WELCOME TO RIVER DAVES PLACE

Retirement, would love to hear from the guys that have pulled it off.

stephenkatsea

Well-Known Member
Joined
Apr 30, 2008
Messages
8,009
Reaction score
11,577
Other than a mortgage, get yourselves debt free ASAP and stay that way. Pay cash for toys and vehicles. Put 100k miles on your vehicles before trading them in. New cars are crazy expensive. We only had 2 prior to retirement. Max out your 401k contributions. Start an HSA. $ are not taxed going in or coming out if used for medical. We have Medicare and a secondary, but the HSA helps for dental etc. We sold our 5BR empty nest in CA and paid cash for a very nice place in AZ. Transfer 401K to an IRA upon retirement. An IRA professionally directed at Income works well for us. So with Social Security, IRA income and some employer purchased monthly annuities we live very comfortably. Again #1, get debt free and stay that way.
 

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892
Or the worst, comfortable retirement on paper but one of them gets sick and needs long term care without enough insurance to cover it and start falling behind on payments. I can't even imagine.

I think this is huge and folks should be aware of how devastating medical costs can be.

“Medical divorce” is a thing among the elderly, so they can protect assets. Many folks don’t realize that, in certain not-uncommon situations, Medicaid may require you to liquidate assets to partially pay for medical costs of a spouse.

One way to avoid this entirely is to have assets placed in a trust.


Sent from my iPhone using Tapatalk Pro
 
Last edited:

LargeOrangeFont

We aren't happy until you aren't happy
Joined
Sep 4, 2015
Messages
49,690
Reaction score
76,151
I have a 15 year (at worst) plan:
One rental house per year, for 15 years.

Year 16, that first house has 15 years of appreciation and is paid off.

I can refi it to pull cash out...sell it, leverage it for another rental, or just sit on it depending on my situation.

Each subsequent year presents the same options.
And I will have contributed zero of my own money to this plan, because people my renters funded it.

And I can supercharge this by retaining more than one rental per year.


Sent from my iPad using Tapatalk

I’d love to chat about what you have learned so far sometime. I am figuring I need around 10 doors by retirement.

39 now. Been maxing 401k and had other investments since mid 20s so retirement will hopefully be diversified across rentals and investments to guard against economic disasters. Planning to be done by 55-60. Planning backwards towards $12k~$15k net income per month with no debt on main residence.
 
Last edited:

Joe mama

Well-Known Member
Joined
Oct 22, 2010
Messages
3,710
Reaction score
3,460
I’m 32 but i think about retirement a lot. I’m planning to be done by 55. I work like a mad man and recently changed a few things up. Houses should be paid off by 50 and I don’t have any other major debt. Hopefully I can follow the plan and enjoy retirement. I don’t believe in divorce and hate to even mention it but I’m watching the neighbors go through it. So much money thrown away at attorneys. Neither can afford the house alone if they have to buy out the other and they still have kids. 15 and 10. That could really mess up the retirement plan.
Been there done that and your 100% correct.
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
I wish i would of been buying property instead of buying boats, blowing up motors most my adult life, divorces and so on. Is what it is, I'm not working until Im 70 so i can croak and leave it all for someone else to spend. It don't cost much to hang out at beach and play a little golf, maybe marshall so its free. My only advice start saving early, it sure wont be fun but can be when you get old. I'm good with the fun i had for the last 40 years of my adult life, if its a little less as Im older, I'm good with it.
 

caribbean20

Well-Known Member
Joined
Mar 4, 2011
Messages
1,523
Reaction score
3,134
Put your mind at ease, do a rough cash flow forecast. Dust off that Excel spreadsheet (what I used) or use some template. It’s not that hard. Cash/Investments+income-expenses=year end amount. Rinse and repeat for about 30 years with obvious changes (SS, Medicare, etc). You’ll sleep better.

Also x2 on what others have said re: end of life expenses, they can be staggering. Nursing homes are minimum $5K/month in most urban areas. For my wife and I, we are counting on the sale of our principal residence to cover this cost.
 

