I'm 18 and about to go to college. Luckily, I don't have to worry about student loans or most other living expenses. I've been working and have over $6,000 (will probably be about $7,000 by the end of summer) in my bank account.

I don't want to just keep all this in my bank account. I'm afraid once I get to college, I'll know I'll have all this money and start spending it all away.
I'd like to put most of it away somewhere. I might end up going to grad school, but I'm not sure yet. If I do, it'd be nice to have some money saved for it, so I thought about putting it in a 529 plan. But I might not end up going to grad school so I also thought about investing it or putting it in a Roth?

I'm definitely not going to be super into the stock market, so I don't want to have to worry about losing all of it by being risky. I could also just put it in a savings account.

What should I do?

  • 15
    I just want to point out that you've done well enough up to this point to save that money. What makes you think your spending behaviors will change once you're in college?
    – BlackThorn
    Commented Jun 8, 2018 at 15:54
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    Jim Collins has an (opinionated) suggestion: Invest in an index fund with low annual fees, and then wait. (That post is part of a larger series.)
    – jpaugh
    Commented Jun 8, 2018 at 16:48
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    $6000-$7000 is not a lot of money. Invest it wisely if you can pretend you do not have it for a couple of years. Commented Jun 8, 2018 at 18:23
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    One note - you should never be afraid of losing "everything" in the stock market if you're in a good index fund. Not because it's impossible, but because there's no situation where "the 500 largest corporations in the United States all have a value of $0" where putting your money in a different investment is going to make a difference. It'd likely require massive, simultaneous nuclear attacks to do that. Losing some money is possible, losing all of it means we've suffered an apocalyptic event.
    – David Rice
    Commented Jun 8, 2018 at 18:50
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    @DavidRice in other words if a good index fund gets to zero then you have bigger problems than not having whatever money you invested? Commented Jun 11, 2018 at 18:40

11 Answers 11


A Roth IRA is a great idea. You can only put in as much as you earn (as in, get in paychecks) each year, but that shouldn't be too much of a problem for you right now. You're paying nothing in taxes, or nearly nothing, so you'll have a great opportunity to get some squirreled away in a safe place! And since it's a Roth, you can always withdraw the principal (not the earnings) penalty-free once you go to grad school.

Then you can invest it in the stock market in an index fund (like "VOO" or "SPY", something that's basically "all major stocks in the US" at once); those tend to appreciate over time very well and while they do go down during crashes, they won't totally disappear barring some catastrophic event that's never happened in the US's history, and tend to come back up pretty quickly.

Congratulations on being ahead of the retirement and savings game!

  • 23
    Just a quick contribution to this great answer: OP makes a great point about not wanting to be temped to spend it because she knows she has it. This is where a Roth IRA is great. You generally cannot pull the money out penalty free. There are a few exceptions to this rule. You can use it to: 1. Pay for college, 2. Buy a house, 3. Pay for large medical bills, 4. And a few other exceptions. So in that regard, the money is not easily accessible.
    – sam
    Commented Jun 7, 2018 at 22:30
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    Roth IRA does allow you to pull out the principal after a while, but I think that’s a feature. It’s harder than a savings account, at least.
    – Joe
    Commented Jun 7, 2018 at 22:39
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    I can't resist the urge to augment my upvote on this answer. I had several thousands in a bank account and other thousands in CDs when I went to college. The "cash" money mostly went to McDonald's, and the CDs "had to" get cashed in sooner or later - some of that money made it into a retirement account, but not all of it. At 45, I would tell my former self to put that money into a retirement account back then instead, so that I'm not feeling today that I wish I had a lot more money saved. Commented Jun 8, 2018 at 15:44
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    If OP is in college, they are unlikely to be earning enough to pay taxes on capital gains anyway, so why not just use a regular brokerage so they can have access to the money if they need it (which they likely will because school can be expensive). It will still be harder to access than a bank account and you don't have to deal with the rules of a Roth IRA.
    – BlackThorn
    Commented Jun 8, 2018 at 15:45
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    @BlackThorn: That's true, but Roth IRA contribution limits are very low (compared to earning power of someone with a college degree). If the money isn't put into a Roth IRA when it is earned, it can't be done later holding all other things equal, because future years' contributions are likely to already be at the limit (during college, due to the lack of earned income, and afterwards, due to already saving at the maximum).
    – Ben Voigt
    Commented Jun 9, 2018 at 14:27

