What are your goals?

[Peter_Tersteeg]

In response to the questions and answered in the post Now I'm ready, what should I do?, I thought I'd ask the question, "What are your goals as a result of your investing?"

Delusions of megalomania aside, I guess my primary goal is to have a financial position where I can make choices of what to do and when. I still want to work, but it will be a result of choice rather than necessity. I figure a passive net income of $100k per annum should do it nicely. I'd like to achieve that through a combination of property, shares and business incomes just to keep things interesting.

 

[wylie]

I always remember a very knowledgeable young chap I worked with who was like-minded about IPs saying that to retire comfortablyl, you need five fully paid off investment houses apart from your own home.

I have always kept that in the back of my mind. That would give us $100K in income if we had five fully paid off right now, so I suppose it is worth working towards.

There is actually nothing more that we would do than we do now, apart from perhaps travel overseas now and then, but the attraction is not that strong.

Wylie

 

[Mr. Fabulous]

Spend every night trying to take over the world with Pinky. Other than that, travel around Asia and South America, then come back here and possibly start a business. If not that, just take life as it comes I suppose.

Mark

 

[markxr6t]

"To have an income without working" was always my goal.

This has now evolved (very similar to passive income of $100k example above) to "$2million in net equity exclusive of family home, superannuation, cars and a toy or two."

Of course I'll keep working - its more of an attitude thing where I work because I want to not have to and if I feel like doing something totally different, I can easily absorb a 50% drop in salary.

I also strongly encourage "enjoying the journey" and not just looking forward to the destination. Don't deprive yourself to much on the way to your goal. The elation of achieving a goal soon wears off, and you'll ask "what next?" in no time - the human spirit relies on striving for things.

Mark

 

[alexlee]

Doing what I want. What I want includes time with my family and a lot of luxuries. I want to go to Europe, or even live there for a few months, and be able to stay at the best places. I want a beautiful house with views. I want to be able to afford the best restaurants, wines, etc without caring about the price. I have a very detailed idea of what my days will be like. I'm sure by the time I get there it'll look nothing like what I'm planning, but that's ok. The key is to HAVE a goal so that everything you do is gearing towards that. For example right now I'm building wealth with residential IPs. I may end up investing in businesses. But that's fine: the capital from resi IPs will fund that.

That's the importantance of goals. Not so much that is what you will end up (circumstances change), but so that you have something to aim for and can evaluate all actions against that. Otherwise you just 'drift'.
Alex

 

[lizzie]

surprisingly i was just writing down some of the goals today - in a long email to husband explaining why we should hold onto the 500m2 ip (with old house divided into two flats) in prime location and sell the expensive, large money-sucking instead.

in a month we settle on a new development block and the 500m property was "sold", but due to the floods and length of time insurance has taken to sort itself out (still going) the sale, which would free up the balance of deposit money for the new purchase, fell thru. haven't been sleeping to well at night as such - but - a big but - if we can hold onto the bigger block, by the skin of our teeth, wack the balance of the deposit on the credit card and then take the "very lovely, large, prime location but sucking the life out of our cashflow" property to auction i can breathe again.

i've gotten to the stage that as long as we cover all costs and expenses upon sale of the expensive property, i'm happy - it was a great learning experience and we missed the market timing! we just cannot afford to hold it for the next cycle and have had to make a hard decision - keep the development blocks rather than the developed blocks!

so - short term goal - get my sanf back under control. then develop the new block and the 500m block to add wholesale properties to our portfolio.

at some stage we will also sell another ip, in prime location with da approval for knockdown and new house to be built - the figures don't stack up (at this stage, but subject to change) to actually build the house as the profit level would be minimal (around 9% roi, but if the market takes off by the time da thru we might go ahead with the build) and rent wouldn't cover costs - but ideal for someone's ppor.

mid term goals - build on the development blocks.

long term goals - use various tactics in the marketplace to make enough money along the way to pay off the wholesale ip's. retire on (in today's dollars) $100,000/yr passive income.

 

[Belu]

just want to bring something to note here: remember the time value of money.

My parents are soon to retire, and look like they will have around $65k/year income if they stick all the money in the bank (which is what they are thinking) and live off the interest.

Personally i dont think that is enough, and have told them that in 20 years time (retiring at 55) that $65k definitely wont be enough. (trying to get them to put about $200k into neutrally geared property and then draw down on equity in 5-6 years)

But thats them. Personally I want to be free to do what i like. I still want to work, but I want to be in a position to be able to retire by the time im 40. Which means i would want an income that could support myself, the future Mrs Ben and the future little ones (i know im only 21 but we are talking goals here!). So in today's dollars i guess I am aiming for around $200k/year income, so i would be looking at a net of $4mil equity (returning average 5% to be conservative).

