thefed
Thinks s/he gets paid by the post
- Joined
- Oct 29, 2005
- Messages
- 2,203
SO....here's my story. I'm 25 y/o, 1 child and one coming, self employed with 2 rentals, wife stays home and works under the table. I've only begun working toward FIRE in the last 2 years. Before that, I amassed a whopping $10k in cash savings.
Since then, I've opened a Roth that I max out, a rollover IRA from my old 9-5 job, and a Simple IRA that I contribute $70 to weekly. I also save about $400 month for my cash 'reserves'.
My PROBLEM is that I cant bring myself to touch those reserves. Right now its about $25k. To me, this equals about one full year that I could not work and still survive. The last time I WITHDREW money from this account was 10 years ago for my first car...I wiped out the whole $1200!!
I am currently experiencing a lot of setbacks financially,in quick succession, coupled with a slow season for my line of work. $1500 work van repair, $150 surprise city inspection at rental, $1800 property tax payments (expected, but never easy), excessive federal income taxes due as a result of poor planning ($4k more than expected), $500 roof repair at home due to storms PLUS lots of labor,$1200 roof repair at rental due to old age and storms...insurance wont cover, $200 roof repair plus my labor for shed roof damaged in same storm..... ALL WITHIN THE LAST 2 MONTHS
I've been able to handle most expenses but I have about $2500 left to dole out and my IMMEDIATE month-to-month cash reserves are at an all time low of $1500...I keep $3k to cover one months expenses. Mortgage is coming due, rental heloc's due,etc etc
So....do I take 3-4k from my long term cash reserves and set myself back to 2007 levels...OR write a check from my HELOC (5.5% now, can lock at 6%)and 'pay myself back'? The obvious answer is to use the cash. BUT...I always worry about IF my HELOC disappears (bank choice, depreciation, credit issues...whatever) and I already began tapping cash reserves....I'm screwed! I also have an issue (ego?fear?obsession?) with the $$ amount of cash I have on hand. It is one of the only things financially that helps me sleep at night....and once I pass a benchmark(lately $5k increments) I promise myself I will never go back....
Work has been getting better each year, but as a business owner I'm always VERY leary unless I'm BOOKED SOLID. I think that's normal to be apprehensive and not totally secure as a small business owner relying on the business put food on the table. I spend all my free time on improving the businesses, so the income side of the equation is as good as it is going to get for now
Any input, suggestions, advice?
Since then, I've opened a Roth that I max out, a rollover IRA from my old 9-5 job, and a Simple IRA that I contribute $70 to weekly. I also save about $400 month for my cash 'reserves'.
My PROBLEM is that I cant bring myself to touch those reserves. Right now its about $25k. To me, this equals about one full year that I could not work and still survive. The last time I WITHDREW money from this account was 10 years ago for my first car...I wiped out the whole $1200!!
I am currently experiencing a lot of setbacks financially,in quick succession, coupled with a slow season for my line of work. $1500 work van repair, $150 surprise city inspection at rental, $1800 property tax payments (expected, but never easy), excessive federal income taxes due as a result of poor planning ($4k more than expected), $500 roof repair at home due to storms PLUS lots of labor,$1200 roof repair at rental due to old age and storms...insurance wont cover, $200 roof repair plus my labor for shed roof damaged in same storm..... ALL WITHIN THE LAST 2 MONTHS
I've been able to handle most expenses but I have about $2500 left to dole out and my IMMEDIATE month-to-month cash reserves are at an all time low of $1500...I keep $3k to cover one months expenses. Mortgage is coming due, rental heloc's due,etc etc
So....do I take 3-4k from my long term cash reserves and set myself back to 2007 levels...OR write a check from my HELOC (5.5% now, can lock at 6%)and 'pay myself back'? The obvious answer is to use the cash. BUT...I always worry about IF my HELOC disappears (bank choice, depreciation, credit issues...whatever) and I already began tapping cash reserves....I'm screwed! I also have an issue (ego?fear?obsession?) with the $$ amount of cash I have on hand. It is one of the only things financially that helps me sleep at night....and once I pass a benchmark(lately $5k increments) I promise myself I will never go back....
Work has been getting better each year, but as a business owner I'm always VERY leary unless I'm BOOKED SOLID. I think that's normal to be apprehensive and not totally secure as a small business owner relying on the business put food on the table. I spend all my free time on improving the businesses, so the income side of the equation is as good as it is going to get for now
Any input, suggestions, advice?