Unlike others, I do NOT recommend putting your $6k into a retirement fund this early. It's a bad idea.1 If you're overflowing with money after college and don't know what to do with this $6,000 then, you can do the same thing then2 (edit: see below3)—this extra 4-5 years of interest or capital gains really isn't going make or break you, but the penalty and your lack of easy access to the funds very well might, given that you likely won't exactly be busy getting rich while in college.

Normally I would have encouraged you to open a high-interest checking or savings account—there are ones that give 3%+ interest on limited amounts that are greater than $6k, just Google around.

However, if you're looking to discourage bad spending habits, you can also consider a high-interest certificate of deposit (CD). They also run into the 3% range I think, but they let you pull the money out with reduced interest, and you'll get full access to the money after a few years, after which you can then start saving for retirement.

Some "footnotes":

  1. Perhaps the most important thing to remember that a CD is a guaranteed interest rate. IRAs and other investments are NOT guaranteed. People here like to pretend you're guaranteed to get back 7%/year, but that's only the average over the long term, not a guarantee and especially not over the short term. If you need to pull out your money after college to pay for that new car so you can go to your job, a bad economy could easily mean that you earn less money than with a CD (or worse). Maybe this is an opinion, but to me this is too much risk—it makes far more sense to get start investing in retirement when you earn a stable income and lacking that $6k isn't likely to break you 40 years before you reach retirement.

  2. To make up for what you'd have "lost" by not saving earlier, once you start making real money, you should "pay yourself interest" by investing back the extra amount you would have gained if you had invested in the meantime. For a 7% yearly return after 5 years, that means putting in an extra 40% of that $6,000 (so around ~$8,400) on top of your regular yearly contribution the year after you graduate. Earning interest in the meantime will make this even easier.

  3. As someone kindly pointed out in the comments, there is a yearly contribution limit for a Roth IRA, so if you hit that limit, it may not be so easy to play "catch-up" and pay yourself back interest. However, this doesn't mean you'll lose out on compound interest... you can still invest it yourself normally; it doesn't have to be in a special retirement account.
    So ultimately it really boils down to how much self-control you have. But if you're really hitting your contribution limit, that means you have enough self-control to not be spending that money, so there isn't much to be gained there either, unless you somehow expect your self-control to drop as you get older. On the other hand, you're far more likely to actually need access to this money in the meantime (e.g. a car for your first job, pre-payment on rent, etc.), so that's a reason to have guaranteed access to the full amount (+interest) when you finish college.

