Practical guide · General Questions · Basic level · 5 min read ·
How much of my savings should go into real estate?
There's no single right percentage. A common way to think about it is in layers: first the emergency fund, then short-term goals in liquid options and, with what you can leave untouched for several years, a share in real estate. How much depends on your age, income, goals and risk tolerance.
In 30 seconds
- Real estate belongs in the long-term layer, never in the emergency one.
- What you'll need within three to five years shouldn't go into a low-liquidity asset.
- Spreading across several assets and projects reduces the effect of one doing badly.
Before you start
This guide gives you general criteria, not a personal recommendation. Before deciding how much, be clear on:
- Your emergency fund, complete and separate. If you don't have it yet, start with knowing whether you're ready to invest.
- Your goals with dates: studies, a trip, a home down payment, retirement.
- What other savings or investments you have and where they are, including your home if you own it.
Step by step
- 1
Split your money by timeline
Divide your savings by when you'll use them: under a year, one to three years, and more than three to five. Each timeline calls for a different kind of asset, and mixing them up is the most common reason people end up selling at a bad moment.
- 2
Put short-term money in liquid options
What you need soon goes where you can withdraw it without losing value, such as a savings account or a CDT whose term ends before your goal. Here, having the money on time matters more than what it earns.
- 3
Use the long term for assets like real estate
Real estate and project participations have low liquidity, and their results show over years, through the asset's operations and through appreciation when the project ends. That's why they fit the layer of money you can leave untouched.
- 4
Start with a share and grow in stages
Many people start with a small portion of their long-term layer and increase it as they understand how projects work and read their reports. Going in stages also lets you come in at different moments and prices, instead of betting on just one.
- 5
Spread within real estate
Don't put everything into one project. You can combine asset types and places: at Circular Urban there are hospitality projects like Circular Houses in Medellín and energy projects like Solar Subway La Pintada in Antioquia, with different risks and rhythms.
- 6
Review once a year
When your income, goals or stage of life change, so does the share that makes sense. A yearly review, for example when you file your tax return, keeps you on track without thinking about it every month.
An example
Camila has 20,000 units saved and expenses of 1,500 a month. She wants to take a trip in a year and has no other near-term goals. The figures are illustrative.
| Emergency fund (4 months of expenses) | 6,000 |
|---|---|
| Short-term goal: the trip | 3,000 |
| Long-term layer | 11,000 |
| First contribution to real estate | 4,000 |
Camila doesn't start from a fixed percentage: she starts from what she can truly leave untouched, and begins with a portion of it. Over the years and with more information, she can raise that share or spread it across more projects.
Questions you'll have
Is there a recommended percentage?
Not one that fits everyone. Some popular rules split by age or in equal parts across asset types, but they're starting points, not recipes. What doesn't change is the order: emergencies first, then near-term goals, then the long term.
If I'm young, can I put in more?
Having more years ahead usually lets you hold long-term assets, because there's time to recover from a bad period. But age doesn't replace everything else: if your income is unstable or you have near-term goals, those weigh more than your birth date.
Should I put everything into one project?
Better not. A project can face delays or results below projections. Spreading across several is the idea behind diversification, and with low entry amounts it's easier to do from the start.
Does my home count as real estate?
It counts in your net worth, but it does a different job: it's where you live and you won't sell it to cover an emergency. If much of your net worth is already in your home, it makes sense for the rest not to be all in the same kind of asset or the same city.
What do I do with the results a project distributes?
You can withdraw them or contribute them to another project. Reinvesting makes use of compound interest over the years; withdrawing gives you income for other goals. Both are valid depending on where you are.
Do I need an adviser?
For large decisions or particular situations, such as taxes, inheritances or very variable income, a financial adviser or accountant can help. This guide gives you the criteria to go into that conversation with clear questions.
Common mistakes
- Myth
Ideally everything goes into real estate because it never loses value.
- In reality
Properties can lose value too, or go through periods without income. And their low liquidity means they don't work for short-term needs.
- Myth
If the amount is small, it doesn't matter what share of my savings it is.
- In reality
What matters is the proportion: if that small amount is everything you've saved, it's still concentrated.
Your first step
Start with a small share
Once your layers are clear, read how to start with little money and choose a first project at your own pace.
See projectsKeep learning
Helps to know first
This content is educational. Every participation carries risks inherent to the project, including the possibility of partial or total loss, and results are subject to each project's actual performance.
