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Thread: Wanting to do it all at once!!

  1. #1
    Senior Member fidgiegirl's Avatar
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    Wanting to do it all at once!!

    You're going to laugh at me.

    The money doesn't stretch this far, and we're trying to decide on a starting point. I'm not a fan of trying to do everything at once financially - I think laser-focus has been kinder to us in the past as far as actually accomplishing anything (like paying down debt, and then building up enough to buy this house).

    - Finish the basement
    - Repair our exterior - we have a house with brick/stucco and some wood accents inlaid in the stucco that are rotting out in spots. The brick also needs tuckpointed.
    - Save toward a 20% down payment on a second rental property
    - Start to pay down the mortgage

    First priority is to further build our EF, so at least that's decided.

    We COULD work on the basement in baby steps - for example, if we pay $1000-$1500 to get the egress window put in, we can start to do demo and prep work ourselves. Then by the time we get to needing to do plumbing (more $$) we'll have had a chance to save up the $$ again. Although we do have most of the $$ needed now . . .

    I'll confess - the $5000 is burning a hole in my pocket. (poo, I wanted to link to the "pay mortgage or save" thread I had going recently, with such good advice, but looks like it was swallowed up in the malicious software debacle. Oh well. Short version: We have $5000 sitting around for a car replacement fund and I'm starting to doubt if that's the best thing to do with it and finding myself fantasizing about how else we can spend it).

    We do have to speak with our tax guy about implications of early paydown of our primary mortgage v. rental property mortgage.

    Argh. How to decide?!
    Kelli

    My gluten free blog: Twin Cities Gluten Free
    Our house remodel blog: Our Fair Abode

  2. #2
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    We watched someone downtown remodel a house a tiny piece at a time. Often it was one exterior wall at a time. Over about 10 years, it all got done. It was a tiny house but is quite a charmer.

    The only reason we have a nice nest egg now at retirement is that the money was saved based on our long and short term goals and not "spent" on a whim.

  3. #3
    Senior Member fidgiegirl's Avatar
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    Quote Originally Posted by sweetana3 View Post
    We watched someone downtown remodel a house a tiny piece at a time. Often it was one exterior wall at a time. Over about 10 years, it all got done. It was a tiny house but is quite a charmer.

    The only reason we have a nice nest egg now at retirement is that the money was saved based on our long and short term goals and not "spent" on a whim.
    I think the problem is figuring out those goals . . .

    Imagining the small house! I bet it's cute!
    Kelli

    My gluten free blog: Twin Cities Gluten Free
    Our house remodel blog: Our Fair Abode

  4. #4
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    When it came to remodeling, when I bought my house, it was more major projects. I would buy the stuff as I found bargains and set it aside, until I had it all. Some was paid with cash, others, I did use a CC for, then worked to pay that off ($750 limit when I did this). I still know a lot of people who do things, a piece at a time (now have the Johnny Cash song going through my head). It still gets done, and there is less stress about maxed out cards, etc. that I see with so many people.

  5. #5
    rodeosweetheart
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    I like the Dave Ramsey steps because they make you focus on one thing at a time. So after we paid off debt, we went back to working on emergency funds. We were up to speed, but one new furnace and major tax problem later, we are still back to building up the emergency funds. I am tempted to expand and do other things, like put a downpayment on a bigger house, but I am trying to keep the focus on getting the EF funds back into shape first, and then working from there.

    If I were you, I would not do anything with a second rental property until the emergency funds are in place, and that 5000 could be very helpful with the EF. I know we are at a completely different place in life, as empty nesters trying to work 10 more years before retirement, but we are also feeling pushed in different directions, like getting the bigger house to be able to take in my aging and ill parents. I am forcing myself not to go in too many different directions or try to do everything at once, but it is hard. I like stressing the EF funds for us, because I have felt much safer and calmer when we had the money for these two very expensive situations this year.

    I say that about the second rental property because it exposes you to more complicated situations with more things that need cash input from you, and that will slow down the complete EF. Have you got a definition of what you want or need in an EF? WE have been working on that, working on defining lifestyle choices so that as we do retire, we can still maintain a lifestyle we are used to--this means doing the downscaling now. I know that is different than you because you are in an upward vector, we are in a downward, simplifying mode. We just want whatever we do from now on to be sustainable as we age.

