<prompt> Human: Hi. I recently subscribed to this r, and I love it - GREAT advice and ideas. Now Im using a throwaway, and Id love your advice for my husband and myself.We are artist types, and we love not having traditional jobs, though our income is unpredictable currently very low. I am 42, my husband is 48. We have no children.Our monthly expenses are 3000 US. We are not currently earning enough to cover that.We own a home with a detached garage, so were thinking of using it to generate income - building onto the back of the garage, living in it ourselves, and then renting out our house. Were pretty sure we can get at least 2k per month in rent for the house.The question is how to pay for the building and upgrades necessary to make this happen. The cost estimate is wide 50k-100k, depending on how we do it and how much we do ourselves. So lets say itll cost 75k.We have negligible savings, and a small IRA 14k. BUT! My father-in-law died and left us the following:Annuity: 96KBrokerage Account: 15K2nd Brokerage Account: 27KWhat are the tax ramifications of using that inheritance money? Which accounts should we bust into first? Are we being irredeemably foolish to use it for this purpose instead of saving it for retirement? What is the best way to proceed? Yes, we know we could get regular jobs, but wed like to consider other options before we give up on our artist dreams. I thank you for taking the time to consider this and lend your advice and expertise.EDIT: Thank you all for these great comments and feedback. Please keep em coming! There have been a couple of questions about our monthly expenses, so Ill give more info: We live in an expensive city. Our monthly expenses are: mortgage 1200, utilities 125, insurances - car, home, health 435 total, property tax 400, phoneinternet 105, gasoline for car 140, food 220. Thats 2625, and I rounded up to 3k for little things that add up occasional vet bills, a pair of pants....  <response>: Our monthly expenses are 3000 US. We are not currently earning enough to cover that.If you want to be poor artists you have to live like poor artists. The inheritance helps, but given your unstable incomelack of saving this needs to be considered your retirement savings. Your choices are to reduce your expenses or increase your income. Spending all of your money to maybe rent out your house is not viable; the closest viable option is to either sell or rent out the house and live in a cheap apartment. 