Nicole Lappin
speaker
4,192 appearances
114 recordings
2 series
first heard Nov 2024
last heard 9 Dec
Nicole Lappin’s voice in public audio — every appearance, attributed to the second.
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recordings per month · last 12 monthsRecordings per month over the last 12 months — 5 in all, peaking in Nov 2025 with 2.
Appearances
So you guys have renters in both of the houses you own.
Has it been hard to find renters?
What are your interest rates?
Well, sadly, the go-go days of those low interest rates are over. It is kind of like a double-edged sword, though. Getting a good interest rate is obviously awesome, but then you end up chasing that high whenever you dip your toe back into the market, which it sounds like is what's going on with you guys.
And as we know, interest rates are coming down, but experts think it would probably take another pandemic, which we would not want, for interest rates to go that close to zero again. They were just so unnaturally low for so long that we got used to it. And weaning off, as you have been going through, is really hard to do.
5% is like... Go back to the 80s of 20%. The next property that you want to buy in two years, what's your goal with that property? To live in it for a while, to flip it, use it as an investment?
Okay. So something you can live in that doesn't have a yard that needs to be mowed. Got it. So that's going to help us look at this house goal against your entire financial picture. We got some of your details in advance. Thank you for sharing because we want to dig into it. Let's talk about income expenses and debt. Start with the debt because that's
Not the most fun, so let's just get it over with. You have $128,000 left on your mortgage on your townhouse, $285,000 on the other house, $20K in student loans, and that $35,000 HELOC or home equity line of credit balance. Am I right so far? Yep. So that, Sarah, is $468,000 in debt. Again, this isn't bad debt.
Mortgages can be considered good debt, but that's in the liabilities part of your assets, liabilities, net worth chart. And then your monthly expenses. I'm going to list those out. Rent, $2,900. Mortgage on your townhouse, $867. And the HO fees are $266. The mortgage on the bigger house is $1,871. Your HOA fees are $25. That's pretty low.
I was like, maybe you're missing a zero, but no. Okay, cool. Life insurance is 53 and 37 bucks monthly. Groceries is 150 a week. So that's 600 bucks a month. You said gas is around 110 a month. And for the fun stuff, you said you're between 200 and 300 bucks a month. Let's work with the bigger number. have a little more fun and call it 300 a month. Does that sound right?
So you have a total of $7,030 a month going out in expenses, right? Let's talk about what's coming in so we can see the entire picture. You and your husband make $110,000 pre-tax, but you're also renting out the two properties you own. And the rent you're earning is more than your mortgage payment, which is great. So you're both making a profit there.
You said you're net making $1,200 a month from both properties. So let's add $1,440 to your annual income and say you make $124,400 pre-tax. You live in California, like I do, so your state taxes are probably very high. But putting state taxes aside and just thinking about federal taxes, your take-home pay is probably closer to 95K, perhaps more depending on what you're writing off.
So $95K a year is $7,900 approximately a month. And we said that your burn rate is about $7K a month, which leaves you about $880 a month. And that's not counting your debt repayment for your HELOC or your student loans. But would you say after expenses, you're probably keeping around $800 a month?
Well, let's talk about those savings. So you have $19,500 in a savings account. You also have retirement savings. You told us that you have $44,000 in your IRA and you're not sure about what's in your husband. So maybe we're going to want to check on that, but you think it's probably near $20,000.
Love that for you. OK, I mean, I'm really going to zero in on the retirement part of your overall picture, because I think it's important to look at how that big purchase would affect what that retirement plan is, especially since you want it to be accelerated compared to what people typically think is a retirement age. Is that fair?
So putting real estate aside, let's say you're keeping about 800 bucks of your paycheck per month and you put that toward retirement savings. Now, for most people, their burn rate in retirement is much lower than when they're working. The fact that you own your property means that you have minimal housing expenses when you're retired.
And of course, that would bring down your burn rate dramatically. Or I don't know, maybe you guys want to live in a Four Seasons-esque retirement community when you're older. That's something you maybe need to get on the same page about.
And it's an important thing to consider, especially an important thing to talk about with your husband, getting really clear about what you both envision for those retirement years. Is that something you've started discussing?
That sounds awesome. I love the million dollar windfall. I would say it's important, though, to start planning, assuming that that's not going to happen.
I mean, yeah, and you don't know what's coming. And we hope that you get all the windfalls. But God forbid, maybe that doesn't happen. Maybe something else happens. I would kind of view it as a nice to have not need to have and then operate your own plan independently. So if it happens, it's great, but you're not relying on that.
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