What's the Best Way to Save for a Mortgage Downpayment? 

Same, but tought me a lot.

Same here!

Im curious, where do you live? Im from The Netherlands

@@xoxoJGWS India :)

Most of his advice works anywhere in the world.

I'm not waiting for 20%. Right now rates are so low my mortgage payment will cost significantly less than rent. It's a fixer upper, so it's low risk if the market takes a dive. Finally, there is a very strong rental market in my area.. it will cost me more to wait to avoid PMI than to just buy now.

@@ironmonkey1512 Different situation for different people... Both solid options.

Eric Anderson My parents didn’t like long mortgages and wanted early retirement. They paid off our home before I graduated to 9th grade. My parents explain this and started us saving/investing in 10th grade and to stay debt free. Because of this I had better options in my mid 20s paying cash on a small rental apartment and able to pay off my 30yr mortgage in 9 years while still saving,investing, and funding retirement through it all. Starting early is better. Only debt I ever had was 9 year mortgage.

Unfortunately 10% mortgages are a thing of the past in the UK need 20-25% minimum plus closing costs

This is the world we live in now, where personal financial planning must account for the possibility of once-in-a-century pandemics.

Thats insanely expensive holy. Thats a big chunk down tho!

I’ve been trying to save 20% for a down payment but housing is rising 10% annually where I currently live while my salary only raises 3-5% annually. At this point my only option is to move somewhere else if I want to own a home but I worry about the lack of job opportunities in a smaller city should something happen to my current job.

Just out of curiosity.. why would you pay that much for a townhouse and not a separated single family home? I think I'd lose my mind if I heard someone next door that wasn't my family after that $540k purchase

Best decision I made was starting my own small business! It’s really tough to make it nowadays

xPeonyx single family home automatically about 800,000 around here 3bed 3bath. Anything nice is 1,000,000 or much more all day long

How much did you invest in the s&p

This is awesome! How long was your money in the fund?

Investors make up the top notch hemisphere of the wealthy. That's the more reason why one should save and invest to secure profit and ensure success..🎲..

@@cryptooracle6084 you're right 👍

Well said, you have a wise point on that. But what exactly do we invest in I'd be happy if you give me a some ideas and give them a try

I understand your concerns, my friend. I recommend exploring passive index fund investing and expanding your knowledge in this area. Personally, I experienced both successes and challenges when initially seeking a reliable passive income......,

how do I get in touch with this consultant that assist??>>>>

STEPHANIE KOPP MEEKS, that's whom i work with look her

Thanks for these recommendations.....,,,

Because I just heard said "through one of his investors"

No brokerage account endorses Mr. Ramsey. Hence he wants people to utilize his sponsors.

@@entitykeeper8869 exactly 💯

In the UK you can get an ETF directly.

@Atty. Johnny Sins Personal Finance every time I see a comment of yours it has to be negative?

@Atty. Johnny Sins Personal Finance No one is necessarily "dragging" the other, maybe she means they Both worked but one banked to their income so they could have a downpayment ready so quickly

@Atty. Johnny Sins Personal Finance so a husband and wife agreeing is bad? Working together is bad? You must be a divorce attorney.

Kara Ayers lol you don’t recognize the photo 😂😂😂😂. Do me a favor and google the name 😂😂. I’d bet your BF/husband does

@Atty. Johnny Sins Personal Finance That's an interesting comment. So a stay at home Mom or Dad that is looking after several kids, doing the laundry, paying the bills, running errands etc is not pulling their weight? Seems like your assuming that the someone without pulling in an income is lazy without having all the facts

Yupe for years and eat ramen

no it does not work

And pay 30% in taxes prior to saving? Smh

@Atty. Johnny Sins Personal Finance vs.racking up a bunch of debt to be in the "middle class"? At least your honest with the shed from home depot.

@Atty. Johnny Sins Personal Finance some people dont wanna be housepoor.

@Atty. Johnny Sins Personal Finance do you not understand logic?

