Question on personal finances....

[haele]

I'm expecting a moderate insurance settlement in a few weeks (a little over $20K), one that we will use to:
1) pay off all outstanding bills (appx $5-7K in "credit" and medical bills)
2) purchase a much needed second (used - probably around $2-3K including the extra insurance)economy commuting vehicle, and
3) move into a much needed larger residence (a rental - another $3-5K depending on deposits) - which we can now afford because we'll no longer have to pay $500-$700 a month in extraneous bill payments. (a small two-bedroom 700 sqft crackerbox apartment just doesn't work with mobile disabilitys, a teenaged-girl and seven critters - we need at least 900 sqft and a second bathroom for any sort of comfort level...)
4) Perhaps a $2K extra "treat" spree if we're really economical above ('cause we deserve it). Perhaps not, if the estimate payments above reach the maxout estimates.

That will leave us with approximately $5-8K left over, crappy (around 600 points averaged)-but-paid off credit rating, and a decent salery base with no immediate layoff signs until the Shrub screws social security (hubby's on SSI with additional coverage for the kid and I've got a decent mid-level government contract job with a good, employee-friendly company for now).

I have a couple of options.

My company has an excellant steady employee-owned stock portfolio on top of a pretty decent 401K, with a 2 for 1 options (over 5 years) initial employee buy-in up to $2K. The company stock (a Bull account managed by Vanguard) has weathered the ups and downs of this last five years very well, with only a 2% loss over the past 4 years, which has been made up with a 3% gain over the last quarter after the restructuring and spinoff of one of the subsidiaries. There's also talk of us going public sometime within the next two-three years.
I'm also looking at CD's or some sort of Moneymarket funds; something stable with a bit of growth that can be used in 5 or 10 years.

Eventually, what I'd really, really like to do within the next 5 years is to either purchase a forclosure property as a home for cash or have good enough credit to purchase property normally with a decent downpayment.

So, I guess what I'm asking is - should I go for the options and some other sort of stable short-medium term investment (CD's, Money Markets, Mutual funds?), or is there some other investment vehicles I should be looking at - or should I just "invest" all the remainder at the Indian Casinos playing "hold'em" trying to get into the World Series Poker tournament?
(just joking about the last)

I don't expect to lose my employement anytime soon, right now, I'm being groomed for (gasp) management and tracking into a PMI position. As for the future, I think we'll be comfortable enough as long as we can keep our health - I'm eligible for full military retirement in 15-20 years (retired Reserves - eligable at age 60-65), my 401K is looking pretty decent, and my husband is eventually going to inherit some family country property - but again, that's not anytime soon.

I'd appreciate any advice or pointers as to what I should be looking to do with the settlement, other than just blowing whats left after we pay off the outstanding bills. I do know that I'm pretty much asking "for free" - so I don't really expect any major investment instructions or hot tips. (other than perhaps "buy low, sell high")

Thanks.

Haele

[thoughtanarchist]

1. I hate sounding like Suze Orman but...

What you don't use paying off debt, stash it away safe and concentrate on getting you into a private house. Once you've absorbed the budget impact of the move, then consider investment ideas.

Short-term laddered CD's or a high yield money market acct would be good places to keep your cash while looking for your home.

ing orange savings has a pretty nice rate...

[Zynx]

2. I would reccomend a money market account over a CD.

Neither is a particularly good place to put one's money over a 5+ year time span since most of your yield is eaten up by inflation anyway. At least with a money market account you can withdraw money when you feel like up to a point for other investments.

[RawMaterials]

4. I have a ING account and

I love it, they just raised my apy to 3%. It seams that they are good
at staying ahead of the Fed rate, so right now with rising interest rates that IMO might get to late 70's and early 80's highs around 18-19%
then the ing might be a good safe bet.

Plus your not locking away your money the only down side is it takes 3-4 days for the money to transfer between the ing bank and the regular bank .

[Zynx]

3. In terms of an investment with better returns, but is still stable...

Try a balanced mutual fund, ie half bonds/half stocks. They usually provide reliable returns and I find it highly improbable that the stock market will continue to suck as badly as it has for the last five years.

http://flagship5.vanguard.com/VGApp/hnw/FundsSnapshot?FundId=0002&FundIntExt=INT

This is a good place to start looking. What's really nice about it is because of the bond portion you get a 2.3% yield that you can have sent to you or reinvested.