I have a call with a realtor on Friday to check in on next steps. She toured our house last week, so should have a good sense of value, the market, etc. The market in Seattle has been very hot, but if it's anything like the market we're in, has just started to show ever so slightly a bit of softening. We shall see.
Assuming all happens as expected, I'm estimating that we will clear (after taxes) around $835K. We actively worked to pay down this mortgage while we were living in the house, which will obviously benefit us when we sell. Here's my plan for how we will distribute that money. M & I are still working through this, so it's definitely draft one of the plan, and not a final proposal:
- Pay off our vacation house. The interest rate is at 3.5%, so relatively low. There is no tax advantage on the mortgage interest, as we are maxing out that deduction with our primary residence. - around $230K
- Pay down our primary residence - around $200K.
- Add to our investments - $200K
- Savings - all remaining money, so around $205K. This will be money we use to cover yearly expenses moving forward, taxes (federal & property taxes), as well as give us some flexibility on our budget so I can look for a new job that isn't as demanding.
That's the very rough draft of a plan, of course. M is a much bigger financial risk taker than I am (understatement), so he would love to keep the house. I would love to sleep at night & feel more secure about our overall financial picture. :) I'm sure there will be tweaks on all sides as we close in on the final numbers.
Other things we've considered: additional college savings for the kids (we will likely fund out of savings on a regular basis instead of one lump sum), additional smaller property investments, etc. I'd like to sell, hold most of the money (between savings & stock investments) & then make additional decisions over time.
Any recommendations for things we may have overlooked?