THIS IS THE GREATEST THREAD EVER!!
I want to retire too. I’m just a broke college student though.
I’m 17, and can live at home until I’m nearly 30 if I chose to. I’m probably going to end up being a police officer, and I’d like to retire by the time I’m 40 or so,but the sooner the better, 35 would be awesome. My ideal life consists of me sitting at home playing computer games and going to the gym. So in this retirement I’d like to have enough money to buy the basic things in life, and a little extra, but not really any extravagant things.
I was thinking about trying to find a construction job, and going to college at night, after I graduate highschool, then becoming a police officer.
Until I decide to leave my house, I’ll have almost no expenses, and thus at least $40,000 (hopefully once I get an actual job) a year to save/invest.
Any suggestions on where to put my money, and how I could retire as early as possible?
I think that If I can gather 800,000 somehow, I’ll be able to live off the interest, especially if I have a spouse with a second income. The only challenge is making that much money.
Sorry if this question is at all redundant, I hope it’s not, and I imagine it’s of interest to a few people other than me.
I’m 18 and about to start college. I have a (very) small income at a job where I get $10 an hour, plus the random odd job I can find (moving furniture, etc.).
What can I do right now to get the ball rolling so to speak? I’m not sure if this would be any different than someone who already has a steady job/income, but I figure it would be worth asking. Seeing as I can’t own a home or make any sort of significant investment like that (yet), does anyone have any advice for what to do in both the short and long term.
[quote]Regular Gonzalez wrote:
This strategy worked well for you, but it is not without risk.
What would have happened to you if the real estate market went to shit, and after ten years the value of your properties was lower than your debt? [/quote]
With all due respect Regular - show me an investment strategy that has no risk. Yes, admittedly there is risk and there are 2 things to consider with risk… what is your level of comfort with the risk involved and can the risk be effectively managed.
There is a risk of injury when we train, we take that risk. no risk, no gain, but you decide the level of risk.
Your next question is a valid one, if the property market turns to shit, and it has, there’s no drama’s. Unlike leveraged shares, the banks do not go around and revalue your house and tell you that you owe them more money… unless you ask them too.
Some of my properties have dropped in value recently. I asked the bank for a valuation so I could borrow more and my bank manager simply said “if the value has dropped don’t get the valuation, sit tight and wait 'til it comes back up again”.
For the past hundred years property has doubled every 7 to 10 years (in Aus), there will be down times, there will be up times, but over the long term, the compounding effect of the growth is spectacular.
hope that clears things up a bit.
[quote]msd0060 wrote:
Invest in China and India but bitch and moan about outsourcing (AKA corporations doing the same thing as you).
Oh and X, a few things to notice in your quest:
Just like politics, nutrition, exercise, and religion,
Everyone is an expert, everyone knows best, everyone has a “better way to do it”.
But know that everyone is out for your money…
It is ridiculous how many “economists” there are on the internet. You’d wonder how in the shit America is doing so badly.
I recommend reading Dave Ramsey, and no one in this thread, to be honest. You don’t know if anyone here is a paycheck away from the streets, and you certainly don’t know if anyone here is lying about how well they “trade”. And are they going to give their secrets of “trading”? A sexy term for a futile, un-proveable hobby. The experts don’t post in forums. Just a rant of my own… soon as I started my first “real” job a few months back I immediately researched how to be as wealthy as possible as quickly as possible… and everyone knows how to do it it seems.[/quote]
Perhaps I have the wrong end of the stick but I find it hard not to be offended by your cynical post.
I’m not after anyone’s money, I’m trying to help - full stop!
I am not an expert, as I said, I simply have done it, my way, which I do not spruik as being the only way, just one way.
Whether I am a pay-cheque away from going broke or not, is not the relevant question, I offer my advice and I’m sure the intelligent investor would seek more information before diving into anything suggested on here by anyone.
There are NO SECRETS in trading - if you believe that, then I can see where your slanted viewpoint is coming from.
I will, and have, told many people how I trade and I’ve spent many hours doing so for people in America and elsewhere, some even on this forum and have never asked for anything in return - I’m tempted to advise you to wake up to your miserable self and stop being so negative. If you expect negativity from everyone, guess what you get mate…
I’m sorry you feel so negative about the advice people have offered on this thread. If you broke down that wall, you might just learn something, young fella - your choice.
It sounds like the best bet is buying an apartment complex or a home and then renting it out.
Here are some of the sites I frequent, when I’m not risking large sums of money on penny stocks.
[quote]Professor X wrote:
It sounds like the best bet is buying an apartment complex or a home and then renting it out.[/quote]
Be careful to read the horror stories too. I had a friend who lost an ass load on two rental houses. Bad tenets, late payments, and it was a huge time drain. It went bad for him. Another just tried to rent his house after a PCS move. He hired a company to manage it and he was not happy with the end result either. It can be a great strategy, but it isn’t always the easy millions some make it out to be.
