I read your column regularly and feel almost out of writing. Unlike most of your writers, I don’t have a huge or impressive portfolio.
I am 61 years old. I make $ 35,000 a year. I have a 401 (k) of just over $ 40,000 and a company stock of just under $ 200,000. I have a mortgage on my home for less than $ 25,000. The current value is $ 200,000. I also have $ 20,000 in credit card debt.
I feel like I’m spinning the wheels. I’ve worked hard all my life – maybe not wisely – but I still feel like it’s hand to mouth. I’m not sure how long I’ve had this world, and I want to have a home I’ve always dreamed of before I died.
“I’m not sure how long I have for this world, and I want to have the home I’ve dreamed of before I died.”
In other words, I’d rather have a pool, a strong porch than a thin aluminum lanai, and I’d love the new equipment.
I am blessed with a 500 square foot workshop on my property, from which I would like to receive a one-bedroom lease. I could rent it out for $ 500 a week. I assume I justify my set by claiming that it is for tenants.
Should I withdraw $ 20,000 from my 401 (k) to pay off my credit card debt? Can I take out a second mortgage to turn my studio into a garage for rent with a pool?
In my opinion, this could provide support for my social security while providing the house of my dreams. I plan to work until I turn 67. I have no dependents, so I’m not worried about leaving an inheritance to anyone.
This column is for you. As well as any emails I receive.
Some of the most important letters I’ve received from people who are struggling to make ends meet. And as fragile as your financial life may seem at the moment, remember that it is read by people who are in a worse economic situation.
This woman from the then state of Texas, then 36, wrote about Money in September 2018. He had no higher education and worked full-time for $ 15 an hour and bequeathed a life-changing $ 150,000. I still think of him and hope he lives his best life.
Your priority # 1: Pay off your $ 20,000 credit card. You bleed money with an astronomical interest rate. Replace your porch, upgrade your equipment as needed, and help ensure your home is comfortable for the rest of your life.
Withdrawals from 401 (k) should be a as a last resort. You have $ 200,000 in company inventory. The good news is, you can sell some of this stock to pay off credit card debt and make the necessary improvements to your home.
You can sell part of this stock to pay off your credit card debt and make the necessary improvements to your home.
Investment rule No. 1 is to diversify. If this company’s stock tanks you have problems. Think investing in funds covering many different stocks. See also regular interest-bearing bonds, fixed-income securities.
Carefully tread before becoming a landlord. Short-term rentals are subject to local laws. You have a whim of tenant reviews, complaints and requests. For some people, champagne is never the right temperature. Try your roommate first.
This means that if you sell shares in the company, you can look into the cost of upgrading the studio. Check similar items in the area to see how much people are paying. When you are ready for the challenge, it can be a long-term source of income.
Pool maintenance is expensive – $ 35,000 to $ 65,000 – and as nice as they look, you’re likely to use it less often than you think. (Upgrading a studio can cost you twice as much.) Try the water in the above-ground pool.
As one member of our Facebook group said: “Because we have had two pools, they are like boats, a hole in the water that sucks in money. The difference is that the boat can be sold – the best days are when he buys the boat and when he sells it. Skip the pool. “
You have more immediate responsibilities. How did you get $ 20,000 in credit card debt? Don’t fall victim to the same emotional or psychological pitfalls. Keeping a pool may seem like an apotheosis of the American dream.
However, a secure retirement is a more attractive, sparkling prospect.
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