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How much is enough?
With the boomers retiring and the property market and sharemarket heading down of recent times, I got to thinking - how much is enough?
We all try to build our wealth, without really knowing how much we need to be able to stop and enjoy it!
I was chatting to Lisa about this and Bandwidth noticed and wrote this:
"Noticed your comment, on Lisa's page, about how many properties is enough the general feeling is 7 properties.
It all depends on the $ if you want to live on 80K a year you need 1M at 8% return puls 500K to ensure the nest egg grows or at 6% you need 1.35 plus 600k for growth.
Property tends to double every 10 to 12 years so if you have a 1.5 M portfolio and 12 years to wait then you are in the ball park. At the end of the 12 years you will own 1.5 and the bank 1.5 :-) "
What do others think? How much is enough and what defines financial freedom for you?
KBot
We all try to build our wealth, without really knowing how much we need to be able to stop and enjoy it!
I was chatting to Lisa about this and Bandwidth noticed and wrote this:
"Noticed your comment, on Lisa's page, about how many properties is enough the general feeling is 7 properties.
It all depends on the $ if you want to live on 80K a year you need 1M at 8% return puls 500K to ensure the nest egg grows or at 6% you need 1.35 plus 600k for growth.
Property tends to double every 10 to 12 years so if you have a 1.5 M portfolio and 12 years to wait then you are in the ball park. At the end of the 12 years you will own 1.5 and the bank 1.5 :-) "
What do others think? How much is enough and what defines financial freedom for you?
KBot
Tags: investing, money, retirement
Views: 1
Replies to This Discussion
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Permalink Reply by Lisa on -
Hi Kbot
In my (early!) retirement, I would expect to be earning (from property or otherwise) at least 60% of my current salary, with no rental expense hanging over me... that would be financial freedom to me. Until then, I'll just keep working... lucky I love what I do!
I'd go further than Bandwith to say that property tends to double every 7-10.
My plan is to have enough debt-free property to achieve this. After a number of years, after a number of (hopefully!) high growth properties, I'll sell off a selection of properties to leave me with the best yielding properties at the time, leaving the rest debt free.
The question "how much is enough" is a fairly fluid question in any terms as it's always relative... it will depend on my salary when I plan to retire, the properties I have in the future and their yield. Who know's how much they will be worth in the future... or how much rent they'll be earning!??
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Permalink Reply by Bandwidth on -
Hello Lisa
I was being conservative with the property cycle. This allows me to agressively invest in a conservative manner :-)
I am happy to continue to carry the debt as long as I can service it that way I can reap the benefits from the investment business then pass it on to my kids.
Things like buy a property in every state and then, using a Winebago travel around the country and visit my properties twice a year. I might look at Port Douglas or Broome next :-0
As I have mentioned before I intend to make my money in the share market and store my wealth in property. With satellite technology and internet hot spots I can trade from anywhere.
Another venture I want to look into is mentoring people in the trading.
I also love to cook and make pastries so in the gray nomad mode I could probably do well in that.
I am good at building and renovating so maybe move from primary residence to primary residence, add value and sell with no capital gain :-)
Maybe what I am saying is Enough is when I can do what I want to do, when I want to do it, where I want to do it. FOREVER, however long that may be
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Permalink Reply by Matthew Reader on -
For me I'd say financial freedom is $1500 a week passive income, with $250k in the bank. That way I could travel the world and have enough capital to start a business, like a bar in the Carribbean. ;)
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Permalink Reply by Bandwidth on
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Hello Matthew
When you extend that number it becomes 78000 a year after tax so about 100K per year before tax so at reasonable returns of 8% that means 1.5M in capital investment. That is unles you have another form of passive income :-)
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