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    Putting money into your retirement fund early is the opposite of pointless; the sooner you put money in, the more you will get out of it. It's not what I'd choose to spend it on but it's undoubtedly a mature and sensible choice for the long term. Commented Jun 8, 2018 at 12:14
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    @JackAidley: No, it's pointless, if not borderline stupid. "The more you will get out of it"... yes, but how much more? A 100x return on a penny is still only a dollar. In this case even if you gained 10% every single year for the next 5 years, you'd only have earned ~$5k in this period for your retirement. Not exactly life-changing. You might as well hold off until you make decent money the year after college and put in an extra $5k afterward, when it's both (a) much easier with an income source, and (b) not reducing your means meanwhile. (What if you want a car for that job? etc...)
    – user541686
    Commented Jun 8, 2018 at 13:10
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    A roth (if she is able to use it due to earning, either this year or later) allows penalty free withdrawal of the principal if she later needs it for a home or school. And fifty years of compounsed gains is amazing; at a reasonably conservative 7% it’ll be worth almost $150,000, and could be as much as $600,000 if she manages 10% (which many people have historically over that length of time, though I don’t advocate assuming that strong of returns). And it’s all tax free.
    – Joe
    Commented Jun 8, 2018 at 13:17
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    Yes, an extra $5k. Because the compound in the meantime is being lost. The idea therefore that it is "pointless" - your words - to invest now is clearly wrong by your own calculation. Commented Jun 8, 2018 at 13:44
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    Note that there are yearly limits to the amount youcan deposit in a year. If you're dealing with a Roth IRA with a $5500/year limit, it'll be difficult to make up for missed years by playing catch-up down the road, since there isn't that much leeway to begin with. Also, many retirement accounts can only be contributed to in the calendar year that you earned that income, which may also limit when and how much one can contribute. Commented Jun 8, 2018 at 14:04

First, it's great that you're considering these options at all, and that you're trying to be responsible and forward-thinking about planning for your future.

I'm also going to break with the consensus and point out 2 things:

  1. $6,000 is better than $0 or being in debt, but it's really not a lot of money. Depending where you live it's "2-4 months' living expenses." If you decide to move across the country to SF or Seattle after graduation & rent a 1bdrm apt, you will wipe this out. If this seems like a lot to you, and you're worried about blowing it on stupid stuff, it could help you to learn how to budget & have it around but not spend it.

  2. Yes, you could potentially benefit ~50yrs from now by starting to save/invest at such a young age, but you will do better if you ensure you avoid debt in the near term. Just as compound interest can giveth greater retirement savings, compound interest from credit card debt & other loans will taketh away your financial flexibility for the decades between now & then.

A Roth IRA is a good idea to start sooner rather than later, but first ...

Maximizing interest rates for retirement in 2065 is not your greatest immediate concern. You'd do well to plan for 5yrs out (you can do 10, 20 & 50yrs too if you want, but start closer): How will you cover rent & basic necessities once you're out of the dorms? A shorter-term CD or T-Bill could be part of this.

Learning to live within your means & keep your credit intact when you have little/no income is a skill that will serve you well, but it might not always be possible to avoid debt. That $6K cushion is a good thing to have, but if your alternative is putting $1000 debt on a credit card w/a 30% annual interest rate, you're likely better off dipping into savings to cover it. This means keeping at least part of it liquid & accessible.

If you're worried about self control, and the mere idea of having a little bit of money inspires you to blow it on frivolous things, then you'd do well to learn how to have money and how to budget. You need to keep some in the bank to learn how to ensure you keep enough in the bank every month to cover your expenses.

Even if you're not worrying about living expenses right away (by living at home, in a dorm w/a meal plan, etc), you will still need to plan & budget for those things in the next few years. Start building those habits now. Make a budget & pay your own bills. Learn how to avoid debt before you have to. (Btw, should you need a student loan, DO NOT take private student loans!!).

My suggestion:

  • Keep ~$500-1000 in a (free, ideally) checking/debit account for your weekly/monthly expenses. Automatically deposit future paychecks into that account. Try to keep its balance steady, never negative, and below ~$2000 to prevent a large loss in the event of debit card theft/scams.

  • Put the remaining ~$5K in an interest-bearing savings account (with the same bank for convenience, or with whoever's offering the highest interest rate). Forget it's there. This is now your emergency fund.

