Author Topic: need objective advice  (Read 6741 times)

needmyfi

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need objective advice
« on: October 12, 2012, 09:25:09 PM »
Quit well paying engineering job in 2004. Had a paid off triplex, no debt and 70k in savings and started a gardening business.  Within a year I was making about 30k at gardening working 25 hous a week and still had my 10k in rental income.  SWEET right? Husband also working about 25 hours a week making 25k Bought a camper and paid a very part time employee (also mustatian type) and able to travel several times a year.  Then katrina.  Thats Katrina as in hurricane.  We moved to rural ga, currently have 11k a year rental paid house but have looong commutes and no freedom  we have lost about 30 percent of equity in our two houses. I would love to move back but would take a huge hit on houses.  Also husband now has diabetes and private insurance is minimum 2400 a mo. No that is not a typo.  I have great job in horticulture and conservation that i love that only pays 10 hour and is 24 miles away but we are no longer young and it gets us good insurance for 4oo a mo.  Working for insurance and gas. In addition to two paid off houses (350a month t&i) we have only 80 k   7 years after hurricane.  We were saving over 15k a year before the hurricane threw a huge wrench in plans.  Want to move HOME.  Want fi againand ability to travel again. Dont mean to whine about first world problems but after one big leap that threw us off a cliff we are gunshy.  MOVE OR STAY?-
« Last Edit: October 13, 2012, 12:05:57 PM by needmyfi »

needmyfi

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Re: need objective advice
« Reply #1 on: October 13, 2012, 06:49:59 AM »
The property was sold and we did a real estate exchange to avoid capital gains tax. We were very fortunate that we ha adequate insurance and were in a desirable neighborhood
, thepropery sold for 109k and the rental property cost us 117k. The house was worth about 200 and we got 220 combined so we are grateful but it would cost 300 for a renovated house in that area now. I know that is counterintuative but the hood was gentrifing even before katrina and is one of the few middle class areas available
. NOLA is mostly  rich 500k plus or under 100k and poor.  Also rents are much higher now.  Do to limited availability they soared after the storm.. We would like to move to an area about 45 mi north which has grown post storm and would cost about 100k more for the two houses than we could get for the ones in ga. Atlanta has been hit very hard in the housing market and our area is in the mountains where there are lots of second homes so we still have a huge glut.
The only bright spot is that I am very confident I could get the gardening business back and running.  Insurance is slightly better since LA has state run high risk pools for people with pre existing conditions but the cost would still be the unmustachian sum of 1800 a month. One of us would have to have a "real job " There are no solid financial reasons to move, the only advantage would be our happiness at being back near family and friends.
We are currently saving 10k a year but with market drops and lots of moving expenses we have been really set back in our goals of er and fi.
 

needmyfi

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Re: need objective advice
« Reply #2 on: October 13, 2012, 07:46:49 AM »
Forgot to mention I am now almost 55 and dh is 57.  It does get harder to find jobs as we age, especially aafter having lots of parttime work in the last 9 years.We could get 160 or 170 out of these two houses after realtor fees.
« Last Edit: October 13, 2012, 03:06:31 PM by needmyfi »

Jack

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Re: need objective advice
« Reply #3 on: October 13, 2012, 08:07:19 AM »
I know that is counterintuative but the hood was gentrifing even before katrina and is one of the few middle class areas available. NOLA is mostly  rich 500k plus or under 100k and poor.

Intown Atlanta is the same way (>$500k in the North and East, <$100k in the South and West), but that doesn't mean there aren't decent yet affordable neighborhoods on the edges between. I suggest that if you really want to go back to NOLA, you should find one of those (one that's gentrifying, but perhaps not quite as far along in the process as the neighborhood you left).

needmyfi

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Re: need objective advice
« Reply #4 on: October 13, 2012, 09:29:05 AM »
Jack I totally agreed on that. Paid 237 for both houses here,talked to two agents and have been tracking prices both here and there.  We could get about 170 combined maybe 180. To replace rental income and have safe cheap house we are looking at combined cost of two houses around 250 to 270.  Could cash in the rental house,but would pay 15 percent in cap gains (1031 exchange) on top of losing in home value.  Bought triplex in my late twenties so the rental portion was fully depreciated.  Not trying to "yes but " just scared to take on debt and reduce passive incme when we really need to rebuild our finances.  Triple hit of hurricane housing and health have turned me from fearless to fraught. Need my mustache mojo back!  Have even considered trying to go back to engineering which I never enjoyed,but then could possibly live where I want and feel mre confident.

needmyfi

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Re: need objective advice
« Reply #5 on: October 13, 2012, 10:03:54 PM »
Thanks for the advice lhamo.  We can totally live on SS, right now with rental income and paychecks we take home about 45k year and have been able to save 10k this past year. Our biggest expense by far is insurance, car house and health are about 8k a yearI haven 't looked at at 62, but last time I checked at 66, payments they will be slightly more se to what we are making now (close to 35k together for ss) so we will be plenty comfortable I know one of the goals on ERE is to live on less,we are at what I consider to be bare bones but still bearable.
If I was selling in one depressed market and buying in another depressed market I wouldn 't hesitate. The area we have been researching is north of NOLA, higher and hopefully drier!  but close enough to visit ffamily and friends.Prices in this area have risen since the storm but we know and love the area. We had hoped by now to have alot more saved by now. If I went back to engineering even for 5  years I could save beaucoup , my best chance of finding a job after 9 yearsout of the game would be back home. My heart says go, but my head makes many of the same conclusions that you do. Stay in a not so bad situation. If we stay our only financial worry will be the cost of long term care if either of us needs it or of assisted living.  The equity in the two houses shuld be a good head start if needed.
Whatt bothers me thee most I guess is that I feel like I 've just traded the daily grind of an unfullfilling job for a life dictated my money in a whole different way.





« Last Edit: October 14, 2012, 12:02:50 AM by needmyfi »

needmyfi

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Re: need objective advice
« Reply #6 on: October 14, 2012, 01:00:54 AM »
Thanks again.  We had many friends totally devasted by Katrina. The real damage that the hurricane brought us was we made rash decisions we may not have normally made. After Katrina wewere emotionally devastated,but in reality not hurt as badly financially as most, the housing bust has been financially almost as bad losing 60k plus in 7 years when we thought we would save more than that not lose it!   Working up here in  engineering would be pretty ironic since the only thing I like about living here is my job.  I am truly grateful that I do have options with my degree.
« Last Edit: October 14, 2012, 01:10:10 AM by needmyfi »