How many of you are planning on retiring early? What strategies are you using and what investments are you taking advantage of?
I'm 24 with $25K in a Roth IRA and $20K in savings, making $42K per year.
My Roth is entirely invested in one diversified dividend ETF that distributes $0.30-0.40 per share quarterly. I plan on building this account until my quarterly dividend payment is $3K+. At that point, I can begin to withdraw dividends since principal withdraws are tax and penalty free in a Roth IRA. For now, I'm reinvesting all dividends and dollar cost averaging with more shares twice per month.
Outside of dividend investing, I've realized that rental properties are the only legitimate source of passive income that nearly anyone can get involved with. I'm negotiating the purchase of a 3/2 single family home for $160K. My monthly expenses will be under $700 with taxes, insurance, etc. included. This property should rent for between $1,500 and $1,700 per month, which leaves me with a $800-$1,000 profit monthly. After savings 6 months of profits to use for potential repairs or vacancies, I will begin to use the profits to pay down additional principal on the mortgage and eventually to finance the purchase of another property.
My goal is to retire by age 32 with a target monthly (passive) income of $4,000. This will be 4-5 rental properties, at which point I will hire a property management company. I can not depend on the Roth IRA income until the dividends reach a certain point, and I don't believe that will be achieved in the next 8 years so I will let them compound.
So again, how many of you are planning on retiring early? What strategies are you using and what investments are you taking advantage of?
>I've realized that rental properties are the only legitimate source of passive income that nearly anyone can get involved with. Ever heard of bonds?
Aiden Morgan
Yes that's true, but bonds right now are paying shit. Even a 10-year at 3% you would need hundreds of thousands of dollars to generate an income that you can live off of. Compared to RE investing where you can put down $30K and start to almost immediately generate $500+ per month in profits.
Aiden Myers
>put down $30K and start to almost immediately generate $500+ per month in profits Or -$500+ per month in losses if you can't find tenants, eventually leading to foreclosure if shit really gets bad. Real estate is riskier than Rich Dad Asian/Carleton Sheets make it out to be. I'd stick with dividend ETFs, maybe consider utilities ETFs as well. Buy that shit in a regular taxable account and hold after you've met your non-taxable maximum contributions for the year. Tax man is going to get his money one way or another.
Jeremiah Cook
24 max 401k, max ira, have $80k in taxable i learned today that if i stop saving and coast ill have well over a million in 2017 dollars by 55 which was my retirement goal thing is i only max my tax advantaged accounts so that i dont get my privilege checked, i care way more about financial Independence than i do retiring early people obsessed with retiring early just seem to hate their job
Jackson Cox
31.
Want to retire with current equivelent of $5,000 month to live and 5k a month to also reinvest and grow.
120k a year... i just broke 50 first time ever. Working 2 50 hour oer week jobs pays 100k
...kill me
Evan Nelson
Muh stock market. Noo......
Luke Butler
Dont shit on kiyosaki. He saved my life...
Elijah Scott
this is a stack of worthless garbage
Jeremiah Sanders
You won't stay retired long.
There is much that you don't understand, grasshopper.
Angel Perez
>Download robinhood >put 45k in >buy 45k worth of AMRS >wait till July.
pretty easy.
Noah Flores
>single family home for $160K >property should rent for between $1,500 and $1,700 per month Really? Where is the property?
Justin Gutierrez
Great stats. I want to retire early in the sense that I won't "have" to work. I still plan on doing some part-time stuff to keep busy, as well as build on my investments. I may even grab another job at some point if I feel bored, but I live in Miami and there are a lot of ways to keep busy. I like my current job, but I don't want to be obligated to someone else's schedule.
Miami area in a unique area that is being "gentrified"
Christopher Scott
Here I am with more in savings and Roth IRA, making 110k a year, don't know what to do, 0 rental properties; always rented an apartment. How can I retire early? I have too much I don't know what to do with it besides eat at restaurants and lose money in Robinhood.
Jayden Gonzalez
definitely trying, maxing 401k maxing roth ira, a lot going towards mutual funds. any extra goes to gambling on crypto and penny stocks. was thinking about trying my hand at making a few websites, but nothing really yet. housing in my area is out of control, so no getting rentals for me :(
Trying to get to 1mil nw in the next 6 years.
Jaxon Robinson
Start a business, invest in the stock market.
at least investing in a fund that tracks the sp500 could net you ~6-10% or something over the long term with minimal effort.
Austin Clark
I'm all about the FIRE. MrMoneyMustache, MadFientist, jcollinsnh, etc.
I'm 29 w/ 250k paper assets, and a 200k mortgage on a house I should probably get 250k for pretty easily. 100k/year.
I'm not heading straight into FIRE. First I'm taking a mini-life break hopefully in ~2020, will have between 350k-500k at that point, enough to glide into retirement no probs. Plan is to reevaluate where I am in my life and where I want to go. Get a college degree(veteran and technician now) that will either make me feel satisfaction from work, or unlock the 150k+++ jobs, or trade in time for tons of OT as a field service engineer. I don't know, stash + lifestyle/savings rate unlocks possibilities.
Dylan Thompson
Don't eat at restaurants. Conciously evaluate your life choices and where you're spending money. Evaluate things on how many hours a year/days you work to obtain it.
Max 401k, due to tax savings, it's far more efficient than only ROTH's. You save at your highest marginal tax bracket, and will be pulling it out starting at the lowest tax brackets. There are ways to pull it off before old age.
