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Cities where you can quickly save a 20% home down payment

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How long it takes you to save for a 20% down payment on a home depends in part on where you live. 

In a pricey area such as New York City, it could take the typical buyer roughly 10.85 years to save $173,000, which is 20% of the median list price of $865,000 for a home, according to a report by RealtyHop, a real estate investment agency.

RealtyHop measured the “barrier to homeownership” for the top 100 U.S. cities by population. The analysis is based on median list price using more than 1.5 million residential listings, as well as median household income data from the U.S. Census Bureau. It assumes a household saves 20% of its annual gross income and intends to make a 20% down payment.

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In each of the five cities with the lowest barrier to homeownership, the savings timeline is less than four years.

Detroit has the lowest barrier to homeownership, the report found. 

In Detroit, potential homebuyers who earn about $39,575 — the median household income in the area — need just 2.53 years to come up with a 20% down payment on a home purchase, the report found. That amounts to $20,000 for a home priced at $100,000.

Cleveland, Ohio, is the runner-up: A potential buyer in the area needs 3.55 years to save $27,800, or 20% of a home that costs $139,000, the median listing price in the area.

Rounding out the top five are Baltimore; Buffalo, New York; and Pittsburgh.

Even in cheap cities, there can be savings roadblocks

Big expenses can derail your down payment savings timeline, even in a city where homes are less expensive.

A separate report by Zoocasa, a Canada-based real estate website and brokerage, found that homebuyers with children on average take longer to come up with a 20% down payment versus buyers without children because of expenses such as child care costs.

Potential homebuyers with children in Detroit, for example, need roughly 20.3 years to save for a 20% down payment from scratch, according to Zoocasa. Meanwhile, homebuyers without children in the area need about 4.2 years to come up with a 20% down payment if they’re starting off without prior savings, the report found.

Rising home prices can represent another challenge, said Jacob Channel, an economist at LendingTree.

“The more expensive real estate is where you want to live, the more you’ll probably want to save for a down payment,” Channel said.

The median list price for homes in Los Angeles, for example, is about $1.13 million, RealtyHop found. LA tops the list of five cities with the biggest barriers to homeownership, followed by Irvine, California; Miami; New York City; and Anaheim, California.

Even the cheapest real estate price on the “high barrier” list — No. 3, Miami — is $699,000, nearly three times pricier than the most expensive city on the “low barrier” list, Pittsburgh.

If a typical household in LA aimed for a 20% down payment, they would need to save $1,339 a month for roughly 14.10 years, the report found.

Why you might not need to put 20% down

In many cases, a 20% down payment is not required for you to buy a home.

In the third quarter of 2024, the average down payment was 14.5% and the median amount was $30,300, according to Realtor.com data. That’s down from 14.9% and $32,700 in the second quarter of 2024, the site found.

Some mortgages require much smaller down payments. For instance, the Department of Veterans Affairs offers VA loan programs; those who qualify can put down as little as 0%. Mortgages from the U.S. Department of Agriculture, referred to as USDA loans, aim to help buyers purchase homes in rural areas and also offer 0% down payment options. 

Federal Housing Administration loans, or FHA loans, can require as little as 3.5% down for qualifying borrowers, which include first-time buyers, low- and moderate-income buyers, and buyers from minority groups. 

The disappearance of the starter home

The benefit of a smaller down payment is that you can become a homeowner faster, and with less saved up, experts say. 

But if you decide to buy a home with less cash upfront, you’ll likely end up with higher monthly mortgage payments

“If you put less money toward a down payment, you’re going to end up with a larger loan,” Channel said.

Additionally, private mortgage insurance is usually added on to the monthly cost when the buyer puts less than 20% down on the home, he said.

PMI can cost anywhere from 0.5% to 1.5% of the loan amount per year, depending on factors such as your credit score and your total down payment, according to The Mortgage Reports. For example, on a loan for $300,000, mortgage insurance premiums could cost from $1,500 to $4,500 a year, or $125 to $375 a month, the site found.

“That’s another kind of payment that might be bundled in with your mortgage that further increases your housing costs,” Channel said. 

How to come up with your own savings timeline

Where you want to live long-term and what your financial circumstances are can help you figure out your own down payment savings timeline, according to Melissa Cohn, regional vice president at William Raveis Mortgage.

First, you need to have a good household budget — understand how much money you make, the amount you typically spend and what you’re able to save in a given month, said Cohn. 

“Can you cut back on how much you spend? Can you increase your savings? … Can you save your bonuses every year?” she said. 

Then, find out what a house in your desired location typically costs. “It would be important for a buyer to go out and get an understanding of what price point would work for them,” Cohn said. 

