saving for down payment while in med school

[E.A. Poe]

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My wife works so it is possible that we could begin putting some money away for a down payment while I'm still in school. I think a problem with this is that the govt would look at the money with their need assessment and claim that I should be using some of this for tuition. Does anyone know of a method to shield money saved for a down payment from this assessment. I have a child so we could possibly put it into an account with in his name until we are set to use it.

 

[edmadison]

My wife works so it is possible that we could begin putting some money away for a down payment while I'm still in school. I think a problem with this is that the govt would look at the money with their need assessment and claim that I should be using some of this for tuition. Does anyone know of a method to shield money saved for a down payment from this assessment. I have a child so we could possibly put it into an account with in his name until we are set to use it.

First of all, there are quite a few places where physicians can get no money down loans and still not have to pay PMI. I'd recommend putting your money into a Roth IRA for both of you. You can also start a 529 or Coverdell for the ankle biter. Take advantage of residency and medical school to sock away money in you Roth, you will not have this option once you are out of training because you will make too much money. I am pretty sure that you can pull money out of an IRA without penalty for the down payment on a home. I wouldn't recommend doing this however. I check, though and let you know.

Ed

Addendum: I looked it up and you can use $10,000 of IRA money without penalty for the down payment on a home. Combining this with your spouse, you could spend $20,000. If you have traditional instead of Roth money, you would still have to pay the tax on the money, however. I still would not recommend spending you money this way, however.

 

[E.A. Poe]

thanks a lot for the advice. anything else you scrounge up would be great.