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I'm assuming his savings goal comes through he would have $190k in checking/saving for the down payment by summer 2022. For a $500k home that's more than enough needed, 20% is great, I know people that have bought homes on 3%. So I think the proper move is (assuming there's no >10% inflation and housing prices also don't go up by 10% in 2022) is keep $100k + 6 month emergency fund in a checking account and invest the rest in an index fund. Just my $0.02
Hybrid is exactly what I've been doing. Built up almost six figures in savings, switched over to mutual funds since. Thought I was going to be in the housing market this year, then covid sent everything into insaneland so I'll sit on the fence and invest until the madness subsides. Good strategies, Marko.
Great points Marko! In a similar position. Stinks that liquid cash gets eaten up by inflation but when we need money for a house rather have everything be stable 👍
I will say that my experience with investing in CDs has been great up until this year. I physically checked the rates at credit unions and banks. I had rates at 5% for 1yr when inflation was 2 to 3 %, and just last year I got a 3% with a $60 bonus and a 4%, but since inflation I have lost money by it sitting there.
Super safe but let’s say you were invested and the market went down…looking at 1-1 1/2 down… but during that time you are DCAing and when it goes back up you will have a lot more….if anything…50% invested and 50% in savings
I bought a house in April … with $TSLA stock. I would have been stupid if I had the money parked in a savings account. Savings is only good for emergencies.
What about putting that money in a real-estate based ETF? Your money is tied to real estate prices, so if prices go up then so does your investment and you still have a good percentage of a down payment. If the ETF goes down, then you're fine because your house will also be cheaper
Marko, have you done a video recently on the pros and cons of renting vs owning in this type of market? I’m in California and don’t see the benefit of owning a house here, as we are currently in a massive bubble. Thanks!
Thanks for the insight Marko! I'd also like a video on this topic. I'm in Georgia and I'm also on a 1 year horizon to purchase a a home. But, I have some flexibility.
Two omissions on stock market. First is that if one places a STOP on SPY such as 4% moving stop, then one protects 96% of portfolio. Second is selling short on SPY during correction if a super way to make money. More than an up market. Marko did an excellent job overall. As a side note, suppose the stock market tanked , well so will home prices so purchasing power for home purchase remains good. I use real estate and stock market and avoid keeping cash at all.
@Roberto Vidal Garcia No one knows the future. That is why you place a stop to sell xyz number of SPY as a GTC order in the blind. It consumes some margin but not that much. In my case at level 3, I use e minus or symbol ES on futures. Today I offset my stock losses by around $2000 before closing the position.. Never wait, act immediately. I hope this helps.
My recommendation would be, (what I tell my nephews and nieces) plan for 10% for the down, 10% in a liquid savings account, (even CD) as safety net in case you go through a forced job change, and at least 10% in a Post-Tax brokerage account, (not IRA or 401K) invested in something along the lines of total stock market. 10% is enough to get you financed with PMI. Lenders look highly on having the liquid assets. Plus, puts you in a position to put the house up as a rental if you are so motivated to have a few rental properties. (Did that once, have no desire to be a landlord again, not worth it)
I'm in the same boat. However, I'm scared to lose thousands a year due to inflation in my savings account, but also don't want to lose money from my brokerage account due to a downturn in the market. Damned if do, damned if i don't.
When you withdraw from your index fund, are you subject to high tax/capital gains? Would that negate a lot of the investment or is this not a problem when using that money for a property?
I doubt the taxes you owe Uncle Sam from a profitable investment sale just disappear. You'd need to set aside money from the profit to cover those taxes when you end up filing.
I have 3 months of savings in a 'high yield' bank account and 3 months in a short term corporate bond index. It's doubtful I'll need 6 months savings, but if I do I won't have lost much if any principle and the upside is a lot better on those bonds even with gradually increasing interest rates. I definitely would skip longer term bonds though! If I had 3-5 years, I would invest in a short term bond fund, treasuries if you're skittish, ST corporate bonds if you want the potential for decent yields (around 3%).
What does everyone think about a tips etf? The fed governor was on CNBC recently and he mentioned inflation protected tips as an option for saving your money?
Currently wondering similar for myself. Thank you for taking the time to go through the options. I agree on the investing a percentage simply because that growth could mean I could purchase even sooner (right now looking at 4+ years considering current CA prices). Thank you again 🙏
5:12 "month over month". No, over a year. You could've been more clear to say that these percentages are year normalized. It would be something like 0.4% by month.
