If you're starting to feel like paying rent is a waste of money, here are four tips for how you can take your stimulus check and get the most out of it to buy a house in 2020.When I first got my stimulus check, I was so happy to see the money hit my account. But I didn't know what to do with it. I thought back to all the expert advice I've heard over the years, though, and realized I should immediately put it in a high-yield savings account.
Nilay Gandhi, Certified Financial Planner, is a senior financial adviser with Vanguard Personal Advisor Services. She says that for a near-term expenditure, such as a down payment on a house this year, placing the money in a high-yield savings account is a wise move, since your money will earn more there than in a standard checking account while remaining safe and accessible., Gandhi says steer clear of doing that if you want to buy a house this year.
"It's always important to consider your time horizon — exposure to stock markets is generally not advisable if you are planning to use the money within a few months or even a couple of years," says Gandhi.Another way to use your stimulus check so you'll be financially ready to buy a house this year is paying off any existing debt., a real estate investment company, recommends using the check to pay off small debts that report to the credit bureaus.
"Reducing your debt-to-income ratio will have a larger impact on your ability to buy a home than simply adding the same amount of cash to your down payment savings," says Mandrell. "This could potentially bump up your pre-approval spending limit by $20,000 or more on a 30-year mortgage. This strategy will allow you more options when you go out home shopping.
"I like that number because for most homeowners, that will cover at least six months of mortgage payments, including principal, interest, taxes, and insurance. It will also go a long way towards covering large, unexpected repairs, like a roof replacement, HVAC problem, etc.," says Trench. "The stimulus check is $1,200. It's not enough to cover the down payment, or really make up a meaningful percentage of the costs associated with most home purchases.
Very true.. it's all about maths.. pay the one that leaks the most money out of your pocket FinancialFreedom COVID19 mondaythoughts Insecure success
There's me thinking people would buy food and pay bills... never crossed my mind it was disposable income
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