Echo Lodge

Well-Known Member
Joined
Aug 27, 2009
Messages
3,387
Reaction score
5,256
I retired in Oct at 52. 31 years with a government pension. I always lived within my means. Everything has been paid off for past 5 years and I was aggressive investing in my 457 plan. The biggest key to my successful retirement is my almost 30 year marriage to my high school sweetheart. 3% @ 50 is much easier to live on compared to 1.5% @ 50.
 

Rajobigguy

Well-Known Member
Joined
Aug 21, 2015
Messages
4,595
Reaction score
10,007
I think that I'm in pretty good shape for retirement (sometime in the next 10 months). We have about 1million in real estate equity that we will cash out and pay off a 320000 loan on our Havasu home. Then we have close to 1 million in retirement accounts (401k's, ira's and savings). The wife and I both have small pensions (a couple hundred a month combined). Our combined SS will be around 4200 a month. By my reckoning our living expenses should be around $82500 a year. I'm pretty sure that with a little judicial investing of funds that we can easily pull it off.
So far as staying busy, I don't think that will be a problem. I have all the things that I need to build/rebuild engines and I'm pretty good at it, I even have a bit of a following from the hot rod crowd, not that it will make me a fortune but it will be a hobby that more or less pays for itself.
There is always unknown factors that lie ahead, like the old saying goes "man plans and God laughs" but those truly are things that you have no control over and if you try to plan for every possible contingency you will never retire.
 

AZLineman

Adjusting to retired life
Joined
Oct 29, 2008
Messages
1,846
Reaction score
2,148
Pulled it off 6 weeks ago @ 56. Just need to manage the spendies. No debt, own multiple houses/ properties and No new vehicles to depreciate (keep my old non emissions diesels forever) and i do all (mostly) my own work on my toys. Luckly i have the kno how and resources. Pension plus 401k draw till SS. Adjust as neccessary and do side work here and there.
 

2Driver

Well-Known Member
Joined
Dec 21, 2007
Messages
16,684
Reaction score
29,944
Nothing matters more than correctly understanding your expenses. Without knowing that, you are in the dark about “how much will I need in retirement”. It’s unbelievable to me people will actually answer that question without an exact understanding of their needs.

Quicken is stupid easy to run all your expenses through and it categorizes all your expenses. I know to the penny what I spend on everything. From there, project your expenses after retirement and you better be damn conservative on medical and unexpected costs. Inflation is another item to project and it has a massive impact over years. BTW don’t forget you have to pay taxes out of your earnings. If you think $100k in earnings will cover your expenses, dont forget 25% is going to go to taxes, now you really need 130k gross return to cover expenses.

Here's what I did.
Before we both retired early I assumed we would spend about the same day to day and then I added 20% to that figure as a buffer. I assumed a 3% inflation rate. I added 25k a year for medical insurance. Then I doubled the total number. That is where I felt we would be prepared for pretty much any down turn, or 0% interest rates.

Sound like too much?
New truck is $60k, new roof $30k, unexpected home repair 10k, 15% correction in the market, 0 % interest rates, unexpected out of pocket medical, quarterly taxes from your earnings and property taxes. How many times do you see older folks back working at walmart or home depot or how many RVs go up for sale by older folks to cover unexpected expenses.

BTW: Quicken has a great retirement planner in it and works off your accounts listed and allows you to play ”what if’s”.
 
Last edited:

DILLIGAF

Well-Known Member
Joined
Jan 10, 2008
Messages
17,109
Reaction score
24,039
I am 61 and retired a few months back. Have a self funded retirement that will provide me an income I will be happy with. I am going to try to live below those means though. My goal is to stay out of my principal and leave that alone. I am one of the lucky ones that bought a long term care plan for cash and the benefits increase every year 5% with no premiums. It is with Mutual of Omaha and has set me up for care when needed without being a burden on my son. Shit, it allows him to be paid a very good amount monthly if I am in need of care and staying with him instead of a assisted living facility. If I need to stay in an AL facility my policy is excellent and covers a long long stay. One of the best decisions I made in my life. The policy I have plus the single pay option is no longer offered. My company paid for it so it was also a tax writeoff for the business.

