Me - 45, currently 25 so 20 years to get there.. So if it happens earlier then great. But really need to plan it a bit more as I've just been buy and holding with no real goals in mind, other than a rough idea of when.
What age do you plan to retire?
- Thread starter ianvestor
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Hi Cutegal,
Don't think anyone can answer these questions for you. I started to develop answers to these types of questions when reading about the experiences and strategies of others on Somersoft. The keithj interview really got the mind ticking over - as did Rixter's simple but brilliant CGA strategy (sorry, couldn't find the link). It's also interesting to read Dazzling's thoughts in this very thread (above) and, more recently, here.
Jan Somers' most recent book could well form the basis of your strategy. Then you could make your own modifications and amendments to suit your yourself.
Given the additional obstacles that you are confronted with (raising kids on sole parent and child support), inspiration might also be drawn in the Elin Power storey that you can read about in the Reno Kings book.
Hope this helps - Ben
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Question back to you: what is the absolute minimum per year spend you can live on?
If you can answer this, the other answers will follow.....
Cheers,
THe Y-man
It will take a long time for a B&H property investor to retire on income from IPs due to the low yield and all those unexpected maintenance !
Well I dunno about that. How long is a long time?
If you're starting off with some equity, as Cutegal is, and you commit yourself to learning how to overcome the loan serviceability and risk issues that inevitably arise, then you can move a lot closer to retirement in just one property 'cycle'. Low yields and unexpected maintenance will not seem terribly significant to an investor IF their property doubles in value every 7-10 years.
Regards - Ben
Hiya,
As Ben points out, define a long time?
I know a number of people who have, are in the process of, or could choose to, retire based on their buy-and-hold property investing. Many of these people started investing within the last ten years. Not all of them are using LOE, either; some have yields in the vicinity of 15-20%.
While that may not be the norm for many, and none of us can know with any complete certainty what the market will do over the next ten years... I think it is important to have an open mind and not be restricted by misconceptions and prejudices.
If you think that it will be a long time for a B&H investor to retire on rental income, then you'll probably be right in reference to your own situation. In that case, maybe best to look at other options
Cheers
James.
Don't agree.
By buying and holding for both cap gain and cashflow, you will accelerate your overall financial position much faster.
The results can be exponential, and you can reasonably quickly arrive at a position where you can use the increasing equity in your asset base for other things, such as businesses, or shares, or more property, or, if your financial position is strong; living on equity for a while.
For example, and it is a bit simplistic, if you buy a $200k property and keep doing this every 2 years for 10 years, you will have at least $1 mill in assets.
These will, in all likelihood if you've bought well, go up in value by at least 5% per year on average. That's $50k without lifting a finger. Of course; as your knowledge and experience grows, you can maximise these percentages without too much effort.
If you were to keep following the plan, buying every 2 years, it wouldn't be too long before you could sell off a few properties to retire much of the debt, put the portfolio well into the positive, and have a good deal of equity to be used for something with better returns if required.
This ultimately gives you so much more choice for what you do with your life.
For someone starting their investing later in life, this is probably not the fastest strategy, but it can be faster than many think.
For someone beginning their investing at aged 20, they will be very financially secure by 35.
Hi
Personally, I would prefer to be financially free. Retirement seems like leaving behind the career and doing nothing but lawn bowling; and currently, I am enjoying my work and chosen career. My partner and I just acquired our first PPOR in Nov 07. Am looking at 2 IPs by 2012 latest, both working only 4 days a week by our early 40s, 3 days a week by late 40s / early 50s.
Will not retire. Just keeping working in my field, buying and holding IPs to allow me to do what we want, when we want to and with whoever we want to as well.
Cheers
Daniel LEe
Personally, I would prefer to be financially free. Retirement seems like leaving behind the career and doing nothing but lawn bowling; and currently, I am enjoying my work and chosen career. My partner and I just acquired our first PPOR in Nov 07. Am looking at 2 IPs by 2012 latest, both working only 4 days a week by our early 40s, 3 days a week by late 40s / early 50s.
Will not retire. Just keeping working in my field, buying and holding IPs to allow me to do what we want, when we want to and with whoever we want to as well.
Cheers
Daniel LEe
Exactly. My 'retirement' will still consist of property development, programming games and online stuff, brainstorming ideas and starting new businesses.... you know, all just for fun.
I have to add here that I find, in my line of work, that I will not be able to maintain financial status where my investments would indirectly make more money than that. I hope to be in a position where I can buy two or three houses, purely for the sake of pulling in LOC income, after which they get sold. This would supplement the aforementioned 1.25mil. I guess getting there would be tricky on my current salary (74K).
I am having trouble putting a "complete picture" together of how this all will look like in 17 years.
Alex, I would like to add here that referring to having 54K after tax income, as a "crap" lifestyle, perhaps you need a reality check about what "lifestyle" is for over 90% of the population...
HA888, I plan to quit my job in my 30s and have enough assets and passive income to be truly financially free by 40. I'm not benchmarking 99% of the population anyway.
To be brutally honest, if I wanted to live like 90% of the population, I could 'retire' now. If you were content to live like 90% of the population, why invest?
Alex
I think the idea for me and my level of scope, ability and level of risk taking, is to live balanced now, but be at the usual retirement scenario by the time I'm 45. This theoretically would put me well above the 90% already. You seem to be heading towards the 0.07% of people who are totally financially independent. Lucky you...
I think the idea for me and my level of scope, ability and level of risk taking, is to live balanced now, but be at the usual retirement scenario by the time I'm 45. This theoretically would put me well above the 90% already. You seem to be heading towards the 0.07% of people who are totally financially independent. Lucky you...
