Personal Finance

Best way to save for house downpayment

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  • Jan 1st, 2015 1:04 pm
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Sr. Member
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Jan 31, 2005
507 posts
14 upvotes

Best way to save for house downpayment

My wife and I want to save $80,000 over 5 years for a downpayment. Neither of us qualify for the first time home buyers program. We are starting out with zero dollars in January and saving $1415/month. We are considering putting our savings directly into a TFSA high interest savings account. What other low-medium risk options could there be for us to accumulate this money faster whereby we could also access it when needed?

Thanks
6 replies
Banned
Jul 3, 2013
1508 posts
300 upvotes
Why 5 years? How much do you gross as a couple?
Deal Expert
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Aug 18, 2005
21223 posts
5939 upvotes
Burlington-Hamilton
For a 5 year time horizon, the TFSA and regular savings accounts (and maybe a GIC) are really your best options.

Do not go and risk your money in some mutual fund for such a short time period or you could come out in the red.

P.S., most mutual fund advisors make money when you buy funds, so some of them will always tell you to buy funds even when it makes zero sense for your situation.
- casual gastronomist -
Deal Addict
Jul 6, 2005
4451 posts
2139 upvotes
Toronto
+1 interested in this topic for similar real estate down payment purposes.... bumping this thread for hopeful good discussions and suggestions by many
Deal Expert
Feb 29, 2008
30106 posts
5547 upvotes
Montreal
OilyBob wrote: An ETF consisting of preferred shares will pay about 5% interest in dividends, and you can hold it in your TFSA. It's not guaranteed like a GIC but the chance of you losing money over 5 years is minuscule.

http://www.milliondollarjourney.com/top ... e-etfs.htm
The capital is not guaranteed however. You need to able to withdraw the full amount for the downpayment.

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