I have always been very conservative with my finance and fortunatly I was able to pay off my home in December. My vehicles are paid off and I have no credit card debt; furthermore, I have no intentions of leaving my current home but with all that equity tied up in my property a few questions have cropped up.

Can I use my home or cars as the down payment considering I own them free and clear?
if so,
Does anyone on the forum think that taking advantage of the reduced home prices now or over the next quarter may be a wise investment?
or
Should I just stand fast and continue investing my free cash in the slumping stock market?

Thanks in advance for your thoughts.

HBomb

Fr_Chuck

I guess the question is do you want to go back into debt, what are you looking for n a new home, and if you are buying a new home, are you not going to sell your old home ?

And I actually think home prices are going to keep going down next two years ( but heck I have been wrong before)

But cash in the bank, CD and in good stock funds are still a growing investment, ( may want to look at some overseas investment funds)

But if you want a much larger nicer home and can afford it, that is your choice and normally a good investment.

HBombToo

My house is more than sufficient to raise my young family with a large yard and more than enough space in a very highly regarded school district. I don't care what the Jones family has as long as my wife and kids are comfortable, safe and warm all is good for me.

My 401k is maxed to the federal limit and distributed ~ 70%/30% across FDGFX and FEMKX, I have not done much in IRA's over the past few years but being 42 with many years of work ahead of me I see the need to get that ball rolling.

I have continuosly used CD's to balance my free flo cash balance between Money Markets and checking accounts. I'm really not sure what more I should be doing but debt is not really where I think I should be going.

Thanks for the help and I am always looking for advice.

Regards
HBomb

kp2171

congradulations on a fantastic financial position.

i dont have answers. not an expert. just some questions to open up the discussion more.

are you just sick about seeing the markets bump about? if the markets were soaring would you be asking this question?

also, the home is paid for but are there updates that need to be done? can you invest back into the home to make sure it would sell well based on condition? i know a neighbor of mine has her home paid off but shed struggle to move it fast or have to drop the price as shes done no updates in the last 15 years.

also not clear on your intention? are you looking for investment property? if so, what about a vacation home or condo that you can rent out? again, it might be against your nature, as you have respectfully avoided bad debt. and investment property requires someone to do work, you or a management co, so it comes down to your comfort level. but not sure if the 20% down was to try to find investment property.

how far are you from retirement... or should i say how far are you from "standard" retirement age?

what about kids and 529 college funds?

HBombToo

You read my mind kp2171... the market fluxuations have most definetly got me rethinging my strategy. Since I'm 42 and have a long way to go until retirement I figure its just a bump in the road so to speak so I'm not over reacting in the 401k world.

I'm not real knowlegable on the 529's other than what I have researched has shown many restrictions on their use which has made me back away. My oldest is 6 so at least I have another ~12 years before that reality sets in.

Investment properties is exactly where my head was and again that added responsibility has put the breaks on for me and resulted in my query here. That said, if I can consolidate my equity and use it for the 20% down as a leverage then my free cash does not get hit all at once. -or thats what I was thinking- but I am very ignorant in this arena.

Thanks
HBomb

gazelleintense

down payment for what? sounds like your debt free right? sounds like you've been very wise with your money. must be a dave ramsey fan.

rather than the stock market, look into growth stock mutual funds. they offer better rates than the stock market alone.. more info at

Real Debt Help - Get out of debt with Dave Ramsey's Total Money Makeover Plan.

ScottGem

I was bothered by the down payment question too. There is no explanation of down payment for what.

I'm not sure what restrictions on 529s bother you, but they appear to be a good way to finance college and I suggest you take a further look at them. Also 12 years is not a lot of time. In 12 years a college education will probably cost in the mid 6 figures. That means you will have to save more than $10K per year during those 12 years.