What should we do with our Vacation home fund?

Your page was suggested to me by a friend and I cannot stop consuming it!

My husband works for one of the Big 3 Automakers and will be eligible to retire after 30 years of service at the age of 51 with a full pension and small 401k. This is in just 9 short years!! We want him to be able to stay retired and just make money doing side hustle work as needed/wanted. We have about $35,000 in consumer debt and owe about $190,000 on our home. Our goal is to be able to downsize our current home in 2 years (when our daughter is out of elementary school) in order to purchase a smaller local home and coastal vacation home. We know our first step is to get ride of the $35,000. At which point we plan to just stock away as much of my husbands income as possible, as once the debt is gone we know we can live on my income alone. I am in the IT field and am doing really well with my salary.

Where should we put the money we are saving for the vacation home- money market style savings or invest it? We have researched the homes in the area we want to go and if its a non rental home is in the modest 100-150k range so we think it would only be there for about 18 months - 2 years.

Thank you for all you do!

Hey @beachfamily!

Thank you for all that consuming!

Short answer: Pay off the debt, then stick the house fund in a regular savings or money market account. Don’t invest it.

Here’s an article that explains why:

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Great! Thank you - I was on the fence as it was a vacation home - not a primary home.

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Yeah, I’d say any money you’re planning to spend within a few years should just be in cash. There’s no real upside to investing over a short time, and plenty of downside.

If you’re only “maybe” going to buy a vacation home or will wait 5+ years to buy it, then sure, go throw it all in a brokerage account and let it grow! :slight_smile: