Should I Invest or Save More for a House?
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Iac is gona join us now and see the rapid I on isa cocoleu.

Yes, good. I want to say that I really appreciate a the great a lot of wisdom and guidance for some Young people like me and people that I was just looking for help.

Well, thank you for saying that we're glad you're here today. How can we help?

Yeah so I did you my situation. I'll ask my question at the ends um so i'm twenty four years old, i'm on baby step three b can I flash four? Um I don't learn to buy a house in the next eighteen twenty four a month. So currently i'm running and putting fifteen percent of my salary towards retirement right now i've got four percent in my h and a eleven percent towards my rough for a one kay um and so if you were in my shoes, would you recommend I continue to put that fifteen percent towards your retirement and then have a smaller count that towards a downpayment in the future? Or would you put IT either more towards the downpayment or even more than fifteen percent towards retirement since i'm not planning to buy in the next in the next year.

So when are you planning to buy? Like if you had your way, when would you want to buy public two.

two years now? okay. So I just .

reverse engineer IT. I'd if I want to buy, if I want to be sitting in the house two years from now, then i'd asked myself, okay, how much would that house cost? That way I can figure out what the dawn payment would be, and then I can work IT backwards.

And so, okay, let's pretend I need to put eighty thousand down. How long is gonna take me to get that? And if you run that math, you might find, okay, I do need to start now.

And something tells me, yeah, if you want to do IT comfortably and you might want to start now. And here's the thing, here's your options. You either start now when you do a mix of I do a little bit now you've done the calculator is okay. I'm going to put um five hundred dollars away every month towards this in the rest uh goes towards baby step for you might find you can do both. You might find that you can do the four fifteen percent and put aside .

I was thinking, can we dive in your numbers a little bit? I like what what is your take home? Yeah what .

you take just not to mention, uh, i've got the Randy solution uh calculator in front of me. How much can I have d pay per um i'm bringing in uh four thousand eight hundred a months and so that would allow me according according to that is to afford A A house that's in a range of about a one hundred and sixteen thousand um that top hundred a month for um for organ yeah before we get to .

that I want to stay on this line here. So forty eight hundred months you take home. How much margin do you have after you take care of all your necessities? Because we started off say, and i'm in three b four and i'm just curious what kind of margin you have after taking care of necessities?

Yes, just one hundred, thirteen hundred per month.

Is that including the fifteen percent to retirement? Or is that excluding oh, that I watch .

including the fifteen percent and then i've got that just over a thousand that's going towards my H E A and go unk.

okay. So okay, so you're putting around seven hundred and twenty dollars into investing, and then after that, you still have thirteen hundred. I just want to be clear.

IT. okay.

So I think, yeah.

I found me .

you doing both. How much when you do the calculator, how much does IT say your dawn payment needs to be .

downpayment is twenty three thousand .

three hundred? okay. And so then run IT back. What's divided by twenty four months?

Yeah, so and so I guess bingo maybe as a wrinkle, maybe doesn't right. I've got i've got thirty six thousand currently saved out, just kind of for in the future I I might be getting my might want have a wedding ring and that's .

not your three to six months expenses.

That is extra, extra correct. So that's three, six months of expenses.

Are you seeing anybody else? This just hypotheses .

ticals a is a little, a little story.

I kind like, no, I wanna know too. Okay, so let let's prioritize this.

Let's pretend we had to make a list of priorities because essentially that's what we're doing. First on the list is investing. That's a Green check. Next on the list is is in a house or is IT is the future misses Isaac?

Are you asking .

her saying I you, me the priorities because that lets me know if the thirty six thousand is up for grabs or if it's not.

In other words, are you buying a house for you or you just gonna wait until we get serious when ready to get married?

Yeah that A A bud of mind from church he has got a who to allowing me to rent for relatively cheap so currently I don't see a lot of reason to buy a house for myself um right now and so I kind of like this uh the thirty six thousand in a high taking account and fortunately, you are. And unfortunately, it's kind of just sitting there and getting born a half percent on growth.

That's that's fine. I think for you where you're at, you're definitely at less than a five year play. I think if you were like jane, this is more than five years out, i'd say go ahead and invest.

But I think it's a less than five year play. And if I were you, I do the priority. I keep investing. Number one, I keep the thirty six thousand exactly where it's said and you could label IT wifee wedding whatever life to be downpayment and then say, okay, i'm also going to save an additional twelve thousand dollars each year to put with that so that when the time comes, I can do engagement ring put towards the wedding and put towards the down payment.

Don't forget the honeymoon.

Well, let somebody else buy your hand as a gift, I think so. I think good question that .

would you ever recommend putting more than fifteen percent towards retirement at this point?

At this point? no. But later on, definitely the one question I had for you, I like, is I thought I heard you say when you told me the mix of what you're investing was that sounds like like you h putting more towards your hsc than your roth four one k and that that was a question mark for me. Why are you doing that if I understood correctly?

No, it's not that four percent towards my H S. A. That's the maximum that I can contribute to my H S A oka one percent to.

And yeah, my question is, are you why would you just max, the raf a one? K, first, because it's the Better investment vehicle, unless you have a health situation I .

don't know about. No, I get what I have heard. And H, S, A, you get triple taxi advantage and good that. I ouldn't max that out and then puts the other eleven percent of the fifteen percent towards my raw.

You do IT is tribal tax advantage. But all in all, if I were going to go in the order of best practice investing, I would max out the roth for a one cave first, simply because IT does IT is rough stat is and it's not, uh, just for medical situations. Now don't get me wrong, your H S A will convert at age sixty five to regular retirement.

But until then the truth is that would be IT would be uh caught up in medical expenses. So unless you were like A J trust me, I need this because I go to the doctor a lot or whatever I would do, uh, row for a one k first and then i'd go to routh array and then i'd go on h sa. Let that be my final option.

OK. So you go last four one. K, and a rough.

I ray, do you have? Do you have a match .

on your rough four one? K.

okay. yeah. I'd max that bad way out. Go to the rough. I A, and then i'd pride to the hc west. It's still a great vehicle. But for what you get and access to what I, i'd start with the others first.

Congrats, by the way. Yeah, man, I mean, listen, you ve got your act together. I mean, yeah, you really do.

And by the way, what I was saying, but I just wanted clarify that can i'm just happy you're investing, right? Like if you take that advice, you're if you don't, you'll be just fine. IT was just me splint here.

Yeah, he is so early in the game. And so whatever your romantic situation is, we're routine on the time line. But i'd love to stack in that money, to stack the money because eventually you need a house.

Yep, whoever the misses is or whatever you. And so love that you get the low cost for ant. Love that love your discipline.

Good job. Yeah, hope they cleared everything up for you in. But wow, it's going be waiting big.

Don't you wish we had done this earlier twenty three.

twenty four years of age? Or you kidding me, right? But alas, we're doing others.

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