That’s what confused me

How's it going?

@@kbanghart still finishing college but looking and saving

​@@gabrielh7517 who says you "should" be doing anything? Buy a house if/when you can.

That was a good episode. I agree

I would lean more towards a 3:1(75% in money market account and 25% in mutual funds) approach to be a little safer especially for a 5 year plan, but agree about allocating it between the two

so, lower than inflation and much lower than housing prices are growing. NICE

Inflation is %15

@@ashtonojr I-bonds at 9.6-ish percent right? And what’s inflation 15% on, new cars? 🤡

early 30s

@Sir We Are About to Die Yeah dividend are good place to save right now

@Atty. Johnny Sins Personal Finance Thanks. I will

Credit cards don't make money. Homes go up in value they are investments credit cards are debt.

@@teamtakeover7317 That's a lie. Homes only go up an average of 2% per year. Look at Khan Academy's videos on the subject. Homes go down during a recession. In the end buying a house is a *lifestyle* choice because what you make in your "investment" you give up for in sleepless nights over paying for insurance, property tax, HOA fees, and maintenance costs. If you want to buy a house you buy for it in cash. Period. If you can't afford it, you rent. Period.

Homes go up in value far more than 2% in many areas. Homes are a hedge against inflation. You don’t lose much value as interest rates are low, the interest is deductible, and money goes back into principal. Imagine renting a home in a good location for the same monthly rate that people were paying 20 years ago. That’s buying. (Even though Dave recommends 15 year fixed).

@@ret4kind Homes go up in value much more than 2% at least in the areas I have lived in. If I bought a house 10 years ago it would be more than twice the value.

​@@ret4kindbuddy, who tf has $350k in cash just lying around? 😂

He probably spoke too fast...you buy funds through brokerage account.

@Sir We Are About to Die with a Roth you could only take out the money you’ve put in, and not the gains.

@Sir We Are About to Die I get that and have an IRA, but what does that have to do with saving for a house quickly, lol. With that logic, you can put $6000/y in your savings account and pull it out in your 30s and the $6k a year in your savings account would have atleast included interest so it would be a greater amount than the amount you are pulling out of your Roth IRA. What you said is not baby step 3B, lol. Please keep in mind this video is about saving for a down payment fir a house quickly, and please keep in mind the rules for investing is if you need the money in less than 5 years you save (I.E savings accounts, money market accounts, etc.) and more than 5 years you in vest (I.E. 401K or IRAs). Now it came up that you can invest in mutual funds to save for a house, but he said don’t use a brokerage account to do it. This is where I am confused and where my question came from. How else can some invest in mutual funds to use for a down payment on a house without using a brokerage account, because you can’t use an IRA fir that. Please pay attention before responding, lol.

@Sir We Are About to Die so you’re saying putting the $6K/Y in a Roth IRA for 5 years and then pulling the $30K out would grow faster than $6/Y in a savings or money market account for 5 years because of taxes? With that logic you might as well put the $6K/Y under your mattress. Can some fact check this please?

I'm in the same boat. I just finished this week saving up for school for the next 2 years, and 6 month EF. Thinking I max out my Roth IRA by December, and afterwards try to save up for a house. Bc the Roth can accumulate interest for retirement while Im in school. But hard to decide Roth or house, but take too long to do both at same time 😕

Always do the retirement accounts because of the time in the market. Your saving accounts will only be slowed by few months the most anyways.

I probably wouldn't invest anything. Stay out of debt and just save up the cash to build a home of your own. The market is extremely volatile and you never know what it will do. You might get a 7% return on the money if your lucky but honestly that's not enough to fool with. There's something about cash, real cash in you hand that really brings a since of power. If I you save up some serious cash then you can build a home of your own and become totally self reliant. No debt with a paid for home, that's seriously cool place to be. This way you don't have to depend on anyone. Cash is certain, the market is not.

