When my paycheck comes in, should I start with savings or ETFs?
I’m a office worker in my third year of working life. Until now, I’ve just let my salary pile up in my bank account, but I’m starting to think I should actually put it to work.
People around me say I should first build a lump sum with a savings account and only use extra money for ETFs. On the other hand, some say that when interest rates are ambiguous like now, it’s better to just do regular ETF contributions. So I’m torn.
I’d be curious to hear how those who started around a similar stage split things up.
10 answers
Always start with savings deposits. There’s no rush on ETFs—you can get into them later once you have spare money.
If you're in your third year, shouldn't the first step be to build up six months' worth of emergency savings? If you start with ETFs before you have that, you'll lose your nerve in a downturn and end up selling at a loss lol
I had similar concerns, so I split it half and half: automated transfers into a savings account, and 200,000 won a month into an ETF via regular contributions. After two years, the savings account definitely felt more reassuring. If you’re the type to get stressed watching an ETF’s unrealized gains and losses swing around, I really wouldn’t recommend it.
I think it’s a bit risky to say ETFs are better when interest rates are ambiguous. Rates aren’t ambiguous right now—they’re persistently high, aren’t they?
Got a source? All those rumors going around the community these days come from YouTubers' remarks.
I just dollar-cost average everything into ETFs. I didn’t think it was worth locking my money up for a year just to get savings account interest in the 3% range. Instead, I only invest money I really won’t touch, and I keep my emergency fund separately in a parking account.