Stuck newbie

[RoadAhead43]

Hello to everyone,

I live in Pa, married with two young children in a 5000 sq/ft home, market value estimated at 1.1M with a 500k mortgage.  I have worked as an IT consultant for 20 years and am burnt.  Not an hour goes by that I don't dream of a new lifestyle, doing something other than staring at a screen and struggling with logic and technology.

Last year I presented my plan to my wife: we downsize to a 2,200 sq/ft home for which we pay cash and I pursue other business ventures or just do IT consulting part time.  There are several small businesses I'd like to start, none of which involve IT.  I was so pumped!

The expression on her face was telling; she was far from enthused.  She had some good points: we have invested so much into this house in terms of money, time and energy, we're not going to save that much by downsizing, etc, etc. Now my 4 1/2 year old daughter has started in: "Daddy, I want to keep my beautiful house."

So, I've spent the last 3 months working even harder, trying to build my consulting business, thinking that maybe if I really go for it I will make enough money to make it all worthwhile.  The results have been predictable; my heart isn't really in it and people can sense it, making me less effective in selling and other aspects of my work.

Then, I think that maybe I am counting on the grass being greener, and that I am blaming my work for my lack of zest, and it is really deeper issues.  But I've explored that area very thoroughly, and think that is due to my growth and self-empowerment that I have reached this point and these new goals.  I want more for my life than just being a zombie for the sake of 5000 sq feet. And, I know my family will not suffer if we downsize. In fact, I think it will teach my kids an important lesson about conservation; an issue that they will certainly be facing in their lives.

I am looking for some help to get me moving toward the direction I want, and maybe need, to go.  Or is the grass just as green where I am?

Thanks,

Jeff

 

[RoadAhead43]

Adding to my first message, I should mention my age:43. Also, have the home equity (approx $500k, assuming we could sell for 1M) and $350K in defined benefit pension account and another $50k in mutual funds. I'm not really looking to retire, that word isn't in my vocabulary, but I am looking to take on a sustainable lifestyle that will serve me well into my later years.

 

[AltaRed]

I see the possibility of a major fracture happening with your health and/or your family situation within the next 2 years or so unless there is some intervention. At the very least, you will remain quite unhappy and that will ultimately reflect in your relationships with your family.

Since your family has no basis to understand very well your personal and work situation, more family discussions will not likely be very productive. What I recommend is that you enlist the help of your minister or a family psychologist to intervene as an independent third party with you and your wife. It will help take away the 'me versus you' situation.

The company I used to work for retained the services of 'family counselling' for employees in a variety of situations, including the type of situation you find yourself in. I would recommend an employee talk to these folks when a particular work situation required such intervention.

FWIW, I agree with your assessment of the situation. A 2,200 sq ft home can be a lot more conducive to healthy family relationships than a 5000 sq ft McMansion with all the trimmings and your family will have the benefit of a happier and healthier provider as a bonus!

 

[astromeria]

"we're not going to save that much by downsizing" from a $500,000 mortgage to ZERO

uh...I don't know how to put this delicately, but your wife isn't rational. Aside from the mortgage itself, how about the property taxes, homeowner's insurance, heating/cooling, maintenace/repairs, yard-care service, cleaning service, and furnishings for a huge house. Or by "that" was she referring to something other than money: we're not going to save that much...bragging rights?

My kids didn't want to leave our cr@ppy apartment at that age either.

 

[AltaRed]

uh...I don't know how to put this delicately, but your wife isn't rational.

Precisely, and that is one reason why the OP needs 3rd party intervention.

 

[ladelfina]

Since your family has no basis to understand very well your personal and work situation, more family discussions will not likely be very productive. 

Hmm, I disagree. Sounds like RoadAhead has not been talking *enough* with his wife about his stress and how hard it is for him to keep maintaining their current lifestyle, if she really doesn't understand it. Maybe the 'little talk' at the time was like a bolt from the blue for her.. Keep the conversation going.

The company I used to work for retained the services of 'family counselling' for employees in a variety of situations, including the type of situation you find yourself in.  I would recommend an employee talk to these folks when a particular work situation required such intervention.

Are the 'family counselors' retained by a firm obliged to disclose an employee's dissatifaction/readiness to bail, or are they encouraged to promote the company line? Just asking because you do say they are retained by the company...

I think RoadAhead should update his list of pros and cons to downsizing and revisit it with his wife. If she is not working, he could suggest that she go out to work if she wants to keep the 'beautiful house' (I think this came up on another thread not so long ago). He could do child care PT,  work from home PT.. She needs to see that she married a man, not a house.. and if RoadAhead goes bonkers or drops dead from the stress, then where will she be?