You also have to save for closing costs, which can vary substantially from place to place, Cohn said.

Average closing costs can range from roughly 2% to 6% of the loan amount, according to NerdWallet. So a $300,000 mortgage could require from $6,000 to $18,000 in closing costs on top of the down payment, it said.

To figure out what closing costs typically amount to in your desired area, ask a mortgage broker or a real estate agent, she said. 

Overall, you want to set realistic goals for yourself and take the time you need to get there. 

“Go as slow or as quickly as you need to,” LendingTree’s Channel said. “Ensure that you’re making good choices.”

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Trump administration loses appeal of DOGE Social Security restraining order

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A person holds a sign during a protest against cuts made by U.S. President Donald Trump’s administration to the Social Security Administration, in White Plains, New York, U.S., March 22, 2025. 

Nathan Layne | Reuters

The Trump administration’s appeal of a temporary restraining order blocking the so-called Department of Government Efficiency from accessing sensitive personal Social Security Administration data has been dismissed.

The U.S. Court of Appeals for the 4th Circuit on Tuesday dismissed the government’s appeal for lack of jurisdiction. The case will proceed in the district court. A motion for a preliminary injunction will be filed later this week, according to national legal organization Democracy Forward.

The temporary restraining order was issued on March 20 by federal Judge Ellen Lipton Hollander and blocks DOGE and related agents and employees from accessing agency systems that contain personally identifiable information.

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That includes information such as Social Security numbers, medical provider information and treatment records, employer and employee payment records, employee earnings, addresses, bank records, and tax information.

DOGE team members were also ordered to delete all nonanonymized personally identifiable information in their possession.

The plaintiffs include unions and retiree advocacy groups, namely the American Federation of State, County and Municipal Employees, the Alliance for Retired Americans and the American Federation of Teachers. 

“We are pleased the 4th Circuit agreed to let this important case continue in district court,” Richard Fiesta, executive director of the Alliance for Retired Americans, said in a written statement. “Every American retiree must be able to trust that the Social Security Administration will protect their most sensitive and personal data from unwarranted disclosure.”

The Trump administration’s appeal ignored standard legal procedure, according to Democracy Forward. The administration’s efforts to halt the enforcement of the temporary restraining order have also been denied.

“The president will continue to seek all legal remedies available to ensure the will of the American people is executed,” Liz Huston, a White House spokesperson, said via email.

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The Social Security Administration did not respond to a request from CNBC for comment.

Immediately after the March 20 temporary restraining order was put in place, Social Security Administration Acting Commissioner Lee Dudek said in press interviews that he may have to shut down the agency since it “applies to almost all SSA employees.”

Dudek was admonished by Hollander, who called that assertion “inaccurate” and said the court order “expressly applies only to SSA employees working on the DOGE agenda.”

Dudek then said that the “clarifying guidance” issued by the court meant he would not shut down the agency. “SSA employees and their work will continue under the [temporary restraining order],” Dudek said in a March 21 statement.

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Most credit card users carry debt, pay over 20% interest: Fed report

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Many Americans are paying a hefty price for their credit card debt.

As a primary source of unsecured borrowing, 60% of credit cardholders carry debt from month to month, according to a new report by the Federal Reserve Bank of New York.

At the same time, credit card interest rates are “very high,” averaging 23% annually in 2023, the New York Fed found, also making credit cards one of the most expensive ways to borrow money.

“With the vast majority of the American public using credit cards for their purchases, the interest rate that is attached to these products is significant,” said Erica Sandberg, consumer finance expert at CardRates.com. “The more a debt costs, the more stress this puts on an already tight budget.”

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Most credit cards have a variable rate, which means there’s a direct connection to the Federal Reserve’s benchmark. And yet, credit card lenders set annual percentage rates well above the central bank’s key borrowing rate, currently targeted in a range between 4.25% to 4.5%, where it has been since December.

Following the Federal Reserve’s rate hike in 2022 and 2023, the average credit card rate rose from 16.34% to more than 20% today — a significant increase fueled by the Fed’s actions to combat inflation.

“Card issuers have determined what the market will bear and are comfortable within this range of interest rates,” said Matt Schulz, chief credit analyst at LendingTree.

APRs will come down as the central bank reduces rates, but they will still only ease off extremely high levels. With just a few potential quarter-point cuts on deck, APRs aren’t likely to fall much, according to Schulz.

Credit card debt?

Despite the steep cost, consumers often turn to credit cards, in part because they are more accessible than other types of loans, Schulz said. 

In fact, credit cards are the No. 1 source of unsecured borrowing and Americans’ credit card tab continues to creep higher. In the last year, credit card debt rose to a record $1.21 trillion.

