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deni's avatar

What should I do with $30,000?

Asked by deni (22607points) October 18th, 2011

My gram recently died :( and she was worth quite a bit, so my mom and brothers and I are all getting a good chunk of change. By the beginning of 2013 I’ll have about $30,000 dollars. My mom is giving us the just straight up money that my grandma had sitting around the house (which was a lot…she only used cash and, of course, didn’t trust banks)...she’s giving it to us in separate checks of under 13,000 a year so we don’t have to pay an inheritance tax on it (what fuckin bullshit!) ....anyhow! What should I do with it? I went to the bank today and the banker told me essentially a CD is pointless, because you can’t touch it and interest rates are so low now it’s pointless. I’m more interested in something like gold or stocks. I’ve owned a gold coin before and I liked that, but I also get nervous about having a tiny, quarter sized thing worth 2000 dollars…I’m afraid of losing it!! I move around a lot and travel a bit and would feel…I don’t know, just uneasy. Stocks? I literally don’t know the first thing. Are there any other options?

FYI, I will be using a couple thousand dollars, putting it in my primary checking account just to make myself a bit more comfortable. And, like I said with the CD above, I want to be able to use it if I need to. And by need I mean, if I want to travel or need to fund something large, probably a trip.

I’m just looking for some input, basically. Thanks. :)

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43 Answers

LuckyGuy's avatar

Are you totally debt free? First pay off any credit card or high interest loans you might have.
Start or contribute to an IRA or 529 college fund.

Oops! I see that you might not have any credit cards. Scratch that.
When my kids were 14 and 12 I opened brokerage accounts for them. I told them to pick two companies who made products they enjoy. One son did very well. The other did OK. The money really came in handy.

Coloma's avatar

The healthy approach to money.
Spend some, save some, give some away.

I’d take a trip if that is something you really want, then, treat a few pals to some fun, nothing huge, but, maybe spring for a weekend get away, hotel, dinner, drinks etc. THEN…bank the rest while researching some modest investment options.

I am sure your parents can help advise you, or, start a small biz. of your own.

deni's avatar

@worriedguy Yeah, I should have mentioned that. I went to community college for 2 years and paid for it totally. And I’ve never had a credit card. But I got one today! But don’t plan on using it ever really.

lukiarobecheck's avatar

Get a nice Patek Philippe. They are classic, and timeless. Plus, instead of investing, you can actually get some use out of it. Also, if you take good care of it, years down the road it will be worth more than you paid for it. Or you can pass it down to future generations. Win, win, win;-)

rebbel's avatar

Another idea is to consider lending some of your money to help poverty stricken people in developping countries, through organisations like “We are a non-profit organization with a mission to connect people through lending to alleviate poverty. Leveraging the internet and a worldwide network of microfinance institutions, Kiva lets individuals lend as little as $25 to help create opportunity around the world.”.

janbb's avatar

I would talk to a financial planner and invest at least some of the money for the long term.

Blackberry's avatar

I wouldn’t trust the market. I would put it in a CD, forget about it, and go on with my life.

syz's avatar

I know it seems staid and boring, but the smarter you are with the money now, the happier you will be down the line.

Sure, you could buy a really nice car, go on a couple of trips….but you could also eventually put a down payment on the house you want, or have a cushion to fall back on if you get stuck in a bad marriage, have a health issue – any number of things could happen.

Put a little aside for fun and incidentals, and then talk to a financial planner about long term investment. Believe me, with that kind of money to invest, a financial planner will be happy to talk to you. Get recommendations from people that you respect, and think 10, 20, or even 30 years out.

I speak from sad experience. I wish I had been smarter.

Coloma's avatar


Respectfully, but…most financial planners scoff at anything less than a 100k. Sure, they can help, but 30k is a drop in the bucket when it comes to investment.

gailcalled's avatar

@deni: What state do you live in? has very conservative tax-free municipal bond funds (very low fees and check-writing availabilty) in certain states.

Personally, I would invest the whole kit and kaboodle for the future. You can use your salary for vacations and trinkets.

WestRiverrat's avatar

Save it for the down payment on your dream house. That is what I did with all the ‘found’ money I came into over the years. I ended up paying for my house outright 2 years ago. Not having to worry about mortgage payments is a beautiful thing.

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deni's avatar

@gailcalled My mom lives in pennsylvania, I live in Colorado. What is a municipal bond fund?

DrBill's avatar

The current inheritance tax does not apply unless it is over $5,000,000.00 (five million dollars)

janbb's avatar

@DrBill I suspect she may be talking about the gift tax.

DrBill's avatar

If it is an inheritance, gift tax would not apply

WestRiverrat's avatar

Maybe they are trying to avoid state taxes.

SpatzieLover's avatar

@DrBill Yes, it would…the mom inherited it and she is giving it to her kids.

@deni I’d put that money to work for me. Either I’d put a down payment on a duplex so I could build equity or I’d put it away in bonds or commodities to grow.

Rarebear's avatar

May I suggest a book? I read this years ago and I learned a ton.

RocketGuy's avatar

I thought the limit to tax-free gift was $10,000. Of course, if it is in cash…

LostInParadise's avatar

You should work with an investment planner. You want a mix of safe slow growth funds plus a little bit in something that yields more but is riskier. You are young enough to be able to deal with a little bit of speculation.

Rarebear's avatar

@RocketGuy You can give $10,000 per person. So theoretically, as I understand it, your mom could give $10,000 to each member of your family.

deni's avatar

From what my mom has told me, she asked her attorney what the largest amount she could give us per year is that would not be taxed, and he told her it’s $13,000. Maybe its varies by state? I don’t know, but whatever it is, that’s how much we’re getting the next two years, then whatever the rest is in 2013. And she also told me the inheritance tax is 15% on any amount you inherit? So whats the one @DrBill is talking about then?