Just my .02: 5000s.f. is an obscene amount of space, even for the Brady Bunch. I have more space than I can handle at 1/2 that: 4 b.r., 3 baths! Get a grip! You can only be in one room at a time...  :  And I can't even imagine cleaning all of it OR paying someone to do so!

Also, who handles all the bills astromeria mentioned? If it's not the wife, she needs to see the real sum of all those incidental expenses. Maybe that will help open her eyes. Or give her a copy of "the Millionaire Next Door" or similar..

Best wishes!

 

[dumpster56]

As woody allen said in a movie, I try not to keep up with the jonses, I BRINGEM down to my level!

5000 sq foot house. oofah too big, 500K mortgage, Can you say stress?

My 250K mortgage was killing me.

My new 50K mortgage even with a 40K pension is well an easy payment.

Good luck .

 

[Martha]

I am looking to take on a sustainable lifestyle that will serve me well into my later years.

This makes a lot of sense to me. It will also serve your children well. Good luck on the discussions with your wife .

Are the 'family counselors' retained by a firm obliged to disclose an employee's dissatifaction/readiness to bail, or are they encouraged to promote the company line? Just asking because you do say they are retained by the company...

No. An employer may contract with an outside employee assistance provider, but the relationship between a couselor/therapist and the client is to remain confidential.

 

[RoadAhead43]

Great input everyone, thanks. 

Actually, from the first presentation of my plan over a year ago, we have continued discussions and she has started to come around, but VERY slowly.  She now reluctantly agrees with the direction, although it is plain it isn't what she wants. 

She is enamored with things.  I have been trying to tell her that things don't do it..we need freedom, quality of life.

I think part of the problem is that she envisions us moving into a dank, depressing old house and giving up this admittedly beautiful, shining house.

BTW, this thing is a McMansion by all accounts, but as McMansions go it is a nice one.  Over an acre of beautifully landscaped gardens, home theatre, professional kitchen.  She loves all that stuff; I do too.

So, I bought one of the home plan books that show page after page of beautiful little cottages in the 2000 sq ft range.  These pictures seemed to help.  It gave her a new vision of what our downsizing would be.  She still gets her kitchen, just smaller.  I can certainly do my gardens on a 1/4 acre.

But now here's the question.  Can I build a new, 2000 sq ft house and be in a much better position financially?  Or am I going to end up back where I am.

Here's the numbers:

-We sell this place and walk with $400k in cash.  This assumes a sale price of 1M and $100k in costs.  These are conservative figures.  Had we sold a year ago, we almost certainly would have gotten over 1.1M, since another house in our neighborhood got well over that.  But now the market is tanking.

-I estimate $175/sq ft for the new place, so the house is $350k.   A lot will run $150k.  Add landscaping, driveway and all the other stuff and we're at around $650k.  Keep in mind that my goal is to maintain the same look and feel as our present house, just smaller, thus the high cost per sq/ft.

-We need some cash in hand, so we put down $350k, leaving us with a $300k mortgage.

-Taxes should be reduced by at least 30%, so we go from 11k to say, 7K a year

Other expenses are reduced by at least 30% as well.
Electric/gas: 500 to 300/mth
Homeowners: 200 to 100/mth
Water/sewage: probably little reduction

Based on these numbers, we would reduce our expenses by about $2500/mth, but we would still carry a $300K mortgage.  The $50k would almost certainly go to curtains and other accoutrements for the new place.  There is our $350K defined benefit pension plan, but that doesnt help us much now.

I would still have to pull in some serious jing to make it all work. 

Of course, we could buy a 1965 home with its original patina, but she isn't going to go for that, and honestly, that would be depressing for me, although I could probably get used to it.  I could probably find a decent place for $350K.   Knowing us though, we would end up putting another $200k into fixing up the place, bringing us back to the $550K range.

The rental option seems intriguing to me.  But I wonder if we can do that and keep the same standard of living we are used to.

Appreciate your views.

 

[BunsGettingFirm]

Road, I think others have quite expertly addressed you housing and spousal situation. I'd like to talk about your job situation. Yes, IT/engineering/Comp Sci can be intellectually challenging, but after 10-20 years (really more if you count the fact that most of us tech heads have been playing with computers since we were kids), even the most exciting thing turns stale because the joy of discovery is no longer there. I think the best thing about going into a new, somewhat related field (of course, I'm not suggesting that you go into professional ballet or try out for the MLB or the NBA) is that you'll have that sense of adventure again. Yeah, you'll pay plenty with dumb mistakes, but that's part of the cost of learning and growing.

