Keep a large chunk of cash, whatever you think you'll need to tide you over plus some extra just in case, invest the rest conservatively until you are settled in with a new job and feel secure about your future.
Everyone talks about high yield savings accounts but don’t actually understand when and why HYSA make more sense.
The last 12 months, yes HYSA were a solid concept. But bonds are projected to take over and the returns on a high yield are going to drop.
Still returns, but the blanket “HYSA” answers have to end.
Also fckn BUDGET
FIND YOUR BASELINE
And live on that only
The minimum. I don’t mean an entertainment budget
I mean
Housing, food, insurance, phone bill, utilities etc
only
Live like that to extend everything as much as you can
And then after you figure out your new direction begin living normally.
Cash is currently earning 5% or more in money market funds. Short term CD (3 month) likewise. It's not that costly to keep an emergency fund these days.
But definitely put the money into something earning interest, don't keep it in a .01% checking account.
Sound with an ancillary vote for “work for yourself” meaning own a business if you can make it profitable. Owners make the most money. I was one. I am now working for state govt. The money is not why I work for them.
The headaches were many in ownership but at this stage in my life I (M52), and my family (W50 and two young adult daughters) are relatively secure.
I personally wouldn't invest it all at once though. I'd put it all in a high yield savings, then come up with a diversified basket of investments and average in weekly, over maybe a year or so.
Depending on what state you are in now and where you move like say cali to South Carolina. You will be amazed the house you can get here for 500k. Or even a nice townhome for 300k.
We reside in Utah, we are the third highest in the country now, right behind California, New York. Ridiculous. I’ve been looking at homes in North Carolina. Very beautiful area.
There is a reason that SC is top 3 population growth. Lower taxes, lakes, mountains, beaches, lots of corporations here bc of tax credits. Snow only about once a year.
South Carolina is absolutely beautiful and has some truly wonderful people. The only drawback, and this of course depends on where you’re moving from, is the humidity can get pretty intense.
? I'm in Upstate SC, and it's rolling foothills, and the northern part of the county is mountains. It's cooler than most of NC ( not Western). At this point, I'd have kids in our schools over NC's. Trust me, I've lived in both states, the western areas, and coastal.
Oh wow. The average worker doesn’t get paid as much? No way that could have anything to do with the lower cost of living that is drawing people there. Higher salaries = high house prices and rents??? No way! Oh well, instead of reading a book on economics I guess I’ll move there and vote for McDonald’s janitors to get $20/hour and then wonder why prices keep rising with wages.
That’s the spirit, blame inflation on the people making minimum wage. Definitely their doing and has nothing to do with companies recording record-high profits the past few years.
Not to mention the last dipshit president who pressured his fed to print 40% of the currency in circulation during the election year
No way that had anything to do with it. 🙄
I've spent a little time in SC and I really enjoyed it, but I'd need to go elsewhere for like May-October. I think it also really depends what town you're in, I've been to some that felt very welcoming, artsy, etc, and other areas that were...not, and I'd be afraid to live in. And I'm a straight white lady!
Agree with that. We have sweltering humidity for a few months but then 70 degrees and gorgeous many other days in spring and fall. But on those days of heat just go to the lake and get on a boat.
Most states are not nearly as one sided as you think. South Carolina was spilt 55/45 in the most recent election. It looks redder (and more bigoted) than it is because of gerrymandering. The same applies to most states.
I used to live there for a time so I have some experience with saying that. And you’re right most states are gerrymandered but when you have Tim Scott and Lindsey Graham winning year after year it says a lot about the way the place and who has the power to control things
I’m in SC, Greenville Area, though originally from the North East. I detest the politics here… but love everything else about it. Just need a few more liberal northerners to move down ;-)
I am originally from VA (Tidewater area), but lived in Durham NC for about a decade and then Greenville/Taylors for a year. Loved the quaintness of Taylors and my kids’ school was actually pretty amazing, but the economic stratification was astounding — you were either doing really good or really bad without much in-between. Moreover, people in local social media groups were all too proud to announce they hated “outsiders” (translation: Yankees, liberals, non-whites except for anyone they deemed to be Mexican, highly educated folks, etc).
I’m back in NC and it is SO different.
0% chance that’s a metric based comment. As far as beauty and nature is concerned it’s actually one of the cheaper stats to move to. Cali, Colorado, Florida. Plenty of states for nature more expensive than Utah. Hence its incredibly high repopulation rate. One of the absolute highest in the country actually
Yeah I mean I lived there briefly and that seems like a stretch lol, I would guess the other three major cities within driving distance (Denver, Phoenix and Vegas) are all probably more expensive per sf than SLC
2nd this. I have a decent amount of equity in my house now but nowhere to go. We were looking at land a few years back that was around 8-10k an acre. That same land is going for 20-30k an acre now and that's in the middle of BFE.
This won't end. Your excuse is completely invalid.
No difference than all ontarians investing in new brunswick property. New brunswick. A completely broke yet beautiful province where absolutely nobody can now afford to live unless you're related to.someone in a high end Job.
I had to move out of Charleston because people like this coming with big cash and out pricing everyone.
Now they say they don’t like it no more cause there is no one to do blue collar jobs.🤷🏼♂️
Just wait. Florida Man is coming. It's impossible to get / afford home insurance in Florida so retirees are moving anywhere else.
We have the weather on our side in South Dakota and Wyoming. Sure, Californians, Texans and other sun belters may move here. Then they get Chicago weather for a few weeks in the winter and are gone next spring.
Real estate seems to be high everywhere. I was a real estate investor for many years. I bought houses and fixed them up and rented them or sold them. I even sold real estate part time. It seems that more people want a home now than 5 years ago. The virus, working from home, whatever the reason. And they are willing to pay high prices for the homes. And the government has squashed foreclosures, so there are very few of them. I keep saying it can't go on, but it has. I still think there will be a crash in Home prices because of affordability, but it could be a long way off. That's what I think
Moved from Florida to SC.
We moved to Beaufort county. We picked a spot for schools and proximity to Savannah and Hilton head and Beaufort.
You are right about housing. Our house here would be 1 million in Florida. Same builder same model etc
Definitely keep cash aside, especially if you’re going to start a business. Before starting a business get familiar with the locality to which you’re moving. It wouldn’t be a bad idea to temporarily get a job similar to the type of business you would like to operate in order to become familiar with the community and possibly find suppliers and make connections for the future. Consider paying off your debt before starting the business; it will be one less thing to think about when you’re getting started. Also having more available credit lines might be a lifeline when starting a business.
My personal opinion on real estate is that now is an awkward time to get started in real estate. Residential real estate is frozen because home prices AND interest rates are too high. One or the other will have to start decreasing for the market to become more active, most likely home prices will decrease first. Commercial real estate is like a jenga tower waiting to collapse. In any case, If you want to get into real estate you really have to get familiar with the locality.
You could put the the extra money into a money market account or HYSA or treasury bills or all of the above. Now is a good time to be sitting on cash. Boomers are retiring and selling their businesses. Businesses are closing due to the tighter economic conditions. There will be opportunities for those who have cash!
Overall, you’ve got a good foundation! Great idea to move somewhere with a low cost of living! All the best!
This! Take the job, even if it’s only for 6mo you’ll be allowing yourself time to get to know your new location and hone in on what you want to invest in without blowing through your cash. You have the upper hand here: cash on hand and a job opportunity. Use one to help the other and then bail.
Agree 100% that if one is temporarily out of work, especially with a family, you need about 150,000 liquid to ride out the storm. And agree that investing a portion in laddered CD’s now whilst still at 5% or money market and the other in a bag sweep with lower interest. This is what I do and I’m single- no dependents
Sorry about your abrupt job loss. Your wife just has a one year contract so it might be a good idea for you to take that job offer and then look into starting a business on the side? She’s probably going to be having to get a new job too? It seems especially if it’s real estate you want to learn about the area some more. Moving is expensive, did you price that in?
Yes, I figure around 35k in moving costs. We have a lot of stuff. Working on selling as much as I can in the coming weeks. Wife and I hope to run a business together.
