Is a basement apartment worth adding?

We have the opportunity add a basement apartment in our home. Does it make any sense?

basement apartment

Should we add a basement apartment in our house?

Longtime readers might recall that we kicked off a pretty significant basement remodel last year. We knew it was an inevitable future project, but we hadn’t wanted to start while we had such a little kid running around.

When my wife decided to change jobs, she ended up with some time off before starting the new job. An opportunity to have someone watch Pretired Baby while I smashed drywall was something that couldn’t be wasted. So I headed downstairs and grabbed my hammer.

As always, we underestimated how much time the project would take, mostly this time because we didn’t really figure in the time I’d have to keep things quiet for naptime. And because the scope kept expanding.

As we got deeper into the project, an idea that we’d talked about many times began to look increasingly realistic. The idea: add a basement apartment.

I talked quite awhile back about how we bought too much house when we moved here. We had specific things we were looking for and the size of the house wasn’t much of a consideration at the time. Although we love our house, I have to admit buying it was a significant mistake. A cheaper, more appropriately sized home would have been a smarter move. In fact, the extra amount we spent on this house is right about the same amount I currently need to declare myself officially pretired. Obviously if we were to downsize at some point (something that could still happen someday), I could declare myself financially free and be done with it. If we stay here, I will likely need to go back and bank a few more years of salary to put myself over the top.

Or is there another option? Could I downsize in-place? Let’s examine the situation.

  • Total house square footage: 2,500, split evenly upstairs and downstairs.
  • Upstairs layout: three bedrooms, one bathroom, dining room, kitchen. Bathroom is tiny.
  • Downstairs layout: One bathroom, which will be nicer than the upstairs bathroom when done, two bedrooms (One is tiny — only technically a bedroom, but would work for a kid. The other is currently planned as an office and has a fireplace in the room and no closet yet.)  There is an awkward entry area that would likely be a junk-collecting area and there is a large open room that would work nicely as a kitchen, but is currently planned as an exercise room. The laundry is also downstairs.
  • Our mortgage situation: Regular readers already know all about this, but the short story is I’ve paid off my portion of the mortgage to prepare for staying home with Pretired Baby. My wife now owes about $90,000 on her half, with about seven years until the loan matures. Her payment is around $1,500. Zillow puts the current value at $650,000. Appreciation was 11 percent and 14 percent the last two years, so if the market stays hot, we gain about $50,000 or so a year in value.
  • Other bills: Our core bills are around $1,600/month, so $800 each. We’ll call it $1,000 each to include some occasional splurges.
  • Potential rental income: We could easily get $800 for the space, potentially up to $1,000. While we’re daydreaming, it’s conceivable we could double that or even triple it if we went the VRBO route instead, although that would probably only be the high season, so likely we’d average back to the $1,000/month, especially once the extra tax and other expenses are considered.

That’s the big picture. So should we add a basement apartment or just finish up the space and enjoy it? I’m really not sure which way to go.

Yes, we should build a basement apartment:

  • More money is more money. Why wouldn’t we go get more since we’re already in mid-remodel anyway?
  • We’re not really using the space currently and things seem fine. We do have some things stored downstairs but that’d be a minor issue.
  • The extra money could essentially cover a nice chunk of our bills. If we brought in $1,000/month, we’d only need $500 each going forward. Appealing! And $1,000/month is about what my fourplex produced with a lot of hassle. This would be an easier way to get the same cashflow.

No, a basement apartment is a terrible idea:

  • Do we really want someone else living in our house? What if they’re nuts? We have a young child in the house. Is it safe?
  • There is extra work, so more scope creep. I’d have to run an additional drainline under the concrete floor. I’d also have to add laundry upstairs and while I sort of have a space for it, it’s awkward and would actually cause some storage issues.
  • Back to landlord hassles. I’ve really been enjoying not being a landlord the last few months. It’d really suck to go back.
  • We’d have to be considerate neighbors and keep the noise down. With a toddler running around and crying a few times every hour, that may not be possible. One of the best things about living in a house is that you can make lots of noise without annoying your neighbors.
  • Is $12,000 a year really worth it? We’re appreciating at four times that amount right now. I don’t mean to act like that’s pocket change, but in the grand scheme of things that amount of money doesn’t seem to compare favorably to the negatives.

