Author Topic: Fixed Dollar Option in 401k for downpayment savings?  (Read 364 times)

retireatbirth

  • Bristles
  • ***
  • Posts: 260
Fixed Dollar Option in 401k for downpayment savings?
« on: January 12, 2019, 10:08:45 PM »
I'm considering buying a house in a year or two and currently I'm heavily invested in stocks with only about $20k in cash/bonds. I expect a downpayment to be about $80k. I just noticed my old 401k has a Fixed Dollar option that would pay a guaranteed 4.5%. The only yellow flag in researching this fund was that I could potentially be restricted from selling out of it if I were to move money into it. Is this a good option for downpayment savings? Seems better return than most other conservative investments.

In case you're wondering, I would plan to access my downpayment by selling the Fixed Dollar back into Index Funds in the 401k and selling the Index Funds for cash in my taxable account to net rebalance.

Is this Fixed Dollar a good option?