Imo, if you want to buy a home and are just sitting on a lump of cash, a high yield savings would be good. You’ll still have access to withdraw if needed (think it’s like 6 per month)
Depends heavily on your model of expected lifetime earnings, compared to your age.
The answer will be very different for each of the following people:
Someone in their 7th year of a trades career after two years of trade school/apprenticeships, who expect to be able to earn about twice their current income by the time they retire at 60.
Someone in their 5th year of a white collar career, who is coming up on finally paying off their undergraduate student loans, and expects to climb the corporate ladder to where they're making 3-4 times what they're currently making today.
Someone in their second year of medical residency, who has 6 figures in student loan debt, and only makes about $60k now, but expects to be making an inflation adjusted $250k-400k per year for most of the next 40 years.
If you are saving for a home purchase and want something that does not carry risk; you should absolutely be in some 6 month / 1 year T bills. (US Treasury bills)
They are Government insured meaning the government guarantees you your investment back and they are giving 5% interest rates for borrowing your money.
You can use a ladder of bills, or lump into one. Your money will grow safely and that is something I am personally doing during a time when the markets are volatile or more riskier than I am willing to be with money for a home purchase.
notsowisemonk t1_ja99xwj wrote
You said you manage a fund? How can you manage other people’s money and not know what to do with your own?