As far as the extra works goes, the thing that scares me the most is adding laundry upstairs. Everything is possible, but the hassle and expense of that is off-putting. The biggest negative overall is just giving up part of our house — having a stranger around all the time. Maybe we’d get lucky and manage to rent to a busy airplane pilot who is gone all the time, but odds of that are slim. For $1,000/month, it just doesn’t seem worth it. If we were reliably bringing in $3,000/month or more, it’d be irresistibly doable.

But maybe I’m wrong. Small amounts of money do add up over time and this would greatly lower our overhead on a percentage basis. By effectively lowering my overhead to around $500/month, my existing pretirement fund would enough to cover all my bills, essentially rendering me essentially financially free without working another day of my life. (Naturally we probably wouldn’t want someone living in our house the rest of our lives, but presumably, we’d eventually sell and downsize so the rental phase would act as a bridge until the market ripened to where it became time to sell and move, at which time I’d have additional pretirement funds available.)

So on one hand, more work, more short-term expense and a major hit to our comfortable, private lives. On the other hand, I wouldn’t need to think about working ever again. Ever again. That sounds pretty sweet, too.

What do you think? We should add a basement apartment? What would you do? 

How to save money on vacation

Changing your mindset is the key to maximizing your vacation savings

how to save money on vacation

How to save money on vacation — change your mindset!

One of the hardest things about living in Seattle is that the winters can be long. The weeks between the day we win the Superbowl to when the tree pollen traps us indoors can be the longest, most depressing weeks of the year. Rainy season here (really more of a nonstop, grey drippiness than real rain) lasts from around late October until July 5 in a typical year.That’s why we usually plan a vacation to somewhere warm and sunny in late February or March. When we return, we’re usually safely into springtime and ready for a glorious Seattle summer.

We were particularly nervous this year because it was going to be our first trip traveling with a toddler. Would we be the embarrassed parents trying to quiet a screaming child? What if there was a major poop explosion? We packed SO many toys, loaded our iPads with movies and brought along enough food to keep the entire plane fed for a month. We were ready. We thought.

It started off well enough, Pretired Baby had a blast running around in the airport and was already looking tired by the time he got on the plane. He was fascinated by the magazines, the windows, the tray table and all the other people. About two hours in, though, he drank a bunch of milk and laid down on our laps and fell asleep. He slept for a blissful 40 minutes or so and we even took his picture because he was sleeping so sweetly. We couldn’t believe our luck.

Suddenly he awoke with a kind of coughing noise, tried to sit up and started puking ALL OVER Pretired Mama.

“Lean him forward!” I shouted and he puked some more. He’s only thrown up one other time in his whole life and that was such a small amount it barely counted. He was scared and obviously didn’t feel well. He began crying loudly. I called the flight attendant who brought bags and paper towels but there wasn’t much else we could do. We managed to clean him up and calm him as best we could. He was finally quiet and cuddly but still feeling sick. Time remaining: about three hours of hell. Uh oh.

Over the next three hours, he puked.

And puked.

And puked.

The faces of the most annoyed and angry people, frustrated at having a screaming baby on their flight, eventually softened to sympathy and finally open pity or even horror. It may have been the worst flight of their lives, but, hey, were THEY the ones covered in puke?

We let everyone else get off the plane and finally shuffled off the plane, carrying our luggage, a toddler and two large garbage bags full of puke-covered clothes and other items. Did I mention there was a lot of puke? OK, good.

We decided to stop by the urgent care on the way to our condo just in case and almost died on the way. Pretired Baby started puking while we were driving but since he was slightly leaned back in the car seat he was having trouble getting it out. I was sitting in the back seat with him and told my wife to quickly pull over so I could loosen his seat and lean him forward a little bit. She pulled over and I unbuckled the top clip and leaned him forward a little bit and caught the puke in my already covered shirt I’d removed at the airport — the last thing I had with me for collecting puke. My wife suddenly gasped and I turned my head to look out the back window. A car was coming toward us fast — in the shoulder and obviously not seeing us. It fortunately swerved back into the traffic lane at the last second. If it had hit us, at least two of us would have been killed and one of them would definitely have been Pretired Baby, in his car seat with the car seat clip unbuckled.

Anyway, crisis averted, we made it to the doctor (who had no idea what was wrong and just gave us advice for treating nausea and thought it might be altitude sickness) and finally to our condo. Pretired Baby had a rough evening, but he eventually fell asleep on me and slept all night. The next day took him awhile to bounce back, but the day after that he was fine — which is when I came down with the same bug. It took me down for a night and the better part of a day, after which vacation finally started. At least we knew it wasn’t altitude sickness then, which meant the flight home should be better.