Have the college funds set aside for the grandkids.

Have a generous life insurance policy for my son/grandkids.

Have no bills.

My company still can cover my health care costs so as long as that stays alive (whittling down) the insurance is paid for. Eventually I will have to pick up the tab though.

Have a pretty good size legal settlement that is in the courts that when or if it comes thru will throw me some more money to invest. It will be all gravy to me and I am not counting on it.

Sold my house recently and live in a newer fifth wheel and pulled by a dually. I will be traveling when springtime hits. The house took longer to sale than I thought or I would just now be returning from traveling. Staying in AZ in the winter and roaming at all other times.

Other than that I am just breathing right now. It is just me and my consequences for any decisions I make which relieves a lot of pressure off of me.

It also allows me the time to spend some days, weeks or months with the son and grandkids. Helping out right now with their school and working around my sons house while he is out of town working. It feels good to be able to help out.

I got rid of all the toys except for my Harley which goes with me everywhere I will be going. I have done plenty of the boating, etc and now like I said.....I just want to breathe.

It was a long process that I implemented years ago with some unexpected bumps along the way. All that is resolved now so I am good.

Enjoying where I am at right now for sure.

EDIT: There is never enough set aside according to my financial guy BUT.....I understand that is his job. Bottom line I or you make the call.
 
Last edited:

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892
The difference between being rich, and being wealthy:
Rich guy has a high paying job.
Rich guy loses his job, income stops.
Loses everything.

Wealthy guy has income generating assets that earn more than he spends.
Wealthy guy lets his money work as a tool to make more money.

Strive for wealth.

I’m on a generational wealth path with my mentor.
Own assets that can be passed down to your kids, and their kids...so they aren’t slaves trading time for money like the rest of us.

Leave your heirs a pile of money, and they’ll just spend it. Leave them with a trust that owns assets, and you’re setting them up for life.

He lost his job in 2006. Sold everything to get started in real estate. Bought his first rental in 2009. All rentals on 10-15 year notes. Used flips to power down the mortgages, paid them all off by 2014.

Here’s a balance sheet just from his cheap DFW rentals. Values shown are current, not what he paid for them and it doesn’t show forced appreciation from rehabbing them...they were all distressed properties bought wholesale, OPM and zero out of pocket. Infinite ROI because he just kept recycling his initial investment.

I’m following his game plan, it’s not rocket science. Plus I have other irons in various fires. I wish I’d known how shit works decades ago. I’m fucking 50 now and feel like I’m starting over, but I’ve got a game plan and a desire to bust my ass for a few more years.

Adjustments.jpg



Sent from my iPad using Tapatalk
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
The difference between being rich, and being wealthy:
Rich guy has a high paying job.
Rich guy loses his job, income stops.
Loses everything.

Wealthy guy has income generating assets that earn more than he spends.
Wealthy guy lets his money work as a tool to make more money.

Strive for wealth.

I’m on a generational wealth path with my mentor.
Own assets that can be passed down to your kids, and their kids...so they aren’t slaves trading time for money like the rest of us.

Leave your heirs a pile of money, and they’ll just spend it. Leave them with a trust that owns assets, and you’re setting them up for life.

He lost his job in 2006. Sold everything to get started in real estate. Bought his first rental in 2009. All rentals on 10-15 year notes. Used flips to power down the mortgages, paid them all off by 2014.

Here’s a balance sheet just from his cheap DFW rentals. Values shown are current, not what he paid for them and it doesn’t show forced appreciation from rehabbing them...they were all distressed properties bought wholesale, OPM and zero out of pocket. Infinite ROI because he just kept recycling his initial investment.

I’m following his game plan, it’s not rocket science. Plus I have other irons in various fires. I wish I’d known how shit works decades ago. I’m fucking 50 now and feel like I’m starting over, but I’ve got a game plan and a desire to bust my ass for a few more years.

View attachment 942026


Sent from my iPad using Tapatalk
I would say he was just about perfect timing as when he started purchasing in 2009, todays prices little tougher to do.
 