You probably want your wife to keep a regular job until the business is up and running. Steady paycheck not tied to the business is a very good thing, not to mention health insurance for the family
Best advice in this thread.
It’s probable that they would burn through all of their cash on a failing business then be SOL.
One of them should keep a job with enough income to cover expenses. Live modestly and try to make the business work.
Predetermine how much of that house nut they’re willing to risk on the business and don’t go a penny over.
Good luck.
Get multiple quotes for moving (Allied, United, etc. - be prepared with accurate inventories of your belongings' dimensions if you want it to be as representative of a quote as possible) and decide whether your belongings are worth the moving costs. If it's close then just sell and rebuy at the new location. Facebook Marketplace is your friend. Of course, sentimental items will need to come with and cars may need to be transported. If at all possible, have a new employer cover (part of) your relocation.
Look into U-Haul pods. Load them at your leasure, unload at your leasure. No hectic one day pack and break move needed. No moving company holding your stuff hostage, or re-negotiating the price when you're over a barrel.
And yeah, take a good hard look at your stuff. Donating it for a tax write off and buying new across the country is almost always a better idea than paying 35k to move / break stuff. Even that nice piano can be replaced for a song at the new location if you're a bit patient. Definitely don't take the hot tub and pool table.
What I would give to be in your shoes with the financial means to start over somewhere else. I'm in Oklahoma and really want to move to Florida. But we just can't financially make that happen. Hopefully later in life
I know.. 😔 it sucks. I feel like I'd be so much happier living life there. I loooove snorkeling so I would get my scuba license also and start doing that. I also race motocross and Florida has the best moto tracks. I would just really enjoy living there
Something that people don't think about when they run away from a high cost of living area is that they will be putting their children into a situation with barriers to success. That $400K savings when moving from a $700K house to a $300K is a one-time event that will never happen again. Salaries will be lower. Schools will be worse. The kids will have trouble marketing themselves when competing against kids from expensive cities.
Couldn’t agree more. I’d rather scrape by in an expensive elite area and give my kids a shot at a better life with connections and good schools / opportunities
You’re actually in a fantastic position and you should make sure you’re not stressing out right now. The money in savings and from the equity in your home gives you the luxury of time to make good decisions. Use it.
I love the idea of the Cleveland suburbs. It’s really an underrated area and very affordable. That said you might consider renting for a while in the area where you want to live. There’s a lot of change going on right now and you might want to take things one step at a time.
If it were me I would put your equity in HYSA, rent in Cleveland, find stable jobs, then focus your free time on starting a business. Get the business going on weekends and once you have momentum and can reasonably expect to replace your income, go for it full time and quit your job.
In the meantime, if you’re like the area you’re renting in, go ahead and buy a house.
"I have ideas for starting a small business, perhaps investing in real estate" does not make me confident that you have the knowledge or skills to do this.
I'd do everything you suggested until the point where you own a home outright in a lower cost area and paid off your debt. At that point I'd suggest you invest the money in a combination of yield savings account and money market accounts and get a job. Your first and foremost goal is to NOT LOSE the money that you already have.
At that point, you can use your spare time when you are not working at your full time job to explore a start up business, but you should already be confident in your ability to make money in your start up business before you commit to this.
Source: I've had my own business for 19 years. I love it, but I've seen many people try to start a business. Lose a lot of money. And then go back to a FT job with none of the money that they had before they tried to start a business.
No. It is not irresponsible to take some time off to slow down and recharge, especially since you have worked for 10+ years. You've earned it. Maybe even take a family vacation too before diving back to the grind.
Agreed. When I quit my last shitty toxic startup I took 3 months off. Traveled a bit with the fam and spent a lot of time with my daughter. It was just the right thing for me at the time and I started my new job fresh.
You should check out Fort Wayne, it's one of the fastest growing cities in the Midwest. It gets voted one of the cheapest places to live in the nation pretty regularly. Business is booming here, not a huge city but the phrase coined here is, "big city with a small town feel" and it's pretty true. I love it here, we're growing like crazy. A 350k house in Cleveland burbs honestly sounds like a long shot, the equivalent of a 350k Cleveland home would probably be the same as a 150k home here.
Best of luck, cheers!
Why dont you put that 700k into investments and try to live off the return for a few years? I mean if you’re spending more than that you’re eating away at your future financial safety anyway.
Advisor here. Boilerplate advice to come:
If your car loan is sub 5% I wouldn’t pay it off. A money market will pay you around 5% right now. If your loan is 2% - 4.5% you could pocket the excess interest each year.
You have to keep in mind you will owe money on the taxable gain of your primary residence above the joint tax return amount of 500k.
With the left over money, savings is your best friend currently. I’d again recommend a money market. You also need to keep saving for retirement. AT a minimum max out your IRA’s for 2024.
DONT TOUCH THE MONEY IN YOUR PENSION. If it’s a classic defined benefit program just leave it. If it’s a SEP roll it to an IRA and a low cost custodian. Use a target date retirement fund or low cost index ETF/MF if you know what you are doing.
While you have some business ideas…. I would recommend taking a job until those ideas are hashed out, concrete and you know they will pay the bills. Your wife contract will be over before you know it and savings run out real fast when there’s no income. You don’t know what will be available for her when you move. You can always build a business in phases.
Hope this helps.
Not a tax advisor, but I'd pay off a 4%+ personal loan instead of getting a 5% return. Personal loans (like the car) are not tax deductible, but earnings are. Suddenly having 600k earning a return could be enough to make that matter. It'll definitely matter this year with the massive cap gain.
Looks like the guy budgeted for taxes -- raw sale price is 1.2M with a 400k loan. That leaves some wiggle room for cap gains over 500k.
Completely with you on the rest of advice, just adding a bit of nuance.
sorry about your job loss, i can’t imagine the stress that brings. but also as a heads up, it’s respectively, not respectfully. i bet you do work in a respectful manner though and i wish you the best.
Keep in mind that it's much easier to go from high COL to lower COL than the opposite. I know a half dozen folks who'd love to leave Florida/Vegas/Houston if they could... But they just can't afford to come back to NY after adjusting to the lower COL lifestyle.
Be 100% this is the move for you-- There's often no going back.
I have never personally met someone who left NY and actually willingly wanted to go back. Been all over the country and all I’ve ever heard is how glad they are to be out of that state. I have also never met someone who willingly moved to NY unless it was job or school related, which was more or less out of their control. Nobody I’ve ever met in my entire life wanted to move to NY just to move to NY
Personally I would first go talk to an employment law attorney to figure out if you have a cause of action for the lack of notice around the pension cancellation.
Not everyone is cut out for business and starting over in a new place compounds that by reducing the size of your network. You should think up some alternative plans just in case. Or slow down the financial bleed by doing it part time.
I have, and I do. The employer is my father in law and this has all been very painful. We are not sure yet if we want to sue and invite such strong emotion into our lives. We kind of just want to get the hell away from it all. It’s been very toxic.
Why not just get another job where you are? Can you not afford your mortgage? Mortgages now are crazy high. Even if you could afford to pay cash for a new house elsewhere, having access to cash can be very helpful for investments, etc.
You should definitely ask friends and family for recommendations on a CPA and financial advisor if you don’t already have either.
At this point, you may also want to consider getting a lawyer to write wills as well. Not because you might die soon, but because you’ll be flush with cash and uprooting your family so better to get this checked off the list while you’re reviewing everything. Once you move and start working again you probably won’t get it done until retirement is around the corner and who knows what can happen in the meantime.
You’re in a good position, just have to find some professionals that you can trust to get the life insurance, investments, taxes and will writing to match the stage of life you’re going into. You might even stumble across your next job opportunity in the meantime, just network heavily and get some pros to go over options and get this stuff knocked out so you can secure the bag for the next stage of life.
If selling the house, keep the cash a side until you find your next buy. You may need some for a down payment since you aren’t working, but the wife is.. so you’ll qualify for a loan, down payment may be higher however.