No, poor me. Because I'm not easily satisfied. I would probably be a lot happier if I was content to live on $50k a year.
You have your goals, I have mine. I hope we both achieve what we aim for.
Alex
I love fence sitters...
Seriously, I would love to have your goals, I'm just finding it difficult to go that high...maybe I should re-evaluate.
Seriously, I would love to have your goals, I'm just finding it difficult to go that high...maybe I should re-evaluate.
On the contrary. If you're happy with your goal, stick with it. There is no 'correct' level to these goals: if it makes you happy, it's a good goal. I feel jealous towards those who are truly happy on what I would call a low income, because I don't have the same mental peace.
You may not want my goals, because it's driving me to build more assets and keep working a job I don't want to do because I don't have enough to satisfy my goals.
I'm greedy. I know too much about what wealth can buy to be satisfied easily. That's probably a character flaw. But it's what I have so I'll have to work with it.
The problem is, you're most likely going to need more money than you think. Say you're happy with 50k income. How much do you need? About $1m, you would think. But by the time you get there (10, 15 years, whatever) inflation would have eaten up a bit part of that. A mil wouldn't be enough. Inflation and your own rising requirements (family, children, health, parents, and your own 'wants') means you're going to need a lot more than you think. Even if I was happy living on the cash my investments can generate now, it sure won't last long.
Alex
I technically retired around 30. did nothing for 18 months and loved it at first, got a bit bored. did some developing. bought a business, worked hard in it (<40 hours week) for about a year. Now do a couple of hours. started a few more businesses , all systemised so that I don't work in them. I don't feel like I work at all now so am happy to keep ploding on and hanging out with my young family (wife left work 6 years ago, though as a town planner she does do projects via word of mouth for some extra play money). I feel that I am very lucky but only in so much as I get to spend so much time with family. I do still do some hours a week (24 this week) due to a staff member leaving at short notice but will rectify that with more back up staff so I don't have to.
Laptop with mobile broadband was the best thing I ever bought. I do most of my week in a cafe on the beach drinking coffee. Although the other half has no sympathy for me if I have been at work (actually she doesn't count the coffe drink cafe sitting inf ront of the laptop thing work)
I don't think I'll ever fully retire, I might have a yaer or 2 off completely but at the moment I love what I do and the fact it doesn't take up much of my time.
Laptop with mobile broadband was the best thing I ever bought. I do most of my week in a cafe on the beach drinking coffee. Although the other half has no sympathy for me if I have been at work (actually she doesn't count the coffe drink cafe sitting inf ront of the laptop thing work)
I don't think I'll ever fully retire, I might have a yaer or 2 off completely but at the moment I love what I do and the fact it doesn't take up much of my time.
Well done RPI! Thats a very nice position to be in!
My personal goal is to "retire" at 35. Of course by that i mean i chose to work or not work, and am financially independant.
Im currently 26, and getting started on my investing journey - we already have one IP, and are buying the second in the next month. Ive done heaps of reading (books and these forums) and have already put together my plan.
Im really looking forward to the next 8-9 years.. and my partner, well she wants to become a fulltime property investor before she's 35, and run her own events management company.
I just want to play with cars and have a nice big garage to tinker with my toys!!
My personal goal is to "retire" at 35. Of course by that i mean i chose to work or not work, and am financially independant.
Im currently 26, and getting started on my investing journey - we already have one IP, and are buying the second in the next month. Ive done heaps of reading (books and these forums) and have already put together my plan.
Im really looking forward to the next 8-9 years.. and my partner, well she wants to become a fulltime property investor before she's 35, and run her own events management company.
I just want to play with cars and have a nice big garage to tinker with my toys!!
Sounds great for a motivational poster....but it's a tad contrite...
Many people aren't in the professions. There's only four true professions.
Medicine
Law
Engineering
Arms
There's a bunch of 'others', probably the vast majority of the population....who aren't professionals.
They instead have jobs. People like teachers, nurses, police, accountants, riggers, welders and all those guys and guys sweating it out working on the road gang, or the supermarket or the factory floor.
By definition, jobs are not the most pleasant thing in the world.
This may be the case if you are working in a business that you own, or you're an equity partner. It's a tad different when you have reporting deadlines and some stressed out control freak above you starts barking orders.
This is the easiest in the world.
Input needed......Cash. Money.
Output required.....mortgages and family commitments.
Ideally, we'd all like to be sitting in a communal Kibbutz in the valley of some mountain hideaway, painting abstract art with our toes, relaxing and re-joicing in the squishy cold feeling as the paint runs between our pinkies, skipping through the daises prior to sitting down to an alf-alfa salad.....but some people need to be working a job for money.
Many people aren't in the professions. There's only four true professions.
Medicine
Law
Engineering
Arms
There's a bunch of 'others', probably the vast majority of the population....who aren't professionals.
They instead have jobs. People like teachers, nurses, police, accountants, riggers, welders and all those guys and guys sweating it out working on the road gang, or the supermarket or the factory floor.
By definition, jobs are not the most pleasant thing in the world.
This may be the case if you are working in a business that you own, or you're an equity partner. It's a tad different when you have reporting deadlines and some stressed out control freak above you starts barking orders.
If you're not doing what you love, why not?
This is the easiest in the world.
Input needed......Cash. Money.
Output required.....mortgages and family commitments.
Ideally, we'd all like to be sitting in a communal Kibbutz in the valley of some mountain hideaway, painting abstract art with our toes, relaxing and re-joicing in the squishy cold feeling as the paint runs between our pinkies, skipping through the daises prior to sitting down to an alf-alfa salad.....but some people need to be working a job for money.