HubbaHubbaLife

Well-Known Member
Joined
May 6, 2016
Messages
6,531
Reaction score
8,013
The difference between being rich, and being wealthy:
Rich guy has a high paying job.
Rich guy loses his job, income stops.
Loses everything.

Wealthy guy has income generating assets that earn more than he spends.
Wealthy guy lets his money work as a tool to make more money.

Strive for wealth.

I’m on a generational wealth path with my mentor.
Own assets that can be passed down to your kids, and their kids...so they aren’t slaves trading time for money like the rest of us.

Leave your heirs a pile of money, and they’ll just spend it. Leave them with a trust that owns assets, and you’re setting them up for life.

He lost his job in 2006. Sold everything to get started in real estate. Bought his first rental in 2009. All rentals on 10-15 year notes. Used flips to power down the mortgages, paid them all off by 2014.

Here’s a balance sheet just from his cheap DFW rentals. Values shown are current, not what he paid for them and it doesn’t show forced appreciation from rehabbing them...they were all distressed properties bought wholesale, OPM and zero out of pocket. Infinite ROI because he just kept recycling his initial investment.

I’m following his game plan, it’s not rocket science. Plus I have other irons in various fires. I wish I’d known how shit works decades ago. I’m fucking 50 now and feel like I’m starting over, but I’ve got a game plan and a desire to bust my ass for a few more years.

View attachment 942026


Sent from my iPad using Tapatalk
Gotta love Texas!
 

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892
I would say he was just about perfect timing as when he started purchasing in 2009, todays prices little tougher to do.

For sure, and that’s why I’m giving myself a longer horizon to make it happen. And since we all know we can’t time the market, I’m poised to take advantage of any corrections that might be upcoming in the market.

Don’t wait to buy real estate.
Buy real estate and wait.


Sent from my iPhone using Tapatalk Pro
 

LargeOrangeFont

We aren't happy until you aren't happy
Joined
Sep 4, 2015
Messages
49,690
Reaction score
76,151
I would say he was just about perfect timing as when he started purchasing in 2009, todays prices little tougher to do.

Yes, in many markets this makes no sense. I see no need to buy a $300K property in the southwest that makes $500/month when I can buy (2) 150K properties that make $500/month each elsewhere in the country.
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
Yes, in many markets this makes no sense. I see no need to buy a $300K property in the southwest that makes $500/month when I can buy (2) 150K properties that make $500/month each elsewhere in the country.
My buddy has been picking up stuff in memphis through a investment company. It was wide open now they can barley come up with 1 maybe 2 to offer and they are gone in seconds. I like you guys plan,stay the course!
 

EmpirE231

Well-Known Member
Joined
Jan 10, 2008
Messages
4,500
Reaction score
8,910
The difference between being rich, and being wealthy:
Rich guy has a high paying job.
Rich guy loses his job, income stops.
Loses everything.

Wealthy guy has income generating assets that earn more than he spends.
Wealthy guy lets his money work as a tool to make more money.

Strive for wealth.

I’m on a generational wealth path with my mentor.
Own assets that can be passed down to your kids, and their kids...so they aren’t slaves trading time for money like the rest of us.

Leave your heirs a pile of money, and they’ll just spend it. Leave them with a trust that owns assets, and you’re setting them up for life.

He lost his job in 2006. Sold everything to get started in real estate. Bought his first rental in 2009. All rentals on 10-15 year notes. Used flips to power down the mortgages, paid them all off by 2014.

Here’s a balance sheet just from his cheap DFW rentals. Values shown are current, not what he paid for them and it doesn’t show forced appreciation from rehabbing them...they were all distressed properties bought wholesale, OPM and zero out of pocket. Infinite ROI because he just kept recycling his initial investment.

I’m following his game plan, it’s not rocket science. Plus I have other irons in various fires. I wish I’d known how shit works decades ago. I’m fucking 50 now and feel like I’m starting over, but I’ve got a game plan and a desire to bust my ass for a few more years.