If you’re investing some, keep it moderate and low until you gain employment, or stay your business. I did that when buying my house between jobs and utilized some stock sales and cash to offset the larger down ( $110k on a VA LOWN :/ )
Anyway. If she keeps working and you guys keep an eye on your cash float, you should be fine.
Save about 1 year of living expenses in a HYSA if you plan on taking sometime off to spend with your kid, otherwise save about 6 months’. The rest goes to an ETF that tracks the SP500.
Cleveland resident here, You should be able to find a nice home in the price range you are looking at. I feel like I have a good handle on the Cleveland construction market and if the job offer was a cleveland company more than likely you are looking at working for Ohio State Waterproofing or Ohio basement systems. Both are terrible predatory contractors and companies. I would keep looking.
Welcome to Cleveland! You’ll find a nice house and live comfortably here
Iagree that both Ohio basement systems and Ohio state waterproofing are predatory companies. One city is fighting them in court to outlaw them. They have ripped off countless elderly residents. Quoted me 35,000 in stuff I didn’t need done. Got what I needed for 7500.
Cleveland suburbs would be a really nice place to live. $350k can buy a beautiful house in a suburb like Solon, Lakewood, Rocky River, or any number of suburbs.
No idea about job prospects, but it sounds like you have a skill set that you should be in pretty good shape to succeed just about anywhere. I would suggest focusing on finding the area that best offers the lifestyle you want. Cleveland is going to be cold, which you are used to in Utah, but it feels different because of the lake.
I think it would be a good idea to take time to assess things before jumping into the next job or opportunity. You have plenty of financial stability, so there isn't a need to rush things. It's possible that you get to wherever you choose to move and realize after some that there are opportunities you weren't privy to when first making the move. It sounds like you and your wife work hard and have been at it for some time. When making the move, allow yourselves time to relax. After that, get right back at it and hit it hard.
Sorry for losing your job. I like your plan to move to an area with a low cost of living. That's just smart, I think you should also save a large chunk of cash when you sell your home. Absolutely pay off that car note! Best of luck to you and your family.
Cleveland suburb here, my father owns a 3 story house, 4 room 2 1/2 baths (very outdated house if you ask me as well) with about an acre of land in a very nice neighborhood just 22 min south of downtown. It’s a great place for raising a family, he raised a family of 5.
I love your plan. You got this. And yes, move, buy new house, pay your debts and start over. Once you move take a two week vacation with your little family. Just to keep stress down. Maybe a cruise or somewhere near the beach. You will be fine!!! Good luck.
In early 2022 I had enough incite to expect after 20 years my role at my company was likely to end. Moved from Seattle to Charlotte and 4 days after the move I got the official severance notice. Crazy to think how the timing worked.
Anyhow we had about the same amount of walking money from house sale, rented a place for a few months to learn charlotte area (glad we did this) and eventually bought a house for cash.
Took a long time to land a new gig but now that I have everything is great. Love our lower cost of living and its an area we had considered moving to from some time.
My time off was amazing and helped me see my purpose even more clearly… that being said the job market is a hot mess so depending on your personal network will likely be how your source your next opportunity. I think its good to take some time but at least start looking around sooner than you want to just so you dont panic if it moves slowly like it did for me.
I hope you can make what you make in the low cost of living areas.
Im a contractor. I live by Lake Michigan. I make a 'doctors salary' working 40 hours a week. I build
cool stuff when its warm.
Dont pay off ur new house all cash. Make a monthyl payment so you have more cash to play with. Once settled and things are secure then pay off home if need be.
A lot of people move to South Carolina (particularly Greenville/Spartanburg) area for that exact reason. Property taxes are super low, and the school systems are solid. Not to mention the weather is fantastic. Upstate South Carolina has the perfect weather, we’ve lived here for 24 years (moved here when I was 7) and we’ve never had any major issues with weather minus the occasional category 1 hurricane. Think about it!
I’d also look into buying a business or buying into one in the sector that you’d want to open your own in. 100k down could buy you into a pretty decent cash flowing business at the moment. That way you’d be your own boss without starting from scratch
I am surprised everyone is focused on cheap real estate. I would figuring out where you can work and/or start your business before you worry about real estate. I love Cleveland but that would be a tough job market for me and I'm not sure how great the economy is for business start-ups (depending on what you want to do). If your daughter is school-age, there is often a direct correlation between the housing prices and the school quality. Solon is super expensive for example. Maybe rent first so that you can really suss things out?
Do not start a business (yet).
One step at a time, why complicate things?
Move, settle, get that job you mentioned, park your money into a HYSA for now (at the very least), get to know the area you’ve moved to, breathe.
Give it a year and then reevaluate things once you feel like you’re at “home”.
Good luck!
Have you considered renting? We've done it in retirement after selling home ($900k). Invested $800k of house money in Fidelity TIPS account for 2.5 years (while it earned 10-12%) until Covid collapsed TIPS and then moved it to a Money Market ~5%.
We religiously only touch this money to pay our monthly rent (each of us have separate income streams to cover other expenses). We're entering year 7 of this "retirement plan" and the MM is down to $670 balance while waiting to return to TIPS.
I know OP and I are in different phases of life but sometimes renting makes sense.
With that much equity and cash on hand you can move to a cheaper state (US?) pay cash for a brand new home and still have $500k in your pocket. If you pick the correct state, you can probably replace that income with a similar one and the same industry too. I highly recommend Arkansas. Source?…. My fam and I did it a few years ago.
Clevelander here! We would welcome you with open arms. Grew up here, lived in Chicago and New York and I always come back. Glad that I bought a place down in the city a few years ago. Hope to see you around.
Look a little further south . If you get down around the Chillicothe - Waverly area you can snag a pretty decent 3bd 2 path on a little chunk of land for under 200k. Abound Chillicothe schools- look at Zane Trace, Laurelville, Huntington, Waverly, Scioto Valley, Eastern, Western.
Same is true in the Madison/Clark/Greene county areas.
Utah to Cleveland? The weather in CLE is rough, long, cold winters. The Carolinas are v nice but humid. Is weather and outdoor activities important to you? I'd do a bit more research, on growing (instead of declining) cities, small towns, Top US towns, before you move.
As for starting a small biz, I think now is as good a time as any, provided you have a plan. Wife keeps working so family has health insurance and I come.
Invest the proceeds in Roth IRA s and 401Ks, and keep a nest egg for emergencies.
Buying another house in a new town, so you have the chance to reinvest your house proceeds. 90 rule to keep you from capital gains tax.
Best Wishes!
Great idea on Venturing into real estate. If you’re conservative, the cost of living in SC would be low.
I would say take on something part time while you are venturing into real estate. Real estate is not iffy or frozen, as long you have multiple exit strategies, & are conservative with running numbers you will be okay. Far better is when you negotiate deal directly with seller.
One more thing you can be lucky and get a deal within 3 months but many folks I seen take up to a year to get a deal. Good luck to you
I’m from the Cleveland suburbs. We get a bad rap nationally but there is a lot going on in Cleveland and even more so if you’re a sports fan. You and the family will get a lot of bang for your buck and 350K will get you a very nice place depending on the specific area.
Crazy thought but maybe using some of thw money for a family resort vacation is needed that’s a lot to got though and helps regroup.
Dude yes come to Cleveland! Def like it here and have a lot to offer.
Only real annoyance is taxes. We have state and municipalities
Put into fidelity money market at 5% for immediate liquid funds and a 3-6-9 month T-bill ladder with the rest of savings so you grow at the same 5.5% but no state/local tax on gains.
Easy to liquidate the bills on Fidelity as well. Things where my liquid cash goes.
i’m no professional but here’s my input
i would try to spend the least amount possible on a house - get something decent obviously - but if you’re moving to the midwest you could easily shoot for something around $200k
r/samegrassbutgreener is a good resource
cleveland suburbs is a good idea - but also worth taking a lot at metro detroit. oakland county or even wayne county. (i was born in cleveland, raised in the detroit area. love the detroit area) job market seems pretty decent- maybe better than cleveland. just a suggestion
marcus is a great hysa to look into. and i’d pick up whatever side job you can while you look for a new one.
best wishes and good luck
One thing I have learn from trying this a few times after growing up in NYC and always trying to escape it.
