Should I save my cash or invest it

Question

I want to buy a rental property for myself in the near future and due to inflation I don’t know if I should keep the money im saving in my saving or stash in the stock market such as the s&p 500 for the time being until I’m ready to buy a property.

Seth Young · Answer

Real estate is the best secondary market to hedge against inflation! Turnkey real estate may be your "stock market alternative" to investing in real estate.

Trevor Fleck · Answer

@Adrian Diaz thanks for your post. Obviously you're on BiggerPockets so most of us are big fans of real estate investments. With the current rate of inflation and the extremely low interest rates offered by banks, you're actually losing money the longer you keep it there. Think about how much exposure you already have to stocks and your investment goals. Diversifying into real estate - especially as a hedge against inflation - is a very viable strategy.

What's stopping you from buying a property now? Lack of education? Fear? Adequate funds for a downpayment?

Mike Davis · Answer

@Adrian Diaz if you have the cash now and you have no reason to wait...but to wait, I would get a pre-approval now and see what you can get approved for. If terms are favorable, get going. This of course depends on your overall goals.

William Sing · Answer

Hey @Adrian Diaz,

Looking at the time horizon for the money and using it is a big factor. Many people will put money into real estate during inflationary periods since it holds its value better. They do the same thing for physical things like rare metals (gold, silver, etc).

I'd ask yourself what you want to optimize and consider time/effort as a factor. You can get into rentals using a turnkey company, but you might not have as great of a return. Ask yourself what you want to optimize with the time, money, attention, risk, and then figure out the investment fits that the best.

Adri Jusczak · Answer

Adrian-

How close are you to being ready to buy a property? I would try to make it happen ASAP. Money in the bank is losing value, S&P500 is also risky given the current world events.

Should I save my cash or invest it

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