Whether or not I keep an emergency fund is still TBD, but I did finally close my Bank of America CD that was earning a whopping .35% interest. I thought the cancellation penalty was 3 months interest, but, without doing the math it seemed to be more than it should have been — $230 fee on an $8k CD. In any case, I took the hit, figuring it’s better to have the money liquid in a high-interest checking account that probably pays a better rate than the CD with 12 months left on it.
So now, including a few other checks I cashed yesterday, I have $10k in my checking account. The question is — what to do with it?
$1.5k will go into my IRA for this year, so I max it out. That leaves $8.5k left. Since I have a 401k next year (no match) I’m tempted to try to max that out before thinking about an IRA, as I make slightly too much for a Roth and the traditional IRA tax benefits are available for an even smaller salary. I’m also tempted to take the $8.5k and put it into a high dividend ETF or split it up among dividend-bearing stocks. I’m further tempted to put a sizable chunk of it into AAPL, but that seems too risky vs diversifying across dividend paying stocks.
What would you do to invest or save $10k?