Now what? (Opened a can of worms)

[catherine]

So, as some of you know, here is my situation:

• Drowning in debt (I'm embarrassed to say how much)
• Have about $100k equity in my home in NJ
• BIL lives next door in paid-for house left jointly between him and DH (market value about 350k)
• This is a GREAT place for a family, but very expensive. We've raised our family here.
• I've always SAID I'd be more than willing to leave, but I'm tied down (oops--Freudian slip--I originally typed "died down") by my DH and DBIL who are much more resistant to change

So, that is all changing. DBIL is very frustrated by the cost of home-ownership even though the house is paid for and we don't charge him rent (he has a menial job).

DH is finally getting it that we are HOUSE POOR until our debt is paid, and he also finally understands that the kids aren't interested in the house (I tell him, you can't just keep a house as a souvenir like a charm on a charm bracelet)

We are actually IN CONVERSATION about moving!!!! Kind of calls my bluff on my own emotional attachments to this house.

So, here's what we kind of are thinking:

Somehow joining our resources seems to be in the best financial interest for all. Multi-family, guest cottage--even two very small condos side by side might work (although DH has always been against condo living)

DBIL has always wanted to live on a beach or near a beach in a nice climate. Doesn't have to be Florida--it can be simply milder, like NC/SC/GA.

We all feel it would be best for AH and I/DBIL to have some separation--our own living quarters/kitchen.

I, no matter what, want to spend half the year in the NE. My family is here, my roots are here, and I love this part of the country.

So, even though I said I would NEVER move to Florida and be a snowbird, that might make the most financial sense. My brother and SIL, who I love and who I'd love spending more time with, have a small condo in Palm Beach. So I'm thinking, get two very small condos near my brother. BIL gets his beach, DH gets his dock, I get my brother. I'm thinking Boynton Beach which is 20 minutes from Palm Beach but a heck of a lot cheaper.

Another option is to live in a more temperate residential area (think Research Triangle Park/Raleigh/Savannah/Charlotte) and get a nice single family house with fenced in yard for our dogs, and we can either buy a house with an in-law suite, or get a house with easy expansion possibilities.

If I were to choose all by myself, I'd get a small place in Ocean Grove, NJ. DH could be convinced to do that, but not BIL, who thinks NJ is too cold, and we need his share to buy a house there, as it's not cheap to purchase on the Jersey Shore. Of course, we could just split up the proceeds of his house and he can do his thing and we can do ours, but from a purely financial standpoint it's better to pool our resources.

Or we just stay and tough it out at our current address. At the end of the day, I am very comfortable here--20 minutes from one son, and a car ride (albeit a long one) to my other kids. But it comes down to, do I want to spend my life energy in the twilight of my life for this house?

Any thoughts, from a simple living perspective??? My head is spinning.

[Tammy]

I would never pool resources with anyone ... It's asking for all kinds of trouble later on.

[ApatheticNoMore]

And no thoughts of moving to Vermont? Isn't that where some of your kids are? (or am I mis-remembering?) And you kind of want to move there anyway? Don't know if 100k will get you a place there, but a smaller mortgage than NJ right?

[iris lilies]

I'm glad you may be able to break the gridlock of this New Jersey house. The cost of your real estate taxes must be astronomical and that's just money down the drain. If you move to a southern state, your taxes will be low and you would recover at least the cost of your own health insurance, if not the cost of your entire health insurance package.

I don't accept the premise that you need your BIL's money. You really need to look at that analytically. My responses below do not consider your BIL in the mix. He is a grown up man, he can make his own decisions.

Your #1 job now is to retire the debt. Get. Out. Of Debt. I don't know how much you are paying into serving your debt, but it's got to be a chunk. You could be putting that amount away in savings.

But now is the time to put your money where your mouth is, as you've said.You've mentioned that you would be happy living in a Tumbleweed house, well--do it. Metaphorically. Take the simplest route to your housing that is humanly possible, and to me that means renting in a low Cost of living area. That is NOT new Jersey. And hey, it's not buying a beach house either. Christ on a cracker, don't you think all of us here would like a house on a beach!!???? (by the way, buying a Tumbleweed house is just one more example of spending money foolishly, don't do it.)

In your position I would do these steps in this order:

1) sell all real estate, the "stuff" in it, and maybe even 1 car--put toward the debt
2) rent a SIMPLE place until the debt is complete paid off. Throw all of you money toward debt--no eating out. No handing money to children, no new business ventures that require cash outlay & etc. Would that be 2 years? Then
3) rent 2 more years while saving cash to buy a simple house--you should have $50,000 - $150,000 saved by then
4) buy simple house (financing some of it) at a cost of no more than $150,000, continue to work for 2 more years, saving nest egg
5) retire, or if you can stand it, work a year or 2 to build up cash reserves--this is the home stretch so you can do nothing, can do part time, can go whole hog--it's up to you

This is not about where you or your husband "want" to live it's about what the two of you can afford.

You are both creative people, it seems to me, so exercise your "creative" muscles. Any fool can throw money at a solution, but it takes brains and creativity to find the low cost/no cost options.

I realize that you have dogs, so renting may not be easy. And I asusme that you would find a market where renting is cheaper than buying, that's not always the case. Somewhere in this timeline you and your husband both can take Medicare, so that will ease your health insurance bills and will free up money to put into the cash pot.

[iris lilies]

While I wouldn't spend a cent more than $1,000 monthly for rent, this place is damned posh for under $1500/monthly and it accepts dogs, and wouldn't the doggies love it! Gads, it's pretty, with a patio overlooking the river. Now I want ot move there.

http://burlington.craigslist.org/apa/4630307413.html

[catherine]

Thanks, all!

Thanks, IL, for the step-by-step for me. Actually, if we cashed out on both houses, I would be debt-free, so that cuts off two years right there.

And I LOVE the Winooski place! Winooski is becoming more up-and-coming because Burlington is kind of expensive now. But Winooski is turning into a nice industrial-funky-cool town now, kind of like parts of Portland.

The reason I was dragging my BIL in on this was that if we cashed in and lived together, we could liquidate all debt and pay for a house in cash. But I understand the point about going in with people on stuff.

We'll see what happens. iris lilies, you could EASILY be Dave Ramsey's sidekick. I love Dave Ramsey because he's so no-nonsense, and so are you. I love it.

[sweetana3]

Read http://www.frugalqueen.co.uk/. She had high consumer credit card and overdraft debt and a big house. They got the message that this was not the life they wanted and you can read just what they did to pay it all off. She now lives in a small townhouse in a Cornish town and really enjoys debt free living. Her blog has tabs for getting debt free and then daily posts on frugal but interesting living ideas.

[razz]

Extended family and finances never, never mix!!!!! Hard experience speaking so cash out and give DBIL his half and your and your DH plan your life wherever you finally jointly choose. As another poster has said, let DBIL live his own life.

[JaneV2.0]

Finances aren't exactly my strong suit, but I agree you and your husband need to find the best place for you. That will probably be challenging enough without unduly worrying about your BIL. I must stifle a giggle thinking about "downtown Winooski" (that bustling metropolis), but I have to admit the visuals are convincing.

[Tammy]

I like the idea about renting. It keeps your options open while figuring things out. As soon as you retire things will shift again.