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Old 08-03-2011, 08:27 AM   #21
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RE: When to Retire

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Edelweiss wrote:
I was fortunate enough to grow up in a family who worked in and valued real estate investment as a long term hedge. While growing up, I learned early on that house rentals can be painful at times. *But they are a very dependable return on investment, which is running greater than 10% on the dollar, regardless of the status of the national economy.

*

Socking cash away is a great start, but you have got to do something with it, if you intend to use it in your retirement years. *An IRA, 401K, stock and bond market, etc. all derive their earnings from the same source and are heavily influenced by the economy. *They're really great returns while things are good, but a recession can drop the bottom out of your fund and leave you stranded on the beach with the tide running out. *

*Al*Neuharth*the founder of USA Today once wrote in an article that in his many years of experience in financial dealings both in real estate and the stock market that in his opinion the stock market is the absolute best investment*vehicle*there is and has proven that over time.

Charles*Schwab*the investment guru wrote a book several years ago titled something like "Investing in the second half of your life" and he echoed Al's observations. Interesting,*Schwab*stated in his book that he did not recommend buying individual stocks but rather Index Funds,*interesting*and perhaps insightful advise from someone who made his fortune selling individual stocks.*

That being said, the success of ones investment*portfolio*can be decided on the allocation of their savings and this can further be determined over a very short period of time. The two esteemed gentlemen I mentioned above are correct in their observation as they took a very long view*time wise, of their investments. Both have mentioned that the stock market has returned on average 10% when calculated over 70 yrs.*

However for most of us, especially me, the last 5 years and the next 10 will have a very big impact on the success of my investments. Though the last 70 years have favored stocks as the place to be, I don't think that can be true when taking a 15 year slice today.*

Real Estate may be good today, but who in FL, AZ, NV, or CA would recommend that as an*investment*vehicle 5 years ago. We've seen my wife's condo fall in value from 200k in '05 to less than 100k today. That really doesn't matter because it's just a paper loss; she bought it for far less than it's worth today.*

There are some very good buys in real estate now in FL and those that have the cash or can get financing can probably do very well. My wife's condo just became vacant and we're raising the rent $100. Just two blocks from the Gulf. We should have several folks interested.*Ive thought many times of selling it, but it is a constant source of income. Condos in my opinion are lousy investments because most have association fees that reduce its income potential. In our case association fees and taxs eat up over half our rental income. But now is not the time to sell so we'll keep it.

*
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Old 08-03-2011, 01:04 PM   #22
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When to Retire

Edelweiss and superdiver,

Just curious what kind of real estate do you have? *I've heard mid to lower income housing is the most profitable.


-- Edited by timjet on Wednesday 3rd of August 2011 01:05:24 PM
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Old 08-03-2011, 06:03 PM   #23
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RE: When to Retire

I did things rather unconventionally. My retirement is already over, at age 54. I paid off all my debt, accumulated lots of cash/investments, had one absentee owner business (haircut places) etc. and was basically retired for about 15 years. I watched both of my parents work themselves into the grave, and decided I wasn't going to do that. Had a blast for a long time, then had to go back to work last year. Still having a blast but two houses are rented out providing additional income. Will just play it by ear from now on. Don't be scared to retire, do it, have fun, then go from there. No matter what, you'll always have great memories rather than regretting the things you never got to do.
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Old 08-03-2011, 06:16 PM   #24
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RE: When to Retire

If you have a secure , great paying job, with no stress and full bennys, and you Love to go to work everyday then----------

Never Retire!

I did not have a job like that, retired at 55,* now almost 59 and nevered looked back!

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Old 08-03-2011, 09:28 PM   #25
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RE: When to Retire

Quote:
JohnP wrote:
If you have a secure , great paying job, with no stress and full bennys, and you Love to go to work everyday then----------

Never Retire!

I did not have a job like that, retired at 55,* now almost 59 and nevered looked back!

JohnP
Johnp, that's exactly my quandry.* I have a job that's secure, great paying, full bennies and I love to go to work.* The problem is that I love boating more!* Not such a terrible problem to have, but I need to decide which fork of the road to take.*

I'll be 54 this Nov and qualify for 55% pension at age 55 in Nov 2012.* I'm thinking of living for 6 months on my retirement income starting this November and seeing how that works out.* I plan to have the house and boat paid off by the time I retire.* I have no other debts.

