Need advice, stuck on a major life decision

[maxdev]

Hey all, I am new to this forum, thought I would join because I have no one in my life who is financially literate and am in need of some advice.

I just recently decided to shut my business down, the neighborhood location was going downhill fast & several robberies happened. So I went from $7-10k/month income to nothing overnight and no job in sight.

Right now, I am 33 and have 85k in savings and purchased a home two years before closing the business. My equity in the house is around $80k give or take.

Right now I am stuck in life, no income and a home that is considered rural on a lake. I am confused and need advice on selling this house and take the money or keep it and be stuck in a 45 min commute to a major city. There are no jobs here and starting another business doesn't seem appealing to me at this point in life.

I am just worried as it is very hard to find a lake house for the price & my monthly mortgage (death pledge) is about what rent would cost in a major city. I understand a home is not an investment.

Bottom line, is it wise to keep the real estate or dump it for renting in a more central location...financially speaking. Job wise I am in a jam either way...do I take the $80k cushion and lose the house? I don't want to blow through my savings either without a job for the time being.

Thanks for any advice.

[disneysteve]

Welcome to the site.

I'd say your top priority right now needs to be finding a job. If that isn't an option close to home, then for at least the short term, you may need to be making that 45-minute commute if that's where the jobs are.

Your other priority needs to be cutting expenses to the bare minimum to reduce the burn rate on your savings (congrats for having a nice emergency fund in place). That means cutting as much non-essential spending and cancelling as many non-contracted services as you can.

What type of business did you have? Is it something that you can easily transfer to another location? I know you said you don't want to start another business but if the bar to entry is relatively low, you might want to consider doing that just to keep the income flowing while you look for something else.

What to do with the lake house will really depend on how quickly you can get employed, how much you earn at the new job, and where it is located. One option you didn't mention was keeping the house and renting it out. If that would cover your costs, that's another thing to consider if you want to go that route.

Whatever you do with the house, keep in mind that selling isn't a quick process. From the time you list until the time you settle can be a few months. You don't want to rush into selling, take the first offer that comes in, and end up costing yourself thousands because you were in a hurry.

[maxdev]

Thanks, I appreciate the advice.

I agree I need a job asap however I do not have a degree which is a problem. I went straight into business and don't have any other work experience besides my business so I have been having an issue finding employment.

The business was an electronics buy back store, similar to a pawn shop, which requires a high initial investment and various licensing hurdles so it's not really an option again unless I am all in, which I am burned out on this type of business.

Good point on renting the property out. I agree on the time it takes to sell a home as well. Either way I will be losing some savings, I am just trying to decide on selling the house to get that additional cash savings backup or ride it out. Also, houses are not guaranteed to go up. It has been hot for real estate lately but just like the stock market, no gain is a gain until it is realized and prices can drop as this seems like prices are already to high.

Thanks again for the info.

[TexasHusker]

I am wondering if the business is throwing off $8-10K a month, I'm wondering if you could find a buyer for it? That's $100K a year in income, and perhaps someone will look at it and see real value.

Even if it was declining, if I was an investor I'd toss $100K at it for the potential of even $30K a year in return.

[Fishindude77]

Lot's of opportunities to make money around a lake if you don't mind a little physical labor:
Put in and take out docks & boat lifts.
Put in, take out and store watercraft.
House checks for folks who leave their place empty most of the year.
Painting and light remodeling.
Gutter cleaning, power washing & general cleaning.
Lawn mowing.
Landscaping work.

Lake home owners are generally pretty well healed and don't mind paying a premium for someone reliable.

[disneysteve]

Lot's of opportunities to make money around a lake if you don't mind a little physical labor:

True, but this guy was making 100K/year. I think he probably needs a "real" job to replace that, not just odds and ends and handyman stuff.

[msomnipotent]

It depends on what kind of lake. The boat shop on our lake has more customers than they can handle. Repairs are booked 2 weeks out and it isn't even high season yet. The boat and waterski rentals are booked for weeks at a time during the summer. But we are in a tourist spot. A private little lake isn't going to get much business.

[Fishindude77]

True, but this guy was making 100K/year. I think he probably needs a "real" job to replace that, not just odds and ends and handyman stuff.

Could easily make $100K, if you got serious about this kind of stuff. Hire a few employees and get after it.

People look down on this type of basic manual labor, like there is no money in it, and it's beneath them. Truth is, those willing to work these type of businesses hard, can do quite well. Dude that cuts our office grass rolls in with a $60K truck and trailer with a couple fancy zero turn mowers and knocks it out in about a half hour, then probably does another dozen lawns that day, at about $80 each. Do that math times about 6 days per week for the entire mowing season and it's pretty serious money. He goes on out of state hunting trips for a few months every fall, and plays all winter.

[msomnipotent]

I seriously looked at investing in a business on a lake last year. It was a bar, dock, bait shop, and water sports rental plus snowmobiling and hunting in the winter. I just couldn't figure out how to make it work since it was in the next state and my family wouldn't move.

[disneysteve]

Could easily make $100K, if you got serious about this kind of stuff. Hire a few employees and get after it.

Good point. If there is enough business to go after and you can put a crew together, you could do well, especially if it's a year-round location.

[rennigade]

Could easily make $100K, if you got serious about this kind of stuff.

If it was easy everyone would do it.

[Fishindude77]

If it was easy everyone would do it.

Good point, most are unwilling to put in the necessary effort.
There is a huge demand for this kind of "menial labor" type stuff that people just don't want to do. You have to be a hustler, and not afraid to get dirty.

In another thread about "Is home ownership for everyone" DS mentioned a limb on his roof that will probably cost $1000 to clean up and dispose of. In my mind, that's an easy job and a couple hours work at most. If you don't do this kind of thing, it can seem a bit overwhelming.

[disneysteve]

In another thread about "Is home ownership for everyone" DS mentioned a limb on his roof that will probably cost $1000 to clean up and dispose of. In my mind, that's an easy job and a couple hours work at most. If you don't do this kind of thing, it can seem a bit overwhelming.

If you want to come by and take down that 50-ish foot tall tree, grind the stump, and haul everything away, I'll buy you pizza and beer and you can keep the firewood.

[maxdev]

Thanks for all the replies.

I have actually thought about starting a business revolving around the lake & not against hard labor at all but honestly my skills are more in the technical sector.

My main concern right now is: should I sell the house and take the $80k give or take, cash or keep the property and have the money essentially out of touch.

I am just trying to figure out if real estate is worth holding onto or just take the profits now. Either way I will have that living expense of mortgage/or rent. I am thinking it's better to have the cash in bank than the real estate even if it takes months to sell. I don't consider real estate an asset unless it produces income and renting it would break even.

Thanks again for all the suggestions it has actually helped me out here.

[Eagle]

Thanks for all the replies.

I have actually thought about starting a business revolving around the lake & not against hard labor at all but honestly my skills are more in the technical sector.

My main concern right now is: should I sell the house and take the $80k give or take, cash or keep the property and have the money essentially out of touch.

I am just trying to figure out if real estate is worth holding onto or just take the profits now. Either way I will have that living expense of mortgage/or rent. I am thinking it's better to have the cash in bank than the real estate even if it takes months to sell. I don't consider real estate an asset unless it produces income and renting it would break even.

Thanks again for all the suggestions it has actually helped me out here.

Can you try to get a GED or take night classes for your high school diploma? In the meantime you could try to work in retail or in the food industry. Best Buy or McDonald's at $8 or $10 an hour would be better than nothing at this point. With your experience you might even be able to get into management quickly. Best wishes!