How should I invest $3K/month in order to put a down payment down on a home in about 3 years?

Question

I've already maxed out my 401K contribution and am looking to save a little for a home in about 3 years. I've heard CD's aren't that great now. I've heard Muni Bonds are better. Where can I get the highest, yet safe 3 year return? Thanks!!!

Answer 1

That is true that CDs aren't that great now, but they are certainly a lot better than the alternatives. Now 3k a month for 3 years will provide you with a substantial down payment even invested in CDs.  I would avoid munis for the simple reason that with the Fed giving money away and generating inflation rates that have not been seen in over 10 years munis are a loosing proposition especially when the idiots at the Fed finally are forced to raise intrerest rates and drive down the prices of the munis.

Actually, house prices in certain parts of the counrty are dropping so fast that you may want to begin shopping in about one year if you happen to live in one of those localities.

Answer 2

I just signed up for HSBC online savings account in May. Its currently at 3.50%. Much higher than any Savings Account I have seen and almost always higher than any CD, plus you can take the money out w/o a penalty if you need it.

Answer 3

I wouldn't be messing around with this money since you want a home so a CD is a good place because you won't be going backwards if something  crazy happens in the market.  I don't invest in bonds but they are also a safer bet.  A third option would be a 5 star mutual fund that specializes in extremely low risk.  Good luck

Answer 4

CGMFX