We are in similar situation and we treat it as a fixed asset (one is a place to live and the other seems to be the same as any other potentially appreciating asset - paintings, memorabilia, antique car collection - although much more stable). Like others have said - these assets still have great vaule, of course, and still may be worth more in the future (say 3% annually) and should calculate it as such based on historical norms. But don’t forget to subtract the annual cost to keep the assets as well in your calculation, just like you would if you needed to insure or maintain any other asset class. Then, in true nature of this forum, we would conservatively set aside, treat as a dire emergency fund (we label it as “Self Insured LTC Fund” ![😬]()
), and break the glass only as a last resort - whether that means HLOC, reverse mortgage (unlikely), sell, rent out, etc.
We calculated in our spreadsheet that the 2nd home would be sold in 15 years, and then the projected net funds would be added to our investment accounts. Our plan is to rent our partially if necessary before that point, however, or sell if absolutely necessary.
), and break the glass only as a last resort - whether that means HLOC, reverse mortgage (unlikely), sell, rent out, etc. We calculated in our spreadsheet that the 2nd home would be sold in 15 years, and then the projected net funds would be added to our investment accounts. Our plan is to rent our partially if necessary before that point, however, or sell if absolutely necessary.
Statistics: Posted by OMY — Sun Apr 28, 2024 7:38 am — Replies 38 — Views 2177