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Out of debt, have some spending cash, house?

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Money Talk > Real Estate

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Archibald Beechcroft
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Out of debt, have some spending cash, house?  Reply with quote  

My brother just bought a house in a "getting better" town. The house right next to him has gone up for sale for an extremely cheap 43,000. His house cost 78,000. It is in upstate new York right near the St. Lawrence River. I am completely out of debt, I have a kid on the way, and my current teaching job isn't somewhere where I want to be next year. Since the house is only 43,000 and I managed to pay off (without really struggling too much) 38,000 in one year, would it make sense to purchase the house, fix it up a bit and then sell in a few years. I do not plan on living in this house permanently unless I get a job in that area. I am actively searching for a job in this area. I currently make about 62,000 a year teaching. My wife makes about 30,000 as a nurses aide.

Thanks, I appreciate it.
Post Sat Aug 19, 2017 2:14 pm
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oldguy
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quote:
I managed to pay off (without really struggling too much) 38,000 in one year, would it make sense to purchase the house, fix it up a bit and then sell in a few years.


The lottery folks keep track of 'winners', it turns out that the average winner is broke in about 7 years.
Wage earners are so indoctrinated to 'monthly budgets & monthly pay' that they are unable to manage lump sums, ie they immediately attempt to '"do something'. They pay-off their house, payoff the cars, buy a new car to assure future reliability, pay off Mom's house, gift to charity, relatives, start a small business - and then they invest the remaining $10k "for their future," lol.

The actual answer (mathematically speaking) is to keep the entire lump sum intact, place it where it will double about every 7 years (The Rule of 72).

Actually there are books about the difference between 'earned' money (paychecks) and 'found' money. It's part of the human condition, we cannot handle 'found' money. Even something as small as a tax refund (our own money being refunded to us cuz we overpaid our tax bill). People grab it and take a vacation (the 2014 average refund check is $3000).

Amazing that we overpay on purpose (often while borrowing that same $3000 at 12% on CCs) and then wait for a year-end refund? So that we can payoff our CCs bills?
I blame the K12 system, lol - maybe you can teach these kids some math?
Post Sat Aug 19, 2017 5:03 pm
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