HungryGuy's avatar

Buy rental property.

YARNLADY's avatar

If the Mom is the heir, the money is hers to do with as she sees fit. If she wants to give part of it to her children, it is wise to limit it to $13,000 per year to avoid having to pay the federal gift tax. It is the same in all the states.

P. S. Only the Mom (donor) would have to pay the tax, not the person who receives it.

deni's avatar

@YARNLADY Well my mom is the heir, but my gramas grandchildren (us 3) were also in the will. My mom was an only child. She actually isn’t paying tax on it because what we’re inheriting, she already has in cash. Like I said, my grama only kept cash. And she had a lot of it. So the only issue with tax really is how much she can give us per year. You get it.

mazingerz88's avatar

You mention stocks so I would explore that. If you are wiling to start learning how to invest in it, I would say go for it. There is real money there if you know what you are doing and it’s not rocket science. You can put 5T initially and learn the ropes so to speak. In six months or so you would know if it’s the right thing for you.

You could then put more money if you want, especially if you make profit with that initial investment. There’s risks. You could lose the initial 5T. Yet you could also come to the conclusion that stock investing, along with the risks involve with it, is something you could continue learning about some more and be better at it as you go along.

PM me if you are interested to hear my personal experience. I would be glad to share it.

YARNLADY's avatar

Any amount that is directed in the will is not taxable to the heirs. The inheritance tax is only paid by the estate and only applies on estates worth over $250,000. You mother does not have the need or right to dole out the amount stated in the will, it is already yours.

Are you saying that there will be no accounting for the cash involved? There could be fraud involved if there is no executor or formal statement of the true amount of the estate.

Coloma's avatar

Or…you can become a small time personal loan shark. Make short term loans at 10–15% interest. haha

Hey, I lent a friend 10k last year for 4 months and they paid me back $10,900

It was their offer…not bad, not bad at all. haha

echotech10's avatar

I would simply put it in the bank and save it, because you never know what the future holds.

perspicacious's avatar

The annual exclusion allows monetary gifts that are tax-free for both the grantor and grantee. It’s not just about inheritance tax. Your comment regarding it leads me to think you are not mature enough to even have control over $13,000, much less the full amount you say Mom is giving you. I think Treasury Bonds might be a good option for you, but I’m not a financial professional. This is strictly my opinion.

deni's avatar

@perspicacious That was fairly rude.

gailcalled's avatar

If she inherits $30,000, that is what she will get. The taxes get taken out of the estate before distribution.

If her mother wants to give her a gift of $13,000 (tax-free for 2011 and 2012, and then who knows), she can do that this year and next year and then wait and see.

@deni; Gold is not a good idea. CDs are not a good idea. Savings account in a bank is not a good idea.

Your best bet is a municipal bond fund.

“Municipal bonds are securities that are issued for the purpose of financing the infrastructure needs of the issuing municipality. These needs vary greatly but can include schools, streets and highways, bridges, hospitals, public housing, sewer and water systems, power utilities, and various public projects.

Go to and check out several kinds of municipal bond funds.I’ve listed three funds below. I like these much better than Treasuries right now.


Or research the funds that index the Standard and Poor 500 stocks.

deni's avatar

@gailcalled I’ll look into those, thanks. Out of curiosity, why do you say that gold is a bad idea?

WestRiverrat's avatar

@deni everyone has jumped on the gold bandwagon. When everyone starts buying something it is usually a good time to look at selling it. If everyone starts selling all at once there will be a crash in the market similar to the housing bubble and the dot com bubble before that.

Hypocrisy_Central's avatar

If I were you, I would think real estate. (I hear the moaning) It is a good time to think of real estates. It is not like in will not increase in value 5, 7, 12 years from now. As with that gold you are thinking about, you can’t loose it in down the toilet, in the backyard, the back of a moving van, etc. It doesn’t matter if anyone knows you have it, they can’t ransack your home to cart it away to get their Cash for Gold envelope, and many of the top 5% got there by way of real estate.

I would investigate lien sale certificates in your state. With how bad the economy, I am sure there are more than a few. Even the better properties will be affordable with the cash you have, and you will not be spending anywhere near half of it. Depending on your state, in a 6 months to 2 years you will either get your cash back with way better interest than T bills, bonds, CDs, or IRAs, or you will be deeded the property free and clear. You can then go on and sale it, even at fire sale prices you will make your money back with a profit, or you can lease it for passive income. Then you can be earning even if you are shopping for shoes, sleeping or taking a shower. If you end up with the property (if you chose a really nice one) you can live in it, and even if you don’t, get can serve as a tax write-off.

perspicacious's avatar

@deni I don’t worry too much about it when someone uses language like “what fuckin bullshit!” It’s extremely rude to use such language on a forum like this. It offends many. Most will not say so, but I will.

deni's avatar

@Hypocrisy_Central I have thought real estate, but I don’t know where I would even begin. Literally. I live in Colorado now, but probably wont in a year, let alone 5, 10, or 15. I guess it probably isn’t completely essential that I live where I buy, but I do assume it would probably make things a lot easier?

Skaggfacemutt's avatar

You don’t want that filthy money. Money is the root of all evil. Get it out of your possession as soon as possible. Please see my profile to get the address to send it to. Ha-ha.

YARNLADY's avatar

I doubt you are going to get ahead in the real estate market. Prices are at rock bottom, but they aren’t going up anytime soon. Your RE investment would remain below the inflation level for years to come.

I suggest you invest in a Mutual Fund through your bank. We use E*Trade, and have been very happy with them. Perhaps you could find an office near you and visit.

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