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You may have read my other thread about when, where and how to save for a downpayment on a property (titled debt free - what next?) so I won't bore you with the details, but in short, I have a savings goal of $50,000 by December 2014 at which time I may buy a property either in the UK (where I am from) or decide to continue saving and buy a property a little later in Singapore (where I live) which will take a bit longer. There are arguments against being a long-distance landlord and I'm taking these in to account. Some have advised that I should continue to save for retirement during this period, but at the moment, my savings goal is simply to stock pile ready cash. I don't have any other savings mechanism for retirement other than an account where my employer pays $250 in to each month as a perk / add on to my monthly salary. Should I therefore, portion some of my savings out to a retirement fund, another bit to an emergency fund and the rest towards the 'downpayment fund' ? Of course this will mean that I won't have $50,000 to to put down on a property a the end of next year and will have to wait longer (in other words, continue wasting money on rent) until my downpayment fund is built up again. In my mind I was thinking that it should be a priority to put a downpayment on a house first as it is a long term asset / security and once that is done, then think about regular long-term monthly savings for retirement. Any thoughts? If its useful, I'm 32 and earn US$90,000/year.
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oops!
sorry the title should be saving for retirement vs. saving for deposit....
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If you bought a house and it's value reduced due to economic conditions, would it be a good investment? Americans who bought homes/condos in good faith couldn't imagine he value could decrease by 50%. If the house is less than the value of the mortgage, the lender wants you to pay up the difference.
If something changed, if you were to take an employment offer from another company and subsequently be asked to move to Dubai, how long would it take to sell your home? Who would be responsible for the myriad of details in the selling process? How long would it take? How would you afford housing & utilities in two cities?
If you dislike paying rent, why not share a flat to reduce the cost of keeping a roof over your head?
Retirement savings are important as they rely on compounding over the long term. It is presumed that you will contribute for 35 years to fund your living costs after age 65.Comment
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