36M, Received an unexpected $250k windfall. Stuck in analysis paralysis.
My main reddit account is fairly easy to ID me from, so this is a throwaway for anonymity.
TL;DR: I want to use a windfall to buy flexibility and free time in my life after 13 years of grinding non-stop in video post production. I'm weighing three paths and would love the community's feedback on the options I'm looking at.
Windfall: 3 months ago, my aunt unexpectedly gave me a $250k gift. My immediate family background is pretty working class, so I'm grateful, but uncomfortable with that much money.
My stats:
- 36M, 13 years in a video editing, MHCOL city
- Retirement accounts: $332k
- Home: $480k value, $210k equity, $270k left on the mortgage at 5.5%, $1,600/month plus $600/month taxes and insurance
- Cash after the gift: $280k, mostly in a HYSA
- Total net worth: $822k
- Income: 90k/year after overtime. I've been stuck at this income for about 5 years with little hope for increased income at my current job. Inflation has chewed threw my income.
- I rent the spare bedroom in my house for $1,050/month
- Work: 45-70 hrs/week. I'm effectively on call every night, and weekends aren't very safe from work either. It makes it incredibly hard to plan a life (dating, friends, exercise) outside of my work. I enjoy the work itself, but I'm exhausted and struggle to plan a life outside work. Post production can be brutal. I'm fortunate to work with great people.
What I want: I'm not concerned about getting to FIRE at a certain age. I'd rather work longer at a sustainable pace, with more time for dating, friends, hobbies, health, and community. I actually genuinely enjoy my work, it's just the hours and the lack of control over my life that are keeping me constantly exhausted.
Options I'm considering:
- Pay down $200k and recast mortgage. The payment drops from $1,600 to about $400, which my room rental covers along with taxes and insurance. That leaves $80k in cash (roughly 18 months of expenses) and lets me go freelance, part time, or take a lower-paying job with more consistent hours. The 80k in cash would also allow me to do something like 3-6 month sabbatical between this job and the next.
- Invest it. The math says stocks should beat my 5.5% mortgage rate long term. But I expect an AI-driven bubble to pop. I know I can't predict that for sure, but putting this much in at today's valuations feels very risky to me. I've considered sitting on the money and waiting for the stock market to drop, but that is way too much "timing the market" for my taste.
- Rent out the house for a year and travel. A mentor suggested renting out the house, traveling, and trying to start my own business while I'm away, then deciding what to do with the money once the travel period is over. This is the least conventional option, but it might help me decide what I actually want to do rather than make this choice from a place of just wanting to escape my current lifestyle.
Questions for the community:
I'm leaning heavily towards option 1. I'd like to be able to change my life now and be living a lifestyle I enjoy. This feels like a weird question to put out into the void to strangers, but does this choice make sense to other people on their FIRE journey? I'm exhausted and ready for a change.
Disclosure:
My first draft of this post was insanely long and disorganized. I used Claude to help organize my thoughts into something legible that laid out the options I'm considering more clearly.