Blue wants to rent out his East Coast home, take a sabbatical from work, travel to the West Coast with his family, and start a YouTube channel and other entrepreneurial projects. How should he manage his money to make this happen?
Should “Walker,” an anonymous caller, give up a cushy job to take a year-long sabbatical in Europe?
Melissa regrets buying a house two years ago in Ft. Lauderdale. She’s poured $30,000 into repairs, all of which she borrowed. Her home-related debts have mounted. She’s over-extended. Should she cut her losses?
Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.
P.S. Got a question? Leave it here.
Here are the details:
Blue asks (at 03:46 minutes): We’re in our mid-30s, and we’re disenchanted with our jobs and the area where we live.
We’d like to take a sabbatical, move out West for a little while, and try out some entrepreneurial ideas.
We have $110,000 in our retirement accounts. We’re also building our emergency fund and hope to have $12,000 in the next few months.
Recently we purchased a home for $500,000 with a $2,400-a-month mortgage. We secured a $150,000 homeowner’s line of credit (HELOC) for emergencies, though we’ve never needed to tap it.
Our home is set up for Airbnb guests. We hope to start renting it out in the next month. We’d start by welcoming Airbnb guests over the weekend, while we’re camping, to see what kind of income we can generate.
Ideally, we’re hoping that we can earn $5,000 a month from Airbnb, but that would leave us homeless whenever it’s occupied.
Between our retirement accounts, HELOC, and passive income from Airbnb, I’m wondering if we’re ready to move into a Coast FI position. We hope to land new jobs in a new area that’s more in tune with our passions.
I also want to start a YouTube channel around my interests which include bike riding, skateboarding, traveling, local food movements, and farming.
Are we making the right move?
Anonymous asks (at 34:59 minutes): My wife and I want to take a year-long sabbatical in Europe with our two children, but we’d have to give up our cushy jobs.
We have easy jobs that earn us a decent standard of living, and we love the town where we live. We’ve been with our company for a long time.
If we take a sabbatical, we’d start at the bottom floor when we return. Our income wouldn’t change, but we’d have to work long hours again.
While we’d like to spend more time with our kids and expose them to a new culture at a young age, we also love our life now.
Is this tradeoff worth it? Or should we not let “great be the enemy of good”?
Melissa asks (at 57:45 minutes): I’m 44 and I’d like to retire at 60.
I purchased my first home two years ago, but it’s put me in a major financial rut.
I barely had enough money to buy the home with an FHA loan. Within 18 months, I had to take out an additional loan to cover $15,000 in repairs. Now I’m facing another $15,000 repair for electrical work.
I earn $112,000 a year, but I have no savings and nothing for retirement. My debt-to-income ratio is at 45 percent. What should I do?
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