We know, saving for a down payment can be the most difficult part of home buying, especially for first-timers who don’t have the proceeds from a previous home sale to help with their down payment.
You may already be saving for retirement through your 401K or IRA. If it’s your biggest source of savings, you may be tempted to borrow from yourself to get that down payment now. But, should you?
According to Bank of the West’s annual Millennial Study, 19 percent of Millennial first-time homebuyers expect to dip into retirement accounts to fund their purchase. And, 68 percent of millennial buyers said they had home buying regrets, wishing they had been more prepared, had more money down or had better inspected the home before they bought it.
In another survey, the National Association of REALTORS® Profile of Homebuyers and Sellers also found that 19 percent of first-time buyers liquidated part of their 401K, stocks and bonds, or IRA savings to fund their down payment.
But, is liquidating your long-term savings really the best choice?
For most situations, the answer is no. Borrowing from your long-term savings negatively impacts the snowball (or compounding) effect of your 401K fund growth. keep reading
The post Should You Dip Into Retirement Savings For Your Down Payment? appeared first on Down Payment Resource.
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