Author Topic: At a crossroads - I need mustachian input  (Read 2925 times)


  • 5 O'Clock Shadow
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At a crossroads - I need mustachian input
« on: October 21, 2014, 08:01:44 AM »
I feel i already know the answer depends on what I want now and later but here it goes.

Im 32 male in san jose ca, saved a ton and bought 3 properties in the down market in the bay area. 

got a Wife who no longer works (we both wanted her to be home with the kids) , 2 year old, 1 year old and another on the way and I want to retire soon (35ish) as Im stressed, fat, bad anxious habits and totally alone in mustachianism in my group of friends family and coworkers.  I want to improve on my mustachian frugality and am struggling.  our house is 900 square feet 2br 1 bath so we will out grow it with the 3rd kiddo

earn 130k year as medical device sales rep. 6k annually contributions to 401k.  we spend 5k a month on needs but mostly dumb crap we don't need (wife disagrees)

35k in 401k
75k in personal portfolio
20k cash on hand


7 plex. debt 444k valued at 800k - cash flow 2200/month after expenses -- 25 year loan. bought oct 2012

duplex1 - debt 230 valued at 500k - cash flow 800/month 30 yr loan  bought july 2011

duplex2 - debt 345 valued at 925k - I live in it so the other unit rent is 1750 and my total expenses are $3400 so with the rent we pay about $1650 for PITI (principle, interest, taxes and insurance).  15 year mortgage with 12 years left bought 2009 then re fied

Here is the dilemma, I believe we are at the top of the market in the bay area as it has sky rocketed.  Since duplex 2 is our principle residence we can sell with out taxes and pocket 500K!!!!  crazy right?  with that cashola we can pay off the 7 plex and have the 2200 cash flow go up to 4700! leaving us with a grand total of 5500/month passive income from RE alone but no where to live in the most expensive place in the country.  (WE could move in with parents for 2 years and combine the 5500 a month with another 3000 a month from my check to savings.  2 years of badassisty and 8500 a month would kick ass and then I can go build my own house outright and be retired at 35.  I kinda love this….


Keep it all as it will all pay itself off in time,( duplex 2 would cash flow about 800/month if we moved out) cut expenses, save 3k month total by moving in with parents and then what?  RE is way to pricey to buy and it would cost about 3k month to rent a 3br 2 bath house.

Wants:  1 year abroad in ecuator with family. should cost less than 3k/month.  Cant do this until the 3rd much kin is at least 2 so 3 years from now.
free lifestyle to do different kinds of work by choice and travel long periods abroad with family.

Whadda ya think?

side note*  we don't like the city and want to move somewhere in norther cal less expensive but still able to visit friends and family if anyone knows of a wonderful mustachian friendly place to call home that is good to raise kids.  ants:  1 year abroad in ecuator with family. should cost less than 3k/month. 




  • Walrus Stache
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Re: At a crossroads - I need mustachian input
« Reply #1 on: October 21, 2014, 09:48:21 AM »
If it were me I'd want out of the bay area as fast as possible, so I'd sell your house and do exactly as you say... But...

There is another option.. Kick a renter out of one of your rentals, live there 2 full tax years and do it again... All the while keep doing your job and stashing like crazy.. Keep going until you have all your properties sold and a boatload (well over $1M), retire and get the hell out of there. Assumes property prices stay high, but if they don't then keep renting them.

Alternatively stay close enough where you could get to your rentals but live in a much lower stress (and cost) area... Oregon, some gorgeous places there or Nevada for real low cost if you don't mind running your AC all the time. Now if your could move with your job that's a bonus, might be less income but your lifestyle is probably killing you as well.


Cheddar Stacker

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Re: At a crossroads - I need mustachian input
« Reply #2 on: October 21, 2014, 09:51:44 AM »
You spend $5K/month, does that include the $1,650 for your portion of duplex2? If so, $5K-1,650=3,350 and cash flow from the 7plex and duplex1 totals $3K. You are very close if that's the case, particularly since you also have $130K outside the rentals.

Obviously you'd have to find a place to live, but if you ended up at your parents or overseas that $5K monthly could be reduced even more.

I wouldn't be comfortable yet, but that's just me. If you're ready to take a chance, I think the numbers are close to working.

Bob W

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Re: At a crossroads - I need mustachian input
« Reply #3 on: October 21, 2014, 09:57:50 AM »
I find in general it is best to buy low sell high.   You could always do the move to another rental like the last poster said.   

Do trees really grow to the sky in San Fran?

IMHO I would be taking that money off the table asap.   You know the theory --- bird in hand --

Plus,  you could move to a really nice part of the country.   Around here, in the awesome Ozarks, you could buy a very nice country house for 100K.   And we have plenty of jobs for hard working sales types. 

Have you ever been to Ecuator?  Or is that a geographic cure?   I'm thinking there is more conflict between you and wife than you innumerate?


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Re: At a crossroads - I need mustachian input
« Reply #4 on: October 21, 2014, 07:52:13 PM »
What are you relying on for house estimates? Bank appraisals or tax appraisals? If it says something crazy on zillow, it might not be true.