New Investor: Where to hold my money?

[Eddie Houseworth]

I am just getting started in real estate investing. I am reaching out for advice on what to do with my money while I am saving up to buy my first property. Currently, I have most of it invested in a Vanguard S&P 500 ETF with the rest in a high yield savings account. Is there a better option? 

Also, I invested a relatively large portion of my paycheck (14%) into my employee provided 401k. My company matches up to 5%. Do you think I could use this money more effectively? 

[Doug Smith]

You're doing great. The money you put in your 401K is not only deferring taxes (saving you 15%-36% depending upon your tax bracket), but you're getting that free 5% boost from your employer. It's hard to beat that. The only issue with that comes into play if the dollar tanks and inflation rises significantly. I'm a weirdo in that I skewed heavily into the real estate sector to hedge against inflation. The US Government is going to continue spending like crazy thereby devaluing the dollar and driving up inflation. 

Now to preparing for a loan. A lender is going to want to see two months worth of bank or brokerage statements showing that you had that money "seasoned" for two money or they can trace any large deposits to a legitimate activity...like a work bonus or property sale. Don't take the money out of the trackable banking/brokerage system in favor of doing something that can't provide a paper trail like sticking it in your mattress. Make sure any down payment you have has a paper trail. 

Welcome to the real estate investing world. I'm sure you'll do very well!