How to Grow Your Down Payment?

We’ve talked about where to find your hidden down payment and also side gigs to earn extra money.

One thing we still need to explore is how to GROW your down payment.

It’s one thing to work extra hard to find that extra chunk of cash, but it’s another to figure how to grow that chunk of cash to hasten the process of accumulation.

Beat tax and inflation

This is the Wealth Formula…the mother of all formula that every investor needs to know.

After doing all those things discussed about finding that extra chunk of cash for down payment, we need to explore the rate of return.

Time you have limited control. The only thing you can do is ACT NOW!

But where you should park your money now while you save?

Tax now

Tax now…

Brokerage account

Certificate of deposit

Checking account

Savings Account

Tax later

Tax later…

401k/403(b)

Annuity

SEP IRA

Thrift Savings Plan (TSP)

Traditional IRA

Tax never

Tax never…

Be Your Own Bank  (life insurance)

Health Savings Account

ROTH IRA

ROTH TSP

Where can you save that can give you the most bang for your bucks?

You want good rate of return to beat inflation of 3.3% each year

Related article: Is Your Money is Your Savings Account Working Hard for You? Or for Your Bank?

You want maximum tax benefits

You want safety, meaning never lose money!

An indexed universal life (IUL) insurance can provide all these benefits better than IRAs, which limits access to money before age 59-1/2, or HSA, which limits your spending only on health-related expenses.

An IUL lets you capture the upside of the stock market (gain) beating inflation each year, but avoids the down side (loss). So your down payment money grows safely and aggressively with maximum tax benefits.

Learn more at Be Your Own Bank

When you’re ready to pull the trigger to make the purchase, you can take a tax-free withdrawal, keeping your new money in the cash account to continue to grow.

Author: Anna

We help families in Hawaii achieve financial freedom and the lifestyle they've always dreamt of by empowering them with financial education and money strategies to make more money, save more money, so their money can work for them.

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