Everything Down, Nothing a Month

Dear Dave, I'm 21 and make $45,000 a year. I've heard about your 100 percent down plan to buy a house. I'd like to know more about this and where I should put the money I'd be saving. J.P. Dear J.P., I like the way you think! But there's really no big "plan" to what I'm talking about. It's not rocket science. It's just a matter of saving like crazy and living on rice and beans for a few years so that you can save up the cash to buy your home outright. If you're looking at buying a place in less than five years, I'd put it in a money market account. In this case, you're not going to be saving long enough for the interest to be a good friend. Your best buddy is going to be a low-key lifestyle. If your timeframe is more like 15 or 20 years, then you should look into a mutual fund. Most people don't stretch the idea out over that period of time, but if you do you'll get some great help from a friend named compound interest. I don't beat people up for taking out a 15-year, fixed rate mortgage. But I'm always for people living like no one else so that later they can live like no one else. Go for it, J.P.! - Dave
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