Afford Anything

Tag: ask paula

By Paula Pant

#262: Ask Paula – I’m Taking a Mini-Retirement in a Pandemic. What Should I Do?

Tyson is taking a year off of work and plans to devote some of his time to domestic travel, volunteer work, and bolstering his rental property portfolio. He originally planned to travel internationally, but won’t due to the pandemic. How does this plan sound?

Jace is wondering whether she should take advantage of the low stock market prices or keep a larger emergency fund due to the pandemic. Which is the better option, given her goal of financial independence?

Jace also wants to know: where do you park your money after maxing out a 401k and Roth IRA?

Venkat had to relocate after living in a condo for one year. He rents out the condo, but he’s in the red. Should he sell this condo? If so, when? 

TW has $250,000 in cash that he can use to either pay off his rental property or purchase two more properties. Which is the better option? 

I answer these questions in today’s episode. Enjoy!

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By Paula Pant

#260: Ask Paula – Should I Fire My Financial Advisor During a Pandemic?

Katelyn wants to fire her financial advisor and move her investments from mutual funds into Vanguard index funds. Should she do this during the pandemic? Or should she wait?

Marisa asks: can you invest in a Roth IRA if your income is inconsistent and might exceed the cap?

Anonymous “Flo” had a Simple IRA at her old job that she can no longer contribute to. She also can’t contribute to a 401k until she’s been at her new job for a year. Where should she put her money in the meantime?

Mary received an $80,000 grant of RSUs from her employer when she started. These RSUs began to vest after one year, and the price per share has increased 44 percent. What should she do with the shares?

Anonymous “Olivia” is interested in a Roth conversion ladder, but wants to know: does the pro-rata rule apply here as it does with a backdoor Roth conversion?

My friend and former financial planner Joe Saul-Sehy and I tackle these questions in today’s episode. Enjoy!

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By Paula Pant

#258: Ask Paula – Can I Quit My Job Before I’m Financially Independent?

“Burned Out in Boston” wants to reach financial independence.

But she’s not sure she can stick it out in Boston much longer.

She and her husband want to move to an area that doesn’t have many job prospects, and they want to make this leap soon, ideally before they reach FI. How do they know when it’s the right time to jump ship to their dream location?

Ingrid and her husband own two rentals. They’re torn between paying one of their rentals off or buying more properties. Which is the better route to take?

Pat is torn: should she convert her garage into an accessory dwelling unit, or use funds to buy an out-of-state rental property?

Chelsea wants to know: what should you do if your newly purchased home is an instant money pit?

Julia wants to know how to approach investing in sector-specific index funds, like utility ETFs. Should they be a small or large portion of your portfolio?

I answer these five questions in today’s episode. Enjoy!

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By Paula Pant

#256: Ask Paula: Bonds Are Tanking. Should I Switch to Real Estate Instead?

Jon is wondering if now is a good time to move his RRSP into a tax-free savings account, given the market downturn. He knows you can’t time the market, but the opportunity is tempting. What should he do?

Laurel’s question revolves around the CARE Act and early withdrawal from a 401k. She needs to rebalance her 401k and wants to buy a rental. Instead of selling stocks, should she sell bonds as a form of rebalancing and to withdraw for a rental property?

After seeing so many businesses experience financial hardship, Rebecca and her husband are curious: why don’t companies have emergency funds?

Salome sees the stock market downturn as an opportunity for tax-loss harvesting, but does this hold if you’ve held stocks for less than a year?

Josh and his wife have funds in Vanguard and Betterment, and they own their apartment in Queens, NY. Does the equity they have in their apartment count as real estate, or should they invest in something else for more diversification?

Jenny and her husband earn $220,000, max out their 403b and HSA, and have an extra $4,000 per month to invest. Where should they put this money?

Sheena has the option to purchase company stock at a 15 percent discount through an Employer Stock Purchasing Plan. However, it’s volatile right now. Should she contribute the maximum amount, or nothing?

My friend and former financial planner Joe Saul-Sehy joins me to answer these questions. Enjoy!

