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What are your plans for moving when the kids leave the nest? We've always planned on being in a home with rooms for them through college and maybe a year or two afterwards just in case although we don't really want them back. But our good friends recently said they are moving to a smaller house in a different city as soon as the youngest leaves for college. That seems harsh to me, but maybe most people do that.
My general observation is that people have 4 stages of slowing down:
We have some time for that, but if I'm still working we'll probably move to a lake house an hour away (about 40 minutes from the current office). Get a place with 3 bedrooms, the kids can visit but not comfortable enough to crash long term.
Contact your 401k plan administrator for the options on the 401k loan. There is what the government allows and then there is what the individual plans allow/offer, so your specific options may vary.BroncosFan07 said:
Just pay ahead or in your case, invest the money. Nothing like paying 2.75% and watching your Amazon do 20% a year. I'm in the process of taking a 15 to 30 year because it will allow more dti flexibility. Also dti ratios have dropped recently.
Congrats. Not the direction I would have gone, but very impressive on your part to pull that off.
Did the same thing. Don't regret it. My liabilities are whatever my CC bills are at the moment.
Awesome. Been in that boat for about 7 years now and it's great. Just opens up so much. And given all the employment uncertainties with COVID, just knowing that you don't have what most people's largest expense is.....that's a huge "peace of mind" aspect.
This thread might help you. https://forums.footballguys.com/forum/topic/787050-buying-a-vacation-home-as-an-investment-property/?tab=comments#comment-22884692 There's a lot in there from a very helpful poster. The caveat being that maybe French people are respectful of property.
Would likely not want to rent it out for the reasons you mentioned and would make it a spot we could easily get to and immediately unwind for the weekend or work remotely from for an small extended period. Perhaps one day 8 years from now I could turn it into a permanent rental but would not rent it immediately. And definitely would be a vacation condo/apartment vs. home. Do not want to worry about yard work or the large amount of work that comes with a house as compared to condo.
I kind of like your idea of buying a second place you want to hang and enjoy if the housing landscape there forces you live in a place that isn't optimal. A lot of people in the US working in the mega metros rented a small place for the week and then departed for their "home" on the weekends.
I couldn't imagine paying $750 or more per square feet. We're just under $100/sq ft. Maybe for like a 2nd row beach house I can see it, but wow.
Same, it's quite hard to stomach for a house but interest rates here are around 1% on a 25-year term. Once you get over the initial hump of the high fees/taxes on the initial purchase, it's nearly all equity you're plowing into it. And most, but not all, houses are generally quite small here....at least for the price we're looking at.
Gulf shores? We've considered it.
The house next door to where we're staying is actually for sale, if anyone has an extra $1.2 million laying around, looks like a nice place.
At least down in Ft. Morgan the land of my place is worth twice the structure. This pricing makes sense.Gulf shores? We've considered it.
We're headed to Hilton Head in a week. The house we're renting according to zillow is $450 /sq ft, third row. The first row homes we'll walk between both cost just over $3 million. Oddly, one is just over 3,000', the other is 6,700'. With only $300k difference in price.
Be right back....going to short OTC Biotech stonks....Gulf shores? We've considered it.
We're headed to Hilton Head in a week. The house we're renting according to zillow is $450 /sq ft, third row. The first row homes we'll walk between both cost just over $3 million. Oddly, one is just over 3,000', the other is 6,700'. With only $300k difference in price.
Good point. The extra 3,000' might only be worth $100 per foot. I'm not sure about Zillow, would damage or upgrades be included on the site if the house isn't for sale?
I'll be happy to check it out for you.
I would have advised differently but I am sure that is a huge emotional payoff. Congrats!
Zillow is for poo and the answer is no.
Do you already max your Roth IRA? If not, probably makes sense to do that first and then any excess you feel comfortable into your 401K (even if no match it’s still a good investment vehicle).
Roth vs. 401k probably should be more of a tax situation. I max out 401ks because my tax bracket with my wife working as well. That 401k is money that would have been taxed at our highest bracket and can impact other things like capital gains. If you are in a high tax bracket then maxing 401k is a good move even without a match (that change sucks). If you aren’t then that match change would make me think differently. Also, Roth may not even be an option for FBG’s salaries.
Thanks, this is kind of along the lines I was thinking as we don't currently max our Roth's and are not quite up to the phase out limit for married filing jointly (although getting close.)
1. You can always backdoor it (unless for some reason you have a traditional IRA which complicates things)
For 2, I’m not eligible for it anyway with my wife, but I’d still stick with 401k max because I think my tax levels when retired will be less. Only your top tax bracket would matter as every dollar you take off the tax table is at that highest rate. For people earlier in their career or having a lower top bracket, it makes a lot of sense. Also, I don’t think I’ve ever seen a study on it, but I wonder if having all the taxable dollars working for you during a bull run like we’ve had changes the discussion. You still get taxed on withdrawal but could you end up with enough that you never withdraw it all and it keeps compounding until your kids get it? I think there are new tax laws about having them have to drain those accounts and not just let them keep rolling.
There's more to it than "will my rate be higher or lower in retirement?"
If your tax rates are identical, they are exactly the same assuming you withdraw every dollar. People mention that you save more, but that is an apples to oranges comparison as it means that you used extra money to pay taxes so that you invested the same amount . You also need to use an example where that extra money you put in the Roth is put into a brokerage account because that money can grow and will be taxed at capital gains rates which historically is less than income taxes and unless Biden passes a change, can be passed to children with a step up basis. It doesn’t matter to me as I can’t take advantage of it right now but just saying that someone spends $15k to net $10k in Roth and compare it to $10k in 401k/Traditional. There’s $5k missing that could go into stocks and either never get taxed (inherited) or get capital gains treatment.
Yeah I mean if your goal is to build an inheritance fund your function changes significantly. That is not my goal and I haven't looked at that as a goal at all. Would defer to you there.
I feel like we had this discussion several months back, or at least stbugs and I did. I agree with you. His point about the same amount of money does make sense. However the diversity of having already taxed monies and the possibility that rates do go up makes it wise to have a portion in Roths. I'd say 20-30%.
The other thing to remember here is that a new employer would typically have a lag before you start getting a match there too (and sometimes a month or quarter for eligibility). So it may make sense to front load the 401k actually if you won't have it as an option later in the year. You can always put money into the Roth even while unemployed.
I think so. Unfortunately, not sure what real estate you can buy around here for $100K.
I was thinking land in the outskirts of a growing region such Jacksonville. You'd have to do a lot of research. But about a 1,000 people were moving to Florida per day, before the pandemic. It's picked up again.
does he work? If so, can open a Roth and start that as well. (Well...now that I read it again, not sure how a trust would come into play there....but it's something to look into at least)
Do we work at the same place?
