Where to store savings for 1st property

[Jeremy Lohman]

I have been educating myself the last few months about real estate investing (here, books and podcasts). I love how everyone offers the strategies that work for them and the mistakes they’ve made. 

We are saving cash to have money for a 20-25%down payment as well as to have enough in reserves for anything that comes up. 

Where would you recommend saving this money?  

1. Ally savings (where our emergency fund is for our home @ 1.9%

2. Vanguard prime money market taxable brokerage account @ 2.16% 

3. Vanguard total stock market fund in taxable account (I ask this because I heard Dave Ramsey mention he puts money for real estate in an S&P fund until he’s ready to buy).  This is not a debate about Dave Ramsey-we are out of debt and have 6 months emergency fund and don’t adhere to his investing advice but I liked this idea when saving to buy real estate. 

Thanks!

Jeremy

[Tom Shallcross]

An alternate option to also consider would be taking the money and using it be a private lender on a deal with an experienced investor.  This should not only provide much higher returns than the options you've listed above, but also get you exposed to real estate in a passive format which can prove extremely valuable to you in the long-term.   I like this strategy as it's a nice intermediate step between reading/learning and having to go actually do everything without actually seeing how it's done.