    • When you have income going into the checking account & you've accounted for "fixed" (mandatory) expenses, put whatever's left you can afford to here & keep building it up.
    • Down the road, once you have more/steady income, you can "pay yourself first" into a Roth IRA or savings, and then pay bills, etc, but initially focus on covering expenses first.
    • Sure, you could do a CD or T-Bill, but the interest rates still suck (< 2%) and you lose access to the money should you need it in an emergency (medical, homelessness, natural disaster, etc). You'll get ~1.5% from a decent savings account anyway. If interest rates ever get back to 4-6%, sure, go for a CD.
  • OPTIONAL: Once you've built a budget & know your expenses and income, if you're fine w/advertisers knowing what you buy, get ONE credit card that actually pays you back something (cash, Amazon points, etc). Use it to pay for groceries, gas, phone, utilities where possible, and other purchases, but ONLY to the point where you can pay it ALL off that month. DO NOT carry a balance.

    • The goal is to get cash back or points for buying the stuff you would've bought anyway w/a debit card or cash. Use it just like a debit card, and NEVER max it out.
    • Set up autopay to pay off the full balance every month from your checking/debit account. If you're meticulous about making your payments in full & on time, it will help you build your credit score. (Some people say it's better to carry some balance, but I haven't found this to be true. Just don't ever miss a payment).
    • Amazon's Visa card is good, as it has no fee and you earn significant points you can use for almost anything they sell. Saves us $100s every year.
    • Again, DO NOT buy stuff you can't afford or pay off immediately. Of course, if you're philosophically opposed to targeted marketing & companies tracking your purchase habits, skip this & pay cash.

Once you've gotten used to NOT spending your money, it's easier to not spend it. If you get a raise, put the difference into savings. Get a better new job, put the difference into savings & keep your expenses the same. Take the time to build good habits & learn what your real expenses are & how to handle them w/o feeling compelled to impulse buy. That way you'll be ready after college when the real world shows up. ... Honestly, at that point I'd spend it on traveling and enjoying life before spending decades behind a desk hoping to one day travel & enjoy life ... There's a lot to be said for that approach too.

  • Quoth the OP: "Luckily, I don't have to worry about student loans or most other living expenses." (emphasis added). Implying that your first point doesn't really apply here, since the OP's room'n'board is already covered by something else (for instance, maybe they still live with their parents).
    – Vikki
    Commented Jun 8, 2018 at 14:23
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    @Sean - quoth me "Even if you're not worrying about living expenses right away (by living at home, in a dorm w/a meal plan, etc), you will still need to plan & budget for those things in the next few years. Start building those habits now. Make a budget & pay your own bills. Learn how to avoid debt before you have to." ... " If you decide to move across the country to SF or Seattle after graduation & rent a 1bdrm apt, you will wipe this out."
    – mc01
    Commented Jun 8, 2018 at 16:58
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    What a 18yo should do with $6k greatly depends on why they don't have to worry about student loans or most other living expenses.
    – Mazura
    Commented Jun 8, 2018 at 22:19
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    @Mazura - this is true ... I inferred from her statements that she considers $6K a lot of money and is concerned about blowing it that, although she might have tuition & housing covered (somehow - parents, scholarships, etc), she isn't otherwise spoiled for cash or accustomed to handling her own finances. But, circumstances do matter & could change the decision. If/when she can afford to save more, go for it.
    – mc01
    Commented Jun 8, 2018 at 23:13
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    +1 Using this money to learn how to use money - that's the biggest yield one can dream about.
    – Agent_L
    Commented Jun 10, 2018 at 17:51

You're asking, where do I put this money? Generally, you want to maximize tax laws to the greatest extent possible. To that end a Roth IRA might make a lot of sense for you because it lets you put money in to an account that lets you keep the earnings derived from that money without paying income tax on them.

Your option of a savings account is logical (though I think Bob Baerker's CD ladder suggestion is even better). You'll put this $6,000 in to a savings account, say earning 1.5%. At the end of the year you'll have made $90 in interest. You'll owe income taxes on that $90. But, thanks to the standard deduction, it's not likely you'll have income that would be subject to income taxes anyway. So, practically speaking, there's no difference between a regular taxable account or a Roth IRA (or other tax preferred vehicle).

