Home owner in the distant Future

[ibanez19]

So i just purchased a my first car a little bit ago, for me it was a milestone that is followed with purchasing a home. I realistically don't plan to do this for a few years at least, but i was wondering if anyone had any advice on what i should try to save (after paying down ccs and 401k and other savings) to be able to be in the position to buy a house / condo in a few years.

Thanks!

[Seeker]

Actually a great deal of the answer is going to depend upon location. So, I'd advise you to look at the prices of condos/houses in the area that you would like to reside and plan for a downpayment of 20 to 30 percent of that purchase price.

Depending on income and expenses that are realistic in terms of YOUR current $'s to work with, then you'll need to prepare a budget to meet and or hopefully exceed those savings goals.

If you are single and young, then you may want to also consider working part-time for additional savings as well.

All depends on your specific situation and you're not really giving us any numbers to work with....

[disneysteve]

i was wondering if anyone had any advice on what i should try to save

Do you mean how much you should save? If so, you should have a 20% down payment, however much that works out to. You should also have an adequate emergency fund of at least 6-months of expenses. Keep in mind that your EF will need to be larger as a homeowner than as a renter since you will have additional costs to cover in an emergency.

[amarowsky]

I remember asking this question a coupla months ago when I first joined the Forum. Depending on how long your planning on saving you can gauge the risk of the investments your planning on investing in. The safest bet is usually with CD's, Bonds, Money market or High intrest savings accounts. If you are planning on buying this home in say 5 years or more, you could consider to put a portion of that money you plan to save into perhaps some more aggressive investments such as some conservative mutual funds or perhaps ETF's (so you dont have to have the higher income from the interest gained on the mutual funds that are not in a retirement vehicle). For the next several months if your interested you can get an excellent rate on the current I-bonds available at any bank (inflationary bonds) they are currently offering 0% fixed Rate and an APY of 4.8% which is not bad considering you can pull those out w/ a 3 month penalty at 6 months.

So if you have more time and are thinking about building it wealth a little faster and flexible on when you want to liquify your assets mutual funds/etfs are a possibility.

If you have a more firm date on when u want your house and cant risk any sort of fluxuation in your savings I would think savings, bonds, and CD's would be a good bet to grow that money steadily.

[jIM_Ohio]

Set aside 20% of your gross pay for financial independance. Put 15% into the 401k and put 5% into a short term savings account.

You will want to put 20% down on a house, then also have around 10k available to close and move in. You need to know the house price to know what 20% is.