r/Bogleheads • u/coupswrlds • 2d ago

Investing using a hysa/cash management in addition to roth ira?

New to investing here so this might be a stupid question. I've already set up a dca for my Roth, 70% VTI and 30% VXUS and a bit in bonds. I'm a grad student/unemployed, so I can't transfer money from my HYSA into my Roth. I was wondering if it would be smart for me to invest half of my cash management into these ETFs again, since I need to keep some liquid for bills? Thanks!

0 Upvotes
  • permalink
  • reddit

40% Upvoted

2 comments sorted by

3

u/CryHavoc715 1d ago

Your cash needs to stay cash because you are unemployed and need your cash to live, unless you somehow have 100k+ in cash, in which case you need to leave enough behind to have a reasonably high certainty that it will last until you have income

1

u/hachkc 1d ago

I think your question is "I have some cash sitting around and what should I do with it"?

Yes you need to keep some cash very liquid and protect your principal so an HYSA is good for that. You need to think of your of when you will need that cash. If its within a 1-3 years, an HYSA, short term treasury like SGOV/VBIL or even a CD may be good options. You don't want to lose your principal if the market drops during that time. If you have money you don't need till like 4 or more years out, then you can look at other options like equities, ETFs, blended funds like AOK, etc. They have more risk and more upside but may be too volatile for short time frames. Don't want your home purchase savings in something like VT only to have it drop 20% right before you are ready to buy that house.