Depending on when you plan on buying, Stocks and Bonds for 5+ years, CD for no longer than 3 years, high interest savings account for 1 year. DOGE for YOLO.
Next time you are in front of the white board can you dress up like Bob Ross? But seriously, thanks for going over the options. It seems related to where to store an Emergency fund
Hey Marco great work on this video. I know its hard timing the market and most investors fail, what do most experience investors like a Warren Buffet or a Marco do, continue to dollar cost average and leave the bulk of the investment in the market or pull out and wait. Keep up the great work I wish you loads of success. (Polo :)
TLDR: Not CDS (your money is locked away), Not Index Funds (market fluctuates and is too volatile short term)....... SAVE IN A HYSA (safe and can be pulled at any time)
Thank u Marko I love your insights with economical and statistics data to back for being an intelligent investor waiting on you opening up a stock market investor course for short term long term and options trading so using data analysis can trade better menus the market manipulation by wall street boys, hedge funds and wallstreetbets revolting in response
I’m saving for a house now. Just finished paying off all my debt! Yay. I’m putting 15% of gross income into retirement ($18k for me), most of that is in a brokerage and the rest is in a Roth. Once I’m able to open a 401k at work I will. Since my house fund is starting at 0, should I just put $2k into index funds each month and hope it grows while I’m saving or should I keep it in cash? Im thinking of doing 5-10% down so I can get in earlier and then aggressively pay it off. Other option is to just throw it all in index funds and then sell when I’m ready to buy. I don’t know exactly where I’ll live and I move a lot.
Also saving up for a house here. My citi High Yield Savings is giving back such a low percentage, I'm worried about how much I'm losing due to inflation . If we're flexible about our time line (ideally move within the year but it may be longer if the housing bubble doesn't burst) what's your opinion on buying an I-bond, the yearly max of 10 k? To at least curb some of that inflation sting?
Hey Marco, I see it differently … The 1500 bucks a month they pay in rent will cover a 350k mortgage at 3% on a 30 year amortization. A Conservative 4% rise in housing prices will make the cost of a 450k house go up by 18k in a year. So they’d have to earn 15% after tax on their 120k cash just to stay even. Buy now.
So out everything in high yelled savings and lose out to inflation or gamble my money in the stock market and possibly lose out to a down turn in the economy. Both sound like amazing options. I’m going to go cry myself to sleep now.
Theres always stablecoin yields which are better than “high yield” savings accounts. I wont trust block fi with my bitcoin. But leaving stablecoins like usdc with them or a few other exchanges seems like a better idea than the bank. “Imagine losing 56%” sounds like weekend in crypto.
@Marko - Where would you put your rainy day fund in? On one hand you want it to be liquid, but you don't really know when you will be using it, hopefully never. My thought is ideally in a place where you are beating inflation but also exposure to downturn won't wreck you.
IMO your emergency fund MUST be in savings, cash, or cash equivalents. You're going to need that money at the same time the market tanks, and you don't want to be forced to sell stocks at the same time the prices are low. Losing money to inflation is just the cost of having that insurance
first off, you DON'T need "a big down payment". First house should be a FHA loan, which is about 4%. Secondly, August 2021 is a TERRIBLE time to buy a home. We are at all time highs. NEVER buy a house at all time highs. Wait for the good deals and the foreclosures. It WILL cool off soon, I promise you. Rather than focusing on a house, focus on your retirement. Max out ROTH IRA ($6000 per year, per adult). Max out your 401k. And lastly, you can have a brokerage like E-trade, and invest in ETS like SP500 funds. Again you DON'T need a house right now, what you need is strong investing for financial future. Get 3 people and rent a damn house. Now is NOT the time to buy.
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I'm assuming his savings goal comes through he would have $190k in checking/saving for the down payment by summer 2022. For a $500k home that's more than enough needed, 20% is great, I know people that have bought homes on 3%. So I think the proper move is (assuming there's no >10% inflation and housing prices also don't go up by 10% in 2022) is keep $100k + 6 month emergency fund in a checking account and invest the rest in an index fund. Just my $0.02
Investing on the right platform gives you the leverage to afford anything you want. I was able to buy my house within 6 months on investment.
How was that possible? can you also guide me ? i have been saving for a long time.
Contact Tamara Diane Hagan for guidance. Look her up on the web.
Thank you. Found her website already.
@Roberto Vidal Garcia Keep sleeping while people make money.
These videos continue to get better and better. The videos that have practical implications for us “regular” folk are just awesome
Glad you like them!
Should just buy the house now is my advice
They have 120k, why haven’t they bought the house already? That’s 20%+ right there.