Why it’s worth trying to save money on vacation

A plane trip like that is a good reminder that plane travel — even when everything goes great — is a horrible experience. Even the best trips are an endurance test while the worst trips leave you wondering why you spent good money on such misery.

Fortunately our trip was very inexpensive. We had plenty of miles for our plane tickets and Pretired Baby traveled free as a puking lap baby. The suckage that is airplane travel is actually lessened quite a bit by knowing it was free or close to it.

The other reason to try to save money on vacation is that it can be quite expensive. You already have lodging — although that can also be free or close to it as well — you have food costs, which can be quite a bit if you eat out throughout the trip, you might need a rental car and you’ll likely spend some money on some sort of activities once you get there as well. It all adds up. A small family taking just two trips a year could easily drop $10,000 or more just on travel — that’s almost half of our core operating costs for the year! If you want to keep that up while paying out of pocket for everything, you might need twice the pretirement fund you were aiming for.

How to save money on vacation: shift your mindset

Since I already mentioned that we traveled to Maui with miles, you’re probably assuming that I’m going to start talking about travel rewards cards, card churning and other strategies that others have written about much more eloquently than me.

And while I AM advocating using rewards credit cards, what I really want to explain is an important mindset shift that my family has recently undergone.

You see, we’ve traveled ALL OVER this lovely planet, generally paying very little for the tickets that got us there, thanks to having accumulated many airline points. But we could have spent even less.

Most people, I think, are like us. Yes, they have rewards cards and yes, they build up over time with normal usage. So when we think about taking a trip, we get most of the trip planned and then finally we’ll say “Hey, do we have enough miles to pay for that?” Sometimes the answer is no and we’ll pay out of pocket. More likely, though, we’ll be just a little short and we’ll buy a few miles to get us over the top.

So we’ve shifted our thinking completely. Instead of planning a trip and then seeing if we have any miles we can use, we are planning our trips first and STRATEGICALLY building up miles toward each trip. And the biggest key to that, beyond planning farther ahead than we normally would, is to focus on sign-up bonuses vs. earning points over time. The sign-up bonuses require a certain amount of spending in the first few months so it’s critical to pay attention to the details.

It’s worth getting help

Getting organized on strategic rewards credit card usage can help you save money on vacation, but it’s an overwhelming world of intentionally confusing marketing. That’s why I enlisted the help of my friend Brad from Richmond Savers to help me sort through this mess. Brad offers free travel rewards coaching. All he asks in return is you sign up through his affiliate links and he then gets a small commission from the credit card companies.

We started by doing some thinking about the trips we wanted to take over the next few years. Here’s what we’re thinking right now:

  • 2015: Hawaii again, but probably Kauai this time. I think we like it better. Its laid-back vibe fits our personalities better than Maui.
  • 2016: Disneyland. We’re planning a joint trip with my brother’s family. I guess it’s one of those trips that’s unavoidable when you have kids.
  • 2017: Scandinavia: I’ll be turning 50 (really?) so we want to go visit the motherland to celebrate.
  • 2018: Italy: My wife wants to go to Tuscany when she turns 40. If all goes well, we may also be celebrating her pretirement!

It is generally a good idea to start with the trip coming up the soonest so we’re focused on building up enough miles for next year’s trip to Kauai. The way we’re doing this is via the British Airways rewards card, which gives us 50,000 miles. My wife signed up first and I think we’ve already got enough spending on the card to receive our points. Next, I’ll be signing up for the same card and getting the same points.

Once we have those banked, we’ll move on to the next card in our plan and keep going until all our trips are covered. It actually looks like we can pretty much get ALL of our needed plane tickets for nearly free with just our normal spending. We also have some spending we need to do on the house this summer so we’re going to try to time that work with the new card signups to maximize our signup rewards.

On top of that, we should be able to leverage rewards to gain big discounts with Disneyland and we’re even looking at some strategies for getting free hotel stays in Europe when the time comes. While we would have probably gotten most of our plane travel free or greatly reduced with our other points programs, by planning ahead and targeting the card usage at specific trips is the key to maximizing our vacation savings.

Other ways to save money on vacation

So now that you’ve hopefully joined me on my mindset shift and are now targeting rewards credit card spending toward specific trips, I’ll also share some of my other favorite tips for saving money on vacation.

