What's the best way to safely invest in $6000?

I was given $6000 by someone to help for a down payment on a house. I'm in a good living situation right now but eventually want to move into my own house (maybe in 3 years). What would be the best way to gain interest on this money while I wait until I'm ready to dive into the housing market?


My car loan will be paid off in 2 months, so I also will be able to add to my savings for a home. I'll be able to save more since I can change my auto insurance to the minimum requirements. I'll also fund the savings with the amount I was paying in monthy car payments.

20 Answers

  • 1 decade ago
    Favorite Answer

    There is no such thing as a safe investment. The problem is inflation plus taxes. Let's say you are going to be taxed at 28% and the inflation in your state is 5%. You buy a CD at 5% (which is common right now). As you can see, you are just equal to the core inflation of your state and you still have to pay taxes! Even if you found a 7% CD, you would have to pay $378 off of that $1,350 you made. Which makes your total amount $6972, so you made $972 in profit in three years. With inflation, It would take $6,945 to buy what you can for $6,000 today. Now you are up $24 in adjusted money. You are basically staying even at 7% making a whopping $8 (adjusted) per year on average with $6,000. I wouldn't call it an investment as much as protecting your worth.

  • 1 decade ago

    If you were investing long term, I would say, without a doubt, that mutual funds would be the vehicle of preference. But 3 years is too short a period, so go for a CD. Banks are actually competitive to a degree in offering CD rates so shop around to several institutions.

    But, also remember that the sooner you put even a nominal amount into a reliable capital growth fund, the better off you'll be long term. If you are the least bit interested, I'd recommend Vanguard mutual funds which are very reliable, cost effective and focus on investor education.

  • 1 decade ago

    $6000 isn't a lot to work with, and 3 years isn't a long time. But if you want the most conservative investment, a CD is the best. Shop around, most financial institutions are at about 5% right now. My son just got one, minimum investment 5K, 13 month, 5.15%. Much better than just leaving it in a savings account. Good luck.

  • 1 decade ago

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  • Anonymous
    1 decade ago

    Buy a CD (certificate of deposit). You can probably get around 5% today. You could also invest in a mutual fund or individual stocks, but that is much more risky and you could lose some of your principle (the $6000).

  • 1 decade ago

    They have really good interest in CDs these days. If you consider yourself disciplined, I would suggest looking into CD accounts with your bank or credit union. Many have minimun deposits anywhere from 1000.00 and beyond; however, some financial institutions have "easy start" certificates that have minimums deposits as low as 250.00 or no deposit at all (ING Direct -over 5%). You can sit back and relax, pretty much, with CD's; anything else is pretty much like gambling.

  • 1 decade ago

    Three years isn't long enough as an investment time frame. Anything you put the money in would have to be very conservative. You won't make that much.

    Better to just buy now.

  • 1 decade ago

    My grandmother gave me some very good advice which I will pass on.

    She said the safest place for money is buried in the floor under your bed. This is so that when thieves come looking for valuables in your house they will have difficulties finding the money.

    But before you bury the money, cut it into small pieces making it impossible to use. That way when the thieves do find it under the bed, it is no good to them at all.

    Pretty clever! Good luck and I hope this helps.

  • Anonymous
    1 decade ago

    Dive in now you ninny. You want to pay rent for 3 years and subsidize someone else's investment?

  • me
    Lv 4
    1 decade ago

    Compare interest rates at different banks and credit unions and through it in a CD

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