What should I do with my money (stocks/ETFs/real estate)?

Question

Hey friends,

I currently live at home and will probably get married in 2 years.
In the future (in the next 2 years) I want to buy a property and am currently saving up equity.

I currently have €16,000 saved, which I will continue to save. Over the next two years, I plan to save a total of €40,000.

I earn €2,500 net per month and have a maximum of €500 in fixed costs.

I put aside €1,000 every month for my equity.
A condominium becomes a realistic option when I consider my salary and my equity. (My future wife is also saving money, by the way, but I'm not considering her for now.)

Should I save more money for equity or invest in ETFs?

Do you have any other tips?

sandale175 · Answer

Get advice from a specialist, eg bank

paulchenoo9 · Answer

Open a portfolio and buy only American REITs:

Omega Healthcare Investors, Inc. – Invests in healthcare facilities and offers stable returns.
Equinix, Inc. – Leader in data centers and digital infrastructure.
Public Storage – market leader in self-storage facilities.
Ventures Trust – Invests in various types of real estate, including residential and commercial properties.
Innovative Industrial Properties – Focused on real estate for the cannabis industry.
WP Carey Inc. – Diversifies into various real estate sectors and offers attractive dividends.

And read up on things, never buy quickly, take your time and form your own opinion.

answerexchange · Answer

Good evening, any reputable advisor will advise you against ETFs in this situation for the simple reason that you shouldn't force yourself to invest in high-volatility products when the timeframe is so short. You need the money in two years, and if the war in Ukraine or the Middle East conflict escalates, or something else, and the stock markets crash, you'll be forced to take a loss. That represents a significant risk, and you have to decide for yourself whether you want to take it.

ps. I am not an expert or the like, just a layman interested in securities

mertis · Answer

First of all, a volatile investment like stocks or ETFs isn't a good choice if you definitely plan to use the money in two years. Prices can also fall over short timescales like two years; no one can predict that. That's why ETFs are a long-term investment, so small "local" price fluctuations don't matter.

Personally, I think your plan is somewhat unrealistic.

You've saved up €40,000 in equity and want to use it to buy a property? That's just not possible.

I don't know where you live, but even for an 80m² apartment these days, you can expect to pay upwards of €300,000, even more in cities. That's still a long way from the minimum recommended 20-30% equity (which I consider too low).

If I were in your situation, I would quickly forget about the property plan and only dig it up again when we're talking about €150,000+ in equity.