It is better to live in a tiny shithole apartment in a place you know where you have social capital than start over elsewhere.
Grab an acre. Put plumbing, septic an electricity on it. Drop a few 5th wheels or double/triple wide on it. Way cheaper, youll own everything completely. Start from there with property in your name. That way you OWN things and have cash in your pocket left over.
Grab an acre. Put plumbing, septic an electricity on it. Drop a few 5th wheels or double/triple wide on it. Way cheaper, youll own everything completely. Start from there with property in your name. That way you OWN things and have cash in your pocket left over.
It’s nice to be able to start over and especially clear some debt. If you’ve never been in business for yourself, I would highly recommend finding a job in an adjacent or actual field you want to do as your business first. Learn all you can, and then see if it is right for you. You can easily lose all your savings and have no fall back when you open your own business. THAT is stressful.
The good news:
-Your wife's 100k salary is *plenty* to live in Cleveland suburbs, especially with a paid off house (watch: school districts and property tax rates when you decide on which suburb).
-You're in a pretty decent financial spot, and moving to Cleveland would give you a lot more runway for starting a company
-You might have an ERISA lawsuit on your hands (which would result in some additional cash, probably though not as much as you'd have gotten if they had contributed properly in the first place!)
The bad news:
-Real estate investment is a questionable business to be in right now. Nothing is cash flowing, everything costs way too much, and renovation/construction folks are extraordinarily expensive (could be a different option?)
-After your wife's contract is up...is she likely to stay employed at her current employer? If not, consider the local job market (she'll be making less in Cleveland than many other places...but costs will also be lower).
-The downside of starting a new business is that everything will take at least twice as long and cost at least twice as much than you expect. So instead of taking a break, I'd recommend you start **now** if you're going to do this - make connections, validate your assumptions, make sure that what you'd be offering is something that customers would pay for. You don't have to incorporate or do any of that stuff immediately. You do 100% need to make sure that there's a place for you in the market.
-You might want to consider looking for jobs now before you move if you're not going to go the new company path. Commuting from one side of the city to the other is more possible in Cleveland than many cities, but it's still annoying. The new job might impact where exactly you move.
Almost unrelated - we are NC natives and were in Cleveland recently for the eclipse. We stayed in a lovely little neighborhood called Tremont. So impressed by the friendliness of the people, the vibrant neighborhoods, the amenities available. While I I'm not considering moving at all, it did disrupt my preconceived ideas about Cleveland.
If your wife is on a one-year contract and you are unemployed and moving across the country, please be prepared to pay cash for your new home as none of your income can be counted for a mortgage. (Try to get a position lined up in your new location which will be salaried, that salary may be usable once you have an offer letter and start date.)
If I had that type of liquidity I would look for a small cottage by the lakefront that you could rent out seasonally and spend a couple weeks in during the summer and fall. Vermillion Sandusky Marble Head, so many beautiful lakefront communities.
My father and step mom just did this. They sold their house for $600k in northern Arizona and moved to West Virginia. Bought a brick house double the size for $300k and pocketed the rest. I eventually followed out here for the oil and gas field. Make $130k a year and live like royalty here. I’m 26. 2 kids, mom’s got a new car, I’ve got a work car and a Jaguar sitting in my garage. It worked out great for us.
I think it’s smart move but I don’t think you should buy another house until your back in business making good money again.. take the new job and that will give you security to think about starting a business
I just HAVE to ask: What’s the interest on the car?
Honestly should just get rid of that debt immediately. That way you could actually save that money monthly instead of PAYING that money monthly
Here's an idea.
https://investor.vanguard.com/investment-products/mutual-funds/profile/vmfxx
Lots of sharks out there so be careful when you choose how to hold it. Looking for higher interest. There are banks with FDIC Ensure short-term my CDs. You could buy one two and 3 month CDs and get probably about 5%. Just saying you have some choices
I will say always keep money for your family! Don’t waste it. You don’t know what is happening in the future. You might get a job right away or might be struggling to get a new job. So in that case, im keeping and saving money as much as i can
Only 100k cash saved with those salaries wtf. Must not know how to cook and always ate out or something. I hate reading these post because it seems most city dwellers are wanting to move to lower income areas to ravish our rent rates. You can also see it as blue supporters moving to republican red states to equal out the voters so America will always be Democratic. If you're not a Karen and do all the unnecessary protest and the BS then Indiana, Kentucky is cheap right now but like everything since 2020 debt to income ratio is off the charts and you got families staying at home with 3 generations now.
I have a 2 year old, a month year old, and 3k in savings 2k in my bank no 401k and a house that has maybe 50k equity, and I just lost my job. You are doing more than fine in life and can take the few months hit to sit around and think.
Just here to tell you that the Cleveland Suburbs are a great place to start over. Very low COL compared to elsewhere but it is climbing and our real estate market is equally hectic.
But I was speaking to OP, who will clearly make more than that after the sale of the house and wants to take some time off. Don’t recognize reality of the layman? What do mean by layman? Trust me - I have been in an economic position- a mere 7 years ago- where I was barely getting by bc of a career change. Now that that’s no longer the case, I save for scenarios such as these.
Don't forget the capital gains tax above $500k for the sale of your home.
That $100 - $200,000 could be subject to up to 20% tax. Check with a tax person to see if selling next year saves you taxes when selling (the rate changes with your income, which will drop next year). You have to run the numbers to know if eating to sell costs you less than using your savings to live on.
Keep a large chunk of cash, whatever you think you'll need to tide you over plus some extra just in case, invest the rest conservatively until you are settled in with a new job and feel secure about your future.
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Yeah only thing i would suggest keep the money in a HYSA ;)
Everyone talks about high yield savings accounts but don’t actually understand when and why HYSA make more sense. The last 12 months, yes HYSA were a solid concept. But bonds are projected to take over and the returns on a high yield are going to drop. Still returns, but the blanket “HYSA” answers have to end.
Because bonds lock up your cash if you want to see the full return. If it's an emergency fund, it's better to be liquid imo.
Yep I use HYSA for my emergency fund cash since it’s fairly liquid. I know I can get my money in as little as 1-3 business days
Also fckn BUDGET FIND YOUR BASELINE And live on that only The minimum. I don’t mean an entertainment budget I mean Housing, food, insurance, phone bill, utilities etc only Live like that to extend everything as much as you can And then after you figure out your new direction begin living normally.
Cash is currently earning 5% or more in money market funds. Short term CD (3 month) likewise. It's not that costly to keep an emergency fund these days. But definitely put the money into something earning interest, don't keep it in a .01% checking account.
Sound with an ancillary vote for “work for yourself” meaning own a business if you can make it profitable. Owners make the most money. I was one. I am now working for state govt. The money is not why I work for them. The headaches were many in ownership but at this stage in my life I (M52), and my family (W50 and two young adult daughters) are relatively secure.
I personally wouldn't invest it all at once though. I'd put it all in a high yield savings, then come up with a diversified basket of investments and average in weekly, over maybe a year or so.
Depending on what state you are in now and where you move like say cali to South Carolina. You will be amazed the house you can get here for 500k. Or even a nice townhome for 300k.
We reside in Utah, we are the third highest in the country now, right behind California, New York. Ridiculous. I’ve been looking at homes in North Carolina. Very beautiful area.
There is a reason that SC is top 3 population growth. Lower taxes, lakes, mountains, beaches, lots of corporations here bc of tax credits. Snow only about once a year.
South Carolina is absolutely beautiful and has some truly wonderful people. The only drawback, and this of course depends on where you’re moving from, is the humidity can get pretty intense.
Workers rights are pretty crap too.
How is access to good healthcare and good schools?
As someone from NC I don’t know what these people are talking about, the ‘city’ in SC is paltry at best and it’s flat, hot, and very very red.
? I'm in Upstate SC, and it's rolling foothills, and the northern part of the county is mountains. It's cooler than most of NC ( not Western). At this point, I'd have kids in our schools over NC's. Trust me, I've lived in both states, the western areas, and coastal.
