Hi all - I’m happy to say my relationship is going well, and in the next few years we will likely be looking to purchase a home together in a more desirable location. I’d like to start putting money aside for that eventuality, and need some advice.

Background:

I make 105 + potential for 10% bonus (assume closer to 5), have about

130k in home and auto loans

Z-estimate for home (best I have) is currently 260k.

146k in investments, but only about 6k in taxable, most is 401k and Roth.

28k in bank accounts/ rainy day fund

She makes around 74k, with a teachers pension. Not much saved, but no real debt either.

We’re both in our mid 30s.

The areas we are looking are closer to downtown, with homes ranging from 300-550k for what we want.

Mostly I’m looking to see how best I can save/invest in a way that will keep my money free to pull out when the need arises, but doesn’t waste the potential growth in the next year or two.

Happy to provide any other details that might be pertinent.

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omdongi t1_j6is84y wrote on January 30, 2023 at 5:09 PM

#1,619,139

2 to 3 years is not a long period of time. While market returns can be higher over long periods of time we're definitely in a very volatile economy right now.

You could try some CD laddering and HYSAs while the rates are at an all time high. The key thing is to diversify your investments while reducing risk. Your down payment needs to be quickly accessible if you find a house that you want to buy.

Government bonds are also a very safe investment and with the rates at a very high peak, you can buy up some bonds and sell them off at a profit when the rates return to lower values

Pronoia4 OP t1_j6iu1ys wrote on January 30, 2023 at 5:20 PM

#1,619,554

Replying to omdongi (#1,619,139)

I’ll have to take a look at bonds - that’s not a place I’ve invested before.

o2msc t1_j6j032p wrote on January 30, 2023 at 5:57 PM

#1,620,947

You have a household income of $175,000 and already have over $100,000 in equity from your current home to put down on a new place. You could easily afford the houses in the price range you are looking at now. Where’s your money going? A $400,000 house with 100k down would leave a mortgage payment of roughly $2,000. On your income that is extremely affordable. So where’s your money going? Lol

Pronoia4 OP t1_j6j1q50 wrote on January 30, 2023 at 6:08 PM

#1,621,350

Replying to o2msc (#1,620,947)

Nowhere. But I’m planning so it’s as easy as it can be. I’m about where I expect to get in my career. An extra 100k out is essentially a year of my working life gone. I’m absolutely prepared to spend what makes sense and live a good life, but I don’t want to be stupid about it.

Plus, with interest rates where they are, the smaller the loan has to be the more we save over time. I’d just like to be responsible so when that dream home comes up we’re in the best position we can be.

o2msc t1_j6j33a0 wrote on January 30, 2023 at 6:16 PM

#1,621,666

Replying to Pronoia4 (#1,621,350)

That’s the point I’m trying to make. You are in the best position right now. If your dream home is 400-500k you can afford it now on your income with your current home equity.