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Investing Home Equity
We're interested in thoughts on using a portion of our home equity (via refinancing or or home equity loan) to invest in stock mutual funds.
We're both military officers in our early-to-mid 40s and we currently both max out the Government Thrift Savings Program (TSP via stock funds - 401Ks basically) as well as fully fund 2 IRAs (traditional until we convert to Roth in 2010). We also invest additional in Vanguard stock mutual funds (Small Cap Index, Mid-Cap Index, 500 S&P Index, International Explorer, & Health Care) and a Vanguard Money Market Fund. We also invest each year for our 3 children's Vanguard 529 college plans (ages 14, 9 & 8 months). In total we're saving/investing about 26% of our gross income.
When we leave the military in a few years, we'll get pretty decent pensions - $110K combined approximately at today's scale (with annual COLA adjustments for life), plus eventually whatever social security and our investments will provide. Our intent is to continue working at least 10-15 more years after the military, and we have approx. $500K invested now. So, with the pensions and current investments cushion (and life insurance), we're considering being even more aggressive and investing more for future retirement/legacy plans with our "idle" home equity.
Believe we could take up to $200,000+ (much) of our current home equity on our primary residence (have a rental property also) and invest that in stock mutual funds also (or combine the home equity funds with our current mutual fund invesments to give to a money manager to build our portfolio even quicker). Is there a better investment choice than stock mutual funds or a money manager, does this seem too aggressive?
We're both military officers in our early-to-mid 40s and we currently both max out the Government Thrift Savings Program (TSP via stock funds - 401Ks basically) as well as fully fund 2 IRAs (traditional until we convert to Roth in 2010). We also invest additional in Vanguard stock mutual funds (Small Cap Index, Mid-Cap Index, 500 S&P Index, International Explorer, & Health Care) and a Vanguard Money Market Fund. We also invest each year for our 3 children's Vanguard 529 college plans (ages 14, 9 & 8 months). In total we're saving/investing about 26% of our gross income.
When we leave the military in a few years, we'll get pretty decent pensions - $110K combined approximately at today's scale (with annual COLA adjustments for life), plus eventually whatever social security and our investments will provide. Our intent is to continue working at least 10-15 more years after the military, and we have approx. $500K invested now. So, with the pensions and current investments cushion (and life insurance), we're considering being even more aggressive and investing more for future retirement/legacy plans with our "idle" home equity.
Believe we could take up to $200,000+ (much) of our current home equity on our primary residence (have a rental property also) and invest that in stock mutual funds also (or combine the home equity funds with our current mutual fund invesments to give to a money manager to build our portfolio even quicker). Is there a better investment choice than stock mutual funds or a money manager, does this seem too aggressive?
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