No. of Recommendations: 0
Like a lot of things, it depends on your income and your expenses. Presuming that you have at least some free income to play with, here's what I would do:

- Max out your 401k unless it is truly a dog (ie only offers company stock or high fee annuities). This will get you started and help with your taxes. You can always borrow against this money (as a last resort).

- Set up an emergency fund of 3 to 6 mionths of expenses, depending on your risk of losing your job and your ability to reduce expenses on short notice. Plunk this money into a money market fund.

- With any extra cash, start saving. What you do with it will depend on your circumstances. If you are starting a business, you'll need liquid money. If you are buying a home, then ditto. If you are working on your career and not really needing the cash, you can open a Roth and invest in a taxable brokerage account.

Realy think twice about buying your home right now. Consider your local real estate market carefully. If prices are over-heated, then keep paying your nice, low rent and pile up the cash. When prices correct, you'll be ready to pounce. My wife and I bought our condo just under 2 years ago when the local market was taking a breather. The market has since driven up prices about 75% (!). If I were looking right now, I'd put my money away and keep renting, personally.
Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.