My more immediate goals:

- Buy my first 2 IP's next year
- Let the equity build and buy 2 more over the following 3 years
- travel to europe and work for 2 years (in 2 years time)
- so in 4 years hope to have 4 ip's and back in AUS
- give them a couple of years to build up and then use equity to buy larger blocks ripe for development
- develop blocks in order to gain equity on completion
- diversify into shares using equity and margin loan

So there is the next 10 years, which will put me at 32 and hopefully be at about the $1.5mil net equity mark.

not sure how that stacks up with numbers, but thats where I am aiming!

 

[JamesGG]

Hiya,

My goal has always been to be in a position to retire, should I choose to, by age 30. This is now only eight years, three weeks and two hours away.

(Not that I'm counting or anything. Will we need a "JamesGG's retirement" thread soon?! )

Given my current spending habits, wage, and portfolio, I don't expect that ordinary residential property will be enough to get me there. Whilst I'm still tracking at a property per year, they are geared to the max. So, sometime between now and then I'll be looking into business and seeing what sort of opportunities present themselves that way.

I'm anticipating around $200k passive income pa. While I may choose to keep working, I want the freedom to have that choice in the first place. I might currently spend up to about 20 hours a day working hard and playing hard, but, there's only half of that equation (and I'm sure you can guess which half) that I want to continue on an indefinite basis...

So, not long to go now. I'm looking forward to it!

Cheers

James.

 

[Shuttergirl]

I'm still defining my goals I guess but off the top of my head, hehe, they are to retire slightly earlier, maybe 55. Have a passive income of 100k per year, travel travel travel, own 4-5 IP's, travel some more. Filling my days with people and things I love.

A girl can dream I guess.

 

[Belu]

I think this is right, but please someone let me know if I am wrong:

Assuming I want $3mil equity as a current value to generate $200k/year and still keep up capital growth in 20 years time I will need roughly $5.5mil in equity.

This is:

FV = PV(1+i)^n

FV = Future Value
PV = Present Value
i = interest rate (or in this case inflation rate, which i used 3%)
n = number of years

so my current $200k/year in 20 years time will be $361k/year.

Some food for thought for people looking at the actual figures on their goals.

 

[Mon]

I was just thinking about writing down my goals today so I guess this is a great time to start....

1 Year Goal

* return to live in Oz after 10 years as an ex-pat. Travel and re-discover 'home' again for 2 months or so to decide where we want to 'settle'
* Rent for at least 6 months in chosen place to see if it suits to live
* 40K passive income
* 150K saved for home deposit, furntiure, cars

5 Year Goal

* 100K passive income - $2m net worth
* buy PPOR with tennis court, swimming pool, beautiful views etc
* travel overseas every 18 months or so
* be actively involved in sports clubs and community

10 Year Goal

* buy houses for parents and in-laws
* work voluntarily and 'give back' in some way

 

[Brenda Irwin]

Ultimate goal has always been to have a passive income at a level I am happy with. I must be greedy as I haven't got to it yet.

Current goal is to have $1 million borrowing (including brokerage) and invested in the Australian share market. Getting there.
Also current goal is to have nil or pretty close, personal borrowing. Getting there.

Goal after that? Not to lose the lot in a share market crash.

 

[letiha]

My goal is to have enough incoem to be able to work when I want to and spend time with my children and travel/live overseas.

As things are at a very early stage went for 0 to 4 properties since May, my goals for the rest of the year are to save up some more funds for the next purchase, start a share portfolio (nice bluechip divedend paying shares) with the help of some margin lending...oh yes and finishing my law degree in November.

Next year i would like to add 2 properties and double my shareholdings, this is a fairly conservative goal IMHO.

 

[caz]

Our goal is to have enough passive income so we can retire at around 50 if we choose.
We want to have plenty of fun getting there including me not working unless I want to and hubby to continue getting very long holidays every year.We would prefer to take longer then have to be misers and not live a good life now. We want to continue to invest 20%ish of our income (more if I do work).

In todays terms we will need around 2 million net equity bringing in income.
I'm not actually sure how we are going to acheive this. I did some projections on our properties last night and they will only just be positive as a portfolio at this time if we add no more, assuming 3% increase in rent and 2.5% inflation. So this is where my plan gets stuck. if Property continues at 5 to 10 % pa we aill have no trouble with the equity it is just the income that will be stopping us.
So we may need to actually leverage more in to the share market, currently all of our shares except 50k are our money.