View attachment 942026


Sent from my iPad using Tapatalk

pretty legit plan, what state are the homes in?

I plan on rental income being my retirement.... but still don't own a rental. I'm 38... I'm geared up and ready to buy, but not at todays values.

Otherwise, I play the low debt game pretty well... no debts other than our mortgage, which is a tiny balance in todays dollars for what it's worth..... maybe one car payment, but as of now none. Otherwise, no toy debts etc no HELOCS for improvements etc. Will try to keep this path the entire way to "retirement" which will allow me to save, invest and buy more properties.

It would be nice to be done at 55, but that is not guaranteed.... Heck we could MAYBE pull it off today if we sold the house, and I sold my business, and we moved out of CA to a state with much lower cost of living and real estate.... but don't think I'm ready... but it is tempting.
 

EmpirE231

Well-Known Member
Joined
Jan 10, 2008
Messages
4,500
Reaction score
8,910
Yes, in many markets this makes no sense. I see no need to buy a $300K property in the southwest that makes $500/month when I can buy (2) 150K properties that make $500/month each elsewhere in the country.

My friend just picked up two properties in OHIO for 60k each, rehabbed already with a tenants, and supposedly rent is $750 a month... seems like a no brainer, but the pessimist in me thinks there has to be a catch. He bought them through a company that does it all turnkey for you.
 

LargeOrangeFont

We aren't happy until you aren't happy
Joined
Sep 4, 2015
Messages
49,690
Reaction score
76,151
My buddy has been picking up stuff in memphis through a investment company. It was wide open now they can barley come up with 1 maybe 2 to offer and they are gone in seconds. I like you guys plan,stay the course!

I have been looking in Mobile AL.
 

LargeOrangeFont

We aren't happy until you aren't happy
Joined
Sep 4, 2015
Messages
49,690
Reaction score
76,151
My friend just picked up two properties in OHIO for 60k each, rehabbed already with a tenants, and supposedly rent is $750 a month... seems like a no brainer, but the pessimist in me thinks there has to be a catch. He bought them through a company that does it all turnkey for you.

The catch comes if the house gets destroyed, but that is about it. Those companies function as the property managment companies usually, so you pay them to "find" the property and also to manage it.

You have to keep in mind these houses won't really appreciate. You just have to treat it like building an annuity base for yourself. The $60K property might only be worth $80K in 10-15 years. But if you are in it right, you might be close to doubling your initial investment in under 20 years, and once paid off, it is monthly cash for life.
 
Last edited:

Mandelon

Coffee makes me poop.
Joined
Sep 24, 2007
Messages
13,963
Reaction score
18,524
Rental Properties. Buy fixers and hold, buy cheap lots, then build and hold. Pretty much inflation proof, and other people fund the costs.

Pronstar has the plan nailed down.

We got lucky for appreciation here in San Diego. The little shit box fixers I bought for around $100,000 are now worth 5 to 10 times what I paid for them.
 

RichL

Well-Known Member
Joined
Jan 14, 2017
Messages
2,753
Reaction score
2,771
My friend just picked up two properties in OHIO for 60k each, rehabbed already with a tenants, and supposedly rent is $750 a month... seems like a no brainer, but the pessimist in me thinks there has to be a catch. He bought them through a company that does it all turnkey for you.

I would be curious which company that is?
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
My friend just picked up two properties in OHIO for 60k each, rehabbed already with a tenants, and supposedly rent is $750 a month... seems like a no brainer, but the pessimist in me thinks there has to be a catch. He bought them through a company that does it all turnkey for you.
That what buddy is doing, he flew out and checked it all out. Company was huge, like 5-6 buildings with every department from planning to construction, they have a huge warehouse where they keep all the appliances and such for rehab. Only problem is trying they can't pick up enough real estate lately.
 

sirbob

Well-Known Member
Joined
Jan 13, 2009
Messages
10,569
Reaction score
14,497
Live now = 50/30/20 = 50% on needs, roof / food etc - 30% wants boats / toys etc - 20% save. All this is after taxes of course.

