings account. you can read more about this on bogleheads.org wikis, or pick up "the boglehead's guide to investing" on Amazon.

Short-term CDs? Start laddering those and see how long it's going to take you to start paying mortgage off monthly interest income.

Paypal some of that money to me to help you decrease the burden.

Consider purchasing a second home, rent it out. Bank deposits earn next to nothing...take the opportunity to build an equity position.

congratulations on amassing a very decent net worth, if it was me and iv had the same problem as you, I've maxed out both our 401K's over 50yrs $23000 each plus Roth IRA $6500 each. take that ING money pay off the house then start saving again, and pat your self on the back for a job well done

leedsutd67 said:   congratulations on amassing a very decent net worth, if it was me and iv had the same problem as you, I've maxed out both our 401K's over 50yrs $23000 each plus Roth IRA $13000 each. take that ING money pay off the house then start saving again, and pat your self on the back for a job well done

His net worth may be negative for all you know. He didn't include the amount he owes on his mortgage or whether he has student loans or other personal debts.

You could take the existing 100k and start a CD ladder for more return. Only other really risk free return is paying down debt. At this point there's no bad choices, just ones that aren't suited to your goals.

i think it's safe to assume anyone who maxis out there 401k's and has 100k in savings account would has a positive net worth, i could of course be wrong, maybe the OP could let us know

psychtobe said:   So you're leaving it in cash so it loses 1% per year in purchasing power? that seems like a pretty bad idea.

Or here are two more bad ideas, you could put in the stock market now, which is at a 5-year high, and hope for the best. .....or you could put it in bonds, and watch your nest egg get hammered when interest rates start to rise.

Keep putting it in Capitol One, and sleep well.

leedsutd67 said:   i think it's safe to assume anyone who maxis out there 401k's and has 100k in savings account would has a positive net worth

Not at all. The first money most would invest (even if they have relatively high interest debt) is maxing out their 401k match since that's an automatic doubling of their money. Then most would go on to a ROTH if they qualify. His mortgage could be crazy high depending on the area he lives in (Seattle, NY, D.C., L.A.) and $100k may not do much to it, or he could need that high of a safety net because it only covers a short period of his expenses.

If he has student loan debt, the interest may be small. And he may be willing to accept some small interest on those in order to keep the liquidity of his $100k. Or his employer may offet loan forgiveness so any money he put toward them would be wasted. There's actually a pretty good chance, mortgage included, that his net worth is negative.

leedsutd67 said:   i think it's safe to assume anyone who maxis out there 401k's and has 100k in savings account would has a positive net worth, i could of course be wrong, maybe the OP could let us know
Add to that:
DaveTheStud said:   my wife also has a 401K for her job. We own a home and pay more than our minimum for our mortgage, pay our credit cards fully each month...I put $2,000 per month in my ING accountOr in other words, he did include information about his other debt.

misterspaghetti said:   leedsutd67 said:   i think it's safe to assume anyone who maxis out there 401k's and has 100k in savings account would has a positive net worth

Not at all. The first money most would invest (even if they have relatively high interest debt) is maxing out their 401k match since that's an automatic doubling of their money. Then most would go on to a ROTH if they qualify. His mortgage could be crazy high depending on the area he lives in (Seattle, NY, D.C., L.A.) and $100k may not do much to it, or he could need that high of a safety net because it only covers a short period of his expenses.

If he has student loan debt, the interest may be small. And he may be willing to accept some small interest on those in order to keep the liquidity of his $100k. Or his employer may offet loan forgiveness so any money he put toward them would be wasted. There's actually a pretty good chance, mortgage included, that his net worth is negative.


No employer matched 100% up the the maximum contribution level, and some don't match at all or don't match at 100% (I'm making an assumption here...but it's a pretty good one). And while it may be a good idea to contribute enough to get a 100% match, even with high interest debt, it's not a great idea to max a Roth with high interest debt.

You're the one making a lot of assumptions here, and they're not very good ones based on the OP. I keenly await the OP chiming in on this matter. And I'm on the side of OP having a decently positive net worth.