Since this money is likely to be tapped while you're still in school, I'm not sure how much tax benefit you'll actually realize with a Roth IRA wrapper. However, your earnings will be locked in the Roth IRA until you attain retirement age. For simplicity, let's say you put $5,500 in to a Roth IRA. Over 5 years at 1.5% APR you'll earn roughly $425 in interest. After that 5 years you can take your $5,500 back free and clear BUT the $425 of interest would be subject to a penalty of $42.50 and income taxes up to the extent that you have a taxable income at all. The penalty can be avoided a couple of different ways like first time home purchase or if the account is less than 5 years old, qualified education expenses. If this was outside the Roth IRA wrapper there would be no such penalty and depending on what sort of income you'll be generating while you're in school there might not have even been a tax benefit to the Roth IRA wrapper anyway.

This answer got away from me, but you really just need to think about whether or not you'll be working while you're in school because tax preferred investment vehicles are only beneficial up to the extent that you're paying income taxes at all and generally put restrictions on the money which are subject to a penalty you otherwise wouldn't have exposure to.

It might make sense to broadly explain some relevant concepts that you may not have ever really encountered based on your age.

Income taxes: In a very basic sense you get something called a standard deduction (which for illustration purposes let's just call this $10,000 though the amount changes annually). Say you make $15,000 in 2018, you get to apply this standard deduction of -$10,000 to your income leaving you with $5,000 in taxable income.

Earnings: Generally, any money you earn in a year is taxable, including interest or dividends from investments. There's two ways to make money from an investment, interest/dividend payments or capital appreciation.

Interest/Dividends: If you have a savings account or own stock that pays a dividend, you'll receive a periodic payment, that payment is income.

Capital Appreciation: If you buy something for $100, and sell it for $120, you have a $20 capital gain. If you sell after you've owned the asset for a year, that's a long term capital gain, which receives favorable taxation; under 12 months is a short term capital gain which is considered income.

Capital Losses: If you buy something for $100 and sell it for $80, you have a capital loss of $20, which can be deducted against any gains you have.

  • Tax savings of putting it into a Roth IRA is not about taxes on the interest in the next four years while in a low tax bracket, it's on the interest during the 40 years after that while in a marginal tax bracket corresponding to a good income. Still, your straightforward example of consequences of withdrawing either the principle or full balance from a Roth should be very helpful to OP.
    – Ben Voigt
    Commented Jun 9, 2018 at 14:35

Beginning to invest at an early age is a good idea but investing has risk.

Since you don't want the risk of investing, since you think you might fritter the money away during college, and since you might need the money during college and possibly grad school, my advice is that you consider putting the bulk of it in laddered 1 year certificate of deposits/term deposits (CDs).

Figure out how much you want as an emergency fund then divide the balance into several CDs. For example, if you are comfortable with $1,000 available as an emergency fund with access to half of your money every 6 months, put $3,000 in a one year CD now and $3,000 in another one in 6 months. As each CD matures, if you don't need the money, open a new one year CD.

If you want access to 1/3 of your money every 4 months, open three one year CDs with $2,000 (one now, one 4 months from now and one 8 months from now). Again, as each CD matures, if you don't need the money, open a new one year CD.

  • I think this is the best option to start with. OP states they don't have to worry about "most other living expenses" but there is the chance that something unexpected would come up. After OP has started college and is sure of all expenses this money can be rolled-over into a Roth as each CD matures, if that is desired.
    – Dragonel
    Commented Jun 7, 2018 at 23:33
  • -1 T-Bills from Treasury Direct have better interest rates than bank CDs, with shorter maturity times. Commented Jun 8, 2018 at 3:46
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    @Dragonel: Nope, money can't be added to a Roth unless there is at least the same amount of earned income during the same year.
    – Ben Voigt
    Commented Jun 8, 2018 at 4:37

If you want a place to put your money that is secure with a decent interest rate, but have good availability, consider buying T-Bills from the US federal government.

