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Who’s Right: Investing the Profits from Selling our Rental or Paying Off the Mortgage?

Cry Me a River, Right?: A First-World Problem

Many of us would love to have the problem of having to decide what to do with $309,000 in cash. But for one man, this decision is causing a rift in his marriage.

The Situation

The writer of the letter is a corporate attorney who recently sold his rental townhouse for $325,000. He has $309,000 in cash after paying taxes and fees. His wife wants to use the money to pay off their mortgage, whereas he wants to invest in the stock market for a potential higher return. They also have differing opinions on debt and risk.

The Arguments

The wife’s argument is based on the principle of living below their means and being debt-free. She is emotionally averse to debt and the risk of the market tanking. She would rather use the money to pay off their mortgage, which is at a relatively low interest rate of 3.25%. She also wants to use some of the money for a new kitchen as a way to enjoy the proceeds.

The husband’s argument is based on leveraging debt and the historical long-term rate of return of the stock market. He sees the potential for higher returns on investments and wants to take advantage of market opportunities. He also wants to keep their mortgage as a way to diversify their portfolio and have a potential tax deduction.

The Decision

The decision ultimately comes down to a matter of personal preference and risk tolerance. Both arguments have their merits and drawbacks. However, the most important aspect is that the couple needs to come to a mutual decision and compromise.

Based on their financial situation, it may be wise for them to consider splitting the proceeds between paying down their mortgage and investing in the stock market. This approach allows them to potentially earn higher returns while still reducing their debt burden. They can also allocate a portion of the money for home improvements, such as a new kitchen, to satisfy the emotional aspect of the decision.

Related Facts

  • Personal finance is personal, and there is no one-size-fits-all solution.
  • Both paying off debt and investing for the future have their benefits and drawbacks.
  • The stock market offers higher potential returns but also comes with higher risk.
  • Key Takeaway

    The key takeaway from this situation is that financial decisions are a matter of personal preference and risk tolerance. Couples need to come to a mutual decision and compromise to ensure their financial goals are aligned.


    Cry me a river, right? It may seem like a first-world problem, but deciding what to do with a significant amount of cash can be a hard decision, especially when two people have differing opinions. Ultimately, it is important to understand each other’s perspectives and work towards a mutual solution that aligns with their financial goals.

    Denk Liu
    Denk Liu
    Denk Liu is an honest person who always tells it like it is. He's also very objective, seeing the situation for what it is and not getting wrapped up in emotion. He's a regular guy - witty and smart but not pretentious. He loves playing video games and watching action movies in his free time.


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