Dadvice Weekly #50 / Things We Messed Up
Dadvice Weekly - #50
Six years ago, when Alicia and I built our house, the builder gave us the option to finish the basement. The quote came in somewhere between $30,000 and $40,000. It could be rolled into our mortgage, which we had locked in at below 3%, and the builder would have handled all of it.
We declined. We were already at the top of our budget, and I was not fully comfortable with the mortgage payment even without the basement. Saying no barely felt less like a decision and more like the only sensible option.
I am writing this from that basement. My office is down here. The side hustles live down here. And as our family has grown, Alicia and I keep circling back to what this space could be, whether that means extra bedrooms or simply more room for the family we’re building.
Finishing it today would cost between $80-100k. I would be the one managing the project, coordinating framers and electricians and drywall crews on nights and weekends. And none of it can ride on that original loan. The average 30-year fixed rate is sitting around 6.5% right now, more than double what we locked in. The same project is now roughly three times the cost, self-managed instead of outsourced, financed with money that costs twice as much. The window of opportunity closed, and the terms went with it.
Here’s the part that’s hard to sit with: I assess risk for a living. Part of being a decent PM is not just weighing the risks in front of you but also anticipating the ones that have not fully shown up yet. Alicia and I ran that playbook on the risks we could see. We weighed the danger of stretching our budget, and we chose to avoid it. To be fair to us, this was the spring of 2020. Covid was just starting to show up in headlines and dinner conversations, and caution felt like the only sane posture.
The risks that never made our list were the ones waiting on the other side of that caution. The pandemic set off years of inflation. Construction costs climbed and never came back down. Interest rates more than doubled from where we had locked in. The economy that made the basement affordable in 2020 quietly became one that deters us now. We weren’t careless, we were just a young married couple that didn’t have the wisdom we have now. And we treated our list of risks as complete when it only held what we could see in that moment.
For years I defended the decison. Three years in, it still looked fine. The basement sat down there unfinished and we did not miss it much. It took getting all the way to the other side, with a bigger family, two fulltime work-from-home jobs, and a six-figure quote to see the full scope of what we had decided. And what we had decided, without realizing it, was that the option would still be there later on similar terms. But for now, it isn’t.
I want to be careful here because this isn’t a piece about beating yourself up. There are always circumstances you cannot foresee, and you can only make the best decision with the information in front of you at the time. I believe that as much as I ever have.
But the experience changed how we decide. We did not have a process for the basement. We had a budget and a low risk tolerance, and our fear won. Since then, I’ve settled into four questions I run before any big financial decision. They came out of a mortgage, but they have held up for cars, career moves, and a kitchen we have not remodeled yet.
1. What does this decision look like today, in five years, and once we are all the way through it? Most decisions get evaluated in the present only. Making a good decision does not require predicting the future, it just requires admitting the decision has a future. In 2020 we asked what the basement cost, but we never asked what our family or our needs might look like in year six.
2. If we say no today, can we say yes later on the same terms? This is the question that would have changed our answer. Some options wait for you and some quietly expire. A no that can be revisited anytime is cheap. A no that closes an insanely-low interest rate window is a different kind of no, and we treated them as identical.
3. What does waiting cost, not just what does acting cost? Every decision has two price tags, and we only read one of them. Acting had a clear cost: $40,000 and a bigger payment. But not acting on it at build has indefinitely stalled our plans to finish the basement. The realized cost is nil, but the opportunity cost is great.
4. Which risks have not shown up yet? We could not have predicted a pandemic. But we could have asked what would need to change for this decision to look wrong later, whether that was rates, costs, or the size of our family. Naming those things does not prevent them. It just means that when you choose, you are choosing with the whole board on the table instead of the one piece that scares you.
None of this guarantees the right call. Sometimes you run all four questions and still say no, and sometimes that no still costs you. The point is to decide on purpose, with the full time horizon in view, instead of letting today’s fear make the decision alone. -KC
Dadvice Weekly is Kyle and Skyler—two friends in their thirties, living in Colorado, settling into fatherhood and trying to stay sane. Every Tuesday we share what’s working in our homes: gear we use, routines we’ve tested, ideas we’re trying. It could be a recipe, a product that solved a problem, or just what we’re thinking about as dads.
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