Hey guys,
I just recently moved from Minneapolis to Phoenix for a new job, and in the process I've sold my house. We've got about 80k in cash from the settlement and we're not planning on buying anything down here for at least 2 to 3 years (at which point we'll need the money again for a down payment). I'm wondering what you guys would recommend doing with the money in the meantime... here is a bit more background info.
We've got some debt that we could payoff:
- 25k in student loans (@~5%, $216/mo payment)
- Auto loan (@2%, $450/mo, $7k payoff)
- *Nasty HELOC (@9%, $330/mo, $25k payoff)
*The HELOC is from 2006 when I bought my first property. It was technically the '15%' of an 80/15 loan I got. It has a 15 year balloon payment and pays down sooo slowly. We still own the condo and are currently renting it out (at a $400/mo loss). We plan on selling the Condo in May of next year since we're finally back up to break even on it after the market correction in 2007. So, I'm not sure there is a huge advantage to paying this off now (besides the additional cash flow) if we're planning to sell in a few months.
So, thoughts on what to do? Easy option would be to just throw everything into my brokerage account and buy into VTI. There are some other more conservative investing options out there as well, obviously. We're fairly risk tolerant (age 32) but we'd like to be able to have access to the money in a few years so we can buy another house. Also see lots of talk about a coming market correction. Would it be wise to sit on the money and buy in at the next correction? I understand that this is very difficult to time and may end up costing me more money by missing out on short-term gains.
Should also note we're fairly aggressive savers. We both max out our 401ks and HSAs every year. We're no longer eligible to contribute to our IRAs. We're no longer eligible for student loan interest deductions. Our household income is around $290k / year.
Thanks for any thoughts you might have.