How to invest excess money
I was recently let go from a company I had been at for almost 20 years. I was given somewhat of a package that enabled my to accrue about $150K in cash reserves that I don’t need right now. I anticipate that I will get a new job in the next few weeks/months. That being the case, I was thinking about putting some of this towards the principal on our home. I really have no other bills. Any thoughts on what to do with this extra cash? Also, I am 62 1/2 years old.
Terry Says
Taht depends on your entire financial picture. If your mortgage rate is below 5%, I would not prepay it. Let’s see how quickly you get the next job. I would leave it in an FDIC-insured money market deposit account at a bank, or put a portion of it into 3 or 6-month T-bills.
Read this: https://www.terrysavage.com/t-bills-beat-cds-2/
I just realized I am assuming that this is likely taxable income! So did you have them withhold taxes? If not, speak to accountant to make an estimated tax payment in January.
And if it is PRE-TAX, some sort of rollover would be allowed — perhaps to an IRA. You need to know those important details. Then write back.
