Too much money in savings account - where to put it

[Anonymous]

My husband and I have recently inherited several hundred thousand dollars. Some was already invested or in an inherited IRA but some is the result of property sales and is cash. We already have a healthy emergency fund and don't want to make any quick decisions of what to do or how to spend it. However, I'm feeling uncomfortable having that much money in a savings account that's earning little interest. It's currently in an ING Capital One account. Any recommendations on where to put $100k or so that is very low risk and easily accessible.

We're not ready to invest it yet and really would rather just ignore it for a few months while we get used to no longer being poor. We may end up just leaving it where it is, but if anyone has any ideas of equally conservative places to keep it with slightly better rates of return I'll gladly consider them. Thanks!

[Anonymous]

CDs.
Money market.

Those are basically the only safe, accessible, non-invested options.

[Anonymous]

What's your telephone number? I'll call you to give you my bank account number. Thanks!

[Anonymous]

Anonymous wrote:CDs.
Money market.

Those are basically the only safe, accessible, non-invested options.

They are only FDIC insured for $100k. What do you do when your balance is higher than that?

[Anonymous]

Anonymous wrote:

Anonymous wrote:CDs.
Money market.

Those are basically the only safe, accessible, non-invested options.

They are only FDIC insured for $100k. What do you do when your balance is higher than that?

Actually, they're FDIC insured for $250,000 per depositor per bank for each type of account.
http://www.fdic.gov/deposit/deposits/dis/

If you have more than $500K you open accounts at a 2nd bank.

[Anonymous]

Yup, the financial reforms after the crash in 2008 upped the $100,000 amount to $250,000. But before that, the answer was: open another account at a different bank. Not rocket science.

OP, if you have non-mortgage debt to pay off, it's probably better for you to pay it off now rather than let that money sit earning less than 1% while you pay interest until you decide what to do with it.

[Anonymous]

Same situation here. Best yield I can find for FDIC insured savings account is one percent. Anyone know of one higher?

[Anonymous]

Anonymous wrote:Yup, the financial reforms after the crash in 2008 upped the $100,000 amount to $250,000. But before that, the answer was: open another account at a different bank. Not rocket science.

OP, if you have non-mortgage debt to pay off, it's probably better for you to pay it off now rather than let that money sit earning less than 1% while you pay interest until you decide what to do with it.

Thanks for that info, I wasn't aware of that. No debt other than a small mortgage, which we could pay off but likely won't. At least not right now.

[AroundTheBlock]

Anonymous wrote:My husband and I have recently inherited several hundred thousand dollars. Some was already invested or in an inherited IRA but some is the result of property sales and is cash. We already have a healthy emergency fund and don't want to make any quick decisions of what to do or how to spend it. However, I'm feeling uncomfortable having that much money in a savings account that's earning little interest. It's currently in an ING Capital One account. Any recommendations on where to put $100k or so that is very low risk and easily accessible.

We're not ready to invest it yet and really would rather just ignore it for a few months while we get used to no longer being poor. We may end up just leaving it where it is, but if anyone has any ideas of equally conservative places to keep it with slightly better rates of return I'll gladly consider them. Thanks!

Safest is to buy a 1 or 3 year CD from the bank. Yes, the interest rates are low. But, it's a free way to get more money. You can always invest it in the market, but I would only suggest that if you are familiar with investing or have the time for it.

[Anonymous]

Make sure you pay attention to interest rates on CDs. I found that ING Direct had the highest interest rate, although the amount of money I was dealing with was significantly less. ING gets .75%.

[Anonymous]

Anonymous wrote:
OP, if you have non-mortgage debt to pay off, it's probably better for you to pay it off now rather than let that money sit earning less than 1% while you pay interest until you decide what to do with it.

I think the conventional wisdom is to spend up to 1% for fun but wait 6 months before spending any more.

[Anonymous]

how old are you? when will you need the funds?

Best bet may be to take your time coming up with a long term plan including long term investment allocation for a good portion of it and maybe take a small % of it for short term "treats", but realistically, it's not enough to retire on so you ought to focus more on making it grow than on spending it in the short- to mid-term (IMO).

[Anonymous]

in my account

[Anonymous]

Why wouldn't you open an investment account at Vanguard and just put it in an index fund or whatever?

[Anonymous]

Anonymous wrote:Why wouldn't you open an investment account at Vanguard and just put it in an index fund or whatever?

It does not look like the OP is the risk taker. Invest in index funds have potential to lose money. Again, no risk no gain.