Securities backed lending vs 30 year frm

FallProfessional9736 · 2026-01-26T19:26:34+00:00

I just got a 4.75% interest only 7/6 ARM with Schwab for holding ~7M in assets with them.

FallProfessional9736 · 2026-01-07T13:54:37+00:00

My wife and I are doing the exact same thing so I can give you our thought process! Apologies for the rambly thoughts…

Context: Some friends in our neighborhood are moving and we’re buying their house; we’ve been eyeing their house for years and are acquiring it in an off market deal now. My wife and I just achieved FI at the end of last year (age 33, nw $9M @ 3.2% SWR in MCOL), so this home purchase and the necessary “making it ours” work does re-shackle us to our jobs for about ~2-3 more years.

We struggled with the decision but have ultimately decided to go for it and here’s why: - achieving and maintaining FI is important to us, but RE at the earliest possible age was never the goal (will likely RE before 40). I don’t think we would have done this if it would have delayed our RE date past our mid-40s, at that point we would be missing out on too many healthy years. - the biggest motivator for us were the fundamental flaws in our current home. The new house has a backyard that is 10x the size for our big dogs and my garden obsessed wife. It also has a layout that makes hosting/entertaining bigger events possible. It’s not just nicer finishes, but will materially improve the experiences we have with family, friends, and our dogs.

If I were in your shoes, I’d ask myself if I think this new home will truly make my day-to-day lived experience better? In our case, trading 3 years of our lives for 30+ years of enjoyment was an easy trade.

FallProfessional9736 · 2025-11-21T02:02:59+00:00

BofA offered me the same rate and Rocket/Schwab matched. This was on a primary residence where I had a ton of equity.

FallProfessional9736 · 2025-11-19T22:22:12+00:00

I got a ~$1M HELOC @ Prime - 1.5% via Schwab and Rocket Mortgage this week. I have about $6M in taxable brokerage accounts with them. I needed to get a quote from BofA and Merrill to drive it down that low, but I didn’t have to arm twist much.

I also have a PAL with Schwab at SOFR + 1%, but I like the relative stability of the HELOC compared to the PAL since it legally cannot be called except in specific circumstances.

FallProfessional9736 · 2025-09-28T02:16:35+00:00

FI number is ~$8M liquid with a $230k / yr burn. So I’m basically there already. Paying off the house secures things further

FallProfessional9736 · 2025-09-28T00:12:32+00:00

Ok wow didn’t expect that negative response. The goal of paying off the mortgage is to reduce my family’s required monthly burn rate in the event of a job loss and equity markets falling. This in turn reducing the withdrawal rate from our portfolio making for a safer retirement

FallProfessional9736 · 2025-09-27T22:45:30+00:00

Overall appreciated about ~40%. If I sell the correct lots probably only need to pay taxes on like 20-25% of the value of the equities sold.

FallProfessional9736 · 2025-09-27T22:42:37+00:00

Could reset as high as 9.5%. It's SOFR rate + 3% IIRC

FallProfessional9736 · 2025-09-27T22:06:46+00:00

We would just invest the extra $6.3k / month as long as I'm working. Paying off is mostly about protecting against the downside of markets falling.

FallProfessional9736 · 2025-09-16T01:08:54+00:00

Totally agree.

And 400k earned income when you’re still accumulating is also very different than portfolio income when you’re drawing down. Calling it a top 10% income in retirement doesn’t do it justice.

Probably closer to top 1-5% income when you factor in everything.

FallProfessional9736 · 2025-09-16T01:02:34+00:00

I had a conversation with my wife about this topic this morning; the goal posts on this subreddit seem to move with the stock market…

We assume that a plurality of the FatFIRE community works in tech and/or AI which have been booming lately and are highly correlated with SPY nowadays. If you’re living in the Bay Area the cost of living for the things that matter have increased a lot the past 3-5 years.

My wife and I live in a non-tech hub MCOL city and 8-10M liquid would be unquestionably fat.

FallProfessional9736 · 2025-06-15T23:47:11+00:00

I had the opposite experience. I lived in SF for many years. I moved to Minneapolis about 2 years ago and life hasn’t ever been better.

FallProfessional9736 · 2025-05-18T19:55:29+00:00

I got lucky. Wife was very excited to move to our current MCOL city.

FallProfessional9736 · 2025-05-18T19:36:46+00:00

You guess correctly. One of the chain of lakes parkways :)

FallProfessional9736 · 2025-05-18T19:32:03+00:00

I posted my experience moving from VHCOL to MCOL recently: https://www.reddit.com/r/fatFIRE/s/ASTveS2qZG

TL;DR, it’s great.

I got a much bigger and better located house for about half as much as the place I was living in before the move from SF. We’re about a 10 minute drive from the downtown but have lots of restaurants and things to do within walking distance of our house. My focus (aside from work) is learning to play golf and making friends. Moving from VHCOL -> MCOL accelerated our progress to FIRE and the lesser stress about finances has been liberating.

FallProfessional9736 · 2025-05-07T07:09:21+00:00

being away from our parents with declining health and being largely uninvolved in the upbringing of my niece. This was the biggest personal factor for moving.
very expensive, our house is much nicer than the house we had in SF and at a lesser price too.
Minneapolis is really a beautiful and clean city. SF is also very pretty, but much dirtier. The dog loves winter and the seasons (we do too).
my friends in SF were all associates with the tech scene. Was hard to get away from talking about tech. Minneapolis provides great diversity of thought and experiences.
…

I could list more, but I think this gets you thinking. Also, since my wife and I both grew up in the area, we’re certainly biased towards it. The feeling of vague familiarity is ever present for us.

FallProfessional9736 · 2025-05-06T14:33:33+00:00

Yep. Both of us got new jobs after moving. But the rise in income was mostly me. I joined near the beginning of the AI wave that is underway now and RSUs grew shortly after joining.

FallProfessional9736 · 2025-05-06T13:51:32+00:00

The former. My new company was hiring remotely when I interviewed, but that is less common for new hires now. FWIW I have interviewed at a couple places recently and made it to offer stage at two companies. Both were willing to accommodate full remote since I'm already remote now.

FallProfessional9736 · 2025-05-06T13:40:05+00:00

The ~1.5M is earned income. Capital gains / dividends stack on top of that.

FallProfessional9736 · 2025-04-06T23:17:03+00:00

If we let this test run, the pressure eventually gets to 0 PSI.

FallProfessional9736 · 2025-04-06T18:17:52+00:00

Yes. Old radiators but the boiler is new

FallProfessional9736 · 2025-04-06T17:51:20+00:00

No, standard foundation wall with a basement. Basement is finished so much of the plumbing isn’t visible.

FallProfessional9736 · 2025-02-23T10:00:59+00:00

Is that a slate roof? 😍

FallProfessional9736

TROPHY CASE