If you set up an account at Treasury Direct, and buy a T-Bill with 4 weeks maturity, you'll make earn an interest rate comparable to a bank certificate of deposit.

Because it has a short maturity, if you need the money you can get it pretty quickly, less than a month. It has an interest rate above inflation, and is a secure investment.


My advice would be to seek professional advice.

  • Take maybe $150 and hire a financial adviser for an hour or two to sit down and go through your options personally with you. Ask them to help you make a plan for some big purchases you might be wanting in the future (e.g. mortgage/car) as well as have enough for short term beer/partying/etc.

  • Banks often have advisers you can talk to for free, they'll offer you their products of course but you can go to several for very little cost.

I would not suggest making any investment with the fruits of years of your life on the opinions of some people you've never met on the internet, no matter how reputable they may be on this site.

  • 6
    With $7,000 and pre-college, it's a bit early for a $150 financial adviser consultation. The free bank adviser consults are a good way to help with the early learning curve. Getting set up for life (an education) and achieving some financial literacy should be the objective at the present time. Commented Jun 8, 2018 at 11:53
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    By all means listen to a "free" bank advisor consultation, but for the purpose of learning what not to do and what isn't "good financial advice". A bank advisor will probably be tied to only offering you the bank's products, and will most likely advise you to take the one that earns him/her the most commission, not the one that is best for you personally!
    – alephzero
    Commented Jun 8, 2018 at 13:48
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    @alephzero then listen to several before you commit your funds anywhere.
    – Izzy
    Commented Jun 8, 2018 at 18:24
  • @BobBaerker How is $150 for a financial adviser not stepping towards "Getting set up for life (an education) and achieving some financial literacy."
    – Izzy
    Commented Jun 8, 2018 at 18:26
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    There's no free lunch. "Free" bank advisor consultations are actually sales pitches into fairly lousy financial-service products like load funds or annuities that pay the "consultant" a fat commission. Only do business with financial advisers who only work on an upfront fee basis and are not affiliated with banks or investment firms that offer funds or annuities. It's the only way to get an honest one. Commented Jun 8, 2018 at 23:46

That's awesome that you have that much money already saved! Since your monthly expenses are already taken care of then you essentially have $6000 to do something with.

I suggest keeping $1000 in a checking account in the bank. It's always nice to have a certain amount of money in an account that you can access it any time of day without a penalty of withdrawing it. You never know if you need to fix something on your car, need a bus/plane ticket, or everyday expenses.

With the remaining $5000 I feel like you could wait until you're making a larger regular income before setting up a retirement account/plan. Also, since you want to shy away from the stock market then your options are a savings or money market account and a CD (certificate of deposit). I would put X amount of money into a savings account and Y amount into a CD. See if your bank has these things or shop around to find a bank that offers the highest interest rate on those accounts.

A savings account is nice because your money earns interest, but you can only withdraw up to 6 times a month from it if need be. A CD earns more interest, but you're not supposed to touch it until it matures (6 months, 1 year, 5 years, etc.). Nerd Wallet is a good site to compare accounts: https://www.nerdwallet.com/banking/best-savings-accounts


If you're going to college, you are going to have expenses which you will need money for. It's altogether a good idea to put it away where you won't be able to spend it, but if you have legitimate costs coming up, you will need to be able to access your money.

... Usually, index funds outperform professionally managed investments, once you take into account management fees.

... in an index fund ... you'll lose some money, maybe a lot of it, if the stock market as a whole goes down. But it's still a lot less risky than other investments that have decent returns.

... the OP said she's off to college--so she will be able to withdraw it all anyway [from a Roth IRA] (to pay for college).

... she'll be living on her own within a few years at least, when she'll be needing everything from furniture to a car (?) and only a starting salary to pay for it.

... get established in life first, then worry about the future (just don't wait too long).

