Easiest way to Retire Quick!

retire
Practicing Early Retirement

If you are reading this then you are DONE!!  Done with work, done with employees, done with co workers, done with bosses, done with the commute, and done with work.  You may have been googling around during your lunch breaks and at home for a way out and quick.  You might be 20 or 60 years old, but you are done, or at least thinking about it on a regular basis.

The simplest way to define retirement is when your investments can pay your bills.  If your investments are paying your bills then you don’t need an income, retire already.  So, how do you get to a point where my investments pay my bills quickly?  Rental Properties!!

Some people think you have to have money to make money, or you have to have a million dollars in the bank to retire on your 4% interest.  That isn’t true in the new sharing economy.  Lets look at a made up case study called “Steve.”

Steve has $10,000 to his name for emergencies, and needs to make $3,000 a month to pay his bills.  He owes $135,000 on his mortgage that is $800 a month.  He has a spare bedroom, so he rents it out to a young man for $500 a month, and he rents his garage as a storage unit for a friend’s boat and junk for $300 a month.  Steve’s mortgage is covered and now Steve has $800 a month to save for the down payment for his first rental property. He targets duplexes for under $100,000, so in 12 months he can have 10% down from his mortgage being saved, or just cash out his savings and gamble for quicker results (This makes me too worried).  When he finds his duplex for $100,000 he puts $10,000 down from his mortgage savings, and does a little remodel in the next few months.  He now can rent his duplex out for $1,200 each, bringing his take home up to $2,400 from the duplexes and $800 from the rental space at home. Meaning that Steve can quit his job because he is making $3,200 a month.  If he lowers his bills some, cuts out eating out, and some other luxuries, he could lower his bills another $500 a month for $700 a month in profits.  He will continue to save for his next duplex for another year and repeat the process.  He now has another $2,400 a month and a big safety net.  He can evict his roommate and kick his friends boat out of his garage.  I would tell Steve to start paying off his mortgage, and then start to pay off the mortgages of the first 2 duplexes.  After that pay cash for the next one and be debt free! Steve only needs to make some calls to get things fixed or rented out.  Steve is retired in one year in this scenario.

Now this is a very overly simplistic scenario, because you have to find a duplex with very few repairs, you have to find them in cheap areas, and maybe they are not in good areas for good rent prices. You have taxes and closing costs to deal with, and you have a roommate in your home that hopefully you enjoy.   You are also counting on the units being rented the entire time and no months of them sitting vacant.  Also, in some areas around the country you can’t find real estate that cheap.  I did a quick online search in the Dallas area, and found 12 duplexes within 50 miles of me for under $100,000.  So, Steve must live in Dallas.  I also know that this plan takes 1 to 2 years to complete, and for some that is not quick, but for a 30 year old to retire at 31 or 32, that sounds real quick to me.

The main point I’m making here, is that you can retire anytime you want if you put together a great plan.  You can use this one or modify it for quicker results, such as rent out your whole house and live in a camper or van for a while.  You can focus on buying single homes, apartments, commercial property, or a combination.  Research your area real estate and see how rental prices are, and put together a plan, or just save a bunch of money, lower your bills, and try to live off the interest your money makes on Wall Street.  You can still save on Wall Street once you quit your day job, and you have extra money rolling in on your rentals. Put together a plan today to get out of the rat race before the rat race kills your spirit.

Sunrise
Another Monday morning in my backyard, back to the grind.  Lifestyle design helps you feel retired while working.

*On a side note I do plan to add some rental income to my portfolio in the future, but I am paying off my mortgage first and buying in cash debt free for my rentals.  I love my work for now and don’t plan on retiring yet.  So saving long term is fine for me.  There is still much to be done teaching our youth today, and it feels great to be there helping and making a difference in young peoples lives daily.

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