Read Full Article here… lifehacker.com

Photo: Victoria 1 (Shutterstock) All potential homeowners face the same conundrum when it comes to the down payment for their potential new home: The money needs to be quickly accessible during the home buying process, but by keeping that money in cash, you lose out on the potential returns from less liquid investments like stocks or property. So where should you stash your down payment so you don’t sacrifice the upside? Here’s a look at your options. When it comes to down payments, liquidity is king If you’re planning to buy a house within a year, financial advisors commonly advise that you keep your down payment savings in a low-risk cash account of some kind. This is for two reasons: Liquidity: You need to be able to withdraw the sum very quickly when home buying (sometimes in a matter of hours). Risk exposure: You could risk losing a large chunk of that money if it’s tied up in riskier investments like the stock market. As Molly Stanifer, a financial adviser with Old Peak Finance explains to Insider : “It’s better to give up expected investment return to have the money available when you want to buy your house than to miss out because you invested too aggressively, or your money is not liquid.” Unfortunately, that means giving up an average annual return of 10% on the stock market for something closer to 0.5% with savings accounts. That doesn’t mean you couldn’t keep that money in a brokerage account if […]