Author Topic: Lower 401K Contribution to save for down payment on Rental Property  (Read 323 times)

ATLien_Si

  • 5 O'Clock Shadow
  • *
  • Posts: 13
  • Location: Atlanta
  • YOUR COMFORT ZONE IS A DANGEROUS PLACE
So i'm currently contributing 15% to my 401K (Not much I know). I receive a 100% match on the first 5% from my company. I really would like to invest in real estate, specifically rental properties. My question is, do you think it would be a good idea to drop my 401K contribution to 5% while I save for a down payment?

I don't currently own a home so HELOC is not an option. I want to avoid PMI, as that would make the property harder to cashflow and I would need to live in it for a year to qualify for FHA.

I live in Atlanta, GA so housing prices aren't crazy high like SF or NY

>I currently save $500-700 month
>I have $9k in emergency fund
>invested $6k in a house flip which is near completion and will return $12k

My emergency fund is high because i drive a company vehicle, so if anything were to happen with my job I would need to buy a vehicle. I know the stock market is in a downturn so its also a great opportunity to buy stock cheap.

Im 28 so I've got time to make some mistakes, but I would like to avoid them where possible.

any input would be welcomed, Let me know if you need more info