Me and my wife just netted $72,000 by selling our old house. I’m trying to see if the plan we have worked out is solid or not.
$40,000 – paying off my wife’s $800+ car payment at a 9.5% interest rate (terrible decision, we weren’t as financially wise back then and we still owe too much on it to trade it in for something cheaper. With this payment and our second mortgage gone though we plan on investing heavily into ETFs, 401ks, and Roth IRAs with the extra disposable income)
$10,000 – High yield savings account
$5,000 – making renovations to new house
$17,000 – S&P 500
We were initially thinking of putting more back for a college fund for our 1.5 year old son but I was thinking if we could grow a solid stock portfolio we may not even need a college fund. Idk what to do
What should me and my wife do with $72,000 we just made from selling our house?
byu/YaBoiCade ininvesting
Posted by YaBoiCade
18 Comments
Are you accounting for cap gains?
How old are you guys and how much do you have in retirement accounts?
Where are you living now the house is sold?
Use SGOV instead of HYSA.
Plan looks fine. Start adding to VOO weekly instead of spending all your money. Work to increase the weekly. Sell only when you have something urgent to pay for.
Open a Fidelity account for the SGOV and VOO. Use their planning tab to budget and track expenses. Link all banks and credit cards. Best of luck.
Assuming this $72 is your proceeds after closing and any tax your plan seems OK.
That said, I would consider a 529 for your kid. Any tax advantage is tax advantage. Of course there are a multitude of factors that make this a decision not an automatic. But I would look into it.
Get a financial advisor, in a financial office. Not on Reddit. Damnit.
sounds like a nice plan I would recommend putting 1k a month or something like that into sp500 over the next year and a half instead of everything rn but aside from that sounds like you know what you’re doing
Instead of the 17k in sp 500 do one of you have a 401k you can max for the year.
With just this information, it seems like a solid plan. I’d encourage you to come up with a plan for the money you will no longer need for the car. Don’t let it simply be consumed by life. Make it work for you. Maybe $400 a month for S&P and the rest to pay down other debt.
Some folks may encourage to not pay off the car. You can argue #s or you can find peace and hopefully enjoyment. You don’t like the constant reminder of the bad decision you made. Get rid of it and use that experience as you move forward. You are wiser now!
College fund. Not a bad idea while they are young. I waited too late. The initial tax savings was minimal and the savings on the growth never really came to much. I could deduct the expenses and save more than the initial tax savings. You and your wife might enjoy building this gift for your child.
Congratulations on the money you made. Don’t sacrifice the good for the perfect. Make good decisions and keep moving.
Blessings
I assume the HYSA is an emergency fund? Does that put your emergency fund at 3-6 months?
Otherwise it looks good
Buy physical silver
Sell the car then buy a $20k car. Dump the difference into S&P with the $17k
I’d rather invest it and use profits to fund that I would have paid off assuming I knew how to invest/trade it. Earning an average of just 10% in S&P 500 might not be good enough offset depending on time horizon
Buy yourself a nice Rolex. They appreciate nicely and, unlike a dumb gold bar or stock certificate, have some use as timekeepers or as valuable heirloom to pass down to your progeny.
Definitely pay off that car loan. Your plan seems sound to me. Understand the 17k in sp500 is not something you should take out for at least 5 years or more. If you need liquidity keep it in hysa so something similar
Absolutely pay off the car, the rest is kinda up to you
a really nice boob job
Paying down a high interest loan is a win. So it’s like whatever your interest rate you’re paying off, you can see it as a gain. 8% interest rate? You just made a 8% return