Good Morning Bogleheads,
I have posted a small amount of times for the past few years and have been so grateful for the advice I've received. Our financial and family situation has changed since our last post and am currently exploring a the possibility of a home purchase. Unfortunately, I need some help thinking this through. According to my friends and family, I have become way to risk adverse and conservative, and I must admit it has provided me great mental/emotional comfort to live well below our means. With that said, as we are now entering a new phase of life maybe I need to reconsider. I was up all night rattling my brain, so I apologize if this post is incoherent, and thank you to those who take the time to read and respond!
Finances:
Income Me: 120k (state employee, outside of occasional basic COLA raises, I'm topped out) Overtime is available
Income Her: 50k (she works part time 2 days a week in healthcare)
Retirement:
I will have a Pension at percentage of income pending years worked. No social security. I plan for roughly 60% of base salary.
Other combined retirement accounts currently sit at 140k.
Debt: None
Only thing that worries me a bit here is we have two older cars 15 and 17 years old respectively, that are obviously paid for but could foresee a need for at least one vehicle in next 2 years.
Cash: 130k
Other investments/taxable: None
We are married couple (38/36) with 1 toddler in Boston area. Never owned a home and currently rent a small apartment.
Pros of the apartment:
1. Cheap! ($1800) Got in at just the right time 5 years ago, currently priced way under market, but landlord likes us so hasn't done much to the price.
2. Excellent landlord.
3. Relatively close to work (by Boston standards) 15 minutes for her, and 45 minutes for me.
Cons:
1. Not a particularly safe area, not the worst, but definitely rough. Family, friends do not particularly feel very safe in the area. Which was no big deal in the past as we were childless, but now with a child, we have heard a bit more of it.
2. Absolutely would not send child to the schools in the area.
3. Small and old (100 year old triple decker)
The house:
Price is 560k.
We would put 20% down giving us a PITI at about $3600
Good school school district, excellent neighborhood with lots of kids.
Here's the kicker. this house is way closer to family and would guarantee free childcare for us.
The down sides are, my wife would probably have to go to work full time. In which case her income would be just over 100k. But her commute would go from 15 minutes to 40 minutes, and neither of us really want her to work full time. She is an amazing mother and I don't want her to be less involved to simply afford a home. With that said I can't deny the reality that we can't always get what we want - some people just need both parents to work and its ok. Also, we want to have one more, and would be looking to get pregnant soon. Her last pregnancy was rough, and its possible she will need (and I fully support) a very slow road back to the work world. The benefit to my job is I do have overtime so I could cover us next year during maternity leave. But I would much rather spend my time helping and caring for my family then working all of the time.
The thought of a PITI of 3600 kept me up all night last night. I don't even really know hot to plan for utility cost differences or maintenance costs outside of the very basic recommendations I see online.
Enough rambling from me, maybe someone with a cleared mind on this board can provide some insight.
I have posted a small amount of times for the past few years and have been so grateful for the advice I've received. Our financial and family situation has changed since our last post and am currently exploring a the possibility of a home purchase. Unfortunately, I need some help thinking this through. According to my friends and family, I have become way to risk adverse and conservative, and I must admit it has provided me great mental/emotional comfort to live well below our means. With that said, as we are now entering a new phase of life maybe I need to reconsider. I was up all night rattling my brain, so I apologize if this post is incoherent, and thank you to those who take the time to read and respond!
Finances:
Income Me: 120k (state employee, outside of occasional basic COLA raises, I'm topped out) Overtime is available
Income Her: 50k (she works part time 2 days a week in healthcare)
Retirement:
I will have a Pension at percentage of income pending years worked. No social security. I plan for roughly 60% of base salary.
Other combined retirement accounts currently sit at 140k.
Debt: None
Only thing that worries me a bit here is we have two older cars 15 and 17 years old respectively, that are obviously paid for but could foresee a need for at least one vehicle in next 2 years.
Cash: 130k
Other investments/taxable: None
We are married couple (38/36) with 1 toddler in Boston area. Never owned a home and currently rent a small apartment.
Pros of the apartment:
1. Cheap! ($1800) Got in at just the right time 5 years ago, currently priced way under market, but landlord likes us so hasn't done much to the price.
2. Excellent landlord.
3. Relatively close to work (by Boston standards) 15 minutes for her, and 45 minutes for me.
Cons:
1. Not a particularly safe area, not the worst, but definitely rough. Family, friends do not particularly feel very safe in the area. Which was no big deal in the past as we were childless, but now with a child, we have heard a bit more of it.
2. Absolutely would not send child to the schools in the area.
3. Small and old (100 year old triple decker)
The house:
Price is 560k.
We would put 20% down giving us a PITI at about $3600
Good school school district, excellent neighborhood with lots of kids.
Here's the kicker. this house is way closer to family and would guarantee free childcare for us.
The down sides are, my wife would probably have to go to work full time. In which case her income would be just over 100k. But her commute would go from 15 minutes to 40 minutes, and neither of us really want her to work full time. She is an amazing mother and I don't want her to be less involved to simply afford a home. With that said I can't deny the reality that we can't always get what we want - some people just need both parents to work and its ok. Also, we want to have one more, and would be looking to get pregnant soon. Her last pregnancy was rough, and its possible she will need (and I fully support) a very slow road back to the work world. The benefit to my job is I do have overtime so I could cover us next year during maternity leave. But I would much rather spend my time helping and caring for my family then working all of the time.
The thought of a PITI of 3600 kept me up all night last night. I don't even really know hot to plan for utility cost differences or maintenance costs outside of the very basic recommendations I see online.
Enough rambling from me, maybe someone with a cleared mind on this board can provide some insight.
Statistics: Posted by boglerman — Sat Mar 16, 2024 6:08 am — Replies 15 — Views 669