And I'm going to guess OP lived in PA. Could be wrong.

robby69 said:   psychtobe said:   So you're leaving it in cash so it loses 1% per year in purchasing power? that seems like a pretty bad idea.

Or here are two more bad ideas, you could put in the stock market now, which is at a 5-year high, and hope for the best. .....or you could put it in bonds, and watch your nest egg get hammered when interest rates start to rise.

Keep putting it in Capitol One, and sleep well.


S&P500 PE is 17.26, basically average; PE10 is 23.3, high but not outrageous. European stocks are far cheaper; I think the FTSE 100 PE is about 11 right now.

It depends on his time horizon. I bonds would be better than a cash account for all holding periods over 1 year because the rate is higher and the taxes are deferred, even including the three month penalty. $25k per married couple adds up to $75k within the right 13 month time horizon (December 2011 - January 2013) and he'd have been ahead of where he is now.

Invest 20% in precious metals, the rest in CD's and real estate. Just my 2 cents.

CD laddering is the way to go for now

BingBlangBlaow said:   No employer matched 100% up the the maximum contribution level, and some don't match at all or don't match at 100% (I'm making an assumption here...but it's a pretty good one)...Fail. Mine does.

DaveTheStud said:   I have a savings account with ING (Yes I know it is now Capital One 360). I currently have very close to 100K in it. I also have a 401K, Roth IRA (which I max out each year) and a Scottrade account to buy stocks. I am married and my wife also has a 401K for her job. We own a home and pay more than our minimum for our mortgage, pay our credit cards fully each month. I am just wondering if I should stop putting money in my ING account. If so, where should it go. As of now I put $2,000 per month in my ING account. I am not investment savvy but I have to think I do not really need to put more money in my ING. What do you guys think I should do with the $2,000 per month? I don't necessarily want to put more of it into my Scottrade.Your money is not working very hard for you. If you are willing to put the time into researching your investment options, examining your tolerance for risk, assessing your tax situation, and doing some long range estate and retirement planning, you can certainly get your money working harder for you. If not, just keep putting it in your savings account. Either option is correct.

dcwilbur said:   BingBlangBlaow said:   No employer matched 100% up the the maximum contribution level, and some don't match at all or don't match at 100% (I'm making an assumption here...but it's a pretty good one)...Fail. Mine does. Nice. Afterwards I thought there must be some that do. I would think it's a small employer?

OP, based on the information given, you seem to be in a good position. If that is in fact the case, and if you do not have significant "bad" or "high interest" obligations hiding out there, I'll toss this out - are you enjoying your life? Given that you're not going to earn squat in a savings account or CDs right now, have you considered taking a bucket list trip or doing something that you and your wife have always wanted to do?

Saving and growing principal always matters, but you might also want to invest a small percentage of that money in yourself, your marriage, and things you've always hoped to do...since the future is never certain, consider taking a moment to reward yourself for doing so well up to this point in time.

As for the rest of the money, I'll offer my standard response - what will allow you to sleep soundly at night? Doing what you're doing now? CDs? Equities? Bonds? Metals? Only you can determine your risk tolerance.

Buy a boat

BingBlangBlaow said:   dcwilbur said:   BingBlangBlaow said:   No employer matched 100% up the the maximum contribution level, and some don't match at all or don't match at 100% (I'm making an assumption here...but it's a pretty good one)...Fail. Mine does. Nice. Afterwards I thought there must be some that do. I would think it's a small employer?Nope. But that's all I'm saying.

dcwilbur said:   BingBlangBlaow said:   dcwilbur said:   BingBlangBlaow said:   No employer matched 100% up the the maximum contribution level, and some don't match at all or don't match at 100% (I'm making an assumption here...but it's a pretty good one)...Fail. Mine does. Nice. Afterwards I thought there must be some that do. I would think it's a small employer?Nope. But that's all I'm saying.

