Question: We have saved some money for a house deposit in 2-3 years. We have a 3.99% mortgage on our current place. Should we invest our down payment for our next house or should we pay off our current mortgage? We are both conservative investors. Tom, Boston, MA 

Answer: Assuming you are going to move within the next two to three years I would stash the money in safe, conservative investments. I imagine between the savings and the equity from the sale of your current home you would be able to put a hefty down payment on the new one. You would have a conservative balance sheet.

Another advantage of saving the money is that it gives you the most financial flexibility, from an extra money cushion to withstand a setback to taking advantage of an opportunity to a large down payment.