Merging Their Money and Their Goals

Ian Mackinnon, an engineer for Sunoco, had an unusual problem for a 26-year-old: He had $25,000 in a savings account and wanted advice on how to invest it for a higher return. His financial goals in 2011, when Kiplinger story appeared: continue saving for retirement in his 401(k), to which he was contributing 15% to 20% of his salary, and at some point buy a car and a house. He was also adamant that he keep some of his savings in cash as an emergency fund. Kiplinger recommended putting $10,000 in cash accounts, $5,000 in a Roth IRA and the remaining $10,000 in two growth-oriented mutual funds from Vanguard. Six years later, Mackinnon has checked off all three of his goals. The Vanguard funds did well, and over the next few years Mackinnon kicked in another $2,000 to each of them, resulting in a total balance of about $19,000.