What's the best thing to do with excess wealth at age 30?

I have excess funds and am unsure what to do with them I'm 30 years old with a stable job and single. I've already contributed to reach my company match on my 401(k) and maxed out my Roth IRA contributions. I have already set aside 1 year of emergency funds. Now I still have excess savings, and I'm unsure of what to do with the money. First world problem (I know), but what do you recommend to help grow my wealth?

Retirement Savings, Investing
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3 weeks ago

Having excess wealth at age 30 or any age is a problem most people would love to have. For someone your age I would think a long term growth strategy would be beneficial. And depending on the size of your retirement accounts you may want to allocate a small percent of your investments in alternative investments. 

Some alternative investments require accredited status and you may give up liquidity but the long term returns outperform the old standard asset allocation mix of stocks, bonds and cash.

This model of investing is referred to as the Yale University Endowment Model. In 1987, David Swensen, the chief investment officer of Yale Endowment, moved aggressively into non-traditional and often illiquid asset classes like foreign equity, absolute return, real assets, real estate partnerships and private equity.

His unconventional approach produced a 20-year unbroken record of positive returns, resulting in stellar growth of the endowment from $1b to $17b. No wonder rival school Harvard University studied him closely. Other institutional money managers have followed his strategy.

Yale’s six asset classes are defined by their different expected response to economic conditions, such as inflation, growth and interest rate. As these asset classes are noncorrelated to the stock or bond market and over time during bear markets potentially producing better long term returns versus investing only in stock and bonds.

 

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