[JMcLellan]

My wife and I are becoming very passionate about owning a lake property. This idea has morphed from buying a small cabin to use seasonally as a 2nd property to buying a home on the lake right next to our house. Why drive a couple hours away to go enjoy the lake when we could just do that at our main home?

The price to buy a decent place on this lake is 3x to 5x the cost of buying a cabin a couple hours away which is currently out of our budget unless all we wanted to do was spend our money on a mortgage and eat ramen. However, what if someone just said eff it, and took out a large chunk out of retirement right now and made a bet that this lake home could be worth way more later than keeping the money in retirement funds (or at least would stay on par with their retirement funds)? Assume the lake home would be $1.4 million: down payment would be using $500K from retirement plus $300 to $350K from equity in our house we would realize upon the sale. We would take on a $550 to $600K mortgage on the lake home then assume about 10k per year in property taxes to start.

There would be early withdrawal penalties and the tax year when you take out a big chunk you would be pushing a lot of money into higher tax brackets and would take a hit there. But how much would this really hurt us if our lake home was worth a crap ton more in the future? And then there is the whole return on enjoyment factor of having the lake place now and being able to use it.

This idea popped into my head a few weeks ago and I've been mulling it over. Am I stupid, or could this actually work? My wife and I are planning to work another 15 to 20 years and will continue to get paid and continue contributing to retirement funds. I welcome any feedback, feel free to call me crazy. I know, I should be talking to my financial planner instead of people on a car forum but all he is going to say is "don't do it" because he only makes money the more I save with him so there is that bias. I trust people on here will shoot it straight.