Here's an email I recently received from a reader:
My wife and I are both 30 with no kids and we have a dilemma. We are planning to retire by 45 and have no debt except our current primary mortgage at $100K. I have roughly $90K in my 401K and we are not particularly interested in increasing retirement contributions as we plan to retire much younger than is normal.
We just sold a rental house and have $80K to dispose of. We plan to save $20K for some projects around our current house (major renovations) but are not sure what to do with the other $60K.
We don't really want to just pay down our primary mortgage as it's at a great rate (3%) and I didn't like how illiquid the money was for a very low rate of return on our rental house. Some options we've thought about are to 1) Invest in the stock market, 2) Invest in a local business, 3) Put the money into P2P lending, 4) Buy another rental property.
We don't mind if the money is not liquid as long as there is a good rate of return. We don't anticipate any pressing need for the money in the next 10-15 years so this could be a long-term investment. I'm pretty open to something riskier but my wife is not so much. We would both be ok with some moderate level of risk. Our previous rental house barely broke even (it was a former primary residence from a move) and we're not so sure we can find a good rental house with the tax and rental rates in our area.
Any suggestions from you or your readers would be appreciated.
What are your thoughts for him?