My wife and I are in what I hope to be our final couple of years before FIRE. We plan on moving to a different state and buying our "forever" home. This will probably cost about 700k to 1 million.
I'm conflicted about a few things and would like to hear other members' thoughts.
1. An expensive home seems like such an inefficient use of resources. If I pay cash for the house, the opportunity cost of those funds is going to be about $50k / year. Add in 20k for maintenance, taxes and insurance and we're talking 70k / year to live in the type of home we're considering.
I think this bothers me so much because I'm extremely investment oriented and virtually 100% of our net worth is currently working for us in some sort of investment. Do I just need to come to terms with the fact that we planned to splurge more during retirement and so it's time to quit being so frugal and just spend the 70k per year on our dream housing?
2. We plan on traveling a lot more during retirement. I could easily see us being away from our home 3 months a year (multiple trips). I'd be worried about having an expensive home vacant so much. It also compounds my feelings expressed in point 1 as paying that much for a house and not enjoying it for 3 months a year seems like a colossal waste.
Financially, I don't think we'll have any problem affording the home. It's just such a dramatic change to my lifelong pattern of spending little while constantly saving and investing.
Anyone been in a similar situation or given thought to these issues?
Thanks!
Sent from my iPhone using Early Retirement Forum
I'm conflicted about a few things and would like to hear other members' thoughts.
1. An expensive home seems like such an inefficient use of resources. If I pay cash for the house, the opportunity cost of those funds is going to be about $50k / year. Add in 20k for maintenance, taxes and insurance and we're talking 70k / year to live in the type of home we're considering.
I think this bothers me so much because I'm extremely investment oriented and virtually 100% of our net worth is currently working for us in some sort of investment. Do I just need to come to terms with the fact that we planned to splurge more during retirement and so it's time to quit being so frugal and just spend the 70k per year on our dream housing?
2. We plan on traveling a lot more during retirement. I could easily see us being away from our home 3 months a year (multiple trips). I'd be worried about having an expensive home vacant so much. It also compounds my feelings expressed in point 1 as paying that much for a house and not enjoying it for 3 months a year seems like a colossal waste.
Financially, I don't think we'll have any problem affording the home. It's just such a dramatic change to my lifelong pattern of spending little while constantly saving and investing.
Anyone been in a similar situation or given thought to these issues?
Thanks!
Sent from my iPhone using Early Retirement Forum