If this was my plant I would cut it from about 2 inches from the top let it callus for a couple days and then plant it. I would also propagate the left over leaves that were left on the stem. I'm sure you know this but make sure you put the freshly cut top and leaves in a dry shady place while you're waiting for them to callus:) Good luck .

Ps- that mark on the bottom doesn't look like rot I wouldn't worry about it. Over time no matter how hard you try succulents get damaged somehow someway.

Sorry to say that plant is starved for more light. Also that soil needs to be made more fast draining, it's too peaty. I'd add 50% perlite to that mix to help in that respect.

Yes to soil - add lots of perlite or make gritty mix.

Container should have drainage hole (can't tell if your does or not).

When be-heading, I would leave at least couple of leaves on the stem. It may start growing some new babies - if healthy enough.

Okay, I'll cut it and let it callus over. That sounds like the best. And I'll pick up some perlite for the soil when I get the chance, it could just look bad because I had just watered, but then again, I don't know what it's supposed to look like!

Thanks everyone!

It will look vastly better with more light. In CA you can grow these outside.