Best way to fund a gap year in income?

Submitted by Conundrum5 t3_yigmt3 in personalfinance

I don’t have income this year. My income will resume next fall, at which point I’ll make more than I spend. In the meantime, what are my options for funding my next year of expenses (~40-50k)?

I have good credit and a few hundred k in stocks so it seemed like rather than sell stocks I could take a margin loan, but then I saw interests rates like 10-12% which seems crazy! Then I thought about 0Apr intro credit cards but learned that I can’t exceed 30% credit utilization or it’ll hurt my score, so it seems like I’ll only safely put ~3k-5k of debt there. Are there any other options besides selling stocks in a down market?

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Comments

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93195 t1_iuij8jc wrote

With money you made in prior years….

The time to plan was before, not after….margin loans were never the answer, then or now.

Either sell some stocks or go back to work.

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BringItBoy t1_iuijhm5 wrote

Are you able to get government assistance or unemployment?. Even if you take a loan you have to pay it all back and you will still have expenses next year.

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Mashtatoes t1_iuijleh wrote

Credit utilization really matters only if you’re planning to get a major loan before paying it off. It’ll go back to normal a month or two after you bring it to normal utilization levels.

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nails_for_breakfast t1_iuiocsm wrote

Go back to work and save up until you have enough in liquid assets to fund your gap year plus an extra cushion for unexpected expenses and/or delays in getting your job back. You can't just jump into something like this without prior planning

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Alright_So t1_iuizwy7 wrote

It may be the case, but comments seem to be suggesting this is a "gap year" as in voluntary year off, but there may be other reasons....

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