What is your spouse's plan for all of your excess cash while waiting for the opportunity to pick up another rental property? Inflation is a SOB that makes your savings accounts whittle away over time and it sounds like you two may not have the necessary time to spend finding a good rental property.
What is your desired allocation of real estate to stocks? Are you able to come to a compromise that is somewhere in the middle of her desired allocation and your desired allocation?
Do you guys invest in individual stocks?
Does she know what the index funds are or does she feel as if the ticker symbol (VTI or VTSAX) represents a single company (i.e. -> vanguard goes bankrupt and you lose all your money invested in VTSAX/VTI -or- does she really feel as if all 3500+ publicly traded companies making up those index funds will go bankrupt at around the same time)? Just trying to understand better what her fear is.
I will state that I've gone to a brief seminar put on by a local bank that discussed self-directed IRAs for investing in real estate and it was NOT GOOD. Must use commercial loans (25% down or more, bank reviews your numbers, unlikely to get a good interest rate), all repairs, downpayments, mortgage payments, insurance payments, capital improvements, etc must come from within the IRA, must use a property manager as all transactions must be kept at "arms length" and you could still trip up and trigger special IRS rules that will try to tax you inside of your SDIRA if you aren't very careful. On top of all that, you get to pay annual fees to the administrator of your SDIRA.
My spouse is the opposite.
She worries constantly about our rental properties and is always trying to come up with reasons to call the property managers, request photos, ask a 1000 questions about every nook and cranny. She is 1000x more comfortable just putting everything into the stock market (index funds) and owning all the publicly traded companies where she doesn't have to worry about it. She really hates the emails where a maintenance concern needs to be addressed -> it feels to her that all our money drains away and the renters are ruining the houses whenever this happens.