Why is it a secret

BingBlangBlaow said:   misterspaghetti said:   leedsutd67 said:   i think it's safe to assume anyone who maxis out there 401k's and has 100k in savings account would has a positive net worth

Not at all. The first money most would invest (even if they have relatively high interest debt) is maxing out their 401k match since that's an automatic doubling of their money. Then most would go on to a ROTH if they qualify. His mortgage could be crazy high depending on the area he lives in (Seattle, NY, D.C., L.A.) and $100k may not do much to it, or he could need that high of a safety net because it only covers a short period of his expenses.

If he has student loan debt, the interest may be small. And he may be willing to accept some small interest on those in order to keep the liquidity of his $100k. Or his employer may offet loan forgiveness so any money he put toward them would be wasted. There's actually a pretty good chance, mortgage included, that his net worth is negative.


No employer matched 100% up the the maximum contribution level, and some don't match at all or don't match at 100% (I'm making an assumption here...but it's a pretty good one). And while it may be a good idea to contribute enough to get a 100% match, even with high interest debt, it's not a great idea to max a Roth with high interest debt.

You're the one making a lot of assumptions here, and they're not very good ones based on the OP. I keenly await the OP chiming in on this matter. And I'm on the side of OP having a decently positive net worth.

And I'm going to guess OP lived in PA. Could be wrong.


I interpreted his statement as contributing to his 401k up to the max that they match, not the total max contributions allowed in his 401k (not sure what the benefit of that would be when there are many other IRA options out there that aren't tied to his employer). I agree that anything above what they match would be foolish assuming high interest debt. No one said anything about maxing a ROTH when you have high interest debt - notice I was referring to 401k match in that statement.

There was a thread on here not too long ago with someone in a similar situation with a large amount of cash on hand and a lot of debt. He/she made a good case for how it didn't make sense to put the money toward their debt as the student loans were being paid off by their employer and the cash was being used for churning activities.

I dislike hijacking threads but just cannot help it. I'm in a similar situation as OP but the only diff is that I rent right now and intend to buy a house in the next 2 yrs. where we live, the down payment will be close to $150k. so the question becomes, should I suck it up and be happy with 0.75% (ING) or 0.91% (Ally) for all my monies or do bonds or...?
again, we intend to buy something in the next 1.5-2 yrs but will not jump into home ownership just because. It's possible we continue renting for > 2 yrs...
as for the rest of my portfolio, it's all good with 401k /Roth etc...etc..
no debt.
appreciate all your thoughts..

1.5-2 years you shouldn't really take much risk. Have to take the no-risk option, unless you can accept the possibility of loss.

OP, it really depends on your risk tolerance. Risk tolerance consists of ability to take risk AND willingness to take risk. You seem to indicate that you have a fair amount of ability to take risk but a low willingness. You may want to examine this a bit more and give us an idea what is driving this stance.

In case you prefer not to take any risk, the laddered CD approach is the only option you have. The next step up would be TIPS which would protect you against inflation. And then, of course, you could dollar cost average/invest in some combination of fixed income and stocks, both international and domestic, through index funds or ETFs so the risk is somewhat diversified. There is a lot more to this last option and you would be well advised to spend some time researching your options or asking for professional help.

Thank you for many of the responses. To answer a couple questions. In terms of other debt we do both have student loans left but I will have mine paid off by the end of this year and my wife will have hers paid by the end of next year so that is already budgeted accordingly, I do not see a need to put more into that. 401Ks are maxed out now each year (We were able to afford to max out as of a couple years ago). We also take a couple vacations each year so we get our travel in.

I think I have a fairly high risk tolerance, we are both in our early 30's. I put a decent chunk per month in my Scottrade to buy stocks. I don't necessarily want to put more in for straight up stock purchases. I guess what other equities should I look at for the 2K/month I want to now stop putting in ING. Bonds, mutual funds...

Kiplinger's magazine is tailored for your situation. Find something called a "public library" and look through/photocopy the investing issue as well as the most recent. Save the commissions an investment advisor charges to (mis?)manage small-account assets.

