I have $170,000 to be used for all my expenses during 5 years of school and am looking for a safe, hands-free place to invest it. I have worked out my budget for the next 5 years and this money should be enough to cover my expenses if it grows above inflation. I am not interested in purchasing real estate, owning a business, or managing a large stock portfolio, so I would be grateful for any ideas regarding the best way to invest this money for the next 5 years. I will need to be able to withdraw 20% of the money each year to cover my expenses. Money-market savings accounts and certificates of deposit do not appear to have high enough interest rates to be viable options. The only option that I have found so far are Treasury Inflation-Protected Securities (TIPS) and Vanguard Inflation-Protected Securities (VIPSX) looks to be the best TIPS, but I don’t know enough about inflation, diversification or investing to know if putting the entire $170,000 in a TIPS for 5 years is the best option. I would greatly appreciate any financial planning advice regarding my situation. If you could map out the specific investment vehicles or sketch a composite portfolio for the $170,000 I would be very thankful. This would be easier for me if I was investing for the long term, but my 5 year window, expense requirements, and the current inflation outlook and bear market make my situation very confusing. Thanks for your help.

I can give you some ideas..

Send me an e-mail at kawi340@yahoo.com

lol don't look for investment here. Approach a bank or investment institutes in your area....SAFER!!!

yeah, i would keep it in a bank.

First of all congratulations on being able to save that much. I would suggest that term deposits best suit your requirements. If you do not require the funds immediately look towards longer timeframes. Spreading the deposits over several terms (e.g. $10,000 in a 6 month term, $15,000 in a 9 month deposit etc) will allow for some liquidity and will allow your money to follow interest rate changes and depending on the policy will keep your returns above inflation rates.

You should do some research and consult someone regarding medium to long term interest rate forecasts. If they believe rate will fall you should put more of your deposits in long terms and visa versa if they are expected to rise.

You may also want to look at depositing funds in other countries that offer higher interest rates and have a higher resistance to the current credit crisis. However you will then need to take into consideration that movements in currency rates can affect your returns.

At any rate you should keep some cash "on call" for emergencies.

You'd better deposit it in banks or investment institution in your local area .

What I would be doing with that $170000 is use it to turn it into $1000000, which is very much possible with the right team and a bit of leverage.... The funny thing is, you would only need a very small % of that to change your life forever!

Then, you could still deposit the 165000 into your bank account, while turning the leftovers into your retirement!