Personal Finance Question

Chivas989

Pigeon
Hello gentlemen,
I hope you’re all doing well. I would like to share my current financial situation and would love to hear your opinions on what I should do.

I live in Canada. I’m 41, unemployed due to a company lay-off in January. I took a short break and followed a 9-week web development Bootcamp. Currently, I’m on unemployment (I receive 2k a month) and I’m in full job-search mode. I do have a lead for a new job. The job looks interesting but the salary sucks. They are offering approx. 65k/year. I was previously making 95k/year as a consultant, so a 30k drop. Going back in Consulting is an option, but to honest, I wouldn’t want to go back unless I receive a kick-ass offer. You can make lots of good money consulting but its stressful AF. And the majority of clients are a pain in the ass.

I currently own a condo. I have approx. 140k left in my mortgage. I have 2 credit card debts. CC#1 is about $3500 (not in default) and CC#2 is 30k (in default) (still paying the price for mistakes I made in the past). Obviously, CC#2 is causing a lot of stress and anxiety.

I’m thinking of the following two scenarios.

Scenario 1:
Get a 5k Line of Credit from the bank. I would use it to paint my condo (painting the unit will cost approx. 2k + home staging etc.)
Once set up, I will sell the condo and make a hefty profit. With it, I will pay off the line of credit, both CCs, Save enough money for a 6-month emergency fund. Save a little for retirement. And I still have some money left over to travel, put a down payment on another condo, or simply rent an apartment and invest in stocks, mutual funds, etc. I would be free but homeless so to speak. But I would be able to do anything I want, travel, start a business, etc.

Scenario 2:
Accept any job. Keep the condo. Rent it. The monthly rent would cover the mortgage, condo fees and taxes. Borrow some money from the bank to pay off my CCs. Then, I would rent a cheap apartment to live in. I wouldn’t have an emergency fund so I would need to work and save for that. Also, I wouldn’t be able to travel or invest as much as I would love too.

What do you think I should do?

Thank you very much for any advice or inputs.
 

Dr. Howard

Peacock
Gold Member
Chivas989 said:
Hello gentlemen,
I hope you’re all doing well. I would like to share my current financial situation and would love to hear your opinions on what I should do.

I live in Canada. I’m 41, unemployed due to a company lay-off in January. I took a short break and followed a 9-week web development Bootcamp. Currently, I’m on unemployment (I receive 2k a month) and I’m in full job-search mode. I do have a lead for a new job. The job looks interesting but the salary sucks. They are offering approx. 65k/year. I was previously making 95k/year as a consultant, so a 30k drop. Going back in Consulting is an option, but to honest, I wouldn’t want to go back unless I receive a kick-ass offer. You can make lots of good money consulting but its stressful AF. And the majority of clients are a pain in the ass.

I currently own a condo. I have approx. 140k left in my mortgage. I have 2 credit card debts. CC#1 is about $3500 (not in default) and CC#2 is 30k (in default) (still paying the price for mistakes I made in the past). Obviously, CC#2 is causing a lot of stress and anxiety.

I’m thinking of the following two scenarios.

Scenario 1:
Get a 5k Line of Credit from the bank. I would use it to paint my condo (painting the unit will cost approx. 2k + home staging etc.)
Once set up, I will sell the condo and make a hefty profit. With it, I will pay off the line of credit, both CCs, Save enough money for a 6-month emergency fund. Save a little for retirement. And I still have some money left over to travel, put a down payment on another condo, or simply rent an apartment and invest in stocks, mutual funds, etc. I would be free but homeless so to speak. But I would be able to do anything I want, travel, start a business, etc.

Scenario 2:
Accept any job. Keep the condo. Rent it. The monthly rent would cover the mortgage, condo fees and taxes. Borrow some money from the bank to pay off my CCs. Then, I would rent a cheap apartment to live in. I wouldn’t have an emergency fund so I would need to work and save for that. Also, I wouldn’t be able to travel or invest as much as I would love too.

What do you think I should do?

Thank you very much for any advice or inputs.

Scenario 1. Then find yourself remote work (I have no idea what your skill set is but I'm assuming computers) with a US company. You can take advantage of the currency differential and for some reason they love to contract with Canadians.

