Car loan and savings and monies

[Hanakuso]

Thank you all for your suggestions! To add to my situation, i'm married and my wife has a 10 year student loan that has 0% interest. I believe it's $10,000 total. We'll just pay off her loan on time since I don't see a reason to pay it off fast.

To answer some questions, i'm planning on buying a house within 5-10 years from now. I live rent free right now taking care of my 93 year old grandma. Basically, as of right now I feel like for the next 10 years is when I can really save up a lot of money and I just want to do it the most effective way possible.

[Hanakuso]

Originally Posted by bakerr6

What is your timeline on buying the house? Depending on that would tell us what the best thing to invest in would be. Stay away from mmkt accounts and even if you get a cd that's paying 2-3% (I would never suggest to invest in one at these rates) you could still protect the money well.

Earliest would be 5 years from now but it could be 15 years from now if we really wanted to stretch that. I don't care where I live right now but when I have kids, i'll want to live in the better parts of town for schools. The average seems to be $500,000ish.

[bakerr6]

Originally Posted by Hanakuso

Earliest would be 5 years from now but it could be 15 years from now if we really wanted to stretch that. I don't care where I live right now but when I have kids, i'll want to live in the better parts of town for schools. The average seems to be $500,000ish.

You're going to need a large sum for a down payment then. Try to get in the area of 15-20% for a down payment to avoid PMI (this is subject to change in the future). Also, I would worry more at this time about accumulating money than looking at a house. Feel free to invest the funds, but not very aggressively. Once you hit 1-2 years out from when you will be looking for a house, move it into something more safe (probably nothing that you are required to tie it up for x amount of years).

Since this will be your first time home purchase, see if you can start investing in either a roth or trad ira. Roth will make more sense in most situations as you get tax free earnings and you would meet the 5 year aging period. There are certain income limitations.

If you want me to take a look at your situation and make some suggestions, send me a pm and I'll help you out on a broad planning perspective.

I would still suggest developing a relationship with a local planner in the future to really sort out which steps make the most sense.