Hello! I live in the VHCOL area of the SF Bay Area. It’s the best place in the country to be a nurse for my savings rate. All of my family is in this area so currently at this stage of life I don’t see myself leaving this area. I make $150-220k a year depending on how much I want to work. My required minimum of 24 hours a week gives me $150k. My biggest goals in life would be to work part-time doing two 12 hour shifts a week, get married and have a stay at home wife, and raise kids together. I would then use the difference in my time to be a part-time stay at home dad and travel very often as well with my family. Currently, I’m just trying to travel the world as often as I can before I get married. It’s a big enough part of my life that I could see myself spending $20-$40,000 a year. Here are my stats. Everything I own is in the s&p 500:
$420k in brokerage $135k in 401k $40k in IRA No debt Renting an apartment Single
I am maxing out my 401k each year. No longer contributing to IRAs because I’d rather have the money more liquid in a brokerage account to use for a home purchase. I roughly save at least $3500-5000 a month and put it all in the brokerage. At this rate it’s likely to have 1.25-1.5 million in my brokerage alone in the next 6-8 years. However old fixer upper homes in my area start at that price. Given the current interest rate environment that we are in it seems like it is actually cheaper to rent and invest the difference into my brokerage account and keep on growing my stocks, and also maxing out my 401(k), than to buy a home. From what I could see after the numbers it seems like the only way that a home is a better financial decision in this area is if you put 100% down which I could do in about a decade, but is that even a wise decision at that point?
Should I rent or buy? If I buy, what is the most effective way to use my money to do this? It seems the longer I hold onto this brokerage account for long enough it will actually rapidly surpass how fast a house can gain equity and increase in value. If I were to buy my rough plan was to continue working and pull out about 100 or $200,000 from the brokerage account each year to pay down the loan assuming I have married and filing jointly at that point.
Every resource I look at says that I should be invested in IRA, but in this scenario of wanting to buy a home, is it sensible to do so?
Another thought is that as a Christian, I want to give large sums of money to organizations and churches that I care about. If I rent, I could very easily give away $100,000 a year in a decades time, which could be much more fulfilling than owning a house. What are some good tax strategies for excessive giving?
If I rent, then I would very likely be able to retire before 40 years old. But I will probably still just work the bare minimum hours to keep benefits and give myself something to do.
Another question I have is that I’m a really good saver, but I have such a hard time spending money. Any resources for how to shift my mindset from saver to wise spender?
[link] [comments]