17 y/o with 60k in bank account and don’t know what to do

[zomnuhu]

Hello, I am 17 years old in grade 11 from Canada looking to invest my money. I started a business when I was 13 buying & reselling and currently have 60kcad in my bank right now. RBC student banking gives 1.7% interest rate a year, which is where all my money is sitting right now. I don’t need the money anytime soon and I was wondering if there was someplace better I can invest in that is safe and profitable than sitting in my savings.

I have a rough idea of wanting to invest $5000 in a high risk and high return program (stocks maybe?), and 45k in a fixed interest for a 2 years or 5 year program. Let me know if that’s a good idea? Again, that was just a rough idea. As mentioned I can currently with RBC right now, but willing to switch if there are any good programs out there.

I am new to all of this please let me know if you have advice or suggestion on the program I should invest in LMK, thank you

 

[rchnasinghs]

@zomnuhu At your age you should reverse those numbers. A good no load growth mutual fund should return a on average 8-9% a year. At 9% your money doubles every 8 years. That means $50k invested at 18 will be worth $4,200,000 at age 66. That same amount invested at 1.7% will bring you just over $100k. It’s that big of a difference.

 

[zomnuhu]

@rchnasinghs Thank you for your input, do you have any good no load growth mutual fund programs in mind? I’m not similar with this so let me know

 

[rchnasinghs]

@zomnuhu Vanguard has some really good ones. Indexed funds on the S&P 500 or MASDAQ would also be options.

 

[noah76]

@zomnuhu Try posting in personalfinanceCanada!

 

[jared280]

@zomnuhu Wow, really unfortunate you can't just put the money in a TFSA/FHSA yet. Any reason you can't reinvest in your business, maybe hire a friend to help you out? I wouldn't bother with the savings account, just go open a brokerage account (RBC direct investing works since you already have an account) and put most of it into an index fund. Keep maybe 5-10k for individual stocks, though I think you'll find it's pretty boring seeing 10-20% gains on smaller investments of 1-2k.

When you can open up some tax free accounts, start contributing to those ASAP!

 

[zomnuhu]

@jared280 Thanks for the input! I will look into it. Currently heading into grade 12 plus my hockey career doesn’t leave me as much time as I’ve had then I was 13-14 unfortunately.

 

[popty4real]

@zomnuhu Also Canadian here. If I had that money at 17, i'd wait till I'm 18, open a TFSA, put it all in VFV.TO (S&P500 fund) and forget about it. Hopefully in 5 years it'll pay for your uni + more. Congrats on having this much money this early. Don't fck it up by picking too risky stocks like i did.

But if you want to have a little fun maybe allocate 5-10k in individual stocks of your choice but remainder in S&P forsure.

 

[bamau777]

@zomnuhu Open an account with Vanguard, invest into broad market index funds, read John Bogle’s books.
Your future self will thank me.

 

[thomas8]

@zomnuhu Don’t know much about Canada retirement plans, there’s something called an RRSP you should look into opening. But other than that open a brokerage account and invest 50k into a fund that tracks the S&P 500. Then use the other 10k to try your hand at stick picking. But leave that 50k alone and in 30 years it will be 500k. If you add another 2k each year then after 30 years it will be 1m. Take advantage of long term compounding interest since you’re only 17.