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By Paula Pant

#254: Ask Paula – Should I Invest During a Pandemic?

It’s our First Friday bonus episode!

Lydia earns income as both a 1099 contract worker and a part-time W2 employee. She filed for unemployment as a W2 worker, but can’t find information on how to file as a contractor. Is there a process contractors can follow to file for unemployment?

Florina and her husband have $70,000 in cash to invest. Where should they put this money in light of the current market?

Ali and his wife saved eight months of living expenses in their emergency fund in case they get laid off during the pandemic. Is this too excessive?

Danielle wants to take advantage of pandemic stock prices – what should she invest in?

Anonymous in Real Estate wants to buy a multifamily property with the equity in their first rental as a downpayment. Their husband doesn’t want three mortgages. Should they accelerate mortgage pay-down and be one mortgage down in four years?

I answer these five questions in today’s episode. Enjoy!

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By Paula Pant

#252: Ask Paula – Will the Stimulus Cause Massive Inflation?

The government issued a $2 trillion stimulus. How will that affect the economy? Could we endure massive inflation or hyperinflation?

Bradley kicks off today’s Ask Paula episode with this timely question. What inflation rate will we see in 2020, and how can we prepare? How should we hedge against hyperinflation?

Anonymous Retiree (whom we call Sequencing Sally) is 64 and retired last year. She lives off of monthly withdrawals from a Vanguard portfolio. Given the bear market, should she leave her portfolio alone and spend from an emergency fund?

Additionally, her target allocation is off-kilter. Should she rebalance now or later?

Jay wants to reach financial independence in five years, but she’s in a job that will pay her $270,000 student loan balance if she stays there for another 17 years. Should she stay, or quit and face the balance?

Jan has $500,000 in a managed fund with a three percent annual fee. He wants to move his funds into his Vanguard personal brokerage account, without incurring a ton of taxes from the sales of his holdings. How can he accomplish this?

My friend and former financial planner Joe Saul-Sehy and I answer these questions in today’s episode. Enjoy!

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By Paula Pant

#247: Ask Paula – Is the Stock Market Going to Crash in 2020? How Should I Invest in a Bear Market?

Caroline wants to buy her first home in Denver, CO. How can she calculate how much mortgage she can comfortably afford?

Anne plans to retire later this year on rental income (woohoo!). She’s saved up a hefty emergency fund for her properties, and she wants to know 1) if she should invest a portion of this in index funds, and 2) whether she should rebalance her portfolio to account for this huge cash allocation.

Anonymous Nurse has over $100,000 in debt, not including their mortgage. They want to invest in rental properties, but with so much debt, they’re thinking of selling their home or renting it out. Which option is best given their interest in real estate?

Joy wants to know if she should put $50,000 towards her primary residence mortgage, or use it as a downpayment on her first rental property. What are the pros and cons of each option?

Anonymous owns a cash-flow positive condo…on leased land. The land will revert back to the owners in 32 years. When is the best time to sell this property?

I answer these five questions in today’s episode. Enjoy!

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By Paula Pant

#243: Ask Paula – How Can I Retire in 10 Years with Rental Properties?

Adam is 23 years old and wants to achieve financial independence as quickly as possible. However, he’s nervous about investing in the stock market and real estate. How can he overcome his fears?

Paris, age 35, has a similar question. She earns $150,000 per year, is debt-free, and doesn’t own a home. How can she reach financial independence in less than 10 years?

Paul wants to househack his first home, but none of the properties he’s seen meet the one percent rule. He doesn’t want to rent forever. Does he need to compromise on his commute time, or wait until he finds an undervalued gem?

Anonymous Househacker rents an apartment with three bedrooms, two of which he rents out on an inconsistent, short-term basis. They want to know: does the money they earn count as rental income if they aren’t making a profit on it?

Ben is a real estate investor who’s curious about growing his portfolio from four units to 20 units. What’s the best approach to take?

I answer these five listener questions in today’s episode. Enjoy!

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