Papoo
Polar 1.
I have a hypothetical question, for those more dialled-in with finance matters.
I'm currently flying overseas, and running the numbers for a possible scenario in a couple of years. Of course, I know a lot can change in two years, but I'd like to hear your opinions and ideas on what you would do in the our situation - so let's treat it as if it were happening right now.
There's a possibility of returning to an LAX based position with my employer in two years time. What I'd like to gauge is people's opinions on what they would do with their war chest when they arrived back.
We will have around $350,000 in cash. Also, my provident fund (B fund, if you like) will be liquidated, and I anticipate it being around $150,000-$180,000. So, all told, somewhere around $500k, maybe a shade more.
We have no debts, aside from our two credit cards which we use for our monthly expenditure.
This is EVERYTHING we have at our disposal. We'll likely get a bit of cash from selling our stuff here, but for the purposes of this discussion, let's ignore that.
My income will be about $135,000 for a year, then a jump to $165,000, and it'll creep up about 3k a year from there until I upgrade a few years down the line.
My retirement fund is going to be in cash when I arrive, as mentioned above. I will receive a further 15.5% company contribution into a 401(k) from when this position starts. Healthcare is covered.
We are a family of two. No kids. Wife may work, with good earning potential, but I'd rather have our obligations based on just my income. So, let's pretend she isn't working.
Scottsdale AZ is where we would likely reside. San Diego is close to both of our hearts, but I'm not sure it justifies the substantially higher cost of living in terms of accommodation and tax.
Moving costs will be zero, as we'll be showing up with suitcases and ship a few things back for minimal cost.
So, armed with the following information, what would you do?
I figure 10k to furnish a place (likely a decent two bed condo - 1200sqft - no idea if this is a viable figure), 20k to put down on two cars, and let's have a 10k buffer for incidentals. so, 40k set to one side.
$410,000 remaining.
The condos we are looking at are in the 350-450k range. Let's eyeball it at 400k, which is eerily close to what is left in our cash pile.
So, do we buy a place outright? That would obviously provide security, as all I need if it goes horribly wrong is a job as a Walmart door greeter to put food on the table.
Do we go with a large deposit, say 50% (200k) and invest in other property - say 2 places in the PHX metro area with 100k down, or 3 places with 65k down?
Do we spread ourselves out thinly - with minimal down-payments and try to acquire more with heavy leverage?
Invest elsewhere?
In terms of incomings, I mentioned my income in my first year at $135k. Loose maths and an assumed 30% tax rate would be about 7.8k net per month. In year two, the $165 figure loosely equates to 9.6k net per month.
I think it would be wise to have a few months living costs stashed away to start with, too. That amount would likely vary with whichever idea we went with.
By the time we'd purchased our main residence, and got our lives figured out, I'd likely be on the year two salary figure - so I'm happy to use 9.6k net as a yardstick of my take-home pay regarding affordability of rental homes/investments etc.
For other stuff, I've factored 1k a month to run two cars (finance payment, insurance, tax & fuel). Groceries and household bills (AC, water, cable, wifi, cell phones) another 1k. These are mentioned, so you have an idea of what I have to work with, and to scrutinize my figures if you think they're off. I mention them because I'd value your opinions - I'm coming from Hong Kong where the cost structure of our existence is very different. Some things cheaper, some far more expensive, so I'm really shooting in the dark and hoping for feedback.
So, the remaining cash (call it 7.5k) is what's usable to repay finance, invest further for the future, and discretionary spending. Let's ignore the future pay rises as I'd like to 'feel the benefit' of them.
We are in our mid 30's. So, we have some time on our side, but also of an age where our decisions need to be made with respect to our future; so, I open the floor to the financial-minded to share their opinions on what they would do.
Cheers all, I appreciate your help and ideas.
I'm currently flying overseas, and running the numbers for a possible scenario in a couple of years. Of course, I know a lot can change in two years, but I'd like to hear your opinions and ideas on what you would do in the our situation - so let's treat it as if it were happening right now.
There's a possibility of returning to an LAX based position with my employer in two years time. What I'd like to gauge is people's opinions on what they would do with their war chest when they arrived back.
We will have around $350,000 in cash. Also, my provident fund (B fund, if you like) will be liquidated, and I anticipate it being around $150,000-$180,000. So, all told, somewhere around $500k, maybe a shade more.
We have no debts, aside from our two credit cards which we use for our monthly expenditure.
This is EVERYTHING we have at our disposal. We'll likely get a bit of cash from selling our stuff here, but for the purposes of this discussion, let's ignore that.
My income will be about $135,000 for a year, then a jump to $165,000, and it'll creep up about 3k a year from there until I upgrade a few years down the line.
My retirement fund is going to be in cash when I arrive, as mentioned above. I will receive a further 15.5% company contribution into a 401(k) from when this position starts. Healthcare is covered.
We are a family of two. No kids. Wife may work, with good earning potential, but I'd rather have our obligations based on just my income. So, let's pretend she isn't working.
Scottsdale AZ is where we would likely reside. San Diego is close to both of our hearts, but I'm not sure it justifies the substantially higher cost of living in terms of accommodation and tax.
Moving costs will be zero, as we'll be showing up with suitcases and ship a few things back for minimal cost.
So, armed with the following information, what would you do?
I figure 10k to furnish a place (likely a decent two bed condo - 1200sqft - no idea if this is a viable figure), 20k to put down on two cars, and let's have a 10k buffer for incidentals. so, 40k set to one side.
$410,000 remaining.
The condos we are looking at are in the 350-450k range. Let's eyeball it at 400k, which is eerily close to what is left in our cash pile.
So, do we buy a place outright? That would obviously provide security, as all I need if it goes horribly wrong is a job as a Walmart door greeter to put food on the table.
Do we go with a large deposit, say 50% (200k) and invest in other property - say 2 places in the PHX metro area with 100k down, or 3 places with 65k down?
Do we spread ourselves out thinly - with minimal down-payments and try to acquire more with heavy leverage?
Invest elsewhere?
In terms of incomings, I mentioned my income in my first year at $135k. Loose maths and an assumed 30% tax rate would be about 7.8k net per month. In year two, the $165 figure loosely equates to 9.6k net per month.
I think it would be wise to have a few months living costs stashed away to start with, too. That amount would likely vary with whichever idea we went with.
By the time we'd purchased our main residence, and got our lives figured out, I'd likely be on the year two salary figure - so I'm happy to use 9.6k net as a yardstick of my take-home pay regarding affordability of rental homes/investments etc.
For other stuff, I've factored 1k a month to run two cars (finance payment, insurance, tax & fuel). Groceries and household bills (AC, water, cable, wifi, cell phones) another 1k. These are mentioned, so you have an idea of what I have to work with, and to scrutinize my figures if you think they're off. I mention them because I'd value your opinions - I'm coming from Hong Kong where the cost structure of our existence is very different. Some things cheaper, some far more expensive, so I'm really shooting in the dark and hoping for feedback.
So, the remaining cash (call it 7.5k) is what's usable to repay finance, invest further for the future, and discretionary spending. Let's ignore the future pay rises as I'd like to 'feel the benefit' of them.
We are in our mid 30's. So, we have some time on our side, but also of an age where our decisions need to be made with respect to our future; so, I open the floor to the financial-minded to share their opinions on what they would do.
Cheers all, I appreciate your help and ideas.