Ask Terry Questions Investing “extra” cash in retirement

Investing “extra” cash in retirement

By Terry Savage on July 18, 2018 | Investments

My husband & I are in our late 70’s, healthy and active. We each have income from SS, 2 managed IRA, and have some stock as back up income. We have some cash we want to invest and are considering an index fund following S&P 500. Would that be a good income investment? Our other thought was using half to invest in stock. Please give us your opinion. Thank you!

Terry Says

It all depends. How much are you willing to lose? When will you need this money. If the answers are “none” and “soon” then stick with money market deposit accounts and Treasury bills. But if this is truly “extra” money, which you will likely pass on to your heirs, then you might want to invest half in a S&P 500 stock index fund at Vanguard or Fidelity.
Just because it’s “extra cash” doesn’t mean you are willing to take risks with it at this stage of your retirement. You might rather take a trip or purchase a combo life/long term care insurance policy which you can draw upon if the need arises.

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