What to do with 100k in the bank?

[Albert Velasquez]

18 months ago my parents had to short sell our home and rent it from the seller. Today our financial situation has completely turned around. We have 100k in the bank and don’t want inflation to destroy it. We want to know what you guys think we should do with the 100k. Here’s the problem, because of the short sale on my parents' credit report, they’re not able to qualify for a traditional bank loan for another 6-18 months. We are aware of the 7.5% inflation numbers this year and don’t want to just let our cash sit in the bank. My parents cannot qualify for a loan, but I myself can qualify. The only problem is that I make very little money as a full-time student. My parents are willing to gift me the 100k so I can buy a property that we’ll own as a family, and possibly rent out.

Here are the only two options we think we have:

1. 1. Let our cash sit in the bank for the next 6-18 months until my parents can qualify for a bank loan and buy property on their own.
2. 2. Gift me the 100k, so I can buy a property for the family.

The cons for choice 1 are the obvious inflation numbers. The cons for choice 2 are the fact that it will require between 75 and 95k downpayment so I can qualify for a loan with my low income. However, we plan on doing a cash-out refi in the future, so we’ll be able to pull out that downpayment again.

TLDR: We have 100k in the bank. Parents can’t qualify for loans due to short sales on the credit report. We want to conserve the value of our 100k and think the best asset to do that in is real estate. I can qualify for a loan, but it would require us to use basically all our capital for the down-payment. What should we do to conserve the value of our money? Should we use it to invest in real estate even though we might need to use all of it for only 1 property?

[Matt Pursley]

If that's the only money you have then I'd be careful investing it. There's always risk so if you invest without knowing what you're doing it could go badly. Is there a duplex or multi plex that you could house hack? 

If you know what you're looking for then holding it in the bank is fine in my opinion. Yes inflation is brutal right now, but cash is a position and if you're waiting for a particular purchase then it's fine to hold that money. But if you're not sure what you're waiting on then I'd say spend it on something that can be an asset. Buy a fixer upper to live in. Buy a multiplex and house hack. Do you live with your parents now? If not, consider buying a house that can comfortably let you two live together while still being doable emotionally and financially. 

Do you have any HIGH interest debt like credit cards or personal loans? You could consider paying those off first as well. Anything over 7% imo, but choose your own comfort level there.