Once you pick up a good network, move to a cheaper place to live in Canada, close enough to a land crossing into the US.
 

bacon

Ostrich
Gold Member
Unless you don't want to live in your city anymore for the foreseeable future it would be unwise to sell your place. That said, how much equity can you get from it's sale? If its a six figure sum that might be worth considering considering your credit card debt would carry a high interest rate.
 

Lampwick

Woodpecker
Gold Member
Is the 65k job a software development job? If so, will it have learning/advancement opportunities? You may be weighing starting salary a bit too much. Any time you switch careers you will take a short term hit.

Also, almost everyone in software development says that this is the optimal path:

School (ideally a computer science degree, but otherwise boot camp/self-study) -> work for a company -> (maybe) work for yourself or work remote for a company

Going from a 9-week bootcamp to doing software development on your own is not realistic, unless you are a rare breed. There are two main reasons: 1) software is a team sport and working for a company helps you understand the team dynamic, and 2) it's difficult to get the depth of experience needed for mastery without working for a company.

There are lots of stories about boot camp graduates applying to 100+ companies before landing their first software development job. If you have an opportunity in hand to start, and it is interesting to you, that is a huge leg up. You can start earning and learning now, and increase your salary fairly easily, especially if you are willing to move.
 

Chivas989

Pigeon
Dr. Howard said:
Chivas989 said:
Hello gentlemen,
I hope you’re all doing well. I would like to share my current financial situation and would love to hear your opinions on what I should do.

I live in Canada. I’m 41, unemployed due to a company lay-off in January. I took a short break and followed a 9-week web development Bootcamp. Currently, I’m on unemployment (I receive 2k a month) and I’m in full job-search mode. I do have a lead for a new job. The job looks interesting but the salary sucks. They are offering approx. 65k/year. I was previously making 95k/year as a consultant, so a 30k drop. Going back in Consulting is an option, but to honest, I wouldn’t want to go back unless I receive a kick-ass offer. You can make lots of good money consulting but its stressful AF. And the majority of clients are a pain in the ass.

I currently own a condo. I have approx. 140k left in my mortgage. I have 2 credit card debts. CC#1 is about $3500 (not in default) and CC#2 is 30k (in default) (still paying the price for mistakes I made in the past). Obviously, CC#2 is causing a lot of stress and anxiety.

I’m thinking of the following two scenarios.

Scenario 1:
Get a 5k Line of Credit from the bank. I would use it to paint my condo (painting the unit will cost approx. 2k + home staging etc.)
Once set up, I will sell the condo and make a hefty profit. With it, I will pay off the line of credit, both CCs, Save enough money for a 6-month emergency fund. Save a little for retirement. And I still have some money left over to travel, put a down payment on another condo, or simply rent an apartment and invest in stocks, mutual funds, etc. I would be free but homeless so to speak. But I would be able to do anything I want, travel, start a business, etc.

Scenario 2:
Accept any job. Keep the condo. Rent it. The monthly rent would cover the mortgage, condo fees and taxes. Borrow some money from the bank to pay off my CCs. Then, I would rent a cheap apartment to live in. I wouldn’t have an emergency fund so I would need to work and save for that. Also, I wouldn’t be able to travel or invest as much as I would love too.

What do you think I should do?

Thank you very much for any advice or inputs.

Scenario 1. Then find yourself remote work (I have no idea what your skill set is but I'm assuming computers) with a US company. You can take advantage of the currency differential and for some reason they love to contract with Canadians.

Once you pick up a good network, move to a cheaper place to live in Canada, close enough to a land crossing into the US.

Thanks, I'm leaning towards scenario 1 as well. I'm in IT (Business analyst and web development). Working remotely in the US is a good idea. I haven't thought of that. I will research it and see what comes up.
 

Chivas989

Pigeon
bacon said:
Unless you don't want to live in your city anymore for the foreseeable future it would be unwise to sell your place. That said, how much equity can you get from its sale? If it is a six-figure sum that might be worth considering your credit card debt would carry a high-interest rate.

I have to admit, I do love my area and my condo. That's why I'm asking the question. Scenario 1 gives me the chance to restart from scratch. Sell everything and pay off debts and have some money left over to do anything. The market is hot right now, so If I sell I would make approx 150k.
 

Chivas989

Pigeon
Lampwick said:
Is the 65k job a software development job? If so, will it have learning/advancement opportunities? You may be weighing starting salary a bit too much. Any time you switch careers you will take a short term hit.