My dad told me as a kid to save 10%. It wasn't enough! I wish I was saving minimum of 20%. How you invest that 20 is up to you but if you are going to do it your self be sure to make it a job not a once in a while check in type thing.
 

Uncle Dave

Well-Known Member
Joined
Sep 7, 2008
Messages
9,826
Reaction score
10,929
I wish i would of been buying property instead of buying boats, blowing up motors most my adult life, divorces and so on. Is what it is, I'm not working until Im 70 so i can croak and leave it all for someone else to spend. It don't cost much to hang out at beach and play a little golf, maybe marshall so its free. My only advice start saving early, it sure wont be fun but can be when you get old. I'm good with the fun i had for the last 40 years of my adult life, if its a little less as Im older, I'm good with it.

You could have spent your money differently, but when I was being put under to have my kidney removed what was going through my head wasnt that I should have saved more money.
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
You could have spent your money differently, but when I was being put under to have my kidney removed what was going through my head wasnt that I should have saved more money.
Very true Uncle Dave, i haven't seen you post much i hope all is well.
 

Uncle Dave

Well-Known Member
Joined
Sep 7, 2008
Messages
9,826
Reaction score
10,929
Very true Uncle Dave, i haven't seen you post much i hope all is well.

Thanks, roughest year of my life...not much time.

A few months ago I had a nightmare I was getting my ass beat by a Yakuza gang - they were giving it to me good.
I woke up gasping for air and slowly realized my real life was as bad or worse.
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
Thanks, roughest year of my life...not much time.

A few months ago I had a nightmare I was getting my ass beat by a Yakuza gang - they were giving it to me good.
I woke up gasping for air and slowly realized my real life was as bad or worse.
Well i hope things turn around soon for you.
 

EmpirE231

Well-Known Member
Joined
Jan 10, 2008
Messages
4,500
Reaction score
8,910
The catch comes if the house gets destroyed, but that is about it. Those companies function as the property managment companies usually, so you pay them to "find" the property and also to manage it.

You have to keep in mind these houses won't really appreciate. You just have to treat it like building an annuity base for yourself. The $60K property might only be worth $80K in 10-15 years. But if you are in it right, you might be close to doubling your initial investment in under 20 years, and once paid off, it is monthly cash for life.

yeah just looking at it from an ROI perspective.... He's making 10-12% on his money.
 

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892
pretty legit plan, what state are the homes in?

I plan on rental income being my retirement.... but still don't own a rental. I'm 38... I'm geared up and ready to buy, but not at todays values.

Otherwise, I play the low debt game pretty well... no debts other than our mortgage, which is a tiny balance in todays dollars for what it's worth..... maybe one car payment, but as of now none. Otherwise, no toy debts etc no HELOCS for improvements etc. Will try to keep this path the entire way to "retirement" which will allow me to save, invest and buy more properties.

It would be nice to be done at 55, but that is not guaranteed.... Heck we could MAYBE pull it off today if we sold the house, and I sold my business, and we moved out of CA to a state with much lower cost of living and real estate.... but don't think I'm ready... but it is tempting.

They’re all in the Dallas area, mostly Garland, Mesquite and Lewisville to be specific. Low cost of living cities.


Sent from my iPhone using Tapatalk Pro
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
The places my buddy is picking up through MIP, they even have a pay window, he said everyone there still comes to pay their rent in cash.
 

HNL2LHC

What is right and what is wrong these days!
Joined
Jun 25, 2018
Messages
13,832
Reaction score
24,802
Pronstar got it right....I was just having the conversation yesterday. I tell most young guys that I work with buy ANY real-estate you can afford ASAP. Not one has done it yet. If you did it the first thing is that you are pay equity to you not your landlord. Fix it up and then rent it out. If you are not married get a 2 bedroom and have a roommate. It is only for the first couple of years And you will free up some cash. Then move out and rent the unit
 

WYRD

Well-Known Member
Joined
Sep 25, 2007
Messages
3,609
Reaction score
7,505
You could have spent your money differently, but when I was being put under to have my kidney removed what was going through my head wasnt that I should have saved more money.
There's a flip side to that coin as well..if you were not financially prudent you could have been laying in that same hospital bed wishing you had the money for better insurance to cover the cost of having your kidney removed. There should always be a balance between saving and spending
 
