I gross 211k/yr (s-corp profit), wife is at 24k/yr. Background is in driving truck, currently run a dispatch s corp which is why my income is what it is. This has been a relatively new change, I’m right at 2 years now.
The only liabilities are my truck at 900/mo 26k remaining, and rent at 2000/mo. It’s a write off for the business so there is no point to pay off the truck. The business also is able to absorb some of what are also costs of living due to being home based, such as part of the utilities/internet/etc.
Monthly cost of living is 6k/month. We do end up with various expenses such as a bed we needed and bought. I attribute that partially to lifestyle creep but more in the way of buying things we technically needed but would have waited and budgeted for in the past.
We currently have out of approximately 400k gross over 2 years:
50k liquid-20k in a hysa, 6k for this months bills, and 24k spread among the business accounts to cover upcoming quarterlies etc. and avoid charges for minimum balance requirements.
150k retirement-100k in a 401k and 50k in a Roth (only around 10k added over the past 2 years)
My job is secure until oil prices drop to $50/bbl or until I just can’t take the stress any longer.
My wife wants to get into a house. The median price is 450k in our area, but the market is absolutely stagnant. I cannot stomach what she’s wanting which is more on the line of 600-650k. The payment would be staggering (to me) at around 4500/mo as well as wiping out most or all liquid cash to cover down and closing. Quick math in my head puts it simply not worth it, saving 2500/month for 5 years and continuing to rent is 150k liquid, if I pay the house payment I’d have approximately 30-35k equity plus any appreciation in value. The house purchase route seems much higher risk to me, and I just need to know if I need to get over my mental block or if I’m just being logical.
We do have some physical assets, 10k in pm, a 2025 van we own outright (approx value of 40k), and a couple recreational vehicles worth around 20-25k with the trailer.
Do I just wait out the housing market if I’m not comfortable or debate a move to an even lower col area? I can do my job from anywhere I have phone service. Or do I just stay where I’m at and just keep stacking, and start putting more money into retirement/investing? I’m savvy enough with money to avoid blowing it all on nonsense, but not disciplined enough to live like I made 3k/month.
Continue to rent making over 200k?
byu/Rotorsnside inpersonalfinance
Posted by Rotorsnside
6 Comments
Following! I don’t have any advice but rly relate
>Do I just wait out the housing market if I’m not comfortable or debate a move to an even lower col area? I can do my job from anywhere…
These are all questions you need to answer for yourself. Do you want to be locked into where you are now if you buy a house? Do you want to be a landlord if you buy a house then decide to move.
I’m not sure if the mental block will ever get easier. We make $350k+, 1.2M invested and still rent. That being said, our house prices are much, much higher and our apartment is rent controlled. But yeah, I can’t bring myself to sell off my taxable holdings and increase my monthly payment just to say I own a condo/house when I really don’t mind renting. Sounds like you need to get on the same page as your wife.
Renting and investing your money in ie index funds tends to have a better return. BUT the point to life isn’t stacking bills, and maybe it would be worthwhile to have a home of your own. Why does your wife want to stop renting?
If you mean saving the money without any investing vs putting it into a house, a house is usually better. You’re still saving your money – just in a house instead of an account – and if you are intentional with your house/area purpose you will gain money on it.
I wouldn’t rush this choice though. You can wait and think about it, while building a hefty deposit or nest egg.
I think you need to exercise the discipline muscle before getting into a more expensive house.
Save and invest in the interim and be content with renting.
The mortgage on a primary home is a liability, not an asset.
Owning a house is often more expensive than renting, but can be worth it if you’re more comfortable that way and can afford it.
Now seems like a good time to save as much as you can (within reason). If discipline to save is hard set up a automatic deposit to a separate account for that purpose.