Seems like they’re trying to avoid a large loan.
They might want to borrow less (mortgage)
Right?! What do they want to buy … a mansion?
probably they are really risk averse.
@@randomdaveUK my girlfriends client just lost a house after putting 25k over. They need to hurry. Houses aren’t being built fast enough
This couple is in a very good spot saving wise. I'm 28 and married, and won't have nearly as much saved for a house when I hit 36.
If the government taught me anything, its that I dont need to save. Just find the nearest copy machine and print as much dollars as possible
You forget....the Gov't prefers people who don't pay their rent....or college loans.....or have kids they can't take care of.
Or purposely live on welfare programs and never try to better your situation.
Hybrid is exactly what I've been doing. Built up almost six figures in savings, switched over to mutual funds since. Thought I was going to be in the housing market this year, then covid sent everything into insaneland so I'll sit on the fence and invest until the madness subsides. Good strategies, Marko.
Which mutual funds? Hopefully they don’t have any load fees and low management fees.
Great points Marko! In a similar position. Stinks that liquid cash gets eaten up by inflation but when we need money for a house rather have everything be stable 👍
I will say that my experience with investing in CDs has been great up until this year. I physically checked the rates at credit unions and banks. I had rates at 5% for 1yr when inflation was 2 to 3 %, and just last year I got a 3% with a $60 bonus and a 4%, but since inflation I have lost money by it sitting there.
Less than 5 years, keep in savings account. You'll lose to inflation but won't risk a market downturn.
Super safe but let’s say you were invested and the market went down…looking at 1-1 1/2 down… but during that time you are DCAing and when it goes back up you will have a lot more….if anything…50% invested and 50% in savings
you could keep it in REIT ETFs and mutual funds so it will follow the real estate market incase housing prices skyrocket
This. If the market crashes, you have the funds in your savings account to buy stocks at a good discount
bad advice, you should invest in bonds for short term goals, not savings account
This guy is a legend, thanks for the lessons!
you're a legend sir!
Always helping me master my money
I don't understand what this person is asking...They have the liquid cash/assets available to put 20% down on either a 450k or 500k house.
Great video! Buying a house next year! Thanks Marko. Happy seeing your TH-cam channel growing. Keep the work and blessing!
Hey, did you end up buying the house?
Buying the GME options at the end. The madman. LOL
The cerveza sickness 😂 that was slick. I picked up on that 🤣🤣🤣
I would like to see this subject addressed as investing "time horizon." It would take care of house buying and other large future purchases.
Cerveza sickness....smooth lol
I bought a house in April … with $TSLA stock. I would have been stupid if I had the money parked in a savings account. Savings is only good for emergencies.
What about putting that money in a real-estate based ETF? Your money is tied to real estate prices, so if prices go up then so does your investment and you still have a good percentage of a down payment. If the ETF goes down, then you're fine because your house will also be cheaper
Where to save money for a house? Meme stonks, huge upside potential with limited volatility
Meme Stonks?
💎👐
Legit made a good amount doing this but it's risky
Marko, have you done a video recently on the pros and cons of renting vs owning in this type of market? I’m in California and don’t see the benefit of owning a house here, as we are currently in a massive bubble. Thanks!
I'd love that!
Thanks for the insight Marko! I'd also like a video on this topic. I'm in Georgia and I'm also on a 1 year horizon to purchase a a home. But, I have some flexibility.
I second this!
This is almost the exact same question my wife and I have right now. Great video!
End of week options embrace the variance
Two omissions on stock market. First is that if one places a STOP on SPY such as 4% moving stop, then one protects 96% of portfolio. Second is selling short on SPY during correction if a super way to make money. More than an up market. Marko did an excellent job overall. As a side note, suppose the stock market tanked , well so will home prices so purchasing power for home purchase remains good. I use real estate and stock market and avoid keeping cash at all.
@Roberto Vidal Garcia No one knows the future. That is why you place a stop to sell xyz number of SPY as a GTC order in the blind. It consumes some margin but not that much. In my case at level 3, I use e minus or symbol ES on futures. Today I offset my stock losses by around $2000 before closing the position.. Never wait, act immediately. I hope this helps.
Thank you. This video reinforced to me that my husband and I are doing the right thing. Great insights too.