  6. #6
    Senior Member fidgiegirl's Avatar
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    Thanks to everyone who has responded so far. Toomuchstuff, I see us doing the basement much the same way. Plus, allowing ourselves time so far has already resulted in some deals. For example, my mom has a sink base she bought for a project at work that is now unneeded that we can use and she will give it to us. Turns out she also has a broom closet we can have as well to hide the stack. That kind of thing.

    rodeosweetheart, I appreciate the mention of Dave Ramsey. We really were devotees there for a while, and need to get back to him. We also aren't maxed on retirement funds. So there is quite a bit of work to be done.

    Your mention of aging parents hit home as well . . . my mom is referring to the idea to finish the basement as a "mother-in-law apartment" (it will not be, and my mom can barely do steps now at 60 anyway, so I don't know how she thinks she'd live in a basement apartment anyway) and keeps talking about us adding a bathroom on the main floor! This would involve adding an an entire room as the layout of the house does not allow for a bathroom to tuck in anywhere. But that's really about her and the stairs. So I just sigh and remind her that it would be many thousands of dollars and we're not doing that right now. "Oh, I know, I know, I'm just teasing . . . " ***Sigh.***
    Kelli

    My gluten free blog: Twin Cities Gluten Free
    Our house remodel blog: Our Fair Abode

  7. #7
    Moderator Float On's Avatar
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    I would for sure take care of the current problems (rotting wood, tuckpoints,etc) before doing any remodeling to the basement.
    Then I'd do remodeling while paying down mortgage before I'd consider a rental property (which will come with it's own need for repairs, which will always come before your own repairs once you have renters).
    Float On: My "Happy Place" is on my little kayak in the coves of Table Rock Lake.

  8. #8
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    I don't have advice, but I know how it goes. There's always at least 5 projects we have in mind for every bunch of dollars we have available...

  9. #9
    Senior Member jennipurrr's Avatar
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    Somehow I missed the basement thread...I haven't been on the boards as much as I used to.

    As someone who bought 4 rental properties in 4 years, I vote to give it some time between the rentals. They are a lot of work when you start getting more than one. There are always various issues going on with one on them. Usually its just little things, but some times its big things...and its always a time suck. I tell people I wanted an income stream but I got a job stream, haha. It doesn't help that one is completely short term rented and the other two are semi-short term rented. Those have the most day to day little stuff.

    So that brings me to your basement...I think its a cool idea! But, as I said above...short term rentals are a job! DH and I invest about 10 hours per week in ours. It would be less with just one but not that much less. I've been trying to get DH to go for including one of our bedrooms in some replies from our VRBO ad, but he refuses. His staunch refusal to rent out our home short term actually led to buying the two short term rentals. You have to be very careful to make sure this is acceptable in your area though. A woman called us basically in tears because she had bought a home in a very desirable location for short term rentals and started putting ads all over the internet and was shut down by the city because she is in a historic neighborhood. A lot of places still have old codes about renting short term that were meant for boarding houses and such. You will also need extra insurance on your home (steve here told me that and it is true!) in addition to your primary homeowner policy. Also...in the world of short term stays I would say it goes like this for the clientel...couchsurfing (lets party!) < airbnb (i'll probably be a respectful houseguest, but if you want to smoke a little weed I'm down with that) < craigslist (looking for a deal compared to a hotel / tire kickers) < vrbo (usually cream of the crop renters). Just my observation of the arena for the past few years.

    I would fix the rot first. Its only going to get worse and is it possible it could cause structural problems? I usually am fine with begnin neglect, but rot sounds like it might become a major issue. Then I would go for the basement because it has a variety of uses. I would try to get it to pay for itself by renting it out. Then decide on the rental vs the mortgage. Just my opinion!

  10. #10
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    I think you need to let go of the "big" ideas for the basement remodel and focus on the needed repairs and also having money for a car. Would you be upset if you spent that money on the basement and then had to get a car payment. How nice it would be to be able to pay cash for a car. Be patient, save, save, save. Do you have an emergency fund also? I would get back to listening to Dave Ramsey to help you refocus. Another rental property while you want to do all of these other things requires a lot of extra cash on hand, like 40,000-50,000 I would think for emergency fund. What if the other rental property needed a new roof all of a sudden. Keep it simple . I can't tell you how many situations I have heard on Dave Ramsey of disasters with a rental property.

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