This guy has a lot of reviews on real estate books and programs:
[quote]AlteredState wrote:
hope that clears things up a bit.
I like your style Duke.
[/quote]
Yep, he shoots straight.
thanks for the info.
Thank you kindly AlteredState and Aussie486.
Flop hat - insurance mate - covers the lot.
I’ve had a bloke pull his motorbike apart in the loungeroom on the carpet, had a tree fall on my house and the bloke next door, had a couple of bad tenants - no worries, I was insured!
Prof - If you’re in a position to buy, financially, then as far as I’m aware, it’s probably a good time to begin the learning process and planning your foray into property. Then when the market looks like recovering, you’ll be primed to pounce.
Compound Growth!
I’ll summarise my spreadsheet to see if it can help make the point.
I have $2m in property, value of $3m, held for 13 years so far
That = a compound growth rate of 3.2% per annum.
With that same small growth rate over the next 7 years - I can expect to make a further $732,000 or $104,000 per year.
If held for the next 15 years, I’ll make a further $1.8m or $120,000 per annum.
Whether I’m working or not. It works for me every second, minute and hour of the day, 365 days a year.
Don’t take my word for it, look into it guys.
And remember, the growth rate above of 3.2% is very low and realistic. some years are less, many years are more.
If you’re living expenses are say $70,000, then you’re not spending it as fast as you’re earning it, and if you set up a line of credit on the properties, then the income is tax free (again, in Aus) which is probably equivalent to having a job and earning about $110,000p.a. before tax.
Sorry if I’m taking over the thread. I’ve done it and it excites me that others can do it too, that’s all.
[quote]Duke wrote:
Compound Growth!
I’ll summarise my spreadsheet to see if it can help make the point.
I have $2m in property, value of $3m, held for 13 years so far
That = a compound growth rate of 3.2% per annum.
With that same small growth rate over the next 7 years - I can expect to make a further $732,000 or $104,000 per year.
If held for the next 15 years, I’ll make a further $1.8m or $120,000 per annum.
Whether I’m working or not. It works for me every second, minute and hour of the day, 365 days a year.
Don’t take my word for it, look into it guys.
And remember, the growth rate above of 3.2% is very low and realistic. some years are less, many years are more.
If you’re living expenses are say $70,000, then you’re not spending it as fast as you’re earning it, and if you set up a line of credit on the properties, then the income is tax free (again, in Aus) which is probably equivalent to having a job and earning about $110,000p.a. before tax.
Sorry if I’m taking over the thread. I’ve done it and it excites me that others can do it too, that’s all.[/quote]
Stop apologizing for taking over the thread. It is clear you know what you are talking about. Keep it up.
Agree, interesting stuff Duke.
I’ve been wanting to invest in property for a while, but it is very difficult with the prices here in London - about the equivalent of US$400,000 for a 1 bedroom flat.
For now, I’m just doing some aggressive saving and will see how things progress.
Duke is on the money here. As in all areas of life, if you want to do something, find someone who is doing it successfully and model them.
Financial Planners/Brokers are just people doing a job in more cases than not, they usually aren’t wealthy themselves so don’t listen to them. I have yet to hear somebody become a millionaire from listening to their financial planner who earns $70k/year…think about it.
The idea is to make money while you sleep so to speak, you don’t need to ‘work’ for money. Have your money work for you. Fuck retiring by 55. My goal is 25. I don’t plan on sitting on my ass all day, just not needing to work to support myself.
My recommendation is to start by reading books and change your mindset on money. Some great books have already been mentioned here and if you are interested enough, you will read them.
You won’t save yourself rich either.
[quote]Duke wrote:
Regular Gonzalez wrote:
This strategy worked well for you, but it is not without risk.
What would have happened to you if the real estate market went to shit, and after ten years the value of your properties was lower than your debt?
With all due respect Regular - show me an investment strategy that has no risk. Yes, admittedly there is risk and there are 2 things to consider with risk… what is your level of comfort with the risk involved and can the risk be effectively managed.
There is a risk of injury when we train, we take that risk. no risk, no gain, but you decide the level of risk.
Your next question is a valid one, if the property market turns to shit, and it has, there’s no drama’s. Unlike leveraged shares, the banks do not go around and revalue your house and tell you that you owe them more money… unless you ask them too.
Some of my properties have dropped in value recently. I asked the bank for a valuation so I could borrow more and my bank manager simply said “if the value has dropped don’t get the valuation, sit tight and wait 'til it comes back up again”.
For the past hundred years property has doubled every 7 to 10 years (in Aus), there will be down times, there will be up times, but over the long term, the compounding effect of the growth is spectacular.
hope that clears things up a bit.[/quote]
You are right that there is an element of risk in all investments.
