Need to park some money over 4 years

[teressap1]

I need to park around 100k over the next 4 years (to pay off a home loan).

I have 15k right now and will save the rest over the next 4 years.
Would you recommend using fixed term deposits?
Currently in my country there are 6 month fixed term deposits of 3.4%, 1 year fixed term deposts of 3.5% and 3 year fixed term deposits of 3.6%.

 

[sandy33]

@teressap1 Can't you just pay off part of the loan?

 

[teressap1]

@sandy33 Loan is fixed @1.75% for 5 years after 5 years goes up to 2.75% but my plan is to pay it off in 5 years and buy another rental (since loan interest rates are so low)

 

[sandy33]

@teressap1 Then you can use fixed term deposit or even your country's gov bonds

Just make sure the rate you are getting after taxes is worth it

 

[divinelife]

@teressap1 I would say a fitting iBonds or a single bonds from a good rated country.

Four years are too short for equities.

 

[guinhamoura13]

@teressap1 You could open up an account with a broker (I'm using DEGIRO) andput that money into a so-called money market fund like Xtrackers II EUR overnight rate swap UCITS ETF 1c.

It's apparently a very safe place to put your money, it's instantly (well, within a few days) available and gives a 3,9% return at the moment.

 

[gen00]

@teressap1 Is there a good reason not to just pay the loan now? Is the interest on the loan lower than the interest on savings?

 

[teressap1]

@gen00 Yes. Loan is fixed @1.75% for 5 years then variable at 2.75%. But plan is to pay it off in 5 years and get another loan to buy another rental (since interest rate is so low)

 

[walkinthewoods]

@teressap1 Currently you get 5+ % interest on USD. But then of course you have some currency exchange rate risk. You could hedge against that with some forex....

Otherwise, I think you can get 3.5% without fixed term, 3.64 % on Euro at wise at the moment.

 

[bnm]

@teressap1 You might laugh but I would put at least 50% in Bitcoin. Our only certainty is inflation, no way around massive spending and more and more programs.

 

[missust]

@teressap1 Nexo for 11%

 

[samanthalynn]

@missust Love Nexo, but I'd rather stuff my money somewhere I know I won't get drained if shit hits the fan. I'd choose 3% HYSA for that safety

 

[hgfdfvnjjjjjjjjggff]

@samanthalynn They have been around for several years by now and they ware the first company to provide proof of reserves in my opinions that are some solid green flags.

 

[walkinthewoods]

@missust with governments trying to clamp down on crypto, the risk of an exchange being hacked, and so on, i think this is actually relatively high risk compared to the other options mentioned.

 

[techo]

@teressap1 Bonds for the near guaranteed interest, broad market index fund if you want more risk and a higher potential upside.

US t-bills are around 5% now, which is really good.
If you want more risk I'd go a split between EQQQ (nasdaq 100 index) and MEUD (euro stoxx 600 index).

 

[hktm]

@teressap1 Have you checked Raisin? It’s a good option if it is available in your country.

 

[jeremymikeg]

@teressap1 Be ballsy, put it in Bitcoin, wait 4 years, thank me later.

 

[oliverab]

@teressap1 Sounds right. Anything else could go up or down in value.

Just remember that banks has a deposit guarantee up to 100K.