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At 53 separated and walked away from a house I owed 300k and was worth 130k. With about 50k total in my ira i decided to reduce my cost of living substantially not only for my benenfit but so at some point going forward my kids are not fighting over who is going to pay my rent.

So I took 10k out of ira and baught a fixer upper mobile home in a nice mobile home community. I call it the house that Craigslist built. At this point two years later I have all modern Stainless steel appliances. Beautiful furniture, still need to paint and replace a few windows (3)

It is a 2 bedroom 1000 sq ft and this is what it cost me monthly.

440 lot rent
120 electric for some heat, hot water, lighting etc
30 propane heating
40 taxes school
630 total

My previous 4 b/r house was running me 2500 month to maintain and all I did was work to pay the taxes utilities and maintenance. What a waste of most of my life.

I plan on using the extra money to enjoy life (and pay alimony). I should have done this 20 years ago
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I plan on using the extra money to enjoy life (and pay alimony).

After taking out the $10k, so that you only had $40k in your IRA at 53, I would suggest that saving for retirement might be a more important use for your money than to 'enjoy life'.

AJ
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<<I plan on using the extra money to enjoy life (and pay alimony). I should have done this 20 years ago >>


What extra money?


You spent your retirement savings to pay for your current housing expense. Then you spent a lot more money to fix up you current housing.

What do you plan to live on in another ten years or so?



Seattle Pioneer
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I admit to a life of working two jobs and spending or letting other half spend like I had three was a foolish mistake. The HElOC was the 15 year poison I tool willingly.
For the first time I am putting money into ira again and living within my means. Maybe you misunderstood what I meant by enjoying life.
To me enjoying life means living within my means a 10 year old car that runs well and is paid for, no loans of any kind a big priority. Maybe a week traveling to visit my brothers down south once or twice a year.
The point I was trying to make was I could pay my basic expenses on Social security at this point. I could have rented a nicer place but the goal is not to be a burden on my children when I get old and they have their own families to worry about.
As far as fixing up the place its practically free. I have been in the trades since I was 16 so other then a little materials most of which I get from craigslist its just time when I have it and when I dont I dont worry about it.
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One other point, foolishly and not in the good way these boards are named after I only had 40k about a years living expenses in IRA so taking out 10k to ensure a stable low rent living situation indefinitely seamed like a good idea to me. I could have left the 10k in ira and rented and doubled my monthly expenses plus rent hikes going forward so I think on that front I made a good choice.
Also like I said previously, a life in the trades - thinking I am going to live to 90 with all the crap I have been exposed to over the years would be pretty unrealistic. 70 is probably a better bet.
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<<I admit to a life of working two jobs and spending or letting other half spend like I had three was a foolish mistake. The HElOC was the 15 year poison I tool willingly.
For the first time I am putting money into ira again and living within my means. Maybe you misunderstood what I meant by enjoying life.
To me enjoying life means living within my means a 10 year old car that runs well and is paid for, no loans of any kind a big priority. Maybe a week traveling to visit my brothers down south once or twice a year.
The point I was trying to make was I could pay my basic expenses on Social security at this point. I could have rented a nicer place but the goal is not to be a burden on my children when I get old and they have their own families to worry about.
As far as fixing up the place its practically free. I have been in the trades since I was 16 so other then a little materials most of which I get from craigslist its just time when I have it and when I dont I dont worry about it. >>


Sounds like a much saner way to live!

(Is that because it IS saner, or just is closer to my own values?)



Seattle Pioneer
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taking out 10k to ensure a stable low rent living situation indefinitely seamed like a good idea to me.taking out 10k to ensure a stable low rent living situation indefinitely seamed like a good idea to me.

You probably want to be sure you have a back-up plan for where you will live if the land gets sold out from underneath you. Mobile home parks with low rents tend to turn into targets for developers. Here's an article about a recent fight in a relatively low cost area of Washington state: http://www.seattletimes.com/seattle-news/mobile-home-parks-r... I have seen other articles about threatened/actual closures in CA, OR and TX.

Also like I said previously, a life in the trades - thinking I am going to live to 90 with all the crap I have been exposed to over the years would be pretty unrealistic. 70 is probably a better bet.

If you don't want to be a burden on your kids, I'd strongly suggest planning until at least the average life expectancy - for a male age 55, that's another 25.41 years, or until age 85.4: https://www.ssa.gov/oact/STATS/table4c6.html
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I could pay my basic expenses on Social security at this point.

I too found it useful to have a frame of reference for establishing low cost budget.

Many years ago, my employer had announced layoffs were coming. I assessed my situation: 1)I had very little in savings and 2) Even though I had good paying job, my state's stingy unemployment benefits meant benefits would replace only small % of earnings. So I decided to lower my expenses so that even if I worked at minimum wage job then I could still cover my expenses. With that in mind, I bought a condo which lowered my housing expenses significantly.

I survived the layoff and started saving at accelerated rate. Ironically I did get laid off many years later--however by that point I had sufficient savings to that I didn't have to work at all.
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Many years ago, my employer had announced layoffs were coming. I assessed my situation:

Similar experience. Plus a sibling that was careless with money and the advice they kept giving has been ignored.

Just after starting a new job, there were layoffs. I ended up stating over 10 years, but my employment has rarely been secure. I was laid off a year ago and have retired.
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All good info thank you for sharing.
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Kudos! for figuring it out. I was in a somewhat similar situation. Started over about 7 years ago at age 50. Had an even smaller IRA than you. Thought about renting but ended up deciding to check the housing market (on a whim) and found a very small house relatively close to work. The thing about going small (1200 sq. ft.) is that everything else is cheaper too. I don't think a "normal" family would find it big enough but it's big enough for me. My washer/dryer sits in the kitchen, the closets are tiny and bathrooms standing room only. It should be paid for by the time I'm getting social security which should then cover most of my expenses. That was the goal.

Peace,
Dana
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