  • Consider VRBO rentals instead of traditional hotels. Obviously you can’t apply rewards points toward private vacation rentals, but if you’re not using points anyway, choose a vacation rental. We use VRBO for at least 80 percent of our trips these days. Mainly because these private homes are usually better set up for traveling with a child. There are usually separate rooms and full kitchens, etc. Even if you only eat in for breakfast and go out for all your other meals can add up to a lot of savings.
  • Book your hotel first. For some reason travelers OBSESS over airline costs. There must be some weird psychology going on where people just cannot handle paying $10 more than the person sitting next to them because people will go through all kinds of maneuvers to save a little bit on plane tickets. Meanwhile they’ll often overpay for hotels on the same trip and not give it a second thought. What you need to know is that there is NO cancellation fee for most hotel bookings but there almost always is for airline travel. You can reserve your hotel stay first and then start looking for airline deals. If you find you need to adjust your stay a little bit, go ahead and make the changes then call the hotel and change your reservation. Hotel prices also fluctuate quite a bit just like airline prices. But if you see a better deal on a hotel than the one you already have, you can simple call and get the same deal. (We have had to cancel and rebook before, but it’s never been a problem.)
  • And just for fun, one of the ways we saved a little bit on this trip was to utilize the local library. In Maui you can get a temporary library card for $10 so we were able to load up on books (they also rent DVDs) and keep Pretired Baby entertained without packing a bunch of heavy books or buying a bunch when we got there. They also had a free storytime for toddlers so he was able to go to that also for free. I do love libraries!

I’ll share some other tips for saving money on travel in the coming days, but in the meantime, what are some of your favorite tips for saving money on vacation? 

Time to take a look back

Two years since I quit my job and a year of blogging — how time flies

zprogressionLife is fleeting. I guess we all know that and it isn’t such a profound thing to say. But there are times when weeks flash by in what feels like minutes. “Wow,” we sigh after an exhausting week, “That week sure flew by.” And so the minutes of our days turn into weeks, which somehow become months. Then, in a quiet moment, we realize decades have slipped away from us.

That’s how it’s been around here the last few months. I can barely remember what’s been happening as I lurch from thing I have to do to thing that has to be done next. So, dear readers, I apologize for disappearing on you for the past several weeks. I won’t promise that it won’t happen again.

What’s been going on? Really, just life. Pretired Baby is officially a toddler now and has me on the move. He also had a major sleep regression a little over a month ago. That joyful stage included screaming in the middle of the night, a sleep schedule thrown into disarray and fighting us at bedtime. On top of that he’s been ridiculously clingy — always with me. To the point where he throws a fit if I even leave the room. Exhausting!

Meanwhile we’ve also been making a big push on the basement remodel project. I’ll save some of the detail for a later post, but let’s just say it’s been a good reminder that you never know what you’re going to find when you take drywall off walls. Naturally right at the same time my consulting client needed a bunch of work all at once so that has kept me hopping.

That’s all just a long way of saying I’m sorry I’ve been too busy to write. We’re making a few schedule tweaks to the childcare coverage and Pretired Baby’s sleep schedule has been getting back to normal so hopefully we’ll be back to normal soon. Fortunately we have a much-needed vacation coming up that should allow us to take a breath at least.

But these crazy past few weeks aren’t the only reason I’m pausing to take a look back.

I’m just a few days away from marking two years since I quit my horrible job to get ready for the baby’s arrival. And I just passed one year of blogging — appropriately I was too busy to post something about it on my anniversary.

This is what I mean by time flying by. Two years since I left my job? Really?

I don’t remember a ton of detail about that last day of work. I had some lunch with some buddies. I deleted a lot of old email. I left kind of early. All I know for sure is that the most dangerous place in Seattle that day was between my car and the freeway. The strips of rubber I left on the road that day are probably still there, marking my trail with black hate.

I quit knowing it was an uncertain move. Sure, I had no short-term economic worries. I had no debt outside of my real estate, enough free cash to last quite a while and a wife who still worked (even though I was committed to paying my own expenses). I was already on my wife’s free healthcare because the plan at that job was terrible. Since I hadn’t yet sold my fourplex, I had some theoretical monthly income and equity I could tap if I ever got desperate. And I’ve always known I probably need 3-5 more years of income to totally ice my pretirement.

But to keep things interesting, we decided that would be the perfect time to gut the kitchen and do a complete remodel. We sent Pretired Mama away for awhile and I got out the sledgehammer and destroyed the place. I’m still amazed how quickly we pulled that one off. It was a little crazy to try to squeeze that in before the baby arrived, but we were smart to get it done before he got here, I think, especially knowing how things are now.

