[PrairieDawn]

Hi,

I've been following resource depletion and climate change news for a while now, and watching things come to a head with some trepidation. I have a husband and two young children, a large amount of debt (and not ipod debt, it's divided about equally between student loans and credit card debt from a couple of periods of unemployment from the last recessions.) My husband's job is relatively safe until early fall, after that it's anybody's guess. Mine won't actually vanish, but I will get fewer contracts and less money as the months wear on.

Here's my little conundrum: My inlaws are in the process of purchasing a hotel in rural Wisconsin. Its a beautiful old place, suitable for use as a bed and breakfast, community center, boarding house, apartments...whatever makes the most sense given the economic conditions prevailing. It's an 1880's building, stone (Really old buildings, built before central heat and air, are often easier to use alternate heating in), and had been in their family several decades ago.

They are paying cash for it, cleaning out FIL's IRA. They close at the end of May. Should I advise them to pull the money out right now or to wait until closing in May? I believe he's past the penalty age. Or in other words, is the market likely to crash before the end of May?

[dunewalker]

Welcome! Sounds like a good plan on their part, who knows? Why not withdraw the money from the IRA now and deposit it directly into the escrow account? It might result in escrow closing sooner and the funds possibly would be safer there. Leaving it where it is after the decision has been made seems like a source of anxiety for the next 2 months.

[Schmuto]

They are paying cash for it, cleaning out FIL's IRA. They close at the end of May. Should I advise them to pull the money out right now or to wait until closing in May? I believe he's past the penalty age. Or in other words, is the market likely to crash before the end of May?

You should not advise them. Neither you nor I nor almost anybody else knows what the market is going to do in the next 50 days.

Further, he's a big boy and should be allowed to stub his own toes, even if you actually did have better information than him, which you do not.

Finally, the plan sounds dodgy to me. I wish them luck with it, but putting money in old hotels does not strike me as sound. OTOH their timeline is short, so it's not as critical that they make good long term decisions.

[Pops]

Welcome Dawn.
I thought the market already crashed?

I don't know nuttin' but depending on how his money is invested and how the future turns out, he could be jumping from the pan to the fire, selling at the bottom to buy a white elephant, or making the best move of his life.


You will certainly get a wide variety of opinions here but my best advice to you is to take all of them with a grain of salt. If there were advice here worth something you can bet you wouldn't be getting it for free, heck, in the financial world it seems you even pay for bad advise.

Good Luck.

[dinopello]

Schmutman is right, don't offer advice. The conventional thinking is money that is to be purposed in this short term should not be in the market. If they ask for your advice, that's what I would tell them. I think the old hotel sounds cool. I'd love to do something like that.

[PrairieDawn]

I probably won't actually advise anything unless asked for my two cents. We're actually more involved in this transaction than just as admiring relatives. This is their attempt to create a family business for the bunch of us, and is also to be all of our home within a year or two.

They're buying it as a building that they can put to whatever purpose makes sense. If it doesn't function as a hotel, it will at least house all of us and our families. My big contribution is to encourage them to purchase a plot of land within easy walking distance for me to grow stuff on "for the restaurant". Both FIL and DH are experienced building restorers and have done everything from roofing to plumbing to installing geothermal systems (FIL is corps of engineers).

We're currently putting a list together of "stuff to do" to earn money, or subsist, or whatever, depending on circumstances. MIL is a doctor (DO, family practice), I'm a useless academic right now, but I have been accumulating skills for when we can leave this dysfunctional city.

[Pops]

I don't know anything about money Dawn but it seems like you guys have lots of practical knowledge. And if the idea of flexibility is truly held by everyone and not just a bargaining chip to get to the longed for B&B, you all might be in great shape.


Someone here said to make sure all of you plans/actions will have purpose in both the best case and the worst.