Job with health benefits for the second parent- get on that STAT! Even if the income isn’t huge, even if it’s not the “all my life I’ve wanted to do X” job, NOT having to pay COBRA on an ongoing basis until the primary finds a fulltime job is going to be huge. And if setting up a business is in the cards, wait until you see how expensive it is to buy your own insurance.
You will be spending down your cash much more slowly if you can nail down health insurance for the family. And I hate to say it- but life insurance? was the only policy from the job, or do you have a term policy which covers the breadwinner?
Do you have a ballpark estimate as to what the second property could get you if you sold it next month?