Updated 4 months ago on . Most recent reply
Saving up for House Hacking
Hi everyone! I am working on saving up for my first house hack. I am passionate about stock investing. Nothing crazy, I just love putting money into the S&P 500 and strong growth stocks. My question is, should I be saving up for a house hack in a HYSA, or is it okay to have my money grow in a taxable brokerage, and when it's time to close my first deal, I can take that money out? Thanks!
Most Popular Reply
Hi Anthony,
It’s great that you’re building toward your first house hack and already have a disciplined investment mindset. When it comes to saving for a near-term goal like a home purchase, the key factor is capital preservation. While investing in the S&P 500 or strong growth stocks can offer higher returns over time, the market is volatile and there's no guarantee your funds will be available at full value when you're ready to close on a property. A High-Yield Savings Account (HYSA), though it offers modest returns, keeps your principal safe and readily accessible. A balanced approach might work well: keep the bulk of your house hack savings in a HYSA or short-term bond fund to ensure it’s secure, and only invest a portion in your brokerage if you're comfortable with the risk of short-term fluctuations. Timing matters—if you’re planning to buy within the next 12–24 months, prioritize stability over growth. If your timeline is more flexible and you can delay the purchase if the market dips, then investing a portion might be reasonable. Just make sure you have a clear exit plan and aren’t forced to sell investments at a loss when it's time to close.
Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.
It’s great that you’re building toward your first house hack and already have a disciplined investment mindset. When it comes to saving for a near-term goal like a home purchase, the key factor is capital preservation. While investing in the S&P 500 or strong growth stocks can offer higher returns over time, the market is volatile and there's no guarantee your funds will be available at full value when you're ready to close on a property. A High-Yield Savings Account (HYSA), though it offers modest returns, keeps your principal safe and readily accessible. A balanced approach might work well: keep the bulk of your house hack savings in a HYSA or short-term bond fund to ensure it’s secure, and only invest a portion in your brokerage if you're comfortable with the risk of short-term fluctuations. Timing matters—if you’re planning to buy within the next 12–24 months, prioritize stability over growth. If your timeline is more flexible and you can delay the purchase if the market dips, then investing a portion might be reasonable. Just make sure you have a clear exit plan and aren’t forced to sell investments at a loss when it's time to close.
Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.