I wisely quit in the spring so I would be able to enjoy the summer at home. And it was a beautiful summer. Yeah, I was busy working on the house, but it felt great and having wide open days with no job or baby meant I could move fast. No desk sitting meant I felt better than I had in years. I’d step outside to cut some studs on the chop saw and the sun would feel magical on my skin. The neighborhood was quiet and empty. Bliss.

Then the baby happened.

I had a lot to learn. How to feed him. How to calm him. I’ve changed a shitload of diapers. I’ve done a ton of laundry. Fortunately my wife got a few months off from her job so we were both home full-time for about four months together. Then it was just me. Then I spun up my consulting business again, doing most of my work during naps. And then I started a major basement remodel. Oh yeah, and started a blog.

The blog has grown far beyond my wildest dreams. It started as a lark, almost more as a way to get some things off my chest more than anything else. But the response has been tremendous and surprising. Now that this site is becoming a “thing” I’m beginning to formulate some actual goals for the future. Goals? Wow, I hope this doesn’t start to feel like a job! Either way I’ll share some of those goals in the coming days. 

And, yes, I have more posts to come. I still have a lot to say. I just need to find the time! 

So here’s to many more years of blogging and hopefully many more years of not working! Thanks for joining me on my journey!

What do you do when there’s nowhere to invest?

nowhere to invest

Nowhere to invest? With a sky-high stock market, it often seems like there’s nowhere to put money.
Image courtesy Renjith Krishnan via FreeDigitalPhotos.net.

I had an interesting exchange with a reader named Bradley recently. Bradley’s basic question was “with the market at all-time highs, where do you put your money? It’s a good question because it does feel a bit like there’s nowhere to invest right now.

And it’s a particularly relevant question for me because I’ve been facing this exact dilemma with the recent windfall from the sale of my fourplex. Making matters “worse,” I just sold another piece of property so I have even more cash coming my way.

If you’ve ever made the mistake of reading any news site comment sections related to the stock market, you already know that there are two main contingents who both believe they are 100 percent correct: One says the market is headed for a crash very soon and only a fool would gamble his money in the stock market. The other group, equally sure their beliefs are correct, say the market will keep going up, up, up and only a fool stays out of the market worrying about a crash. (To get a handle on your investment portfolio, be sure to sign up for a free account from Personal Capital.)

Naturally, both sides are right and both are wrong. In reality, we all know that this market will undergo a significant correction at some point. We also know that the market will grow its way out of that dip. What we don’t know, of course, is when and we don’t know how long it will take to recover. That’s why the most important factor in any investment is the investor’s personal situation. For example, this is why people nearing retirement are typically advised to move to safer holdings as they age, although ironically people in this situation currently are among those who feel strongest that there is nowhere to invest. For some perspective, consider that my first money market account back in the late ’90s paid five percent!

There was a pretty interesting piece in CNN Money in January. While generally sticking with fairly standard allocations and advice, the writer reminds us that good ol’ cash also used to be seen as an asset class.

I recommend heading over and reading the whole thing. Lots of interesting data points pulled together, such as the fact that the market usually has a 10 percent drop once a year but hasn’t seen one in 2 1/2 years (at the time the article was published).  The writer suggests 10 years of disappointing returns await. And, oh yeah, the level of borrowed money in the market is already reaching pre-crash levels. So we’ve got a bubble again, inflated with Fed policy, borrowed money, greed and blind trust.

I might be the last honest blogger, because I’ll just tell you the truth: I have no idea what’s going to happen or when. I held my real estate winnings in cash at the end of last year, partly because I was expecting at least a small correction (which we’ve finally gotten a little taste of) and partly because I haven’t had time to really focus on it. (Which is not to say I didn’t do anything with my money last year. I actually was moving and reallocating funds quite a bit, which is still going on.)

So far this year, I have picked up a few individual stocks when I see a good value, but I’ve held off on buying much more in the way of mutual funds so far. And, in fact, I’ve been moving more money into cash, as I finally dump some stuff I’ve been packing around with higher costs. I’m dreading the tax impacts after this year, but I just want to clean up my portfolio.