Also, almost everyone in software development says that this is the optimal path:

The school (ideally a computer science degree, but otherwise boot camp/self-study) -> work for a company -> (maybe) work for yourself or work remotely for a company

Going from a 9-week boot camp to doing software development on your own is not realistic unless you are a rare breed. There are two main reasons: 1) software is a team sport and working for a company helps you understand the team dynamic, and 2) it's difficult to get the depth of experience needed for mastery without working for a company.

There are lots of stories about boot camp graduates applying to 100+ companies before landing their first software development job. If you have an opportunity in hand to start, and it is interesting to you, that is a huge leg up. You can start earning and learning now, and increase your salary fairly easily, especially if you are willing to move.

No, it’s not a web dev job, but still related in IT. They say that they have lots of Opportunites in the future but all employers say that. I did a search on Glassdoor and lots of people are saying that there isn’t. And yes I agree with you about the salary.

Should I skip this job and apply for junior web dev positions (they usually start at 40k)? Work there for a year or two? And then start working remotely? That’s a good idea as well. I have to think about that.
 

Lampwick

Woodpecker
Gold Member
Chivas989 said:
No, it’s not a web dev job, but still related in IT.

That's different. It's impossible for anyone here to evaluate this opportunity since IT is too broad. More details would be necessary.

Should I skip this job and apply for junior web dev positions (they usually start at 40k)? Work there for a year or two? And then start working remotely? That’s a good idea as well. I have to think about that.

You're in an opportunistic mode. This is not the mode to be in if you're going into web development. It requires a lot of dedication to build your skills, and to grind 100+ applications to get the first job.

If you have already been doing consulting (again, very vague, management consulting?), you may want to look into Sales Engineer roles. The roles go by many names: Solutions Engineer, Field Engineer, Solutions Consultant, Pre-Sales Engineer, etc.

If you've already been studying Javascript, you should look at business-to-business software companies with a web-based product where clients have to do integrations.

If you like where you live, you should stay there.
 

Chivas989

Pigeon
Lampwick said:
Chivas989 said:
No, it’s not a web dev job, but still related in IT.

That's different. It's impossible for anyone here to evaluate this opportunity since IT is too broad. More details would be necessary.

Should I skip this job and apply for junior web dev positions (they usually start at 40k)? Work there for a year or two? And then start working remotely? That’s a good idea as well. I have to think about that.

You're in an opportunistic mode. This is not the mode to be in if you're going into web development. It requires a lot of dedication to build your skills, and to grind 100+ applications to get the first job.

If you have already been doing consulting (again, very vague, management consulting?), you may want to look into Sales Engineer roles. The roles go by many names: Solutions Engineer, Field Engineer, Solutions Consultant, Pre-Sales Engineer, etc.

If you've already been studying Javascript, you should look at business-to-business software companies with a web-based product where clients have to do integrations.

If you like where you live, you should stay there.

It’s an integration role. 80% Customer facing with 20% Dev (APIs, .NET, PHP, Python)

You’re right about being optimistic. That’s one advantage of selling is that I would be able to start fresh. No debts, limited bills, I would be able to work on building sites etc.

I was implementation ERP systems to small and medium size businesses. I never thought of pre sales career.

I’m currently studying JavaScript but my skills are no-where near ready. Like you said, I need to write at 100 projects for this.
 

bacon

Ostrich
Gold Member
If I were in your shoes, I would probably sell then. Your entire net worth is tied to your home. Additionally, you are carrying a lot of credit card debt.

Selling would do 2 things. No more debt and you could invest the proceeds into a equity fund, which would give you a lot of diversification and historically the best odds of getting higher returns long term. Put in some varying interest returns (5-9 %) of what 120k would be into a compound interest calculator if you wait 25 years to retire. That could really come in handy when you are 65 and want out.

Also, if you do sell, it allows you a lot of flexibility to switch jobs, be location independent or even travel for a couple months without reoccurring housing payments eating into your available cash.

Another consideration is that rents are often capped at levels below what the housing values are at in hot markets. This is because in hot markets people will buy homes often with the thinking that they can make more money on housing appreciation than through renting it out. If they charge too much to rent, then people will simply not rent the unit and look for something less expensive. There are ways to calculate this on your on home for instance as the rent price usually sits at around 1% of the homes value. Thus a 100k home might rent for around 1k a month. If the rent prices are much less than this, say 0.5% of the homes value, then its likely that housing is overvalued relative to rent.
 
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