Originally published August 9 2005
Investing tips to help save for a home purchase
by Mike Adams, the Health Ranger, NaturalNews Editor
Joseph Janiczek, a financial planner, can show you how to save a little extra money each month and invest wisely to be able to afford the home you've always wanted.
Overall, Deshmukh has a strong balance sheet, with low debt and about eight months of expenses to cover emergencies, Janiczek says.
To achieve his near-term goal of buying a house, Deshmukh should have a moderate portfolio that is neither conservative nor aggressive, says Janiczek.
He should pare down his positions in small- and midsize stocks and reconsider his position in real estate investment trusts.
But he doesn't need to significantly change his mix of stocks to fixed income.
In the short term, Janiczek recommends that Deshmukh keep a roughly 50-50 allocation to each of these asset classes, allowing the portfolio to grow at an expected annual rate of 6% to 7%.
� Within the stock portion of the portfolio, Janiczek suggests that Deshmukh put half of his assets into large-company stock funds --- with 10% of that in international funds --- and 25% each in midcap and small-cap funds in the near term.
If Deshmukh eventually uses these assets to purchase a home, Janiczek recommends that he build up a six- to nine-month fund to cover expenses before investing again.
"When you're young and starting out, having the flexibility to move with job changes and education changes is really paramount," says the planner.
� Janiczek says Deshmukh should take the $500 currently going into savings each month and put it into a balanced equity-income fund instead for the first year.
� Deshmukh should consider life insurance and disability insurance once he starts working and has a family.
Retirement savings also should be a priority once he has bought a home.
� The portfolio should be re-evaluated once the house is purchased and every time a major life change occurs, Janiczek says.
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