My short-term strategy right now is to go ahead and sell my high-cost funds (I have seven of them left at this point with various amounts of money in them). Thus, my cash position is increasing. I’m selling those semi-quickly. Meanwhile I’ll be moving this cash back into individual stocks and/or low-cost Vanguard funds — however, this will happen much more slowly, basically dollar-cost averaging my way back in. By default, depending on how slowly I move these dollars back into the market, I’ll be effectively keeping significant assets in cash as well. I don’t want to say I’m hoping for a big market crash, but if one were to happen, this would be a pretty awesome time.

So that basic framework aside, let’s get back to the main question: what do you do when there’s nowhere to invest?

Let’s start by recognizing that, really, there is always somewhere to invest. Maybe with a sky-high market, now isn’t the time to move a large sum in all at once. But there are always a few undervalued stocks. But you have to be careful. It always rains after I wash my car and the market always dips when I make a purchase. And with the market so inflated, I have been thinking quite a bit about what options do exist outside the usual menu we typically think about. Here are a few things I’ve thought about.

Pay off debt

If you’re carrying any consumer debt at all, this is a good place to start. Whatever your interest rate is on the debt you’re carrying is your effective return by paying off that loan. Still carrying a car loan? Maybe instead of buying into an over-inflated stock market, you pay that car off for good. The free cash flow you now enjoy could dollar-cost average its way into the market or you could save it up so you’re ready to pounce when things drop.

Keep funds in cash

Why consider holding money in cash? Well, on one hand it’s a defensive move — you’re protected from a big crash. When everyone else is panicking, you’re kicking back on your pile of cash. That pile is, however, slowly disintegrating under you, however, as inflation eats away at your buying power. There is another advantage, of course. Imagine if you’d been sitting on big pile of cash during the real estate crash. I know if I didn’t have all my money tied up in, yes, real estate, I would have been on a shopping spree. Thus retaining cash can be an offensive move as well. Sit, wait for a big drop and start swinging your big weapon.

Pay off your house

If you don’t know where to put your money right now but you’re still carrying a mortgage, perhaps it’s a good time to increase your security by putting a bullet in your mortgage. If you’re worried about missing a big market dip, maybe open a HELOC on your now paid-off mortgage. If things look irresistible, you can pull out the funds from your house again and take advantage of market conditions. Remember the crash you’re waiting for could be two or three years away and you could be enjoying the cashflow improvement in the meantime.

Lower your overhead

Recently I wrote about forcing cashflow and how it can hurt you or benefit you. If you’ve got a sum of money and no place to put it, spending some of that money on increasing your cashflow situation can be a savvy move. For example, I’m still considering making the move on solar panels for our house (no-brainer if we’re going to stay in this house long-term). A $15,000 investment in solar would permanently remove our $75/month electricity bill. The downside is it doesn’t pay if we move. But the idea is the important part. For you, it could mean upgrading to a more efficient car, new insulation for your house, moving closer to work, buying new clothes that don’t need dry cleaning. You name it.

Increase your security

You could also tap your funds for  increasing your financial security as well. This might mean stepping up and paying for a few things now just so you don’t have to bother with it later. Maybe your roof is starting to fail — writing that check now while you have the cash not only removes a hassle from your list, but think about the alternative: Imagine you bought in big to the market at the top and suddenly find yourself with several years of waiting before you’re out of your hole. Then, while you’re waiting, the roof fails completely, leaving you in desperate need for cash. By making sure these aspects of your life are rock-solid now while you have this free cash, you’ll be in a much more solid position when crash time comes.

Be creative

People forget there are other places to invest outside the stock market. There are too many to list here, but for example a guy I used to work with owned shares in a local pizza place. There are always people looking for private investors — some people have friends or family who are interested in starting business for example. (Be careful!) You could even buy a small business if desired. Always wanted to own your own restaurant? Now is your chance! If you can think of it, you could probably make it happen. Have a great idea for a mobile app? You could probably hire a development team overseas for less than $20,000 and bring your idea to reality. In addition, there are online lending options such as Lending Club or Prosper where you can make a decent rate on your invested funds.

Jump in anyway

And, of course, where most of us will end up is back in the market, hoping any dip is not too deep or long-lasting. This is where I’ll probably end up as well. I’ll dollar-cost average my way in, at least, but more than likely I’ll limp my way back in and just wait out any dips, just like I always do. In the end, prudent, boring investing in low-cost index dividend funds is usually the best bet. But when you have a big chunk of cash you’re sitting on, it’d sure be nice to start out with a lower price.

What do you think? Any other creative places to put money while the market remains so high? What would you do if you had a large sum that needed a home?

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