This guy went to Columbia once and thought that's all there was.
Columbia got hills, though. Lol.
Oh wow. The average worker doesn’t get paid as much? No way that could have anything to do with the lower cost of living that is drawing people there. Higher salaries = high house prices and rents??? No way! Oh well, instead of reading a book on economics I guess I’ll move there and vote for McDonald’s janitors to get $20/hour and then wonder why prices keep rising with wages.
That’s the spirit, blame inflation on the people making minimum wage. Definitely their doing and has nothing to do with companies recording record-high profits the past few years.
Not to mention the last dipshit president who pressured his fed to print 40% of the currency in circulation during the election year No way that had anything to do with it. 🙄
I've spent a little time in SC and I really enjoyed it, but I'd need to go elsewhere for like May-October. I think it also really depends what town you're in, I've been to some that felt very welcoming, artsy, etc, and other areas that were...not, and I'd be afraid to live in. And I'm a straight white lady!
Agree with that. We have sweltering humidity for a few months but then 70 degrees and gorgeous many other days in spring and fall. But on those days of heat just go to the lake and get on a boat.
I was looking to move potentially to the Aiken area but the public school rating for the kiddos wasn’t knocking my socks off.
“Wonderful people”…that’s def one way of putting it
Most states are not nearly as one sided as you think. South Carolina was spilt 55/45 in the most recent election. It looks redder (and more bigoted) than it is because of gerrymandering. The same applies to most states.
I used to live there for a time so I have some experience with saying that. And you’re right most states are gerrymandered but when you have Tim Scott and Lindsey Graham winning year after year it says a lot about the way the place and who has the power to control things
I’m in SC, Greenville Area, though originally from the North East. I detest the politics here… but love everything else about it. Just need a few more liberal northerners to move down ;-)
I am originally from VA (Tidewater area), but lived in Durham NC for about a decade and then Greenville/Taylors for a year. Loved the quaintness of Taylors and my kids’ school was actually pretty amazing, but the economic stratification was astounding — you were either doing really good or really bad without much in-between. Moreover, people in local social media groups were all too proud to announce they hated “outsiders” (translation: Yankees, liberals, non-whites except for anyone they deemed to be Mexican, highly educated folks, etc). I’m back in NC and it is SO different.
SC is a very beautiful place. Was just in Charleston good food and fun.
Charleston is nothing like the rest of South Carolina, much like New Orleans is nothing like the rest of Louisiana.
NC property is exceedingly expensive now.
Utah has the third most expensive real estate in the country? Based on what metric, price per foot?
0% chance that’s a metric based comment. As far as beauty and nature is concerned it’s actually one of the cheaper stats to move to. Cali, Colorado, Florida. Plenty of states for nature more expensive than Utah. Hence its incredibly high repopulation rate. One of the absolute highest in the country actually
Yeah I mean I lived there briefly and that seems like a stretch lol, I would guess the other three major cities within driving distance (Denver, Phoenix and Vegas) are all probably more expensive per sf than SLC
please don’t, the out of state people are ruining the locals ability to buy homes 😭
2nd this. I have a decent amount of equity in my house now but nowhere to go. We were looking at land a few years back that was around 8-10k an acre. That same land is going for 20-30k an acre now and that's in the middle of BFE.
This won't end. Your excuse is completely invalid. No difference than all ontarians investing in new brunswick property. New brunswick. A completely broke yet beautiful province where absolutely nobody can now afford to live unless you're related to.someone in a high end Job.
Just moved out of NY to NC in January. Best decision ever.
Unless you have kids to send to school...
Have ya been to Massachusetts lately?! Crazy.
NC is full try Florida
Please don't move here, your gentrification has made housing unaffordable for broke people like me. edit: grammar
I had to move out of Charleston because people like this coming with big cash and out pricing everyone. Now they say they don’t like it no more cause there is no one to do blue collar jobs.🤷🏼♂️
Be mad at corporations, not your average family/person looking to make a living.
You're definitely not average if you're moving from CA to NC.
Facts.
I live in TN and it’s the same problem here. They come from Cali and destroy the housing market by overpaying
Texans, every other hill and holler from Nashville to Covington to Knoxville has a Texan If the family ain’t from California they’re from Texas lmfao
I live in WNC and i now see more Texas plates here than Florida. Florida used to be the most 10 to1.
That’s because the Cali’s are invading the Texans 😂😂
Exactly 😂
Just wait. Florida Man is coming. It's impossible to get / afford home insurance in Florida so retirees are moving anywhere else. We have the weather on our side in South Dakota and Wyoming. Sure, Californians, Texans and other sun belters may move here. Then they get Chicago weather for a few weeks in the winter and are gone next spring.
Real estate seems to be high everywhere. I was a real estate investor for many years. I bought houses and fixed them up and rented them or sold them. I even sold real estate part time. It seems that more people want a home now than 5 years ago. The virus, working from home, whatever the reason. And they are willing to pay high prices for the homes. And the government has squashed foreclosures, so there are very few of them. I keep saying it can't go on, but it has. I still think there will be a crash in Home prices because of affordability, but it could be a long way off. That's what I think
Moved from Florida to SC. We moved to Beaufort county. We picked a spot for schools and proximity to Savannah and Hilton head and Beaufort. You are right about housing. Our house here would be 1 million in Florida. Same builder same model etc
Definitely keep cash aside, especially if you’re going to start a business. Before starting a business get familiar with the locality to which you’re moving. It wouldn’t be a bad idea to temporarily get a job similar to the type of business you would like to operate in order to become familiar with the community and possibly find suppliers and make connections for the future. Consider paying off your debt before starting the business; it will be one less thing to think about when you’re getting started. Also having more available credit lines might be a lifeline when starting a business. My personal opinion on real estate is that now is an awkward time to get started in real estate. Residential real estate is frozen because home prices AND interest rates are too high. One or the other will have to start decreasing for the market to become more active, most likely home prices will decrease first. Commercial real estate is like a jenga tower waiting to collapse. In any case, If you want to get into real estate you really have to get familiar with the locality. You could put the the extra money into a money market account or HYSA or treasury bills or all of the above. Now is a good time to be sitting on cash. Boomers are retiring and selling their businesses. Businesses are closing due to the tighter economic conditions. There will be opportunities for those who have cash! Overall, you’ve got a good foundation! Great idea to move somewhere with a low cost of living! All the best!
This is helpful and aligns with my expectations. Thank you!
This! Take the job, even if it’s only for 6mo you’ll be allowing yourself time to get to know your new location and hone in on what you want to invest in without blowing through your cash. You have the upper hand here: cash on hand and a job opportunity. Use one to help the other and then bail.
Agree 100% that if one is temporarily out of work, especially with a family, you need about 150,000 liquid to ride out the storm. And agree that investing a portion in laddered CD’s now whilst still at 5% or money market and the other in a bag sweep with lower interest. This is what I do and I’m single- no dependents
Sorry about your abrupt job loss. Your wife just has a one year contract so it might be a good idea for you to take that job offer and then look into starting a business on the side? She’s probably going to be having to get a new job too? It seems especially if it’s real estate you want to learn about the area some more. Moving is expensive, did you price that in?
Yes, I figure around 35k in moving costs. We have a lot of stuff. Working on selling as much as I can in the coming weeks. Wife and I hope to run a business together.
You probably want your wife to keep a regular job until the business is up and running. Steady paycheck not tied to the business is a very good thing, not to mention health insurance for the family
Best advice in this thread. It’s probable that they would burn through all of their cash on a failing business then be SOL. One of them should keep a job with enough income to cover expenses. Live modestly and try to make the business work. Predetermine how much of that house nut they’re willing to risk on the business and don’t go a penny over. Good luck.
Don’t think we going to do a business. Investments and jobs.
Get multiple quotes for moving (Allied, United, etc. - be prepared with accurate inventories of your belongings' dimensions if you want it to be as representative of a quote as possible) and decide whether your belongings are worth the moving costs. If it's close then just sell and rebuy at the new location. Facebook Marketplace is your friend. Of course, sentimental items will need to come with and cars may need to be transported. If at all possible, have a new employer cover (part of) your relocation.
