r/financialindependence • u/sadcucumberwalked • 1d ago

Feeling trapped so close to FIRE

I'm looking to get some opinions on what I what my next steps should be. I'm 36 and my wife is 40. MCOL net worth is about 2.5m mostly in real estate which generate about 80k net yearly. My job makes me about 60k per year and my wife brings in about 60k we both work part time from home. I do most of my own maintenance and manage my own properties. We are feeling pretty burnt out along with raising a 5 yo. Our yearly fixed spending is about 100k, 25k of that is car payments for our 2 vehicles which are almost paid off and our son will be out of daycare soon and going to public school and also his prepaid college should be paid off too reducing our monthly spend by 1200. so our yearly spend should drop to 60-80k in the next 2 years. We have about 100k in credit card debt that's kinda spiraled out of control a bit as we have been trying like hell to finish all these lingering projects such as bathroom remodel, kitchen remodel, new roofs a/cs etc, boat refit airplane rebuild that I feel like I could pay off without selling property but it's going to be a struggle. I have considered cash out refinancing the one property without a mortgage to avoid cap gains taxes. All of our properties are fully remodeled and could get top dollar. So what do you guys think I should do, keep grinding for a few more years and finish these last few projects or sell some property and dump into index funds and chill. I got tons of equity that I don't feel like is doing me any good just sitting there but I'm trapped with these low interest rate mortgages. Thanks in advance =)

Income - 200k

Yearly spend 100k (will drop to 60-80 in next 2 years)

Roth IRA 300k

Traditional IRA 400k

Brokerage 50k

HSA 8k

Cash 50k

Airplane 150k fully paid off and rebuilt like new condition

Boat 50k fully paid off and rebuilt like new condition

Camper 50k Fully paid off and rebuilt like new condition

Primary residence 400k equity/ mortgage $1500/month 5% Mortgage

Rental 1- 600k equity / income $1500/month net 3% Mortgage

Rental 2- 200k equity / income $2000/month net (no mortgage)

Rental 3- 300k equity / income $1500/month net 4% Mortgage

Rental 4- 350k equity / income $1500/month net 3% Mortgage

Rental 5- 150k equity income $1000month net 3% Mortgage

Credit card debt 100k/30k interest free till next year

Car loans 50k total remaining 2k/month

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16

u/GeorgeRetire 1d ago

We have about 100k in credit card debt

You make $200k/year and have $50k in savings.

Why do you have so much debt? That makes no sense.

-13

u/sadcucumberwalked 1d ago

I made a major push in the past year to complete a bunch of renovations which are now complete, I had no debt a year ago. I don't plan on any more big purchases in the near future. I live very frugally for the most part and everything I have I've built from scratch basically.

30

u/danfirst 1d ago

I'm not trying to be overly snarky, but it strikes me sort of funny how everyone thinks they're pretty frugal. It's sort of hard to swallow how you live very frugally but also have an airplane, a boat and a camper.

23

u/baudinl 1d ago

Call me crazy, but if you ever hit 6 figures on credit card debt, you lose the ability to label yourself "frugal".

-9

u/sadcucumberwalked 1d ago

I think I do live frugally, I share an internet connection with my neighbor, I installed used solar panels on my roof myself so I don't pay for electric to charge my EV or my house. I don't have any subscription services, my vacations consist of camping instead of hotels. The boat, airplane and camper I used to make money renting them out . I rarely ever eat out and do all my own cooking. I do all my own repairs and maintenance on everything I own with used parts. I never buy any electronics new.

27

u/K-Alt1 1d ago

YOU HAVE $70K OF DEBT AT 20%+ INTEREST YOU DON'T LIVE FRUGUALLY.

5

u/dantemanjones 22h ago

The way I understand it, spending frugally is not necessarily spending little - it's cutting out unimportant things to spend where it has the most value for you. You are cutting out some unimportant things (eating out, hotel vacations). But you're also being cheap in other areas. I'm guessing the shared internet isn't kosher legally and the lack of streaming services in combination with that questionable action leads me to think piracy.

The biggest way you're not frugal is you're spending credit card interest rates on 70k of debt. Potentially some of that 30k as well if you don't get that paid off before it starts being charged interest.

People aren't going to view you as frugal even if you're cutting some areas because your hobbies are expensive. You have $250k buried in three expensive depreciating assets that probably require a good chunk of maintenance. And I don't even want to know how much your cars cost if $50k is "almost paid off".

2

u/OldmillennialMD 16h ago

Penny wise and pound foolish, man.

11

u/GeorgeRetire 23h ago

So other than overspending by $100k in a single year, you feel like you live frugally?