 

[TromboneAl]

Big vote for downsizing here.

I'd vote no for building: marital stress.

If you haven't done this yet: "Hey, honey, we were talking about whether we save, and take a look at this spreadsheet..."

Also, have you tried just looking at some houses? DW might fall in love with one.

 

[Martha]

We used to have a big house on the beach. We ended up moving into a much smaller place. We have now lived here for nine years. At first it was a bit difficult to get used to. But now its home and it is fine. We redid the kitchen and bath, satisfying my decorating urges. We have no mortgage. No debt at all. That is very freeing.

I agree on the don't build recommendation. Costs can easily run out of control. Watching the whole process is a big job too. Start looking around at cute little houses. Read about "not so big houses." http://www.notsobighouse.com/

 

[brewer12345]

Holy crap! I would have to say that you and your family have let your lifestyle get pretty big. A $650k home (in PA, no less) is a hardship?! Jeez, I can't imagine what you would think of my modest home...

If you are serious about downshifting, the lifestyle will have to downshift, too. TANSTAAFL...

 

[astromeria]

Instead of building, how about buying a spec house that's part-way done or already complete, and the builder is drooling over your low-ball offer? Or a barely used house where the seller is desperate. You can get great deals now--even better soon, I expect. One thing I discovered when taking this route was that it's hard to get the spiffy kitchen and master bath in a house under 2250 sq ft. I tried and failed--ended up with nearly 2500 sq ft. BTW, I advise waiting to buy until you've sold your unique home in this softening real estate market. Let's just say I know what I'm talking about

Also...I'm sorry about the crack. I meant to say that your wife is behaving irrationally about this matter, not that she is irrational in general.

But speaking of rationality...is it really necessary to spend so much ($150,000 above the cost of the house) on landscaping and such? Is it necessary to complete every detail immediately? How about saving up for some of the landscaping and fancy doodads instead of adding debt to buy them? I didn't buy our dining room rug or office recliners until we'd been here a year (and saved the money), plantation shutters for 2 years, new family room seating for 3 years. I'm all done now, I think

My huband downsized from being a dierector of engineering to being a college instructor (computer science). His stress level went from your-migraines-are-scaring-me to ahhh. Not to mention having way more time for personal interests such as travel.

You might want to read "The Millionaire Next Door"--T. Stanley, "Your Money or Your Life"--J Dominguez, and especially "Work less, Live More"--B Clyatt. I'm re-reading this last one this week, and I think it's the perfect 3rd-party advice for you & your wife.

 

[donheff]

-We sell this place and walk with $400k in cash...
-I estimate $175/sq ft for the new place, so the house is $350k. A lot will run $150k. Add landscaping, driveway and all the other stuff and we're at around $650k. Keep in mind that my goal is to maintain the same look and feel as our present house, just smaller, thus the high cost per sq/ft.

Good grief. Your original post sounded like you are virtually burned out and here you are planning to step onto another treadmill. Expand your location horizon and look at some houses. You can find someplace wonderful to live in for $400k and have zero mortgage. Heck, sell the mansion while the price is still right and rent for while until you can find a decent place to buy. If you are in southern CA or something consider moving elsewhere. You are obviously a compentent techie if you are making enough $ to live that large. You should be able to find good part time work and wonderful locations all over the country.

 

[RoadAhead43]

Some very sage advice...glad I found this site.

My plan is to:
-sell this place and tally up the kitty
-rent for awhile
-find the right location and right house that satisfies our life style and financial goals
-stretch out and live better..ahhh

Only one problem now, and it's not small.  We had another "talk" this morning..I mentioned some of the viewpoints you guys shared.  Didn't go well...at all.  Very bad in fact.  Looks like if it's going to happen, it's either going to be by myself or with her kicking and screaming the whole way (the scorn of a woman will kick your ass)....

I think a 3rd party is needed to help us through this, so I am making calls today.

 

[RoadAhead43]

BunsofVeal,

I related to your posting about the job. I figure with less financial stress, I can do this part time and delve into my interest in architecture in some way, and then transition over when it makes sense.

I take it you were/are a techie? What're you doing now?

 

[REWahoo]

Jeff, you didn't metntion anything about your spouse having an income. If she doesn't currently work, you can always offer that if she wants to retain the mcmansion she will need to contribute her part of the mortgage payment and additional expeses v.s a ~2,000 sf house. And if you survive that conversation...