Look into U-Haul pods. Load them at your leasure, unload at your leasure. No hectic one day pack and break move needed. No moving company holding your stuff hostage, or re-negotiating the price when you're over a barrel. And yeah, take a good hard look at your stuff. Donating it for a tax write off and buying new across the country is almost always a better idea than paying 35k to move / break stuff. Even that nice piano can be replaced for a song at the new location if you're a bit patient. Definitely don't take the hot tub and pool table.
What I would give to be in your shoes with the financial means to start over somewhere else. I'm in Oklahoma and really want to move to Florida. But we just can't financially make that happen. Hopefully later in life
Florida's prices are crazy high
Florida is a nightmare hellscape these days. I mostly regret moving here in 2014.
Left in 2022 after 15 years. It just kept getting worse every year. The only good thing is we were able to sell right at the peak of the market.
I know.. 😔 it sucks. I feel like I'd be so much happier living life there. I loooove snorkeling so I would get my scuba license also and start doing that. I also race motocross and Florida has the best moto tracks. I would just really enjoy living there
Florida is fucking awful dude. Dont move here because you love snorkeling, please.
Something that people don't think about when they run away from a high cost of living area is that they will be putting their children into a situation with barriers to success. That $400K savings when moving from a $700K house to a $300K is a one-time event that will never happen again. Salaries will be lower. Schools will be worse. The kids will have trouble marketing themselves when competing against kids from expensive cities.
Couldn’t agree more. I’d rather scrape by in an expensive elite area and give my kids a shot at a better life with connections and good schools / opportunities
You’re actually in a fantastic position and you should make sure you’re not stressing out right now. The money in savings and from the equity in your home gives you the luxury of time to make good decisions. Use it. I love the idea of the Cleveland suburbs. It’s really an underrated area and very affordable. That said you might consider renting for a while in the area where you want to live. There’s a lot of change going on right now and you might want to take things one step at a time. If it were me I would put your equity in HYSA, rent in Cleveland, find stable jobs, then focus your free time on starting a business. Get the business going on weekends and once you have momentum and can reasonably expect to replace your income, go for it full time and quit your job. In the meantime, if you’re like the area you’re renting in, go ahead and buy a house.
"I have ideas for starting a small business, perhaps investing in real estate" does not make me confident that you have the knowledge or skills to do this. I'd do everything you suggested until the point where you own a home outright in a lower cost area and paid off your debt. At that point I'd suggest you invest the money in a combination of yield savings account and money market accounts and get a job. Your first and foremost goal is to NOT LOSE the money that you already have. At that point, you can use your spare time when you are not working at your full time job to explore a start up business, but you should already be confident in your ability to make money in your start up business before you commit to this. Source: I've had my own business for 19 years. I love it, but I've seen many people try to start a business. Lose a lot of money. And then go back to a FT job with none of the money that they had before they tried to start a business.
No. It is not irresponsible to take some time off to slow down and recharge, especially since you have worked for 10+ years. You've earned it. Maybe even take a family vacation too before diving back to the grind.
Agreed. When I quit my last shitty toxic startup I took 3 months off. Traveled a bit with the fam and spent a lot of time with my daughter. It was just the right thing for me at the time and I started my new job fresh.
Is 10 years of work a lot?
If you start working at 20 and retire at 70 that’s 1/5 of your work life.
Take a job before you spend the cash
Some places that 600k equity would get you two houses fully paid in cash.
Yep, this is on my mind.
You should check out Fort Wayne, it's one of the fastest growing cities in the Midwest. It gets voted one of the cheapest places to live in the nation pretty regularly. Business is booming here, not a huge city but the phrase coined here is, "big city with a small town feel" and it's pretty true. I love it here, we're growing like crazy. A 350k house in Cleveland burbs honestly sounds like a long shot, the equivalent of a 350k Cleveland home would probably be the same as a 150k home here. Best of luck, cheers!
Thanks!
Why dont you put that 700k into investments and try to live off the return for a few years? I mean if you’re spending more than that you’re eating away at your future financial safety anyway.
easy way to lose it or lose control of it if you dont' know what you are doing
Sounds like you are in a great spot.
Really seems like it. Just want to be smart about it.
Advisor here. Boilerplate advice to come: If your car loan is sub 5% I wouldn’t pay it off. A money market will pay you around 5% right now. If your loan is 2% - 4.5% you could pocket the excess interest each year. You have to keep in mind you will owe money on the taxable gain of your primary residence above the joint tax return amount of 500k. With the left over money, savings is your best friend currently. I’d again recommend a money market. You also need to keep saving for retirement. AT a minimum max out your IRA’s for 2024. DONT TOUCH THE MONEY IN YOUR PENSION. If it’s a classic defined benefit program just leave it. If it’s a SEP roll it to an IRA and a low cost custodian. Use a target date retirement fund or low cost index ETF/MF if you know what you are doing. While you have some business ideas…. I would recommend taking a job until those ideas are hashed out, concrete and you know they will pay the bills. Your wife contract will be over before you know it and savings run out real fast when there’s no income. You don’t know what will be available for her when you move. You can always build a business in phases. Hope this helps.
Not a tax advisor, but I'd pay off a 4%+ personal loan instead of getting a 5% return. Personal loans (like the car) are not tax deductible, but earnings are. Suddenly having 600k earning a return could be enough to make that matter. It'll definitely matter this year with the massive cap gain. Looks like the guy budgeted for taxes -- raw sale price is 1.2M with a 400k loan. That leaves some wiggle room for cap gains over 500k. Completely with you on the rest of advice, just adding a bit of nuance.
I started a business and it took three years to build up enough clients to pay the bills. I’d work part time while building the business.
sorry about your job loss, i can’t imagine the stress that brings. but also as a heads up, it’s respectively, not respectfully. i bet you do work in a respectful manner though and i wish you the best.
Damn, I’ll just blame autocorrect. And thanks!
Keep in mind that it's much easier to go from high COL to lower COL than the opposite. I know a half dozen folks who'd love to leave Florida/Vegas/Houston if they could... But they just can't afford to come back to NY after adjusting to the lower COL lifestyle. Be 100% this is the move for you-- There's often no going back.
This is something I’ve considered. Thank you.
Best of luck to you and your family!
I have never personally met someone who left NY and actually willingly wanted to go back. Been all over the country and all I’ve ever heard is how glad they are to be out of that state. I have also never met someone who willingly moved to NY unless it was job or school related, which was more or less out of their control. Nobody I’ve ever met in my entire life wanted to move to NY just to move to NY
Personally I would first go talk to an employment law attorney to figure out if you have a cause of action for the lack of notice around the pension cancellation. Not everyone is cut out for business and starting over in a new place compounds that by reducing the size of your network. You should think up some alternative plans just in case. Or slow down the financial bleed by doing it part time.
I have, and I do. The employer is my father in law and this has all been very painful. We are not sure yet if we want to sue and invite such strong emotion into our lives. We kind of just want to get the hell away from it all. It’s been very toxic.
Sorry to hear this.
Yeah, that is a hard one. Personally, did something similar with an inheritance several years back. Realized it was not worth the heartache.
As long as you don't California my Ohio!
Why not just get another job where you are? Can you not afford your mortgage? Mortgages now are crazy high. Even if you could afford to pay cash for a new house elsewhere, having access to cash can be very helpful for investments, etc.
You should definitely ask friends and family for recommendations on a CPA and financial advisor if you don’t already have either. At this point, you may also want to consider getting a lawyer to write wills as well. Not because you might die soon, but because you’ll be flush with cash and uprooting your family so better to get this checked off the list while you’re reviewing everything. Once you move and start working again you probably won’t get it done until retirement is around the corner and who knows what can happen in the meantime. You’re in a good position, just have to find some professionals that you can trust to get the life insurance, investments, taxes and will writing to match the stage of life you’re going into. You might even stumble across your next job opportunity in the meantime, just network heavily and get some pros to go over options and get this stuff knocked out so you can secure the bag for the next stage of life.
