Not completely related to your question, but also important:
If you
need the
full amount of the money in 5 years, maybe the stock market is not the right place to be and you want to switch to a bit more conservative asset allocation.
I wrote a similar comment to another reader with a 7-year time frame and a bit different situation, but maybe some of the information is also helpful for you:
You should also note that 7 years is quite a short time frame for any investment in the stock market. Usually, the longer you are invested, the higher is your chance to reach average returns. For me personally, the heat map on portfoliocharts.com helped me a lot to understand the factor the duration of the investment period has on my expected returns. See the graph on https://portfoliocharts.com/portfolio/total-stock-market/
Blue boxes show investment periods with positive real returns, while red boxes show negative real returns. With an investment period of 7 years, 12 of 39 analyzed 7-year-periods had negative or zero real returns! Only with an investment period of 13 years or more, there were no periods with negative real returns.
(Please note, the graph shows real returns and includes inflation, which is a more conservative view [...].
https://forum.mrmoneymustache.com/case-studies/should-i-get-a-mortgage-and-how-am-i-looking-to-retire-in-feb-2024/msg1601705/#msg1601705BTW, for a 5 year time frame, the chart on portfoliocharts.com shows
15 of 41 investment periods with
negative or 0% real returns.
I'm not saying that you should not invest your house sale proceeds, I'm just saying that you should be prepared that there is always the chance of no/negative growth in the short run.
Thus, if you invest in the stock market, it is important to have a plan B and to be flexible - e.g., renting longer and waiting until the market has recovered.
Otherwise, switch to a more conservative asset allocation with less volatility. As a reference, portfoliocharts.com also shows similar graphs for other portfolio allocations.