Author Topic: 457 as House Down Payment?  (Read 1035 times)

put me in coach

  • 5 O'Clock Shadow
  • *
  • Posts: 51
457 as House Down Payment?
« on: July 18, 2022, 03:56:44 PM »
Hello,

We have never owned a home. I am just beginning to research the possibilities of buying. We rent in a HCOL area, in our late-30s with 1 kid.

We have about $210,000 in retirement accounts, and we make about $200,000/year gross combined. We max out our roths and 401k/457. Given the stability of our jobs and situation, we only have about $7.5k in more quickly accessible savings.

I will likely transition jobs which means I can take out ("elect a refund of my contributions") from the $45k in my 457 as a direct deposit or a rollover. Is this advisable to help us pay for the house? Should i roll it over to another account first?

Thanks for your help! Let me know if you need more info.

Jason95357

  • 5 O'Clock Shadow
  • *
  • Posts: 8
Re: 457 as House Down Payment?
« Reply #1 on: November 07, 2022, 12:55:48 PM »
Negative on using retirement money for a down payment.  I'd recommend following one of the trusted financial plans to address deficiencies, including not having an appropriately sized Emergency Fund (EF), before you'd start to save for a house and purchase.  No one knows what inflation and mortgage rates may hold, but at least in the near-term things are pretty bad (7% and climbing).  I'd recommend you focus on saving for your 3-6 month EF, and then save for a down payment.  If you haven't already, look to trim your expenses by getting on a strict budget and/or increase your income if possible.

Here is one such trusted financial prioritization plan:
https://www.bogleheads.org/wiki/Prioritizing_investments

Another trusted resource for home buying:
https://www.bogleheads.org/wiki/Owning_vs_renting
« Last Edit: November 07, 2022, 01:00:24 PM by Jason95357 »