To be honest I keep trying to go thru the scenarios and I just can't figure it out. We like good SANF so don't want to be too aggressive.
I'm not really sure who to turn to to ask as FP aren't there to help with both, can accountants help ?

caz

 

[tremolo]

When I get to the stage that I have a few toys and the time to play with them I'll be happy.

 

[TheCamel]

one year goals:

• finish paying down NDD
• get at least one more property
• move to melbourne. (or the US)
• move rhiannon here permanently. (3 more weeks!!!)
• go on our honeymoon
• PASS my ccna exam
• dabble with shares a bit ?
• learn about shares

i'm pretty sure rhiannon's goal is just to finish uni.

five year goals:

• several (2 or 3 more properties)
• paid down some DD.
• kids (well, start workin on rhiannon, anyway)
• still hopin to go to the US for rhiannon's sake
• get some unix training and experience under my belt - cross skill
• more cisco training and exposure
• work in an environment where i can play with unix and network gear
• another overseas holiday

ten year goals:

• at least 5 properties
• more holidays
• passive income, free cashflow.
• ability to give up job
• or to start business
• maybe a second kid (or, work on rhiannon some more about the idea anyway)
• buy my parents a house ?

In honesty though:
I want to be happy. (Which I am)
I want Rhiannon to be happy. (She mostly is)
I want to be relatively secure financially (getting back there)
I want kids... 2 of them. (need to work on rhiannon)
I want to be able to stop fulltime work by 40, to spend time with kids
I want my job, while I have it, to be enjoyable and fulfilling (mostly is)
I want what happened to my parents to never happen to me.
I want to hold on, and kick and scratch and bite and not go down without a fight.
I want to be a good dad.

 

[VYBerlinaV8]

My goal is simple - I want to have 150k/year investment-based income, split between myself and my wife, in todays terms. I also want my PPOR paid off completely. I think it will take another 12-14 years to achieve this goal.

I intend to achieve this by:
1) Having 10 IPs before I am 40 (within next 8-9 years)
2) Regularly (monthly) buying units in an Australian Shares Fund oriented toward growth, with all distributions automatically reinvested.
3) Containing costs of lifestyle to enable maximum investment contributions and additional savings (offsetting PPOR loan).

I've been investing seriously for perhaps 3-4 years, and in this time have achieved:
1) Nice and comfortable PPOR (although not really an investment), purchased prior to last property boom
2) 3 high yielding IPs in good growth area (with average LVR of about 75% at time of purchase, average purchase price about 300k)
3) Shares portfolio of perhaps 30k and growing nicely through small but regular contributions
4) High working income, several hundred thousand per year combine wife + myself to support my investment 'habit'

Next steps are:
1) Acquire another 7 IPs, at the rate of 1 per year for the next 7 years (shouldn't be too hard given our current position)
2) Continue to contribute to shares funds
3) Continue to build savings in offset to PPOR loan.

If I can achieve all this in the time frames indicated, I will have acquired the asset base I need before I am 40. I can then spend 5 or so years reducing loans (ALL my property loans are P&I), to increase my unencumbered yield. At age 40 I will seriously review the overall strategy, probably with a financial adviser who has done this themself, to work out a graceful way to convert the asset base into a regular income that will last forever.

If anyone reading this has ideas as to how I could do things better, please post them up! I love new ideas!

 

[Dazz]

Stage 1 goal was to control 1M. Took 5 yrs. Used conventional tactics. Complete.
Stage 2 goal was to control 10M. Took 6 yrs. Used smelly and dirty methods. Complete.
Stage 3 goal is to control 100M. Should take 7 yrs. Currently 2.5 yrs into this stage and ahead of target. Need to employ different tactics, which I'm still learning. Ongoing.

Number of properties to get there doesn't come into it for us....the less the better.

Stage 4 goal is to ride my black Fatboy around the world while someone else manages the headache for me...for a pittance.

 

[topcropper]

Good on ya Dazza.

You should be the first somersoftien into the BRW top 200 at that rate.
The first as far as I know, although who knows?

See ya's.

 

[Andrew_A]

Stage 1 goal was to control 1M. Took 5 yrs. Used conventional tactics. Complete.
Stage 2 goal was to control 10M. Took 6 yrs. Used smelly and dirty methods. Complete.
Stage 3 goal is to control 100M. Should take 7 yrs. Currently 2.5 yrs into this stage and ahead of target. Need to employ different tactics, which I'm still learning. Ongoing.

Number of properties to get there doesn't come into it for us....the less the better.

Stage 4 goal is to ride my black Fatboy around the world while someone else manages the headache for me...for a pittance.

Dazzling have you read 'Investment Biker' by Jim Rogers? You should if you haven't!

I like the less rooves the better for property idea. I would trade all my IP's for one small block of dirt on the water at Hedges avenue