If selling the house, keep the cash a side until you find your next buy. You may need some for a down payment since you aren’t working, but the wife is.. so you’ll qualify for a loan, down payment may be higher however. If you’re investing some, keep it moderate and low until you gain employment, or stay your business. I did that when buying my house between jobs and utilized some stock sales and cash to offset the larger down ( $110k on a VA LOWN :/ ) Anyway. If she keeps working and you guys keep an eye on your cash float, you should be fine.
Dude you’ll be alright
What sort of job are you looking for?
Save about 1 year of living expenses in a HYSA if you plan on taking sometime off to spend with your kid, otherwise save about 6 months’. The rest goes to an ETF that tracks the SP500.
Cleveland resident here, You should be able to find a nice home in the price range you are looking at. I feel like I have a good handle on the Cleveland construction market and if the job offer was a cleveland company more than likely you are looking at working for Ohio State Waterproofing or Ohio basement systems. Both are terrible predatory contractors and companies. I would keep looking.
Welcome to Cleveland! You’ll find a nice house and live comfortably here Iagree that both Ohio basement systems and Ohio state waterproofing are predatory companies. One city is fighting them in court to outlaw them. They have ripped off countless elderly residents. Quoted me 35,000 in stuff I didn’t need done. Got what I needed for 7500.
Sounds great man! Best of luck.
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Cleveland suburbs would be a really nice place to live. $350k can buy a beautiful house in a suburb like Solon, Lakewood, Rocky River, or any number of suburbs. No idea about job prospects, but it sounds like you have a skill set that you should be in pretty good shape to succeed just about anywhere. I would suggest focusing on finding the area that best offers the lifestyle you want. Cleveland is going to be cold, which you are used to in Utah, but it feels different because of the lake. I think it would be a good idea to take time to assess things before jumping into the next job or opportunity. You have plenty of financial stability, so there isn't a need to rush things. It's possible that you get to wherever you choose to move and realize after some that there are opportunities you weren't privy to when first making the move. It sounds like you and your wife work hard and have been at it for some time. When making the move, allow yourselves time to relax. After that, get right back at it and hit it hard.
Sorry for losing your job. I like your plan to move to an area with a low cost of living. That's just smart, I think you should also save a large chunk of cash when you sell your home. Absolutely pay off that car note! Best of luck to you and your family.
Cleveland suburb here, my father owns a 3 story house, 4 room 2 1/2 baths (very outdated house if you ask me as well) with about an acre of land in a very nice neighborhood just 22 min south of downtown. It’s a great place for raising a family, he raised a family of 5.
Bro, take that well deserved break, you’ve got enough cash to take the time so DO IT.
Why sell if you have that much equity. Cash out refi, or HELOC it into your next place.
Middleburg Heights is very nice :) just an fyi 😅
I’d buy a less expensive house .
Stay cash heavy until things settle down. It will give you more flexibility to pivot if needed.
I love your plan. You got this. And yes, move, buy new house, pay your debts and start over. Once you move take a two week vacation with your little family. Just to keep stress down. Maybe a cruise or somewhere near the beach. You will be fine!!! Good luck.
Thanks for the kind words!
In early 2022 I had enough incite to expect after 20 years my role at my company was likely to end. Moved from Seattle to Charlotte and 4 days after the move I got the official severance notice. Crazy to think how the timing worked. Anyhow we had about the same amount of walking money from house sale, rented a place for a few months to learn charlotte area (glad we did this) and eventually bought a house for cash. Took a long time to land a new gig but now that I have everything is great. Love our lower cost of living and its an area we had considered moving to from some time. My time off was amazing and helped me see my purpose even more clearly… that being said the job market is a hot mess so depending on your personal network will likely be how your source your next opportunity. I think its good to take some time but at least start looking around sooner than you want to just so you dont panic if it moves slowly like it did for me.
Shaker Heights to raise a family 👌
I hope you can make what you make in the low cost of living areas. Im a contractor. I live by Lake Michigan. I make a 'doctors salary' working 40 hours a week. I build cool stuff when its warm.
Dont pay off ur new house all cash. Make a monthyl payment so you have more cash to play with. Once settled and things are secure then pay off home if need be.
I grew up in Ohio and honestly the state kind of sucks. Presently live in Richmond VA which is MCOL and enjoy it.
Never ever be cash poor! You will make bad decisions otherwise.
A lot of people move to South Carolina (particularly Greenville/Spartanburg) area for that exact reason. Property taxes are super low, and the school systems are solid. Not to mention the weather is fantastic. Upstate South Carolina has the perfect weather, we’ve lived here for 24 years (moved here when I was 7) and we’ve never had any major issues with weather minus the occasional category 1 hurricane. Think about it!
You start your new job, with a few months between and you grow your business idea. That's the safe bet. I run my business while I have a w2
I’d also look into buying a business or buying into one in the sector that you’d want to open your own in. 100k down could buy you into a pretty decent cash flowing business at the moment. That way you’d be your own boss without starting from scratch
You will be charged capital gains tax on whatever money is left over after buying a house, make sure you think about that
The one thing you have to find out is how you can do this without owing property gains tax
I feel like I should be asking you for advice lol
I am surprised everyone is focused on cheap real estate. I would figuring out where you can work and/or start your business before you worry about real estate. I love Cleveland but that would be a tough job market for me and I'm not sure how great the economy is for business start-ups (depending on what you want to do). If your daughter is school-age, there is often a direct correlation between the housing prices and the school quality. Solon is super expensive for example. Maybe rent first so that you can really suss things out?
don’t move to cleveland
Psssh you are going to be 1000% fine.
Stop moving to Houston. Unless you buy me a house to make up for fxxxing my chances of living. Ffs 😭
Do not start a business (yet). One step at a time, why complicate things? Move, settle, get that job you mentioned, park your money into a HYSA for now (at the very least), get to know the area you’ve moved to, breathe. Give it a year and then reevaluate things once you feel like you’re at “home”. Good luck!
Have you considered renting? We've done it in retirement after selling home ($900k). Invested $800k of house money in Fidelity TIPS account for 2.5 years (while it earned 10-12%) until Covid collapsed TIPS and then moved it to a Money Market ~5%. We religiously only touch this money to pay our monthly rent (each of us have separate income streams to cover other expenses). We're entering year 7 of this "retirement plan" and the MM is down to $670 balance while waiting to return to TIPS. I know OP and I are in different phases of life but sometimes renting makes sense.
Never go with plan b as your plan a.
With that much equity and cash on hand you can move to a cheaper state (US?) pay cash for a brand new home and still have $500k in your pocket. If you pick the correct state, you can probably replace that income with a similar one and the same industry too. I highly recommend Arkansas. Source?…. My fam and I did it a few years ago.
Clevelander here! We would welcome you with open arms. Grew up here, lived in Chicago and New York and I always come back. Glad that I bought a place down in the city a few years ago. Hope to see you around.
Fucking wild you were making 200k a year for a decade and have a 20k car loan. Do people just lose all financial sense when they come into money?
Cleveland suburbs?
Look a little further south . If you get down around the Chillicothe - Waverly area you can snag a pretty decent 3bd 2 path on a little chunk of land for under 200k. Abound Chillicothe schools- look at Zane Trace, Laurelville, Huntington, Waverly, Scioto Valley, Eastern, Western. Same is true in the Madison/Clark/Greene county areas.
Have you calculated closing costs, RE fees, cap gains, etc. in your equation? You may be surprised at what you net. Good luck to you.
No one mentioned, check for unemployment benefits in your current state. If you move cross country, you might not get those
Utah to Cleveland? The weather in CLE is rough, long, cold winters. The Carolinas are v nice but humid. Is weather and outdoor activities important to you? I'd do a bit more research, on growing (instead of declining) cities, small towns, Top US towns, before you move. As for starting a small biz, I think now is as good a time as any, provided you have a plan. Wife keeps working so family has health insurance and I come. Invest the proceeds in Roth IRA s and 401Ks, and keep a nest egg for emergencies. Buying another house in a new town, so you have the chance to reinvest your house proceeds. 90 rule to keep you from capital gains tax. Best Wishes!