DaveTheStud said:   Thank you for many of the responses. To answer a couple questions. In terms of other debt we do both have student loans left but I will have mine paid off by the end of this year and my wife will have hers paid by the end of next year so that is already budgeted accordingly, I do not see a need to put more into that. 401Ks are maxed out now each year (We were able to afford to max out as of a couple years ago). We also take a couple vacations each year so we get our travel in.

I think I have a fairly high risk tolerance, we are both in our early 30's. I put a decent chunk per month in my Scottrade to buy stocks. I don't necessarily want to put more in for straight up stock purchases. I guess what other equities should I look at for the 2K/month I want to now stop putting in ING. Bonds, mutual funds...


That's silly. Paying off the student loans now pays an immediate rate of return on that portion of the savings that is used equal to the interest rate of the student loan debts.

With your earning power, as another poster suggested, you need to read "Boglehead's Guide to Investing" ASAP. Also, quick buying single stocks in Scotttrade - the risk is too high for the return.

pay that into your mortgage balance. you get better return than have it sitting in ING.

tennis8363 said:   Over the FDIC limits is definitely too much.

uh, what? Limit is 250k

If you actually had a high risk tolerance you wouldn't have 100K sitting around in ING. But don't worry, that 100K is actually being invested and making a good profit, the only problem is ING is keeping the profit, not you.

You obviously have a high salary. Your greater risk is losing income, not losing your money in the market. Just put it in a low expense index fund and forget about it. People overthink long term savings WAY too much.

And of course paying off any debt that's over 1% is better than your current plan.

If you do decide to leave your savings liquid, it might be worth your time to find a better bank than Cap One

Capital One's interest rate is .75% right now so you're making $750/year in interest on your $100k. The local bank I use has a Reward checking account (1.81% up to 25k) with a High Yield savings account (1.56% up to $100k) in addition to it. So for your same $100k you'd be getting about $1585/year in interest. Yes you have to meet the terms of the RCA, but that may not be difficult and might be worth the $835/year to you.

250k. after that, fdic doesn't insure it

xsnake said:   250k. after that, fdic doesn't insure it
250k coverage in an individual account each for op and wife.
500k combined coverage in a joint account.
1 million total coverage with very little effort towards proper account titling.
OP doesnt have to woory about exceeding FDIC limits for a looong time.

Skipping 13 Messages...
OP, since you are only 30 something old, conventional wisdom would state that your asset allocation be around 70% stocks and 30% bonds. However, given your robust income, current financial condition, dual income and emergency funds, you probably may go up to 80/20 ratio.

To start keep it simple:

Dollar-cost average.

Don't chase yield. More money has been lost chasing yield than anything else.

Stay away from individual stocks or bonds unless you are willing to spend a lot of time analyzing and monitoring. If you want to play with individual stocks then allocate a fixed amount of PLAY money to that endeavor.

Rebalance your portfolio to your allocation every 6-12 months.

Go beyond this message board to really know what you are doing and the risks you are taking. Mind the oft-repeated cliche - "If it seems too good to be true, it probably is."

To keep it really simple, you could go with target date funds that come with an allocation depending on your target retirement date and adjust it as you approach retirement. Compare costs for offerings from different vendors.

If you feel target funds are not for you, you can try to invest directly to achieve your target allocation.

The stock portion could be invested in a broad market index. As you become more comfortable or get some professional advice, you may want to further sub-allocate this into domestic and international, large, mid, and small cap indexes, REITs, MLPs and commodity funds/ETFs. The international allocation can further be divided into emerging and developed markets. There are many choices and it all depends on your sophistication or that of the person who advices you.

For bonds, you could start with TIPS. As you get more comfortable you could look into other choices: short-mid term treasuries (at this point in time I cannot recommend long-term treasuries), municipal bonds, investment grade corporates and high yield aka junk bonds. And then there are international bond issues also.

The point of the above is not to give you a clear path but to outline all the choices that you have given your fortunate situation and the hard work you need to put in to realize its full potential. BTW, I am somewhat inclined to think that in your case it may be worth to get some one-time fixed fee professional advice to get your starting allocation right and a plan in place.



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