36, good income… ready to start investing but need advice

I’m 36, no kids (just my pup), and I think I’ve been handling my finances the wrong way. Time to change that.

Here’s my current situation:

  • $140K sitting in a HYSA
  • $25K-$30K per contract (travel work)
  • Two rental properties (one I stay in part-time when not traveling)
  • $47K HELOC at 7.5%
  • Some credit card debt (but all no-interest and low enough that I’m not worried)

My plan (tell me if I’m on the right track):

  1. Pay off the HELOC completely (brings me down to ~$90K to invest)
  2. Invest $70K into ETFs
    • 70% VTI / 30% VXUS (I’m reading The Simple Path to Wealth and trying to keep things simple)
  3. Keep $20K in savings as an emergency fund

What would you do differently? I work when I want, so money isn’t my #1 priority—time is. Just looking for smart, low-maintenance moves. Appreciate any insights!

If you don’t have a Roth IRA, definitely open one.

You’re in a great position, so first—props to you!

Here’s what I’d do:

  1. Pay off the HELOC
  2. Pay off any credit card balances, even if they’re no-interest (just one less thing to worry about)
  3. If you’re eligible for a Roth IRA, max it out for 2024 and 2025 ($7K each year)
  4. Keep your $20K emergency fund in HYSA
  5. Lump sum the rest into VTI & VXUS in a taxable brokerage

Nice and simple, and you’re set up for the long term.

Get rid of that 7.5% HELOC. You’re not going to beat a guaranteed after-tax 7.5% return this year.

Your strategy looks solid. Just remember ETFs are long-term plays (10+ years). If the market dips in the short term, don’t panic and sell. As long as you’re comfortable letting your money sit through the ups and downs, you’re golden.

Good plan! Though 30% VXUS might be a little high. If you’re okay with more U.S. exposure, consider tweaking it (maybe 80% VTI / 20% VXUS).

Also, as you get more comfortable, maybe set aside a small % for individual stocks if that interests you.

I’d personally go 90% VTI / 10% VXUS but that’s just me.

Consider SPY and QQQ. You’re still young and have good income—these move more consistently and could outperform VTI.

If you don’t need to touch the money for a long time (like retirement savings), VOO (S&P 500 ETF) might be better than VTI. Historically, it has outperformed.

Also, if you’re feeling adventurous, DCA a small % into Bitcoin for fun.

Over time, you can shift toward safer assets (bonds, dividend stocks) if needed.

Since you have rental income and inconsistent work, you might want a larger emergency fund—maybe $50K instead of $20K.

Also, don’t forget bonds if you want to diversify beyond stocks.

I like your plan, but I wouldn’t dump all $70K in at once. Instead, I’d dollar-cost average ($500-$1,000 per week).

While lump sum investing historically performs better, right now the economy feels unstable. Spreading it out reduces the risk of buying at a market peak.

@Abi
Bad advice. Even in bear markets, lump sum outperforms DCA most of the time.

Check this out: Lump sum vs. DCA study.

Lux said:
@Abi
Bad advice. Even in bear markets, lump sum outperforms DCA most of the time.

Check this out: Lump sum vs. DCA study.

If OP drops $70K in today and the market tanks 30% next month, there’s a chance he panics and pulls out at the bottom.

Does your link account for behavioral risks, or does it assume investors always stick to the plan?

@Abi
Yes, it factors that in. Historically, DCA underperforms even when markets are dropping.