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I'm a 23 years old programmer working full time in Milan since September 2019. I'm currently not paying for rent and utilities and I'm managing to save 1200€ net a month (I have no debts). This money is gathering dust in a checking account and if don't do something with it will continue to do so until my current housing arrangement ends (this will happen in either two or three years).

I know I can't ask for a no risk 10% returns one year investment, but since I have some time before having to take on the costs of renting/down payment for a mortgage, my goal being saving something like 30k so that I'm not completely unprepared, do you have any advice (especially if it's Italy-related) for my predicament?

(I have been looking into a savings account but the low interest rates (~0.5%/y net interest) seem hardly worth the effort, but it will do if there isn't anything better.)

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0.5% is less bad than 0.0%. You're only losing 0.75% instead of 1.25% to inflation (which is 60% loss instead of 100% loss). As for where to put money for two to three years... savings or term deposit accounts are exactly where I'd put them.

  • Agree with savings or term deposit if he needs it in 2-3 years, but OP should still be able to find a money market fund that will pay 2% interest at least. – Dugan Nov 17 '19 at 20:33
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    @Dugan you'd think a 2% yield for two years would be easy to find, but I sure don't know that much about Italian banking. – RonJohn Nov 17 '19 at 20:35
  • I can get a 2% gross (1.28% net) for locking in for 2 years, the problem is that right now I have only 2.5k and I would need to add funds on a montly basis. So yes, I can get maybe 5k with 1.28%, but the rest will have to have to fall into much lower interest because I won't be able to lock in for two years. – Livia Nov 17 '19 at 22:39
  • @Livia I don’t know anything about Italian banking but do you have access to a money market fund like these they let you contribute continuously without locking in your capital and keeping it liquid. – Dugan Nov 17 '19 at 23:02
  • @Livia "I can get maybe 5k with 1.28%, but..." €5K at 2% and €25K at 0.5% is better than €5K at 0.5% and €25K at 0.5%. – RonJohn Nov 17 '19 at 23:17

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