I'm (28F) saving for a downpayment in a very high cost of living city. I'd like to have at the very least 350k to put down within 2 years. I have 275k saved so far.

I make about 300k per year pre-tax and usually save $130k (401k + HSA + general savings). In the past, I've always maxed out my 401k, but I'm debating whether I should put the full 22,500 in this year, OR just put in 6% to get the match?

I guess I'm really trying to weigh the benefits of a larger downpayment now considering interest rates at the risk of shorting my 401k for a year or two.

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maedocc t1_j2cb0kc wrote on December 31, 2022 at 4:38 AM

>but I'm debating whether I should put the full 22,500 in this year, OR just put in 6% to get the match?

I mean, at your salary level, assuming you're putting the money into a traditional 401k, you get 35% taken off by taxes. So you're putting in $22,500 into your 401k and only missing $14,625 from your paycheck.

And that's not accounting for any state income taxes.

I'd choose 401k over having a slightly bigger down payment.

arpatel530 t1_j2cl4ws wrote on December 31, 2022 at 6:15 AM

Max out 401k. Put every other $ for house into hysa at 4% and don't play with it. Every other $ that is free use in a taxable account and start buying schd. Don't complicate things.

Your goal right now is to maximize earnings thru your job. That's where the bulk of your early to mid career wealth will come from. The late part of your wealth will be from assets and equities that you built up over time.

stopdrpnro t1_j2crowh wrote on December 31, 2022 at 7:32 AM

May I ask what you do?? That's an incredible salary at 28( or any age for that matter)

dmvmtgguy t1_j2cehas wrote on December 31, 2022 at 5:09 AM

I would put the money towards your 401K. I

f you are short of your goal for down payment - when you are ready to buy - not the end of the world. You have a significant amount of money saved for down payment already - be proud of yourself and stop stressing on it.

Cheaper2000 t1_j2cqyp7 wrote on December 31, 2022 at 7:23 AM

Max. 6% of 300k is 18k, that additional 4.5k shouldn’t be making a difference with your salary and (relatively) modest goal of 75k in 2 years.

ct-yankee t1_j2d3dxl wrote on December 31, 2022 at 10:08 AM

Continue putting money in that 401k. the compounding, tax advantage and partial match are worth far too Much in the long run to disrupt for a down payment.