Last edited:

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892
Pronstar got it right....I was just having the conversation yesterday. I tell most young guys that I work with buy ANY real-estate you can afford ASAP. Not one has done it yet. If you did it the first thing is that you are pay equity to you not your landlord. Fix it up and then rent it out. If you are not married get a 2 bedroom and have a roommate. It is only for the first couple of years And you will free up some cash. Then move out and rent the unit

Yup, some folks call it House Hacking and I wish I had a fucking brain about this stuff 25 years ago...



Sent from my iPhone using Tapatalk Pro
 

HB2Havasu

Well-Known Member
Joined
Nov 4, 2015
Messages
4,433
Reaction score
9,631
I'm somewhere between 2 to 10 years away from retiring. My goal is to try to keep working until 70 to max out SSI, but if I say Fucitol then it might be closer to 62, lol. The plan is to rent out our HB and Havasu Houses for 5 years when we retire and hit the road in our RV and discover all the places in North America we never had time to see during our working lives. We will likely sell the HB House after we get off the road and live in Havasu fulltime then, and maybe pickup a Mountain Cabin for July thru September to get away from the Havasu Summer Furnace, lol.

My Dad gave me some great advise when he was still here about retirement. He said never retire if you have debt, and never let yourself sit idle or you will die shortly after retiring. The only problem with his plan was although he was debt free he outlived his cash reserves by age 86. He ended up getting a reverse mortgage to help pay medical bills when he got cancer. Pops retired at 65 but in hindsight he said he wished he worked a few more years and socked away a lot more cash. His wife went on to live to 99 and was flat broke by the time she passed. I guess the moral of the story is always save way more cash then you think you'll need in retirement because your likely going to need it if you live longer than you planned!!!
 

TexasJet

Well-Known Member
Joined
Aug 6, 2008
Messages
784
Reaction score
1,187
Pardon if I repeat what's been said. The word "style" is a relative term. One million dollars is a good place to start in your 401 etc. Hobbies are a must. Hit the gym at least 3 days a week. Be aware that you will probably be invading your wife's space since you are home now. This can be a major conflict. During the first 6 months or so don't let little annoyances build up. Discuss them early on. Men, listen to your wife and don't talk at her, talk to her. Good luck. I've been retired almost 6 years and this information has worked for the wife and me.
 

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892
The only problem with his plan was although he was debt free he outlived his cash reserves by age 86. He ended up getting a reverse mortgage to help pay medical bills when he got cancer. Pops retired at 65 but in hindsight he said he wished he worked a few more years and socked away a lot more cash. His wife went on to live to 99 and was flat broke by the time she passed. I guess the moral of the story is always save way more cash then you think you'll need in retirement because your likely going to need it if you live longer than you planned!!!

There’s another school of thought that says mounds of cash lose value due to depreciation.

So one could instead use that cash to buy cash-generating assets, so you basically have a bottomless well of cash that’s being generated 24/7.


Sent from my iPhone using Tapatalk Pro
 

mesquito_creek

Well-Known Member
Joined
Sep 25, 2009
Messages
3,623
Reaction score
5,995
Good savers make horrible spenders...
Good spenders make horrible savers...

In general one of the two comes very naturally to most people. Saving has come pretty easy for me with a few bumps along the way, I started in my 20s. I have choose to take a bite of every savings opportunity available (IRA/401K/HSA/After tax stock/Real Estate/Pension/Cash/DebtFree). There is no magic bullet and you don't have to pick one way (like all Real Estate). I am a huge fan of "Pay yourself first" and I have automated my savings for 30 years before I see any of the take home. Out of sight, out of mind. My kids will enjoy my discipline when I die and they get it all. "Spending paralysis" is real. You don't just wake up retired and start spending money when you have been saving for 30 years or more.
 

