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Big City to Colorado
Old 07-19-2004, 07:42 PM   #1
Dryer sheet wannabe
 
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Big City to Colorado

Have been working on financial freedom for years. Always thought it would be better to make sacrifices when young for two reasons; First the power of compounding and second it's easier to be poor when you are young then when you are old. javascript:wink()

We have no debt of any kind + 2 very young kids. We own a small condo($260K) and a beautiful plot of land in the mountains($220K) where we want to move within the next 3 years and build our dream home which will cost about $450K to build. Our IRA's combined stand at $170K. We have various stock 30%, bond 40%, and cash 30% taxable investments totalling $740K. We live on one base salary which is $75K/year, but usually have good commissions of $40K+ on top of that which we invest. Enjoy the job. We also have $22K in a 529 savings account. No pensions. We are in our mid-thirties.

Concerns/questions:
We need a larger home for our family soon. Selling the city condo and using the proceeds to build in the mountains is under consideration as is buying a bigger place in the city to live in for the next few years.

The job opportunities in the mountains are not so great. Considering proposing a telecommunting position to present employer or searching for a similar type position with another firm.

Have worked very hard and made many sacrifices up to this point. Now with young kids, the goal is to take the foot off the gas a little bit to spend time with them and each other. Have already dropped one income.

Dream is to live in a comfortable mountain home surrounded by family and a couple of dogs and do things that are both intellectually and physically stimulating.

Thanks in advance for any suggestions.javascript:smiley()







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Re: Big City to Colorado
Old 07-20-2004, 12:39 PM   #2
 
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Re: Big City to Colorado

Quote:
The job opportunities in the mountains are not so great. Considering proposing a telecommunting position to present employer or searching for a similar type position with another firm.
Giving your current employer this ultimatum is a risky proposition. If business is booming, they may say yes, and rescind later when business slows down. I've seen this happen.

I hate to burst your bubble, but based out what you wrote your expectations are too high (RE and build a 450K home in 3 years.)

You need to run some simulations (use FireCalc). You'll probably need to work/save more, keeping spending down, if you want to RE (within 10 years.) Do you really want a $450K home? IF so, you'll be working for a long time.

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Re: Big City to Colorado
Old 07-20-2004, 03:56 PM   #3
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Re: Big City to Colorado

Hi Mountain_Man,

I love your dream. You will need a guest room for
the flow of visitors coming your way. But seriously,
a small plot of land costing $220k with a $450k house sounds pretty excessive for your resources. That
plot of land must be sitting on a gold mine to be so
expensive. And, $450k for a house in the wilderness?
Whatever happened to "thou and a jug of wine ....."

I admire your lack of debt and the sacrifices you have
made up to this point. Now if you will just get a little
more realistic with your expectations the odds of your
achieving them will increase dramatically.

Cheers,

Charlie
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Re: Big City to Colorado
Old 07-21-2004, 05:31 PM   #4
Dryer sheet wannabe
 
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Re: Big City to Colorado

Thank you for the nice dose of reality. It looks like we will be working longer and/or building a less expensive home for our family. Took the advice and ran firecalc with various expense requirements and came up with between 60% and 90% probabilities of success.

For us it's OK to be working so long as we actualize the dream to move to the mountains. The company I work for has a decent liklihood of being sold within the next couple of years and the little bit that I own would add another $200K - $300K to the mix. To be conservative, it seems prudent not to count it unless it happens.

However, if that does happen and we scale back the house a bit we would be moving to Colorado with a paid for house, no debt and over $1 million in investment assets. This is still not enough to retire but a potential trade off for the ability to live in the place we love. Being a ski instructor would be fun and the plot of land is walking distance to the lifts.

Thank you again for the words of wisdom.

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