Where do you park your RE Money stash to min. Inflation?

Where do you park your RE Money stash to min. Inflation?

Reston, VA · Member since 2014 · 74 posts · 24 votes

Hi All,

I've begun buying RE properties with my business partner, but I really don't know what to do with my "Stash" of RE Investing funds that I save as I'm waiting for it to accumulate enough for another down payment on a property. I am worried about inflation, the last couple of years I've just parked it in my savings account, which is obviously just losing buying power year after year due to inflation.

What do other investors do to minimize the damage of inflation to their money? Do investors park their money in some magical savings account with a decent interest rate that I am unaware of? Because I can't seem to find anything that comes close to beating or at least keeping even with the assumed average 3% inflation.  Are you investing your Stash into index funds and later pulling it out when you are ready to pull the trigger on a RE deal? Please enlighten me. I don't want to keep putting money into a savings account that is losing buying power year after year. My annual income is only $57,200K (Pre tax) so I'm only able to buy one property a year, at the very best of situations so my money sits in my savings account for fairly long times.

Thanks for any input and advice ahead of time.

0Reply
21 views

4 Replies

Jump to latestLatest
  • Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
    8y
    Aaron Hall what do you define as a long time? For investing purposes it’s likely not that long. A rule of thumb is not to stick money you think you’ll need soon In the stock market. Soon is defined as 5 years or less. So assuming that’s the case your best bet will be high yield savings account (ally bank is around 1.75 percent I think) or a money market account
  • Reston, VA · Member since 2014 · 74 posts · 24 votes
    8y

    @Caleb Heimsoth Thank you for your timely reply. Well, in my situation I guess my defined long time would depend on my partner. If my partner passes on an investment and I have to pay the full downpayment(going into the property solo) , my money could be sitting around for 2,3, even 4years possibly because my savings rate is less than impressive. If I am investing with a partner, I would probably not have my saved up RE money sitting around in a savings account for more than year tops.

    I will give ally bank and some money market accounts a look so thanks for that heads up. I'm just trying to minimize the loss of buying power as much as possible while I'm saving up over time for more RE deals.

  • Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
    8y

    well if you do dump it into an index fund make sure it’s heavily bonds.  

  • Reston, VA · Member since 2014 · 74 posts · 24 votes
    8y

    I'll probably stick to your advice with high yield savings account or money market type accounts to be honest. This should at least minimize the damage while my savings are sitting around.

Join the conversationCreate a free account to reply, vote on answers and follow this thread.