Quote:
Originally Posted by 84porsche
To answer some of the questions.
Age? 28
Married/single? Single
Self employed/ employee? Employee
Do you have 6 month cash reserve in case of job loss on top of a downpayment?
This would likely go into the house.
Current rent and living costs? Current costs - $1400 a month
Future plans, relocation, wife, kids, retirement? Would like all of the above except relocation but not near those yet.
Down payment.
I have about a 10% down on $350K home that I could put together.
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OK, good data answers. First, does your employer have a 401K with "matching" offering? If so, put the maximum you can in it to obtain the full matching offered by your employer. See below to pick the investment options to have in your 401K plan, just pick the best your employer offers.
If you haven't a wife or children then why hurry with the house? What is your monthly living expenses? Now subtract anything you don't really need (Starbucks, cable, etc. in case your job goes tits up) and keep 6 months of emergency living expenses in a good Money Market account.
Invest all the rest you can save in the Market. At your age, I would do 50% in stock index funds. I would do 30% in small cap and emerging market index funds. And I would place the final 20% in a high grade bond index fund. Go to Morningstar to research the performance of these mutual funds and pick the best in terms of long term success and low operational fees. Then sit back and enjoy the ride. Depending on your ability and discipline to save, in 10 years you'll have far more in money than any house will bring you. If you marry or have children you can always scale back the amount you are adding to your investments each month (You will not be able to do this with a house and mortage!). By the time you are 38 you will have far more options as to what you can do (buy a house, travel, change carrers, get a family going, etc) than doing it the other way.