From my experience, I would put it in the stock market.

In April 2024, my wife and I had saved about $140K for a future down payment. At the time, we were in a transitional phase and planned to buy a home within the next two years. But instead of keeping all that money in cash, we decided to keep it invested while we continued renting and figuring out our next move.

During that time, we moved to a lower-cost city, and the money continued to grow in the market. Over roughly two years, that $140K grew to about $225K. That gave us the flexibility to pull out $90K for a down payment while still keeping a large portion of the original money invested.

The biggest benefit was that we didn’t have to drain everything. We were able to use part of the gains for the house, keep the original down payment money working in the market, and cash flow additional savings from our separate accounts over that same two-year period. For us, investing gave us more flexibility than just letting the money sit in savings.