Author Topic: Should $90k just sit there for 5 months??  (Read 1057 times)

mamabear18

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Should $90k just sit there for 5 months??
« on: August 24, 2020, 07:39:23 PM »
Looking forward to getting some advice :)

Have to pause the home search for 5 months due to the lease on my rental. Was planning to use about $50k for down payment + closing costs. The rest of it is supposed to be for emergency/home maintenance/furniture for new home.

It seems silly to just let $90k sit there in a savings account with capital one. Any suggestions on what to do with it for 5 months? Have been looking for a house since January and canít imagine we would fine one soon after the 5 months is up. Thanks!

Igelfreundin

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Re: Should $90k just sit there for 5 months??
« Reply #1 on: August 24, 2020, 07:51:22 PM »
I'd keep it in savings. Five months is not very long. I understand the urge to make it work for you but anything that earns will be too risky for your timeline.

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Mr. Green

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Re: Should $90k just sit there for 5 months??
« Reply #2 on: August 24, 2020, 10:13:12 PM »
I'd keep it in savings. Five months is not very long. I understand the urge to make it work for you but anything that earns will be too risky for your timeline.

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+1. You've got that money earmarked for a big purchase and don't want a part of it not being there. I know, it sucks. We've got a large chunk of money like that sitting idle for a property purchase as well but it's the only way to ensure I have all of it within the next year if we find something.

mamabear18

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Re: Should $90k just sit there for 5 months??
« Reply #3 on: August 24, 2020, 10:35:09 PM »
Thank you! I had a feeling you were going to say that. lol

Monerexia

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Re: Should $90k just sit there for 5 months??
« Reply #4 on: August 24, 2020, 10:44:11 PM »
Looking forward to getting some advice :)

Have to pause the home search for 5 months due to the lease on my rental. Was planning to use about $50k for down payment + closing costs. The rest of it is supposed to be for emergency/home maintenance/furniture for new home.

It seems silly to just let $90k sit there in a savings account with capital one. Any suggestions on what to do with it for 5 months? Have been looking for a house since January and canít imagine we would fine one soon after the 5 months is up. Thanks!

You can always go to doctor of credit and look up best bank account/savings account bonuses. Between Citi, Chase, US Bank, PNC, Discover and so forth you could prob make some good cash.

Dicey

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Re: Should $90k just sit there for 5 months??
« Reply #5 on: August 24, 2020, 11:48:44 PM »
You could also have a little fun and do bank account bonuses. You have to be organized, but the payoff is pretty good for the effort required. There are several threads, but this is the first one that came to mind. Remember, most of these are taxable, but if you do it right, you'll still come out way ahead.

https://forum.mrmoneymustache.com/journals/side-hustle-journal-bank-bonuses-churning-tradelines/

BTW, the world won't end if you don't get much in the way of interest for five short months. Do not take unnecessary risks.

omaji

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Re: Should $90k just sit there for 5 months??
« Reply #6 on: August 25, 2020, 01:06:34 AM »
I would definitely recommend keeping the down payment and closing costs in savings and not investing it anywhere. Like someone said, any place that'd give you short term returns is way too risky for you.

However you also mention that you are saving $40k for "emergency / home maintenance / furniture".

I'd separate emergency from the other two categories. What kind of emergencies are you expecting? Are you planning on waiving inspection contingencies that'd put you at risk of buying a house with major issues? Are properties in your areas typically old and thus more likely to have issues? How handy are you / capable you feel of dealing with some home maintenance on the cheap?

Depending on the answers to those and your overall risk tolerance (i.e. are you willing to delay buying furniture if liquidation is slow) I'd consider investing some of that $40k.

alcon835

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Re: Should $90k just sit there for 5 months??
« Reply #7 on: August 25, 2020, 11:04:45 AM »
Keep it in the 360 Performance Savings.

Not a ton of return, but it's the smartest move.

LifeHappens

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Re: Should $90k just sit there for 5 months??
« Reply #8 on: August 25, 2020, 11:47:57 AM »
I'll 3rd the suggestion to chase a few bank bonuses. With that much cash you could easily earn an extra $2000 without much effort.

mamabear18

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Re: Should $90k just sit there for 5 months??
« Reply #9 on: August 25, 2020, 02:44:39 PM »
Thanks everyone! didn't even think about that bank bonuses. thats a good idea lol

Omagi - the emergency money is in case of a layoff and we need extra money. like an emergency fund. It is also to be used in case of a medical emergency.  WE have a high deductible plan and need to make sure we have the out of pocket max saved.

not planning to waive contingencies.
to be honest, I don't think we can do much home maintenance since we have a 3 year old and a 6 year old. We are overwhelmed as it is - no help from anyone except the occasional babysitter. Anything extra on our plate and we might explode lol. 

what do you mean by "if liquidation is slow?"  I'm open to delaying furniture purchase....would love to hear what you are thinking.

omaji

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Re: Should $90k just sit there for 5 months??
« Reply #10 on: August 25, 2020, 03:02:30 PM »
Thanks everyone! didn't even think about that bank bonuses. thats a good idea lol

what do you mean by "if liquidation is slow?"  I'm open to delaying furniture purchase....would love to hear what you are thinking.

I see. The money is emergency fund in general, not strictly house purchase related emergencies. In that case I'd personally be risk adverse and keep it safe and accessible.

Re: If liquidation is slow, I just meant that if you had an investment vehicle that'd tie down the money for six months. Well if that money is for medical expenses that's no good. But if the money is for furniture well, life will go on.

eyesonthehorizon

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Re: Should $90k just sit there for 5 months??
« Reply #11 on: August 26, 2020, 11:11:54 PM »
Read the terms carefully on any bank bonuses, especially for accounts subject to low balance fees; most have a minimum deposit period (and/or half a dozen other requirements) or else you forfeit the perk & might end up paying for the pleasure.