Because credit card lending is unsecured, it is also banks’ riskiest type of lending.

“Lenders adjust interest rates for two primary reasons: cost and risk,” CardRates’ Sandberg said.

The Federal Reserve Bank of New York’s research shows that credit card charge-offs averaged 3.96% of total balances between 2010 and 2023. That compares to only 0.46% and 0.43% for business loans and residential mortgages, respectively.

As a result, roughly 53% of banks’ annual default losses were due to credit card lending, according to the NY Fed research.

“When you offer a product to everyone you are assuming an awful lot of risk,” Schulz said.

Further, “when times get tough they get tough for most everybody,” he added. “That makes it much more challenging for card issuers.”

The best way to pay off debt

The best move for those struggling to pay down revolving credit card debt is to consolidate with a 0% balance transfer card, experts suggest.

“There is enormous competition in the credit card market,” Sandberg said. Because lenders are constantly trying to capture new cardholders, those 0% balance transfer credit card offers are still widely available.

Cards offering 12, 15 or even 24 months with no interest on transferred balances “are basically the best tool in your toolbelt when it comes to knocking down credit card debt,” Schulz said. “Not accruing interest for two years on a balance is pretty hard to argue with.”

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The 60/40 portfolio may no longer represent ‘true diversification’: Fink

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Andrew Ross Sorkin speaks with BlackRock CEO Larry Fink during the New York Times DealBook Summit in the Appel Room at the Jazz at Lincoln Center in New York City on Nov. 30, 2022.

Michael M. Santiago | Getty Images

It may be time to rethink the traditional 60/40 investment portfolio, according to BlackRock CEO Larry Fink.

In a new letter to investors, Fink writes the traditional allocation comprised of 60% stocks and 40% bonds that dates back to the 1950s “may no longer fully represent true diversification.”

“The future standard portfolio may look more like 50/30/20 — stocks, bonds and private assets like real estate, infrastructure and private credit.” Fink writes.

Most professional investors love to talk their book, and Fink is no exception. BlackRock has pursued several recent acquisitions — Global Infrastructure Partners, Preqin and HPS Investment Partners — with the goal of helping to increase investors’ access to private markets.

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The effort to make it easier to incorporate both public and private investments in a portfolio is analogous to index versus active investments in 2009, Fink said.

Those investment strategies that were then considered separately can now be blended easily at a low cost.

Fink hopes the same will eventually be said for public and private markets.

Yet shopping for private investments now can feel “a bit like buying a house in an unfamiliar neighborhood before Zillow existed, where finding accurate prices was difficult or impossible,” Fink writes.

60/40 portfolio still a ‘great starting point’

After both stocks and bonds saw declines in 2022, some analysts declared the 60/40 portfolio strategy dead. In 2024, however, such a balanced portfolio would have provided a return of about 14%.

“If you want to keep things very simple, the 60/40 portfolio or a target date fund is a great starting point,” said Amy Arnott, portfolio strategist at Morningstar.

If you’re willing to add more complexity, you could consider smaller positions in other asset classes like commodities, private equity or private debt, she said.

However, a 20% allocation in private assets is on the aggressive side, Arnott said.

The total value of private assets globally is about $14.3 trillion, while the public markets are worth about $247 trillion, she said.

For investors who want to keep their asset allocations in line with the market value of various asset classes, that would imply a weighting of about 6% instead of 20%, Arnott said.

Yet a 50/30/20 portfolio is a lot closer to how institutional investors have been allocating their portfolios for years, said Michael Rosen, chief investment officer at Angeles Investments.

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The 60/40 portfolio, which Rosen previously said reached its “expiration date,” hasn’t been used by his firm’s endowment and foundation clients for decades.

There’s a key reason why. Institutional investors need to guarantee a specific return, also while paying for expenses and beating inflation, Rosen said.

While a 50/30/20 allocation may help deliver “truly outsized returns” to the mass retail market, there’s also a “lot of baggage” that comes with that strategy, Rosen said.

There’s a lack of liquidity, which means those holdings aren’t as easily converted to cash, Rosen said.

What’s more, there’s generally a lack of transparency and significantly higher fees, he said.

Prospective investors should be prepared to commit for 10 years to private investments, Arnott said.

And they also need to be aware that measurement issues with asset classes like private equity means past performance data may not be as reliable, she said.

For the average person, the most likely path toward tapping into private equity will be part of a 401(k) plan, Arnott said. So far, not a lot of companies have added private equity to their 401(k) offerings, but that could change, she said.

“We will probably see more plan sponsors adding private equity options to their lineups going forward,” Arnott said.

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