Had saved 500k for down payment but couldn't find...

Microsoft
richters

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tc:400k
richters
Dec 6, 2021 21 Comments

a decent and affordable house for the last 2 yrs. The money was in a wealthfront cash account earning a meager 0.1%. Had I invested this in the stock market it would've at least grown 46% (VTSAX). Wondering what I should do now. Invest it or keep it in savings and wait for the right house? If invest, what's a good option? VTSAX?
tc-400k

Edit: or should I payoff my current house. I’ve 350k left. Interest rate is 2.75%.

#housing

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TOP 21 Comments
  • Oracle
    NWiS07

    Go to company page Oracle

    NWiS07
    Redefine what’s “decent and affordable “ and buy the house. I feel you have been too picky.
    Dec 6, 2021 2
    • Microsoft
      richters

      Go to company page Microsoft

      BIO
      tc:400k
      richters
      OP
      It's complicated. Family believes in direction of the house, etc. So, it's really difficult to find one. Besides houses in san jose/cupertino in CUSD are literally shacks that go $300-$500k above asking price.
      Dec 6, 2021
    • Google
      hghk

      Go to company page Google

      hghk
      Why is the asking price relevant? What matters is what they go for?
      Dec 6, 2021
  • Google
    |IlI|

    Go to company page Google

    |IlI|
    You could DCA it over time. I wouldn’t drop it all at once on the market. Esp right now.
    Dec 6, 2021 0
  • Amazon
    RealBezos

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    RealBezos
    Investing all at once has always been a better strategy than investing slowly over time, time in the market is important rather than timing the market especially because you’ve already been sitting in cash for years
    Dec 6, 2021 7
    • McKinsey
      StayAtHome

      Go to company page McKinsey

      StayAtHome
      Thanks Google for the reference. I’ll read up more on this. I would say in order hedge against early growth or the erratic behavior of market later on, follow a similar strategy to what is followed by retirement funds. Your risk appetite lowers as you get closer to your retirement, and therefore keep rearranging your portfolio and move towards less risky investments as you get slower. It still doesn’t solve the issue of an early growth spurt but at least protects you against a later decline.
      Dec 6, 2021
    • McKinsey
      StayAtHome

      Go to company page McKinsey

      StayAtHome
      @suds thanks for explaining that. That makes sense, I agree with you and op on that. It still is risky in case you dump it at a record high, and miss out on potential gains in case of a future decline, that you could have achieved through DCA. I guess every approach has its pros and cons and you just have to figure out what works for you.
      Dec 6, 2021
  • New
    shyronnie

    New

    shyronnie
    I kept my down payment money invested until I got an offer accepted and only sold once I went into contract. It was probably kinda risky but it worked out and I didn’t miss out on any gains lol.
    Dec 6, 2021 1
  • Google
    hghk

    Go to company page Google

    hghk
    A friend of mine watched too many stock market videos and panicked and sold everything as they were dropping in the beginning of 2020. He was too sad to enter back in the market at higher prices after they rose to more than he sold. He even got into an argument with his wife about this. Eventually they bought a nice house in a nice area with the money very quickly. Good knows how much their house is appreciated in this crazy market.
    Dec 6, 2021 1