I’m in the same boat as you! I think Dave would say to put retirement on hold if you can have a down payment ready in under 2 years, but he also operates under the mindset that you won’t be retiring earlier than a traditional retirement age. Personally, I’m partially funding my Roth IRA and slowing the capital accumulation for my down-payment because my renting situation is VERY affordable in the Midwest (1/3 of a friend’s mortgage), and I don’t “need” a house as a single guy. It’s ultimately dependent on your goals. Compound interest in the market is always a good thing, but if you plan to retire at 60 and want the house ASAP it might be worth getting laser intense for a short period of time. The math would say keep a small percentage going into the market. Dave’s website has a good article on baby step “3b” if you want more info on his opinion... and he’s certainly wealthier than me so his advice maybe more valuable.

Also make sure you have a fully funded emergency fund prior to saving a down-payment. It’s tempting to do those two steps out of order but Murphy’s Law will get you if you’re not patient

Look into cds

Yes it is, but the market can only go lower before going back up right? then I am on the right track by investing right now, although I am inexperienced, i am learning fast.

I wonder what the best opportunities to invest now are, there are opinions but a little later I find out these opinions dont matter as a totally different turn of events play out with the stocks they discussed therein.

what route did you take? how can one invest in the face of the pandemic? help. sounds like you got something going for you. I am new at investing and really want in

Dont just venture into the market in these times without consulting a professional. I began through the guidance of a financial consultant and within 2 years, I own 2homes in the United states and car dealership all with an investment capital of $150,000 so it is best to invest with the help of an expert

Everything you said sounds pretty apt. I need some advice. please who is your financial consultant and how can i get in touch?

But with FHA, don’t you always have to pay PMI

@@k.c.andrade4954 So what it's like 90 dollars a month you get to keep 50,000 and still have a low monthly payment because of the 2.5 interest rate.

@@k.c.andrade4954 Cash is King

90 dollars a month for PMI? What are you buying, a $100k house. It’s roughly 90 dollars per 100k, per month. Average price for a house is 400k, about $400 a month wasted to pay for PMI. Almost 5k to PMI a year. Depending on how long it takes to reach your 20% you could be spending way more paying your PMI.

They spend years saving up 3% of the house? Pretty sure they can’t afford it

Pancake Pancake not everyone puts 3% down. In California 20% could be 150-200k. Typically that can take people a couple years to save.

by getting a really bad interest rate with FHA

DurpenHeimer I see

@@jamesstahl my comment was half trolling, but srs, if you're looking to get a mortgage without a credit score, you NEED to start building your credit ASAP otherwise you'll be paying thousands of dollars on high interest for no reason. grab a secured, no-fee discover card, use it on a small purchase once a month (like a netflix subscription or a mcdonalds meal), get your autopay set up for the card (you HAVE to pay it off each month to build credit), and sit on it for a year or two. your credit should boost into good ranges for virtually no work.

DurpenHeimer Thank you

It still makes sense to pay down the mortgage since you are paying more interest on the loan than you are making in the checking. The checking interest is also taxable income, which essentially lowers the actual return. You can still strive to max out the checking account (I'm assuming it only pays 3% up to a certain dollar amount) and still pay down extra on the loan.

Joni Snyder Thanks. the interest on my checking is more. I do the standard deduction on my taxes.

@@ripvanwinkle4532. It depends on the amount of the mortgage and the amount in your bank account. For example, 2.25% of 300k is more money than 3% of 50k. You could also keep the "extra mortgage" payments in your checking account until they exceed the loan amount; then pay the mortgage off all at once. Or heck, even invest the extra payments for the next 5+ years and then use either the entire investment or just the dividends to pay extra toward the house (if you feel safe about tying up that money).

Money market is a savings account pretty much.

Snap I am in Birmingham UK no idea what a money market is either...

Money Market accounts are bank accounts. They usually earn a tiny interest rate (as opposed to checking accounts that usually earn 0% interest). A high yield savings account is similar - also earns a small interest rate

@@arthrodea Money market accounts are NOT bank accounts. They are investment accounts that invest in very short-term debt instruments. Unlike a bank account, the value of one share of a money market account, which is typically set as one dollar CAN AND HAS gone down.