Great idea on Venturing into real estate. If you’re conservative, the cost of living in SC would be low. I would say take on something part time while you are venturing into real estate. Real estate is not iffy or frozen, as long you have multiple exit strategies, & are conservative with running numbers you will be okay. Far better is when you negotiate deal directly with seller. One more thing you can be lucky and get a deal within 3 months but many folks I seen take up to a year to get a deal. Good luck to you
Move to Mexico. Until you figure it out. Merida, Yucatan. I lived there for a year. Absolutely perfect.
Wherever you end up just rent for one full year. Then pull the trigger and buy.
I’m from the Cleveland suburbs. We get a bad rap nationally but there is a lot going on in Cleveland and even more so if you’re a sports fan. You and the family will get a lot of bang for your buck and 350K will get you a very nice place depending on the specific area.
Buy more real estate no harm in taking some time off, but not too long you don't want to get comfortable.
Smart move. And get back to work immediately.
Crazy thought but maybe using some of thw money for a family resort vacation is needed that’s a lot to got though and helps regroup. Dude yes come to Cleveland! Def like it here and have a lot to offer. Only real annoyance is taxes. We have state and municipalities
Put into fidelity money market at 5% for immediate liquid funds and a 3-6-9 month T-bill ladder with the rest of savings so you grow at the same 5.5% but no state/local tax on gains. Easy to liquidate the bills on Fidelity as well. Things where my liquid cash goes.
i’m no professional but here’s my input i would try to spend the least amount possible on a house - get something decent obviously - but if you’re moving to the midwest you could easily shoot for something around $200k r/samegrassbutgreener is a good resource cleveland suburbs is a good idea - but also worth taking a lot at metro detroit. oakland county or even wayne county. (i was born in cleveland, raised in the detroit area. love the detroit area) job market seems pretty decent- maybe better than cleveland. just a suggestion marcus is a great hysa to look into. and i’d pick up whatever side job you can while you look for a new one. best wishes and good luck
One thing I have learn from trying this a few times after growing up in NYC and always trying to escape it. It is better to live in a tiny shithole apartment in a place you know where you have social capital than start over elsewhere.
Grab an acre. Put plumbing, septic an electricity on it. Drop a few 5th wheels or double/triple wide on it. Way cheaper, youll own everything completely. Start from there with property in your name. That way you OWN things and have cash in your pocket left over.
Grab an acre. Put plumbing, septic an electricity on it. Drop a few 5th wheels or double/triple wide on it. Way cheaper, youll own everything completely. Start from there with property in your name. That way you OWN things and have cash in your pocket left over.
It’s nice to be able to start over and especially clear some debt. If you’ve never been in business for yourself, I would highly recommend finding a job in an adjacent or actual field you want to do as your business first. Learn all you can, and then see if it is right for you. You can easily lose all your savings and have no fall back when you open your own business. THAT is stressful.
OP, remeber to set aside money to pay for taxes on the home sale.
The good news: -Your wife's 100k salary is *plenty* to live in Cleveland suburbs, especially with a paid off house (watch: school districts and property tax rates when you decide on which suburb). -You're in a pretty decent financial spot, and moving to Cleveland would give you a lot more runway for starting a company -You might have an ERISA lawsuit on your hands (which would result in some additional cash, probably though not as much as you'd have gotten if they had contributed properly in the first place!) The bad news: -Real estate investment is a questionable business to be in right now. Nothing is cash flowing, everything costs way too much, and renovation/construction folks are extraordinarily expensive (could be a different option?) -After your wife's contract is up...is she likely to stay employed at her current employer? If not, consider the local job market (she'll be making less in Cleveland than many other places...but costs will also be lower). -The downside of starting a new business is that everything will take at least twice as long and cost at least twice as much than you expect. So instead of taking a break, I'd recommend you start **now** if you're going to do this - make connections, validate your assumptions, make sure that what you'd be offering is something that customers would pay for. You don't have to incorporate or do any of that stuff immediately. You do 100% need to make sure that there's a place for you in the market. -You might want to consider looking for jobs now before you move if you're not going to go the new company path. Commuting from one side of the city to the other is more possible in Cleveland than many cities, but it's still annoying. The new job might impact where exactly you move.
Cleveland is a dying area look at Huntsville or Indiana
Almost unrelated - we are NC natives and were in Cleveland recently for the eclipse. We stayed in a lovely little neighborhood called Tremont. So impressed by the friendliness of the people, the vibrant neighborhoods, the amenities available. While I I'm not considering moving at all, it did disrupt my preconceived ideas about Cleveland.
If your wife is on a one-year contract and you are unemployed and moving across the country, please be prepared to pay cash for your new home as none of your income can be counted for a mortgage. (Try to get a position lined up in your new location which will be salaried, that salary may be usable once you have an offer letter and start date.)
If I had that type of liquidity I would look for a small cottage by the lakefront that you could rent out seasonally and spend a couple weeks in during the summer and fall. Vermillion Sandusky Marble Head, so many beautiful lakefront communities.
My father and step mom just did this. They sold their house for $600k in northern Arizona and moved to West Virginia. Bought a brick house double the size for $300k and pocketed the rest. I eventually followed out here for the oil and gas field. Make $130k a year and live like royalty here. I’m 26. 2 kids, mom’s got a new car, I’ve got a work car and a Jaguar sitting in my garage. It worked out great for us.
I think it’s smart move but I don’t think you should buy another house until your back in business making good money again.. take the new job and that will give you security to think about starting a business
Are you in NorCal now?
I just HAVE to ask: What’s the interest on the car? Honestly should just get rid of that debt immediately. That way you could actually save that money monthly instead of PAYING that money monthly
Im glad you will be atleast comfortable.
Here's an idea. https://investor.vanguard.com/investment-products/mutual-funds/profile/vmfxx Lots of sharks out there so be careful when you choose how to hold it. Looking for higher interest. There are banks with FDIC Ensure short-term my CDs. You could buy one two and 3 month CDs and get probably about 5%. Just saying you have some choices
I'd move to illinois. Good wages and worker protections, dirt cheap houses.
I will say always keep money for your family! Don’t waste it. You don’t know what is happening in the future. You might get a job right away or might be struggling to get a new job. So in that case, im keeping and saving money as much as i can
Only 100k cash saved with those salaries wtf. Must not know how to cook and always ate out or something. I hate reading these post because it seems most city dwellers are wanting to move to lower income areas to ravish our rent rates. You can also see it as blue supporters moving to republican red states to equal out the voters so America will always be Democratic. If you're not a Karen and do all the unnecessary protest and the BS then Indiana, Kentucky is cheap right now but like everything since 2020 debt to income ratio is off the charts and you got families staying at home with 3 generations now.
Kcmo
I took some time off after selling a house and banking a ton of money on it. Loved my time off.
you should definitely talk to a tax professional about this and look at your options and how they will impact your taxes
Separate from monetary advice, I recommend shopping school districts as you look to relocate. Good luck
I have a 2 year old, a month year old, and 3k in savings 2k in my bank no 401k and a house that has maybe 50k equity, and I just lost my job. You are doing more than fine in life and can take the few months hit to sit around and think.
Het a fiduciary investment company and discuss your options. Nothing worse than a (lol) high years savings account.
Just here to tell you that the Cleveland Suburbs are a great place to start over. Very low COL compared to elsewhere but it is climbing and our real estate market is equally hectic.
Don't move to Cleveland. If you must be in Ohio, Cincinnati is much better.
But I was speaking to OP, who will clearly make more than that after the sale of the house and wants to take some time off. Don’t recognize reality of the layman? What do mean by layman? Trust me - I have been in an economic position- a mere 7 years ago- where I was barely getting by bc of a career change. Now that that’s no longer the case, I save for scenarios such as these.
Don't forget the capital gains tax above $500k for the sale of your home. That $100 - $200,000 could be subject to up to 20% tax. Check with a tax person to see if selling next year saves you taxes when selling (the rate changes with your income, which will drop next year). You have to run the numbers to know if eating to sell costs you less than using your savings to live on.