I have read and will re-read all post in this thread to help me with this decision.* Thanks for the great input and advice!!
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Old 08-03-2011, 10:30 PM   #26
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RE: When to Retire

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timjet wrote:
Edelweiss and superdiver,

Just curious what kind of real estate do you have? *I've heard mid to lower income housing is the most profitable.

*
We have some commercial property that we inherited, but we have always concentrated on single family homes, which would appeal to middle income families. I particularly like ranch style, three bedroom, two car garage, 1400 -1800 sq. ft. and buy nothing older than 20 years, they rent easy and are low maintenance. *I have one like this that we bought in 1993 which has been continuously rented except for one month since (only because we needed to paint it inside and out and put a new roof on it.)

This September, the current renter will have been in it for 9 years. *They pay $1000 a month and all utilities. We should be getting $1200, but don't like to raise rent on good renters who don't demand constant improvements. *So do the math, $1000 x 12 = $12000 per year x 9 years = $108,000. *We paid $129,000 for the house. You will probably ask, "Why is this person renting?" *Damm good question, but some people are just not interested in owning and have rented all their lives. *The key to getting good renters, is run a credit check and check county records for leans and adverse comments. *Don't rent to people who are dead beats and have a history of not paying their bills.

You're right, no condo's, unless they're in Manhattan, or downtown Seattle.

The rise and fall of the property value of the home is not that important, because we are not "flipping" properties. *As you say, the gain and loss in value is only on paper. The profit is derived from the rental income.

Stock funds are ok, I dabble in the market and have capital in a State Deferred Compensation program. *But I don't rely on this money for my retirement. *It's my form of gambling, instead of going to the casino with my for sure loser friends. *But you have to be on top of it all the time and get out when the market goes south and back in when you think it's turning around. *You have to do your research and follow the financial news. *It can be intense at times, (like right now!!) but a whole lot of fun!! * *



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Old 08-03-2011, 10:52 PM   #27
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RE: When to Retire

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FlyWright wrote:that's exactly my quandry.* I have a job that's secure, great paying, full bennies and I love to go to work.* The problem is that I love boating more!* Not such a terrible problem to have, but I need to decide which fork of the road to take.*
I'll be 54 this Nov and qualify for 55% pension at age 55 in Nov 2012.* I'm thinking of living for 6 months on my retirement income starting this November and seeing how that works out. *

-----------------------------------

This is my personal opinion -

You are too young to retire and really not ready yet or you wouldn't be asking the question !!

I'm in the same situation you are, but about ten years older. *I love my job and look forward to going to work each and every day. *No, I am not a workaholic. *Quite frankly, I can't believe they pay me, to do what I do!!

Too many of my friends, in this situation as you and I are, have retired because they "could" or because some damn fool told them they are "working for half pay." *Only to regret it later. * I think I am about a year away, maybe two, from pulling the plug.

But you and only you will know when that time comes. *It seems like a difficult decision now, but when you are ready, it will be an easy call.*

Whatever your decision

Best of luck

Larry B

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Old 08-03-2011, 11:05 PM   #28
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RE: When to Retire

Quote:
Edelweiss wrote:I was fortunate enough to grow up in a family who worked in and valued real estate investment as a long term hedge. While growing up, I learned early on that house rentals can be painful at times. *But they are a very dependable return on investment, which is running greater than 10% on the dollar, regardless of the status of the national economy.
I grew up in a similar family and learned to hate rentals.* Although I've been in*real estate for 36 years my total combined months of rental property ownership equals about 12.* Both were deals I couldn't turn down but I found a way out of both of them within 6 months.* Even at that I experianced the normal landlord blues.

There can be a good return on rentals but you usually earn*a good*part of it.* It is not passive income even if the IRS says so.
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Old 08-03-2011, 11:34 PM   #29
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RE: When to Retire

"I'm in the same situation you are, but about ten years older. I love my job and look forward to going to work each and every day. No, I am not a workaholic. Quite frankly, I can't believe they pay me, to do what I do!!"

Larry, I'm intrigued...what is is you do you love so much you "can't believe they pay you to do it." To misquote 'when Harry (?Larry) met Sally' - I'll have what you're having.....
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Old 08-04-2011, 09:09 AM   #30
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RE: When to Retire

"This is my personal opinion - You are too young to retire and really not ready yet or you wouldn't be asking the question !!"

There are other reasons people retire. For example, Tuesday was one of those eye-opening days on the job. It highlighted for me that the working isn't everything, life is short and sometimes it's best to just slow down and smell the roses.

