Originally Posted by taubel
I guess I'm just frustrated because I feel as though we can't move forward with our financial plans until we buy our "forever house."
Housing is a dynamic part of your life and thinking like that can really cause financial headaches. There IS no such thing as a "forever house" until the end of your life. Life changes. You have to adapt. You have to make your financial goals with these changes and adaptations in mind. If you "wait"... you'll always find something to wait for. It doesn't mean that you might not find a house that eventually becomes your forever house, but going into it with that expectation is not sound financial thinking.
I agree with Sunny. It seems that you are potentially making some bad financial moves based on your emotions. You need to take step back and evaluate everything because your financial goals should not be dependent on your emotions, your housing or your emotions about housing.
If what you have is a taxable investment that you are considering cashing in to pay OFF a student loan (not pay DOWN, but OFF), then I can see some logic to that if you have maxed out your other retirement options. However, unless you are already maxing a Roth IRA for both of you, then I would consider instead of paying off student loans, to roll that taxable investment into a tax-exempt Roth IRA and hold on to the money for your retirement. You can each roll $5000 per year into the Roth. It is *still* accessible, or at least the principle is... any gains are not accessible until you are 59.5 years old... but it will not be a taxable gain every year. I guess what I'm saying is that you are trading long-term security for today's goals. That is no different than just using a credit card for instant gratification.
ETA: I know my post sounds harsh, but I hate to see people give up retirement for dealing with today's problems. This is probably because I've seen many people in my family do this and now my mother, who is penniless, has to live with us. My sister is in her 50's with no retirement and has lost her "forever house" along with her marriage. Dh and I have diligently been saving and he will retire in less than 10 years at 65 and the sense of security we have is just irreplaceable. Don't give up your long-term future for a quick fix today. You will regret it later.