Totaly on board Marko. Next video next week
My recommendation would be, (what I tell my nephews and nieces) plan for 10% for the down, 10% in a liquid savings account, (even CD) as safety net in case you go through a forced job change, and at least 10% in a Post-Tax brokerage account, (not IRA or 401K) invested in something along the lines of total stock market. 10% is enough to get you financed with PMI. Lenders look highly on having the liquid assets. Plus, puts you in a position to put the house up as a rental if you are so motivated to have a few rental properties. (Did that once, have no desire to be a landlord again, not worth it)
What about TIPS or bond ETFs? Vanguard has both VTIP and BND
ALWAYS stay for the post credit Marko. 🤣🤣🤣 YOLO BAAAAAABY!!!
haha this is the way
Cerveza's sickness... 😂
I tried that ice bath thing and I am considering not taking anymore of your advice. :)
Did you experience shrinkflation. Just tell your girlfriend/wife it’s transitory
Cerveza Sickness 🤪
Because of this I’m going to buy more GME
My man, love your videos! Im in a similar situation.
Greets from Amsterdam!
Your videos are always helpful and informative!
I want to buy a house within next 2-4 years and I feel like stocks are overdue for a correction. Can’t risk it
I'm in the same boat. However, I'm scared to lose thousands a year due to inflation in my savings account, but also don't want to lose money from my brokerage account due to a downturn in the market. Damned if do, damned if i don't.
Dude that ending is so funny
Lol ty
$120k in savings hahaha i wish !!!
you should revisit that GME option in a few days and see whether it would have paid off or not 😂
Ayyy great (non) financial advice Marko!
Marko my man keep up the great content.
Big help! Thanks!
When you withdraw from your index fund, are you subject to high tax/capital gains? Would that negate a lot of the investment or is this not a problem when using that money for a property?
I doubt the taxes you owe Uncle Sam from a profitable investment sale just disappear. You'd need to set aside money from the profit to cover those taxes when you end up filing.
I have 3 months of savings in a 'high yield' bank account and 3 months in a short term corporate bond index. It's doubtful I'll need 6 months savings, but if I do I won't have lost much if any principle and the upside is a lot better on those bonds even with gradually increasing interest rates. I definitely would skip longer term bonds though! If I had 3-5 years, I would invest in a short term bond fund, treasuries if you're skittish, ST corporate bonds if you want the potential for decent yields (around 3%).
Very well said!! Thank you for sharing your thoughts!!
What if u invest in dividend etfs with a stop loss?
What does everyone think about a tips etf? The fed governor was on CNBC recently and he mentioned inflation protected tips as an option for saving your money?
Hmm sounds a lot like MEFO bills.
A big like for you Marko.
Currently wondering similar for myself. Thank you for taking the time to go through the options. I agree on the investing a percentage simply because that growth could mean I could purchase even sooner (right now looking at 4+ years considering current CA prices). Thank you again 🙏
would you consider making a video on option trading? I think there is a big market to teach beginners here.
Chrono Trigger on the outro
1000k like, that was me
Awesome video marko, thanks for sharing!
5:12 "month over month". No, over a year.
You could've been more clear to say that these percentages are year normalized. It would be something like 0.4% by month.
Super Marko 👍
What about an emergency fund for someone who has a family and is in a stable position with their employment?
Thanks Marko👍🏾
I prefer to hold my cash in $PFF. If you see the 5-year history, no change in price and gives monthly dividend payout with a yield of 4-5% average.
Depending on when you plan on buying, Stocks and Bonds for 5+ years, CD for no longer than 3 years, high interest savings account for 1 year. DOGE for YOLO.
Next time you are in front of the white board can you dress up like Bob Ross? But seriously, thanks for going over the options. It seems related to where to store an Emergency fund
LOL
Do it haha
Great advice Marko👍
Hey Marco great work on this video. I know its hard timing the market and most investors fail, what do most experience investors like a Warren Buffet or a Marco do, continue to dollar cost average and leave the bulk of the investment in the market or pull out and wait. Keep up the great work I wish you loads of success. (Polo :)
thank you valentino!
Thanks for the inputs Marco. Your vids get better and better.
Very helpful! Thank you!
TLDR: Not CDS (your money is locked away), Not Index Funds (market fluctuates and is too volatile short term)....... SAVE IN A HYSA (safe and can be pulled at any time)
Marko tried to save money by going to Supercuts last week.
Lol not in a million years sir
Thank u Marko I love your insights with economical and statistics data to back for being an intelligent investor waiting on you opening up a stock market investor course for short term long term and options trading so using data analysis can trade better menus the market manipulation by wall street boys, hedge funds and wallstreetbets revolting in response
There is no advantage at all by locking your money in a bank ….you get low return and their land your money with high interest
I’m saving for a house now. Just finished paying off all my debt! Yay. I’m putting 15% of gross income into retirement ($18k for me), most of that is in a brokerage and the rest is in a Roth. Once I’m able to open a 401k at work I will.