We were flight checking some airport lights at Coos Bay/North Bend, OR that guide aircraft into the runway at the proper approach angle to clear the obstacles. As we approached 1000 ft, the right engine failed. We executed a go around, retracted landing gear and flaps, climbed safely above all obstacles, declared an emergency and secured the engine. We diverted to Eugene to get enough runway for landing and attempted a restart. No oil pressure on restart, so we re-secured the engine and landed uneventfully.

I've been flying for 37 years and this is the first actual engine failure I've had to deal with. Of course, I've had hundreds of practice failures of every kind in the simulators over the years. I was hoping to retire without having one, but now that it's happened, I'm thinking, "Why not pull the plug at the earliest opportunity if the numbers all work out? Life's too short." I don't need to be rich to be happy...just enough to pay the bills and enjoy boating in retirement.
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Old 08-04-2011, 10:02 AM   #31
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RE: When to Retire

In my 38 years of flying I've never lost an engine. I've had a few precautionary shut downs though. I hope I make it another 2 without incident. Smoke in the cockpit scares me the most.
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Old 08-04-2011, 10:10 AM   #32
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RE: When to Retire

Quote:
FlyWright wrote:
"Why not pull the plug at the earliest opportunity if the numbers all work out? Life's too short." I don't need to be rich to be happy...just enough to pay the bills and enjoy boating in retirement.
* * * ** Although that's not exactly the scenario I went through, it's very close.

****** My partners & I had a very successful manufacturing company, with 8 different divisions throughout the country and Puerto Rico. We had a Citation 5 to play with,* had damn good managers and the money was rolling in. One day, my wife died of cancer.* I could not believe it! I had always thought I would go first and had worked hard to make sure she & the kids would have no financial worries. The kids were grown up, through college & out of the nest. Although I was 51, with a lot of working years left, I decided that there were plenty of other things in life I wanted to do before kicking the bucket. Boating was very high on the list. I approached my two partners, negotiated a buyout and here I am with not one regret. Now.... I know that for most, income is the big concern. It's not the only concern, however. Health may be the biggest of all!

I have learned to "smell the roses", (something you can't possibly know until you retire.)

My health is better, (no stress) and I don't regret one second of retiring at 51.

You will not believe how busy you will be after retiring! You'll wonder how you completed all those essential, day to day obligations while still working.

Go with your heart....you'll love it!* (After confirming the numbers, of course!) :nod:
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Old 08-04-2011, 10:10 AM   #33
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RE: When to Retire

Never flew an airplain. sheesh. Lost the motor on my boat last weekend that was bad enough.

How do you handle that kind of pressure/stress.

Hat's off to you big guy.

I'd retire.

SD

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Old 08-04-2011, 10:28 AM   #34
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RE: When to Retire

"How do you handle that kind of pressure/stress."

Training and preparation. To me, an emergency is NOT an emotional event. It's a factual event. It's a situation to be dealt with using accepted procedures (checklists, manuals, memory items), systems knowledge and airmanship. We're trained for this every six months in the simulator or airplane, so it's not something we haven't seen before.

Now, for me, the question of the day is what the heck happened to the engine and how do we prevent it from recurring.

I lost the port engine in my boat a couple weeks ago as I was pulling into the slip. The idle was a bit low and it just puttered out. It was easier to finish the docking single engine that to restart since I was already halfway in the slip. If there's a perfect place to lose an engine on a twin boat, that was probably close to being the perfect place. (Another 20 feet with the lines tied to the cleats would have been even better!)
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Old 08-04-2011, 10:38 AM   #35
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RE: When to Retire

Yikes, Al, lost one of twin engines twice within a few days?* Maybe somebody "up there" is trying to tell you something.
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Old 08-04-2011, 11:52 AM   #36
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RE: When to Retire

Quote:
FlyWright wrote:
"How do you handle that kind of pressure/stress."

*an emergency is NOT an emotional event. It's a factual event. It's a situation to be dealt with using accepted procedures .

*I know what you mean in the thread i started on "Whew hat was fun"

I talked about a hole in my boat. Same thing I went into fix it mode I knew what had to be done and went about solving the problem.

But dude!!!**It's gotta be tough trying to stay off the rocks in an airplane. A mistake and you are out'a there.

Hat's off to my friend.**Nice to know there are guy's like you at the wheel when something go's.**Shall we say afoul.

SD

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