There are quite a few people who seem to handle personal budgeting questions, so I'll ask here, as my situation recently changed.
I am a recently divorced father of 3, and was ordered to pay child support. With nothing left, I moved back in with family and continued working. Slowly, thanks to rent-free living conditions, I paid off quite a bit of debts that the divorce left in my hands. As of today, all that remains are a few major loans, including a car loan at 11% for $6k, a few low-interest student loans at $7.5k (3%), and some collections that are being paid off over time at $9k. I make $100k, but 1/3 of that goes to taxes, 1/3 of that goes to child support, and I keep the remainder. All told, of the net $2700 I get per month, I can use $900 a month for personal use, which I've spent mostly on combating the inevitable depression the entire situation has caused (and supporting my children when they visit on weekends). I've also been working this to build up my credit score from the low 400s to the 660 I have today. I've managed to put $12k into a 401k to start a home buying process while the debt is paying itself off.
I recently will be receiving enough cash to pay off all of that debt, plus the taxes for that funds, and leave me with a bit left over. Personally, I would be happy with this, but I want to see my children. I discussed this with a friend, who suggested I buy a house and go from twice-a-month visitation to joint custody, since now there would be a place my 3 children could live. As a bonus, I could also fight alimony and other charges, which, if successful, would transfer an additional $700/month back on my side.
- Should I seek a lawyer, CPA, etc to go over this situation?
- I do plan to retire in about 35 years, so would aiming for a home now be a wise investment? Homes run for about $250k in my expensive area of the country, but I would be comfortable just anywhere that my kids could live.
- Should I instead consider renting for a year and paying off the debt? I plan to live here for about 15 years (until my oldest can go to college).