I was under the impression that if your assets value fell below your debt level, the bank could revalue, and you could end up with nothing. It seems I was wrong.
I would also be interested to hear your take on the Australian property market. Do you think that now is a good time to be entering the market?, or do you feel that property is currently overpriced and it would be better for a new investor to wait a few years?
I was just reading the following article:
I found the following part interesting - “Although the relationship between Australia’s total land values and gross domestic product has varied since 1911, it has averaged 1-to-1. Although it got to 1.56-to-1 in the 1930s Depression, it now stands at a menacing 2.5-to-1”
Another article - http://www.smartcompany.com.au/Free-Articles/The-Briefing/20080404-Australian-property-bubble-could-be-about-to-burst-IMF.html
"In the April edition of its World Economic Outlook, the International Monetary Fund argues that Australia’s property market is the fourth most vulnerable in the world to a painful price correction.
The IMF looked at the extent to which increases in house prices between 1997 and 2007 are not explained by corresponding increases in the drivers of sustainable house price growth such as higher incomes or low interest rates.
It found the gap between house prices and underlying value fundamentals is close to 25% in Australia, with only the housing markets in Ireland, Netherlands and the United Kingdom in a worse condition.
It is not inevitable that Australia’s property bubble will burst, the IMF says, as rising incomes and moderate inflation could see real property prices fall in a more measured way"
On the positive side (for owners), it also states that "Another characteristic of Australia’s property market that is likely to continue in the medium term is rapidly rising rent levels.
Last year’s double digit growth in capital city residential rents is likely to continue over the next five years, equating with a 50% increase in rents between now and 2013, according to Australian Property Monitors research reported in newspapers today".
Read Dave Ramsey and follow the 10 points. You’d be suprised how common sense they are and how few people seem to do them.
As far as when it comes time to invest beyond your 401k, I had some luck with DRIPs. Luck being the key word. I bought some Washington Water Power a few years ago at like $20 a share and then one day Bill Gates decided to invest and the next thing I know its $60 a share. I certainly didn’t have enough shares to retire, but it was fun.
Motley Fool has some good insight, especially on things like how to buy a car and such. You might look up Hedo on this too. He’s posted in some other threads and I’ve always been a fan of “contrarian” investing. I think that works for most things in life. IMO.
I would say its like gambling, Only “gamble” what you can afford after your other affairs are taken care of.
Read “trouncing the dow” Kenneth Lee
real low key, low effort approach to investing.
Go to starbucks and read it for free. The calculations take effort but you can get them for free at http://www.benchmarkinvesting.com/Dow/Dow10YrEarnings.asp
[quote]Duke wrote:
msd0060 wrote:
Invest in China and India but bitch and moan about outsourcing (AKA corporations doing the same thing as you).
Oh and X, a few things to notice in your quest:
Just like politics, nutrition, exercise, and religion,
Everyone is an expert, everyone knows best, everyone has a “better way to do it”.
But know that everyone is out for your money…
It is ridiculous how many “economists” there are on the internet. You’d wonder how in the shit America is doing so badly.
I recommend reading Dave Ramsey, and no one in this thread, to be honest. You don’t know if anyone here is a paycheck away from the streets, and you certainly don’t know if anyone here is lying about how well they “trade”. And are they going to give their secrets of “trading”?
A sexy term for a futile, un-proveable hobby. The experts don’t post in forums. Just a rant of my own… soon as I started my first “real” job a few months back I immediately researched how to be as wealthy as possible as quickly as possible… and everyone knows how to do it it seems.
Perhaps I have the wrong end of the stick but I find it hard not to be offended by your cynical post.
I’m not after anyone’s money, I’m trying to help - full stop!
I am not an expert, as I said, I simply have done it, my way, which I do not spruik as being the only way, just one way.
Whether I am a pay-cheque away from going broke or not, is not the relevant question, I offer my advice and I’m sure the intelligent investor would seek more information before diving into anything suggested on here by anyone.
There are NO SECRETS in trading - if you believe that, then I can see where your slanted viewpoint is coming from.
I will, and have, told many people how I trade and I’ve spent many hours doing so for people in America and elsewhere, some even on this forum and have never asked for anything in return - I’m tempted to advise you to wake up to your miserable self and stop being so negative. If you expect negativity from everyone, guess what you get mate…
I’m sorry you feel so negative about the advice people have offered on this thread. If you broke down that wall, you might just learn something, young fella - your choice.[/quote]
Hey man, re-reading that I did come off a bit assholish. Not my intention, and certainly was not singling anyone out (you).
After months of reading, I realized there are several people on any given forum offering what seems like awesome well thought out advice, and you can guarantee that almost all of it will contradict what the other “experts” are saying. It makes it very hard to figure out who to listen to.