DarmokTheNinja t1_iubwpla wrote on October 30, 2022 at 3:40 AM

Investing it in an index fund would be a retirement account, even if it's a taxable brokerage. If you want to use it in the next 1–5 years (say, for a nice vacation). then you want HYSA.

alessandrahype t1_iubx7ge wrote on October 30, 2022 at 3:44 AM

Okay gotcha... What about if you wanted to use the money in 5-10 years instead, would you still use a HYSA for it then?

Basically, I'm trying to get a feel for how best to use extra money towards medium-term goals

AdditionalAttorney t1_iubxhsi wrote on October 30, 2022 at 3:47 AM

5-10 years id invest

I’d just watch it and decide when to start pulling out of the market or maybe I don’t have to pull it out bc other windfalls met the goal for what the money was for

However you don’t mention other revolving sinking funds…

Car maintenance

House maintenance

Vacation

Are those covered by your regular budget?

alessandrahype t1_iubyf2x wrote on October 30, 2022 at 3:56 AM

Ok interesting...

So I don't have a car or a house, but I live in a very HCOL city. Vacation is one of the main things I want to save for going forward. I just upped my 401K contribution so in this new budget, I should have about $700 cash left per month that I'd like to put in sinking funds.

I think I want to avoid having 100% of my extra income tied up in the 401K because I want to .... live life lol so if there's a month where I actually have $1000 left over, I'd like it to go to good use