bought a real estate course off the tv in the 90's and put it to work in early 2000's.......people will say it's risky, but I think it's risky NOT to do it. Sold 1 4 plex after a few years and paid off all other rentals. took investments in the thousands to a couple mil....i say GO FOR IT!
Could You Retire On One Million Dollars $$ ? Can you even make 1 million?
- Thread starter 69hurstolds
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Exactly. I know a few people doing it. ROTH IRAs and solid real estate. That's diversified.
The common traditional trend of car loans and 30 year mortgage and making little contributions to any retirement plans, yeah that's gonna get you buried in the ground broke. That's the system making money off of you.
Beat the system.
The common traditional trend of car loans and 30 year mortgage and making little contributions to any retirement plans, yeah that's gonna get you buried in the ground broke. That's the system making money off of you.
Beat the system.
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It's not impossible. Thanks to Jimmy Carter, many my age had to start their careers in his wake of stupid monetary policies and double-digit interest rates which took several years to overcome. When you're stuck in the pool, you don't have much option except to start swimming. To be sure, now is a sucky time to start new careers in general. What's scary is some statistics say that 27% of people 59 and older haven't saved anything for retirement. And even worse for Gen Z.
As far as being a slum-lord and buying property, sure, that's one possible way. But you just tied up $1 million in liquidity into 3 pieces of real-estate which isn't always quickly turned into cash if you need it fast. And now you have to do due diligence to vet the stewards of your properties that are going to live in them and hopefully be timely with the rents. This doesn't even account for maintenance, repairs, and property management, whether you do it yourself or hire it out, and also makes your tax returns longer (and you have to declare any positive cash flow that calender year without any deferrals, which could potentially put you in a higher tax bracket).
I used to rent out our other home, which was paid for, and for me, it's simply just a PITA that I found out I didn't want or need. Of course, there's +/- to renting out your houses, but unless you're into that sort of thing, which I am not, it's definitely not a situation meant for everyone. It was a huge relief to me when we decided to sell it. Personally, I'd diversify the f**k out of that $1 million and reap in more stable income sources. But that's just me. Real estate is geographical and lately, kind of "bubbly" depending on where you live. But, you do you. If that flips your skirt, have at it. If I were going to do money grabs, apartment buildings are usually more cash flow positives.
If you have to finance any of those extra homes, though, it's going to suck. Especially if you have good credit. Thanks to "new and improved" mortgage policies coming to a bank near you on May 1, there's an even more financially stupid move coming. Some people work hard to keep their credit rating high so in the event they need to borrow, they should get the better rates. But soon, people with mediocre credit (FICO score <680) will get a better deal than you when buying a home. They say it only affects people buying second homes and non-primary residences, but I'm not so sure. Haven't read into it a lot, but basically, the higher-risk lenders are going to get subsidized by those with better credit. Just another reason to pay with cash.
Courtesy of the NY Times article https://nypost.com/2023/04/16/how-t...buyers-at-the-cost-of-those-with-good-credit/
"Under the new rules, high-credit buyers with scores ranging from 680 to above 780 will see a spike in their mortgage costs – with applicants who place 15% to 20% down payment experiencing the biggest increase in fees."
Absolutely. This is key. Debt does not pay. It used to [1970's] but after they stopped allowing deductions for all taxes and all interest, debt is just a stone around your neck.
I tell everyone I know to GET READY! Pay off everything and buy what you think you will need BEFORE you retire. Get your health insurance squared away because you WILL get old and sick. A million dollars? I was a mailman. I was never rich but I always had enough for my family to live comfortably. But I was also handy and smart with my money. I own a house I paid off in 2000. Other guys I worked with, that made the same money, rented toon-town apartments and lived from check to check. I know young people that are still buying houses the old fashioned way- don't have kids yet, both work, scrimp and save, do the work yourself, and do without expensive toys. That is how I did it and it still works. Retirededment is no different. My pension is not a lot but I can keep a small boat at a marina because I do the hard work myself.
slum lord...hahaha....that's what my sister called me although she hasn't seen 1 of our properties....."If we can't live there, we don't rent it until we can" has been our motto and has worked. she also said we were stupid to do it. she also sent her kids to college to get a degree they don't use for their income....along with the debt. I helped my kids start businesses and helped them get into their homes. Wouldn't have been able to do that without making money in real estate. Depends on where you buy.....Detroit, Chicago, St Louis ect......wouldn't touch them. We now have moved profits to the Jackson Hole area through 1031 exchanges and have seen the nest egg explode. It's not for the faint of heart that's for sure. I was a drywaller without a retirement plan unless I came up with one. So I can fix any damage from drywall to carpet ect. Now only 1 air-b-n-b I am remodeling to rent at $200/ night and if it's empty no biggie....it's paid for.
