Investing

806 readers

1 users here now

A community for discussing investing news.

Rules:

No bigotry: Including racism, sexism, homophobia, transphobia, or xenophobia. Code of Conduct.
Be respectful. Everyone should feel welcome here.
No NSFW content.
No Ads / Spamming.
Be thoughtful and helpful: even with ‘stupid’ questions. The world won’t be made better or worse by snarky comments schooling naive newcomers on Lemmy.

founded 2 years ago

MODERATORS

_MoveSwiftly

TDF for house down payment (self.investing)

submitted 2 months ago* (last edited 2 months ago) by berryjam to c/investing

10 comments fedilink hide all child comments

Is a TDF a good choice for growing my money, in this case? I plan to use it for a house down payment and withdraw it in 5-7 years. I've been thinking of putting it in a 2030 or 2035 TDF. Should I go this route or just VTSAX and chill?

Background: USA, I will be saving in a taxable account, and I want to minimize my tax liability as much as possible.

you are viewing a single comment's thread
view the rest of the comments

[–] berryjam 2 points 2 months ago (1 children)

I could certainly wait longer than 5 years if necessary. It depends on where life takes me.

VT or VTI would be more tax-efficient than a TDF, then. I could diversify in another way: put some percentage of money into VT, and then the rest into, say, a CD ladder. Maybe start out with VT then taper towards CDs/treasury bills around the 3-to-5-year mark. A DIY TDF, if you will. (I suppose that's the "personal" in personal finance.)

Thank you for sharing your perspective!

[–] [email protected] 2 points 2 months ago (1 children)

Yup, that's basically what I'd do. And instead of "tapering," I'd just sell and "freeze" the assets in CDs/treasury bills once you have a firm timeline less than 5 years. The extra year or so of potential gains isn't really worth the risk of a major correction just before buying.

[–] berryjam 1 points 2 months ago

Makes sense!