For rental properties you'd have to head to real estate investment forums, BiggerPockets and learn the business. Account for vacancies + maintenance, property appreciation is icing on top but don't set your expectations on it.
For equity investing read The Investor's Manifesto and Stocks for the Long Run. That should set you on the right course.
Read Millionaire Next Door.
Aiden Carter
Thanks for the suggestions. I buy some index fund etfs and have tried robo investors with moderate success. It's all slow money and I have been too focused on trying to make a quick buck. Robinhood free trading is a curse in disguise.
Alexander Diaz
>Start a business, this. I retired at 32 with a salary of ~$10k/month US and $0 invested.
it's riskier than investing but when it pays, it pays big.
Leo Clark
24 years old, making 55k before taxcucking. Putting 10% of income toward my 401k, have about 7k in it. I'm using as much of the rest of my income as I can to pay off student loans, 40k to go. Once I'm rid of the damn debts I plan to invest more in some other things.
My 401k is mostly traditional contributions. I guess Roth is better eh? I should switch
Charles Reed
How?
Easton Harris
Are you me?
>just turned 24 last week >make 54k a year >15K Roth > just bought first single family home in jan --147.5k, mortgage 750, rent for 1150 reinvesting profits to pay down 30yr in 12yrs >planning to buy 2nd home in summer. >want atleast 5 to retire at 35ish with passive income 60k yearly
We're gonna make it OP
Leo Wood
I'm 32 Academic Year Staff gross 32-34k
~5.5k in 457b ~6k Trad IRA ~4.5k Safety Net
Expecting ~20k or higher from house sale after 50% with ex then which 5500 will be invested into IRA with the rest going into my Safety Net which is set for ~18k
Hoping for a lateral job transfer within the State going from .8 FTE to 1.0 FTE and invest all the differences into 457b
Alexander Sanders
>Just turned 24
>Finally got my welfare
14k a year babby I'm fucking retired.
Evan Murphy
Says the broke poorfag...
You show me 1 solid asset you have and i will consider your advice. Otherwise i will mail you kneepads so your mother doesnt have to buy them. Cuck...
Waiting on timestamp.
Aiden Nelson
Depressed poorfag with poor people ideals and spending habbits.
Just flat out didnt pay bills for 5 years.
Now im almost debt free. Got 10k in the bank, got 6 cresit cards, and 750 credit score.
Litterally about to start digging out a bunker and having my bros build my wife a house on top of it.
Living the dream.
Joshua Taylor
i am not sure what you mean by solid assets but if it's what i think it is based off those retarded books i sure am glad i didnt fall for it
Michael Jones
Stay poor. Have fun watching your million dollars be useless when the crash come or inflation takes it all. I will be shitposting from my bunker and ahoping for houses online.
Henry Campbell
Can any user explain to me what to do with a Roth IRA account? I understand what it is, taxed on money going, no tax going out after a certain age. But what do I do to make additional currency on it?
Isaac Parker
It's not a terrible plan and better than most. You make the same mistake as a lot of people and concentrate too much on dividends for the stock end, but at only $25K that's a nit. Once you hit 100K or more, you should diversify the stock assets more. Capital gains are your friend just as much as dividends.
I retired early, but way over 32, although my target was frankly way the hell above yours. I did it mostly through stock appreciation in highly diversified tax-deferred accounts, plus some from house appreciation.
Eli Reed
I know "buying isn't for everyone," but it seems crazy to me that someone would rent a place for $1,500 that could be bought for $160k. If you only put 10% down, your mortgage would be like $700/month. I know nothing about the Miami real estate market, but a property that would rent for $1,500 here in Seattle (which I know is a crazy market right now), you'd be probably spending at least $400k.
But that is just the *account*. What you actually invest in, with the money in your account, is largely up to you. If your time frame is 5 years or more, that should be largely in stock funds or ETFs. Those will make capital appreciation (if you pick wisely, as in making your stock investments diversified) which is your primary return. Do remember that your return is compounded over time; if you put 5K in this year and get a 7% return, then next year it'll be $5350 and in 30 years it'll be $38K *without any additional investment*. If you put $5K in each year at 7% return it'll be $5.7M.
People that understand compound interest become regular investors, and become well-off. People that don't, usually don't.
Jaxon Sullivan
>$5.7M.
Shit, typo. Compound interest isn't THAT good.
$510K
Josiah Bailey
think a lot of people cant save up for the downpayment.
SF bay area is similar. 160k would be the down payment. whew
Leo Allen
In my regular brokerage account I have a Spyder index in energy. I'll have to look around to see which others are doing well. I've heard mutual funds are a good long-term investment. I'm in my early 20s so I have more than enough time to let my account grow. joining military soon too, so that's an automatic max out yearly on my RIRA with no worries.
Carter Hernandez
>I've heard mutual funds are a good long-term investment.
Absolutely right but it depends a lot on which one. There is nothing at all wrong with just doing a total stock market index.. There's a lot wrong with picking last year's best performer.
Ryan Brooks
The principle you invest in a Roth account you can access before 59 1/2. Also, if you do Trad IRA -> Roth recharacterization(a taxable event), you can access the recharacterized balance after 5 years.
Ian Bennett
Risky but 15%+ dividends: CEFL, BDCL, MORL
Less risky: REM, BDCS, YYY
Even less risky: BTZ, GDO, IEF, LQD, PCN, PIM, PTY
I have no idea what to do with this money so I need something safe to invest it in which beats inflation and is super liquid with low spreads: BNDS
