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valygrl
climber
Boulder, CO
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Mar 25, 2008 - 10:05am PT
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Sorry for your loss.
Whatever you do, don't end up with a blank resume and an empty bank account when you are 40.
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rick d
Social climber
tucson, az
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Mar 25, 2008 - 10:12am PT
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#1, don't even think of spending more than 10% of the principal. Think of it as seed money for something better.
While many believe in IRA's, there are some investments in the next 20 years that you might miss having the funds tied up for so long in a traditional account.
Starting a business
Only if you know you can make double that and work 2x your current hours.
Real Estate (I'm a commercial broker)
$100K ain't squat. You won't be able to buy a cash investment (other than land- which makes NO income). Buying a rental home(s) is not recommended in this market. Depreciation in either case still means you have another income to offset. When and if you can buy, learn 1031's and trade continually to increase the holdings value.
Stock Market
Too volatile. Metals are very overvalued. If you can understand the futures market play that- but 99 44/100% of population cannot. etc.
You will need to pace with inflation so ideally stick it in a 3 to 6 month CD (close to 5%, but you will pay taxes on the interest) and look around in 5 months for other options.
The best idea if your single is education. You can't waste the time- get in graduate school. $100K will cover law school and a good MBA, cover 50% of med school (just remember to go into a practice with an income not primary care)
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TradIsGood
Chalkless climber
the Gunks end of the country
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Mar 25, 2008 - 10:22am PT
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LOL.
He isn't happy working 50 hours - law school is not a good plan.
Lawyers are a dime a dozen and poor, or working way more than 50 hours and not for themselves.
Woodster - I thought it was biotech now! Is is still really plastics?
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Offset
climber
slc
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Mar 25, 2008 - 11:44am PT
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what a disappointment...
isn't this a climbing site and only one suggestion for booze and hookers! sounds like a bunch of drugstore dirtbaggers!
buy westy van and live the dream, man!!!
(but get a room for the booze and hooker nights...you don't want them in your westy)
as for taking a year or so off, from what i've heard the estimates here are a bit high. i have several friends that have done it and say plan on $1k/month for round the globe tour. certainly you can pay more than that if you want.
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Euroford
Trad climber
chicago
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Mar 25, 2008 - 11:49am PT
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get an education, if your smart and committed you can make plenty of dough and enjoy doing it. then you get to have a fat rack, new ropes, a nice tent and maybe even get girls to go climbing with you.
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clustiere
Trad climber
berkeley ca
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Mar 25, 2008 - 11:52am PT
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Buy a house. They don't cost much these days. Berkeley or Oakland. Better yet Durango CO. !!
Invest and Take a month off. SOO good.
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WBraun
climber
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Mar 25, 2008 - 12:11pm PT
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Gimme some of it.
Might save you later ......
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AbeFrohman
Trad climber
new york, NY
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Mar 25, 2008 - 12:17pm PT
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ok, youre sick of working 50 hours a week. perhaps i have an idea.
people have suggested investing in your education.
How much does it cost to get AMGA certified? Start working as a mountain guide.
Now, with the rest, find a stable investment (CDs sounded like a good idea) to offset your piddly climbing guide income, and never touch the rest of that principal. Or, after your guides education, use it as a down payment on a house near whatever climbing area you like, and rent rooms to other guides to offset the expenses, and hopefully pay off the house.
Just remember, the way it looks to me, is that guiding is 90% taking total gumbies out and being PSYCHED all day about it.
Or working in local climbing shop, with your CD or annuity or whatever offsetting your measly climbing shop income. no cost of guiding education.
Either way, sorry for your loss, and invest in your future wisely.
PS - what do you do for a living now?
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TitaniumTendons
Sport climber
LA, CA
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Topic Author's Reply - Mar 25, 2008 - 12:35pm PT
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Guys thanks so much for all the wonderful advice!! From my years lurking on the Taco I know there are some really smart people here and I value your opinions highly. If anyone's interested in posting further, I'll give a little more detail about myself. I have a bachelor's degree from a good school. I simplified my question by saying I have 100k in the bank. Really the 100k is tied into a house I own, and rent out, in central California. House is worth about 215k and i have a 95k mortgage that my renter is kindly paying off for me. I know what I have now is a "good" thing but damn I'm just so tired of working all day and not climbing enough. More than likely I'll leave the money where it is now. But I can't help but fantasize about something I could do with it now that would help facilitate a lifestyle with more free time.
What got me thinking about all this is that I know there are people out there working less hours than me and probably making more money. I want to be one of those people but don't know how. What careers do some of you have where you don't have to work all week or all year? Something project based would be great. I could work 12 hours days for a few months as long as I knew I'd be getting a phat chunk of time off afterwards. What sort of jobs do you guys have that let you work less than the average 9-5er?
Edit: I currently work as a production assistant for an online subscription based media site. We produce exclusive health and wellness media for our members.
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Matt
Trad climber
primordial soup
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Mar 25, 2008 - 12:48pm PT
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that's untrue, he has options!
sell the 215k house for the 110k it's now worth, pay the agent, pay the taxes, and then go borrow a 5 spot to get a sixer, since you'll be broke.
edit-
btw, if the screen is a little hard to read right now, it might be because you completely upside down...
i'm just sayin...