Seriously, it might help her understand that everything comes with a price, and that she needs to help pay the tab if she wants to keep livin' large. It might also make her serioulsy reconsider the benefits of "mediumsizing".

Good luck with retaining both your sanity and your marriage.

 

[Rich_by_the_Bay]

It's tough using an internet forum as the basis for any important difference of opinion. The nonmember feels excluded, and it's all too easy (and often accurate) to take the tact that "you can't believe anything you read on the internet."

Hope your discussions are not beyond the point of no return. If it applies again, you might use the forum to get links and data and present those findings as if you dug them up yourself. That way she won't feel outnumbered .

Best of luck. Sometimes even when you're "right" you need to wait for the best moment to move things your way. Hope things work out.

 

[SteveR]

I would agree a third party is a very good approach. Having a spouse that is working "against" you in financial matters is not fun (been there done that). We did marriage couciling for almost a year. In our case a lot of stuff ended up on the table for us to deal with but it takes both parties willing to meet in the middle on some things or you don't have a deal.

I wish you the best of luck in this. Go slow.

 

[RoadAhead43]

ReWahoo,

We have discussed the following options ad nauseum:

-hire a European live in au-pair so that my wife is freed up to help with my consulting practice. We got pretty far along that path, but my wife nixed it near the time the girl was supposed to come over. Needless to say, the young girl was not happy.

-have my wife go back to work full or part-time

-have my wife work part-time assisting with my practice

-downsizing and me continuing to be the sole bread winner

She could probably earn 70-80k if she went back to work full-time. She's well educated with good work experience. She got treated pretty bad at her last job though and, rightfully so, doesn't get real excited about returning to that mess.

She doesn't seem to like any of these options. I think the downsizing is probably the best option because I strongly feel that less is more. She is going to have to give somewhere; otherwise, my heart or some other body part is going to give, and I'm not going to let that happen...it's like I'm fighting for my own survival...geesh...what's a family for?

 

[kcowan]

Find a place you could rent. Sell the McM. Then look around at what the market will yield and be really flexible. Either a distress sale or a fixer-upper. You cannot afford to build new without selling current. So by fixing yourselves on the interim rental, you maintain maximum flexibility to strike a fantastic deal on the permanent abode. Get the market dynamic working for you ... and quickly.

One of my moves required a 3 vs 1 decision (wife and kids aged 8 and 11). I was the ogre. One year later they loved the new place and would not move back (was offered another promotion to move back and declined). So you have to make the tough decisions and hold out hope that it is not necessarily a one-way street.

 

[tangomonster]

Road Ahead, I can't speak from personal experience since DH and I are almost always on the same page about living simply, saving, and not spending too much money, which is why we are now enjoying our first week of retirement at 52 even though each of us has not earned over $50,000 each!

But it does seem like counseling would be helpful, since this issue isn't going to go away. Perhaps a counselor can help you reach some sort of compromise. It especially concerns me that your young child is possibly being strongly influenced by your wife to be a material girl and to only be happy with the biggest and the best, even if it's at the expense of your physical and emotional well-being. And if she's like this at under five, just imagine what she'll want/
demand as a teenager!

Your wife sounds just like a character in a book I just finished reading called Rattled. You might enjoy it---at least it could give you a chuckle if you see your wife in it. It's about a woman in suburban New Jersey who has to have a big new house and all the comic consequences that arise
from this (like the developer built it on a rattlesnake den!)

 

[RoadAhead43]

kcowan, I agree with your take and think that's what this family needs. I hate being the ogre..I really hate it..but being a leader, and in my case, standing up for yourself, ain't easy... but my gut tells me it is an important step.

Tangomonster,appreciate your comments and the book reference. Would be hard to laugh since so close to home. Funny, she is from Jersey. Maybe the author IS writing about my wife. :

 

[boutros]

Just thinking from your wife's perspective for a moment.   People generally marry others with similar goals and values.  Together you had a child and built a home.  If you built a 5000 sf home LBYM was not always one of either partners' goals.  LBYM is not for everyone.  Asking your wife sell the house and start LBYM is a big request.  It may run counter to what she values.  It probably runs counter to what you valued a few years ago.  Just because your values change doesn't mean that her's will too.  Try to keep this in mind as you work out a compromise.  

Also remember that a 3rd party (therapist, minister...) is not necessarily going to agree with you unless you recruit them from this board :.  But they should help you work out a compromise.

I wish you the best of luck in this. Go slow.

Best advise you received thus far.