Since my house fund is starting at 0, should I just put $2k into index funds each month and hope it grows while I’m saving or should I keep it in cash? Im thinking of doing 5-10% down so I can get in earlier and then aggressively pay it off.
Other option is to just throw it all in index funds and then sell when I’m ready to buy. I don’t know exactly where I’ll live and I move a lot.
I bonds.
Great video and break down 👍🏼
Great video and breakdown Marko! Sending this to all my friends like always! #ChickenTendies
Also saving up for a house here. My citi High Yield Savings is giving back such a low percentage, I'm worried about how much I'm losing due to inflation . If we're flexible about our time line (ideally move within the year but it may be longer if the housing bubble doesn't burst) what's your opinion on buying an I-bond, the yearly max of 10 k? To at least curb some of that inflation sting?
Well watching these videos really puts it into perspective that, I am financially stupid.
Do we hold out hoping the spread on a market correction will beat all saving or investment yields or do we buy now if can
Hey Marco, I see it differently … The 1500 bucks a month they pay in rent will cover a 350k mortgage at 3% on a 30 year amortization. A Conservative 4% rise in housing prices will make the cost of a 450k house go up by 18k in a year. So they’d have to earn 15% after tax on their 120k cash just to stay even. Buy now.
Marko wearing a white hat like "Hello there fellow children"
So out everything in high yelled savings and lose out to inflation or gamble my money in the stock market and possibly lose out to a down turn in the economy. Both sound like amazing options. I’m going to go cry myself to sleep now.
Theres always stablecoin yields which are better than “high yield” savings accounts. I wont trust block fi with my bitcoin. But leaving stablecoins like usdc with them or a few other exchanges seems like a better idea than the bank.
“Imagine losing 56%” sounds like weekend in crypto.
what about a covered call ETF like NUSI?
Easy. Take 190k and Yolo it on GME and AMC. WHERE LAMBO?
That amount saved can almost allow them to purchase outright in certain areas.
Get me a family with a net pay of 45000
I’m in northeast Ohio. Do you consult people on a personal level in your office? Thanks
Thank you for sharing such an informative video. Do you have one related to or recommendations on HYSA?
@Marko - Where would you put your rainy day fund in? On one hand you want it to be liquid, but you don't really know when you will be using it, hopefully never. My thought is ideally in a place where you are beating inflation but also exposure to downturn won't wreck you.
IMO your emergency fund MUST be in savings, cash, or cash equivalents. You're going to need that money at the same time the market tanks, and you don't want to be forced to sell stocks at the same time the prices are low. Losing money to inflation is just the cost of having that insurance
I would say take all the equity you can out of your house and invest it .
What are your thoughts on municipal bond funds, to try to reduce risk but keep up with inflation?
Yo don't forget its not just a down payment those closing costs can be expensive af lol
1-3% of the price of the home…
Luckily mine were “only” 6k on a 780k home.
@@PodiumTuningRacing i paid 15k on a 250k home
@@bigeric8334 Seriously!!??
@@PodiumTuningRacing yea brother, my taxes almost doubled midway through the deal they jumped from 3600 to 7100
The answer is bitcoin
Marko, a couple years ago you were uninterested in buying a house. Has that changed in the last couple years?
Yeah bought last summer
@@WhiteBoardFinance nice, congrats man.
Ty
You look so refreshed after that ice bath and fancy breathing …..
I feel like a million dollars
@@WhiteBoardFinance 🤣
I learned a lot in this video
do an episode on what someone should do with 60k of student loans at 8.5% interest.
Happy to see Kripparian giving financial advice...
What about BlockFi’s GUSD that gives 9% APY
first off, you DON'T need "a big down payment". First house should be a FHA loan, which is about 4%. Secondly, August 2021 is a TERRIBLE time to buy a home. We are at all time highs. NEVER buy a house at all time highs. Wait for the good deals and the foreclosures. It WILL cool off soon, I promise you. Rather than focusing on a house, focus on your retirement. Max out ROTH IRA ($6000 per year, per adult). Max out your 401k. And lastly, you can have a brokerage like E-trade, and invest in ETS like SP500 funds. Again you DON'T need a house right now, what you need is strong investing for financial future. Get 3 people and rent a damn house. Now is NOT the time to buy.
Great content, shirt's a little tight