... Americans complain how Americans don't save for retirement, then other Americans encourage "blowing it all" right away--like it's some sort of crime to say "no" to a salesman or not spend your tax refund check right away. You can't have it both ways.


Cryptocurrency, I've already seen there was one answer downvoted to hell with this suggestion, but trust me, this is that kind of stackexchange community. People here mostly understand fiat, debt based economics. Concept of deflationary currency is uncomprehensible here. Put it some research into it and no more than 20% or however much you feel comfortable. It is definitely worth the time looking into, its the future man ;]

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    While I think that cryptocurrency has a bright future, and upvoted you, OP wants a low-risk investment. Commented Jun 8, 2018 at 12:39
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    If you want this to be well received, explain why it meets the needs of the question rather than insulting the members of the site.
    – Joe
    Commented Jun 8, 2018 at 13:24
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    A cryptocurrency isn't "investing," it's "speculation" - specifically, speculating that (1) you won't be the last person on the planet to throw their money at something which is basically a Ponzi scheme, and (2) when you want out, you will actually be able to get out without being trampled to death in the stampede for the exit.
    – alephzero
    Commented Jun 8, 2018 at 13:52
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    This. Put some newly emerging/growing into cryptocurrency platforms and watch it multiply (just don't forget to exit before pushing it too much). People who downvote are usually the ones that missed the previous crypto wave at some point. But another one is coming now. Commented Jun 10, 2018 at 20:49
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    theguardian.com/technology/2018/jun/11/… ... $30M Bitcoin stolen in a hack. Bitcoin down 70% from its speculative peak in Dec. No reasonable investment is that volatile - it's just gambling. Smaller crypto offerings are now easy to manipulate by simply renting the equipment needed to mine/control a majority. Blockchain is neat, but unsustainable & way too hyped. Some entire coin offerings are scams that disappear w/your money. Might as well go to Vegas, play online poker, or dump it all into 1 stock/IPO and hope for the best.
    – mc01
    Commented Jun 12, 2018 at 0:52

Buy a few gold and silver eagles and put them in a safe. Seriously. Precious metals have been the method of choice for saving for thousands of years.

Precious metals hold up well against inflation and are free of counter-party risk (bank defaults, etc). So whatever happens with the banks or the economy, your coins will keep their value.

Furthermore, precious metals are currently undervalued, so they might do better than just keeping up with inflation in the next years.

If you go this route, make sure to buy investment-grade coins (bullion) and not collectible coins, as collectible coins have an often unjustified markup.

Edit December 2020: Gold is up 48% over the last 3 years, whereas the S&P is only up 38%. Many experts are currently warning folks that stocks are in a bubble, while gold is still relatively cheap. Take care!

  • 1
    It's not uncommon for gold to lose 25% of its value over a period of years so its inflation beating characteristics could be a Pyrrhic Victory. Counter party risk is one of those sounds good apocalyptic lines but is meaningless. If the banking system fails, gold will be far down the food chain, so to speak. Gold is hardly suitable for the circumstances that the OP laid out. Commented Jun 8, 2018 at 11:49
  • Stock markets can lose their value equally for years, and investing now in the stock market (which a Roth IRA basically is) is really risky right now because it is at an all-time high. Also have a look at the following chart of the performance of gold vs the stock market: gold-eagle.com/article/…. Commented Jun 8, 2018 at 12:31
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    "Stock markets can lose their value equally for year?" Hence the reason that the OP should avoid the stock market as well as gold. Commented Jun 8, 2018 at 12:37
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    A Roth IRA is not "basically the stock market"; it's an investment account, not an investment itself. A security which is trading at an all-time-high is not inherently more risky than one which is not, and "precious metals are currently undervalued" is, by definition, your personal opinion going against the consensus of investors.
    – Sneftel
    Commented Jun 8, 2018 at 14:25
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    Your advice not to invest in collectible coins is good, though.
    – Sneftel
    Commented Jun 8, 2018 at 15:07

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