1Yr·

Moin Moin,

I'm thinking about saving up some money to buy a garage in 2-3 years in order to gain some initial experience with real estate with a manageable capital investment and to further diversify my asset class.

But I don't want to just leave the money lying around.

My idea was to put 25% of my savings rate into each of the following:

1. transfer to an overnight deposit account (as a security amount) possibly later to a fixed-term deposit

2. into an ETF (MSCI World or FTSE All-World) as a (hopefully) small booster

3. a money market ETF LU0321465469 $XFFE (-0.1%)

4. a bond ETF

As I have no experience with bonds so far, I would be happy to receive suggestions for an ETF. Can you make a loss with these? Bonds actually work in such a way that you receive the sum including interest if you wait until the end of the term, right? Please enlighten me here.

I am also wondering whether there is a better ETF for the money market.

Briefly about my previous investment experience:

I have been investing in individual shares and share ETFs, gold, P2P loans and some tangible assets (Timeless) for 2 years, but only as a test for the time being

15 Comments

Justus41@Justus41

1Yr

Hello, first of all I would like to mention that I find it very interesting that you invest in so many different asset classes. I do the exact opposite, which is why I find it all the more interesting and would find it interesting to exchange ideas. But now to the garage: I'd first like to know where the garage is. A garage in the center of Berlin would be completely different from one in a village with 20 inhabitants in Brandenburg. Then there's the fact that the beauty of real estate is the use of borrowed capital, by which I don't mean 110% financing, which in my opinion is unsuitable for beginners in the real estate market, except in exceptional cases. Nevertheless, it usually makes sense to finance at least 70-90% of the purchase price, as this significantly improves the return on equity. But as far as I understand from the post, you want to finance the apartment completely yourself. And I can say quite clearly about the breakdown of the savings installment: it's better not to use money market ETFs or bonds. If you have a call money account with 3% interest or more, save the money in it and perhaps save the ETF as well.

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View all 11 further answers

Sparfuchs@Reinecke

1Yr

Do you have a business plan for your garage project? How much do garages cost? How high is the expected rent? What are the costs of the garage during the rental period? When will the garage pay for itself? My parents bought garages after reunification - 50 of them for DM 150,000. They currently get 40,- per garage at 96% occupancy. That works quite well. Today you pay almost 15,000 euros for a garage. I would sharpen my pencil again.

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Tom@Garfield204

1Yr

@Reinecke Hi there,
I don't have a building plan yet and am only in the initial phase of finding out about it (which doesn't stop me from saving money🤓)
Garages cost around €10,000 to €20,000 here. The expected rent is around 70-100€ (if I take local rents as a reference) it should then amortize after about 15-18 years I guess (I'm only 24 myself so that's perfectly ok)
What do you think about the idea of splitting the savings rate for this? That only makes up part of my total savings rate😊

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Sparfuchs@Reinecke

1Yr

@Garfield204 you would have to know exactly in the end and determine the return. Sometimes you will get more out of an All World. You really have to do the math. The savings rate ... well, that's more like youth research. In the long run, you'll find out what works best for you and then probably choose the best ones.

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