Saving for a house

[zeeshan030]

My husband (31) and I (30) have been in our starter home for a few years and want to start saving for our forever home with a goal to move in the next 5-8 years. Where is the best place to put this money as we start to save? A high yield savings account? Brokerage fund following the s&p or similar mutual funds? Something else?

 

[johndabaptist69]

@zeeshan030 HYSA. Keep the cash as liquid as possible. You never know what will happen. You could also look into CD ladders.

 

[someorder2]

@zeeshan030 If you want to keep it liquid, buying treasuries or funds like sgov or usfr will have better rates than hysas. FLOT has slightly more risk and is a good option.

 

[agonz91]

@zeeshan030 Be very sure that your “starter home” isn’t a good option for forever home. Every time you sell a house and buy another there are a ton of associated costs that are not recouped. Commissions, fees, inspections, time, and stress can really add up. Sometimes it’s a much better option to just upgrade the house you have to be more what you’re wishing you had.

 

[knittingwithlove]

@zeeshan030 Keeping it all, beyond an emergency fund, in a HYSA is not optimal for a 5-8 year span. Put it in a vanguard market index funds and let it do its thing (compound interest)… pull out what you need for the 20% down payment into a HYSA when things get serious. Like when you actually start touring houses…

 

[ladysparkle]

@zeeshan030 You will be almost 40. Do you really mean a starter home?