@@DisabilityExams There must be a difference between a US money market and a Canadian money market. I had a money market account, but it was not an investment that could go up or down.

Vin Nayar right

Most of the same principles apply, not really much difference, mutual funds and etf's are available in the UK, just the taxation will be different

So stunning. So brave.

Depends on when you’re gonna buy a house. If you’re looking to buy a house within the next four years or so, it’s better to put it in a savings account so you don’t risk losing it in the stock market. If you don’t see yourself actually buying a house in the near future but you still want to start saving, you could consider investing the money as a way to grow your savings. Depends on your tolerance for risk.

@@angelac9694 yes I'm definitely looking to buy in the next 3 to 4 years. Thank you

It might have to do with a lot of factors. It could be their personal family circumstances, cost of living in their area, and so on. A tiny house in Boston can easily cost 500k. Rent is through the roof. It has only gotten worse over the years. Here, I think it would be a better idea to put those funds into a mortgage where you can build equity, rather than pay a high cost of rent and expenses and barely be able to save something every month in the process. As soon as you get enough of a down payment, it makes more sense to bust a move and get a mortgage. Also, depending on what they've been through, it's more peace of mind to be in your own home. No one wants to wait forever to achieve that. I speak from personal experience.

IvyOracle worse - NEGATIVE growth

Don’t act like a know it all when you don’t know anything.

IvyOracle investing it doesn’t mean growth either haha. And it’s such a small space of time.. savings account for me.

millsathn you’ll miss out on the opportunity to gain 8% per year and the chance to potentially lose 50% of your down payment when you’re ready to buy. /sarcasm

I am in the same boat as well. Started saving for a house. I’d preferably like to pay cash for it, but I have a dilemma between saving to pay cash or just saving for the 20%

Buy a house now (or anytime you find a good deal). Barring a RE crash, it will most likely be more expensive to buy in a few years and interest rates will likely be higher too. Use your $1100/mo to build equity in your property rather than your landlord's property. FYI: When getting approved for a loan, they might not be able to include your side hustle income depending on what it is and how long you have been doing it.

Lol, I didn't even notice. It's true...

I’m in the same situation as the caller, and I’m so glad that I came across your comment. My timeline is actually closer to to 4-5 years. What do you think I should do? What is a CD?

@@lmlmlmlm7627 don't listen to this guy. Look at S&P 500 history and make your own opinion based on that

@@eeeeeeeeeeeeeeeeeo thank you :)

yeah seems crazy. I'm in a similar boat, except single dad and looking at saving for the next 6 yerars. Im opening a high yield savings account that offers 2% APY. seems its best I can do or find. not sure I'll be able to afford a house with 15 year mortgage but doesnt hurt to try and see what I can find

@Brian Ross ig the logic is that 2% is much better than .60% which is what you might find from your regular brick and mortar chase bank savings account for example. However, I wonder how long it will be until the interest rates for these online savings accounts will go back up to 2%+, as it just continues to keep going down every few months. But all in all you're right. 2% isn't much but it's better than .6% and a safe, no risk way of generating some growth

This interests me can you expand on this,what is your evidence that shows this market correction in the next 3 years

@@cianosorio9017 LOL

nothing

The house you bought, yeah someone else will live in it. The investments you made, yeah well there not yours anymore.

Maybe you should move somewhere more affordable. I live in the Midwest and bought a 3/1 starter home for 62k. Ill have it paid off in 3 years total and save for another and turn this one into a rental

Z G thats not true, im single and make over 70k gross a year. My job does not require a degree or experience even though it would be preferable. Blue collar jobs with industrial companies such as Martin Marietta (where i work), 3M, Cargill, Koch etc pay substantial wages far above the national average household income that has two earners not one

If you never want to get ahead yes keep separate accounts so you’re never on the same page