Different ways to play Monopoly and The Game of Life...wish the best however you choose to play
Different ways to play Monopoly and The Game of Life...wish the best however you choose to play
I used to own several properties at a time.
Not.
Any.
More.
Things aren't what they used to be. Laws have taken such a hard left turn against landlords the risk profile is just too great.
Mix the deadbeat tenant's that stop paying rent because their life got hard and they expect you to forgive their housing payment? Or the squatters? And the courts that delay evictions or municipalities that refuse to allow evictions? Not to mention the property damages that all get rolled into bankruptcies you never get to collect out of? All that ignores the rental scams of people either legitimately caught by fake landlords, or, who pretend they are with false leases just to skip on rent?
No thanks.
You know, if there was a house next door, or across the street, then maybe, MAYBE I'd consider it again. But only if I owned all the properties for cash and had eyes on it at all times. And even then.... meh, not likely. I'm more interested in buying a couple hundred acres of sugarbush than a rental home if I carry a second property.
The last few years we've been rolling the 20k limit into I-bonds. Gives you a few pct points above inflation in returns which is better than most investment classes, and, it's not like we can't just cash everything out of them whenever, the 6 month delay hurts nothing.
House? Paid. Cars? Paid.
You'd be amazed how little money you NEED if you're still in decent health, and you don't carry debt. Each year we cut a little more off that pie.
If I HAD to, I'd suspect we could live fairly comfortably on under $450/month at this point and cover food, utilities, property taxes, etc.
Not.
Any.
More.
Things aren't what they used to be. Laws have taken such a hard left turn against landlords the risk profile is just too great.
Mix the deadbeat tenant's that stop paying rent because their life got hard and they expect you to forgive their housing payment? Or the squatters? And the courts that delay evictions or municipalities that refuse to allow evictions? Not to mention the property damages that all get rolled into bankruptcies you never get to collect out of? All that ignores the rental scams of people either legitimately caught by fake landlords, or, who pretend they are with false leases just to skip on rent?
No thanks.
You know, if there was a house next door, or across the street, then maybe, MAYBE I'd consider it again. But only if I owned all the properties for cash and had eyes on it at all times. And even then.... meh, not likely. I'm more interested in buying a couple hundred acres of sugarbush than a rental home if I carry a second property.
The last few years we've been rolling the 20k limit into I-bonds. Gives you a few pct points above inflation in returns which is better than most investment classes, and, it's not like we can't just cash everything out of them whenever, the 6 month delay hurts nothing.
House? Paid. Cars? Paid.
You'd be amazed how little money you NEED if you're still in decent health, and you don't carry debt. Each year we cut a little more off that pie.
If I HAD to, I'd suspect we could live fairly comfortably on under $450/month at this point and cover food, utilities, property taxes, etc.
Biggest thing about it tho, actually enjoy life and have some fun along the way. I know too many people who just focus on and chase money, and have no hobbies or anything fun. I couldn't live that way.
I would disagree with with your sister. Real estate investing isn't stupid if you like it and do your due diligence. Like I said before, it's not for everyone, although if you work at it (and you will have to work at it) you can make quite a bit of cash if you do it right. You can also fall in a hole pretty fast just like anything else. Housing is very much like the stock market though, although there are some that would argue. The speed at which you can lose your azz or make a mint is quicker in the stock market, but if you have the time, real estate can be lucrative as well. If you really want to play hard and win big, you have to put in the work regardless of your investment vehicle.
We're at a point now that "getting there" isn't the issue for us anymore. It's maintaining. BIG difference. I'm pretty happy we didn't have to worry about sending kids to college. That makes our retirement much easier. And nobody's going to fight over our estate when we're gone. We're not going to buy Lear jets, drink wine out of the finest crystal ever and eat cavier daily, but I think our current projections, should they hold, have us leading a completely comfortable retirement without fear of running out of money before we run out of days. First-world problems.
I do believe we're going to start doing things more, though, while we're still not needing wheelchairs and bibs. Been looking at transatlantic cruises spending 2 weeks at sea, or flying over to Australia during the U.S. winter and taking a 10 day Aussie coastal cruise tour. Wife's not too keen on it, and thinking about it, I used to get paid to do 2 month stints at sea when I was in the Navy. Now we would have to pay $10K or more to do it for only 25% of that time. Oh, the irony.