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TradIsGood
Chalkless climber
the Gunks end of the country
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Mar 25, 2008 - 12:53pm PT
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TT - Sounds like you have maybe $120K equity in the rental - not the same as $120k in primary residence.
In each you have a cost basis (what you paid) for tax purposes. The difference between the basis and what you net after sale is a capital gain, taxable in the rental, not taxable (at that level) in a primary residence. Talk to accountant if that is not clear.
You still do not provide enough information for useful reccomendations, though. Is the rental profitable? How profitable? Without knowing stuff like this anybody who would offer an alternative is blowing smoke.
Best advice is to talk to a financial planner or head to the library. Your asset and liability picture plays a role. Anticipated liabilities - kids - could change things dramatically. Married, etc. Insurance - life, medical, disability, ...
Career counseling? If your work is not satisfying, even fun, maybe a change would be a good thing.
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Haggis
Trad climber
Scotland
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Mar 25, 2008 - 12:54pm PT
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education! we are screaming for geologists currently all earning 100k a year with a MSc and 0 experience.
you get to go some cool places
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TitaniumTendons
Sport climber
LA, CA
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Topic Author's Reply - Mar 25, 2008 - 12:55pm PT
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No I'm not upside down. The house used to be worth 280K. It has slid down to an estimated 220K. It was purchased 7 years ago for around 150K. So that's why I said 100K, if I sold it right now, to the renter who is willing, I'd probably end up with around 100K, after broker fee's and taxes. Maybe less but I don't think my estimate is that far off.
Edit: As far as profitable- the renter pays 850 and my mortgage payment is 800/month.
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Standing Strong
Trad climber
I LOVE TAHOE
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Mar 25, 2008 - 12:57pm PT
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and to put things into perspective, remember too that EVERYONE wishes they could drop out of life and play for awhile. but there's a reason that most people don't.
i personally would LOVE to drop out of school and smoke pot and snowboard all day, but i won't even take another semester off to be a ski bum for a season. i might not even be able to afford to snowboard after i move, but i know i'll be able to again after i graduate and get a job. it breaks my heart that for awhile i might not see the mountains much, but i'll be right in the heart of the sierra as soon as i'm done w/school.
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TradIsGood
Chalkless climber
the Gunks end of the country
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Mar 25, 2008 - 01:05pm PT
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Let's just assume that the "mortgage payment" includes tax escrows and home-owners insurance. Then you are clearing $600 / year on 100,000 of equity - a 0.6% return.
Check 2 year CD rates in your area. You may be able to get say 3.5% or 3500 in income per year. 3 month T-bills are very low now, and they would earn you a little over double what you are getting. If that house is not appreciating in your opinion, get out!
Ten year Treasuries are near 3.5%. Financial planner could cook up much better stuff for you IMO.
EDIT. Actually in the first example, you are earning slightly more than $600, since your mortgage payments include paydown of principal.
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waddell
Trad climber
Seattle, WA
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Mar 25, 2008 - 01:15pm PT
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1. You have positive cash flow coming from your current property. Hard to do these days.
2. If you are interested in Realestate this could be an amazing oppertunity to take what you have and turn it into more.
3. look into a Home equity line of credit (This will give you access to cash). Great oppertunities right now for people who are cash rich...
4. Dont sell your current property it is your foundation and building block.
5. Most realestate markets are down way down. What sould this tell you... if you find the right property for the right price you should buy it low and look to transition it in a few years when the market rebounds.
6. Do your homework in the area you want to buy in. Make sure you are buying a property that has great potential to go back up when the housing market goes back up. Also play in a ball game you can play in. looks like you are in LA 50-100k down probably wont get you much there but centeral cali... maybe even Sac. or Reno NV could be great alternatives.
7. Be willing to pay a small amount out of pocket once you utilize the HELOC remember getting ahead is never risk free or sacrafice free.
8. Make sure you are passionate about this or willing to make sacrafices to work on it. Weathering the ups and downs takes dedication.
9. Unless you are given a huge amount of money, or win the lottery its pretty hard to get ahead with out some hard work and long hours at the start.
Email me if you want more help with this idea.
If you want to open your own business find what you love and build the business around it. You will be far more sucessful than opening a business around what you think will make lots of money.
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caughtinside
Social climber
Davis, CA
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Mar 25, 2008 - 01:22pm PT
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Home equity line of credit? Now?
Fat chance.
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tolman_paul
Trad climber
Anchorage, AK
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Mar 25, 2008 - 01:32pm PT
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You want to know what the best gig is for a young single person? While everyone bitches about high gas prices, some folks are working in the industry that makes that oil. These comments are regarding Prudhoe Bay Alaska. A regular schedule is 2 weeks on, 2 weeks off, for the two weeks on your room and board is taken care of, and I think asside from the folks doing housekeeping, people are starting at 70k/yr. With a technical degree and relavent experience, I don't know anyone making less than 6 figures. Most of the living quarters have weight rooms.
Work and workout 1/2 the year, make decent to really good money, climb the other 1/2 of the year. R/t plane ticket from the lower 48 is about what most folks spend on a car payment and gas to commute to work.
It's a tough gig to break into, especially if you aren't up here. But, not a bad gig at all if you do break in.
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Ouch!
climber
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Mar 25, 2008 - 01:32pm PT
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Go see Werner and let him invest it in Twinkies futures for you.
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