Dear In a Dilemma,
Would holding onto that condo for another five, 10, 15 years may make you wealthier? Possibly.
But would your life be any richer for it? It certainly doesn’t sound like it.
You made an investment when you bought and renovated this condo. Financially speaking, it sounds like it’s been a good investment to date.
For you personally, though, it doesn’t sound like this is the right investment. That doesn’t mean it’s been a mistake. You’ve just realized that it’s not right for you.
Your dilemma, it seems, is about letting go of an investment, something a lot of people struggle with.
They don’t sell stock in a company that’s floundering because they’re still hoping for a rebound. Or they won’t close a business that’s hemorrhaging money. Instead, they fall for the sunk cost fallacy, i.e., that just because you’ve poured time and money into something, you need to keep pouring time and money in, even when it’s a losing venture.
I suspect that there’s a little of each at play here. Perhaps you envisioned pink skies and beach weather in January when you moved to Florida, and then you got a reality check, but you’re still clinging to that vision. Or maybe you feel that you shouldn’t walk away because you’ve already invested three years and $170,000 in this condo.
What will you gain if you come back to Florida and sink another three years into that condo? Home equity, perhaps. But this decision is way bigger than money. You’re feeling centered and having fun back in Chicago — feeling that way in 2020 is no small feat.
Maybe buying that condo was the right decision for you three years ago. You’d just experienced a tragedy and needed a big change. But it sounds like your priorities have shifted, and I’m guessing COVID-19 has driven that shift, at least in part. At a time of so much isolation and uncertainty, being close to the people we love matters more than ever.
Even if you had told me that you’d have to sell your condo at a loss, I would have urged you to consider it. You know where you want to plant roots, and you say you don’t want the hassle of owning two homes.
But yours is an easy problem since you’ll likely turn a profit. If you opt to buy a home in Chicago, you could use part of the profit for a down payment — and maybe even set aside a bit so you can take a vacation in Florida when it isn’t hurricane season.
Although this investment is no longer the right fit for you, I think it’s paid off. It’s helped you figure out what matters and where your home is. That, to me, sounds like money well spent.
Robin Hartill is a certified financial planner and a senior editor at The Penny Hoarder. Send your tricky money questions to AskPenny@thepennyhoarder.com.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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