LakeMead Boater

Well-Known Member
Joined
Mar 1, 2014
Messages
865
Reaction score
1,373
Yup, some folks call it House Hacking and I wish I had a fucking brain about this stuff 25 years ago...



Sent from my iPhone using Tapatalk Pro

Listen to these quite regularly and there are so many school's of thought on how to achieve wealth. Part of me wishes I would have stuck with my sales job and worked on acquiring real estate, but instead I bought a business and the verdict is still out if that will pencil out lol. All in all, great advice and I wish I would have listened to it sooner.
 

DC-88

Well-Known Member
Joined
Aug 27, 2012
Messages
1,798
Reaction score
4,649
Rental Properties. Buy fixers and hold, buy cheap lots, then build and hold. Pretty much inflation proof, and other people fund the costs.

Pronstar has the plan nailed down.

We got lucky for appreciation here in San Diego. The little shit box fixers I bought for around $100,000 are now worth 5 to 10 times what I paid for them.
Agree to a point, and I've benefited from appreciation on the ones we've owned over the years in Ca and Az in good locations. However my really good friend and mentor has been pushing a transition into corporate backed NNN leases and having jumped into one recently with him I think he's right. You own the land and structures, and get appreciation from those plus continual demand from the tenant if it is a good business in a good location (major research is key here ). If the particular branch or franchise goes under, rent is backed by the corporation. No maintenance, no property taxes, no management fees other than statutory agent lawyer for the llc which is minimal.
By comparison we recently sold a rental in a nice area of Ca which had been lived in for about 13 years straight. It wasn't totally thrashed, but needed about $55 K to get it ready for the market as would be done on a flip. NNN ownership goes into your trust like @pronstar said and creates K1 income for you and possibly generations to come. Good ones in good areas appreciate and are very marketable if a sale was ever needed just like any other piece of good real estate. It really seems like a lot less headache with a fraction of deferred maintenance from owning 20 different rentals, or even apartments.
 

TPC

Wrenching Dad
Joined
Sep 20, 2007
Messages
30,445
Reaction score
22,554
If I remember correctly it was 2007 I retired.
With fewer deductions my pay went up.

My pension has a COLA - thats Cost Of Living Allowance up to 6% per year based on inflation benchmarks.
Wife collects 100% of my pension when I tap out and she gets the COLA too - plus 14X my monthly pension amount one time payout.
She is covered with medical insurance, dental, then Supplemental PPO when she hits Medicare.

My medicare supplement insurance is covered and I'm reimbursed for the approx $300 per month that comes out of Social Security to pay for my medicare. I get a quarterly check for a little under $1000. Medicare isn't free. Wife get this full benny too.

The women in the wife's family live to 104 so with the COLAS she'll really be pulling some bank. 104 is a longs ways off for her and she will have full Social Security and her pension too.

She'll be a crazy cat, dog and Burro lady living out in the high desert.

All the above was not free like Fox news wants everyone to believe. $600 was deducted out of my paychecks to pay for all this.
 

boatnam2

Well-Known Member
Joined
Sep 20, 2007
Messages
13,249
Reaction score
6,677
Memphis had 4 for sale today, gone in minutes but I took a screen to see what it looks like.
DF4A410E-786D-4939-BF86-D04848D6EBEA.jpeg
 

pronstar

President, Dallas Chapter
Joined
Aug 5, 2009
Messages
34,461
Reaction score
40,892

HB2Havasu

Well-Known Member
Joined
Nov 4, 2015
Messages
4,433
Reaction score
9,631
There’s another school of thought that says mounds of cash lose value due to depreciation.

So one could instead use that cash to buy cash-generating assets, so you basically have a bottomless well of cash that’s being generated 24/7.


Sent from my iPhone using Tapatalk Pro

I agree 100%. My Pops put all his cash into 2% C.D.s. Not the greatest hedge against inflation, lol. One thing to look at when trying to determine retirement money needs is to look at your family history for average age at time of death. I don't think he ever planned to live to 86. Everybody in his family besides him died before 65. Thinking he figured he only needed a few years worth of expenses to close it out. Damn if he didn't he fool himself, lol.
 
Top