When is the 'game' over ?

Hey all

Long time viewer, some time poster and rare creator of a new thread.

I am spending less and less time on the investment process but PC is a must because of the great people and discussions we have. I have learned much about investing in the last few years here as well as so much about myself and what is important to me.

Some recent threads have been particularly profound and have moved me to a place that questions some of the ways I view things.

These threads include but are not limited to;

Stress and the simple life
Love my work, hate my workplace
Went to a mate's funeral
Anyone selling
Terry's Tax tips (a legend) - Selling the PPOR (or something like that)
LICs (Austing - another legend)
Frank Manos opportunities and posts

Oh, and one of my favourites....The FU position thread (I think BIZ posted the video - loved it)

I have been on the treadmill for quite a while and feeling a prisoner at work. All unhealthy things to feel in life and the reality is the solutions lies within ourselves in either moving from the situation or viewing it from another angle.

My musings and thoughts have resulted in me seeing something that has been the case for a while, ie, I don't have to work any more, I have won my game, I just didn't know it.

In future posts (when I get the time) I will share with you all the results of my thinking (and the decisions we, as a family have made) and I hope it is interesting and perhaps helps someone in some way.

It is all good, in fact, it is great. I have won the game for me and regardless of what I do in the future it is my choice, a least now I know it.

Will post more later

Best to all

 

Looking forward to it. Thanks for the list of thought-provoking threads. I like these ones too. Will go back and have another look.

 

Bunlee pal taking the chequered flag.

 

Biz

You make me laugh - might be the red flag I'm taking mate, I just don't know it

best regards

 

Well done,you are at the stage where you no longer have to worry about anything ,and not look at the price just swipe the card and walk away..

 

Hey again

Bit more free time today so a chance to elaborate and explain.

Firstly, a bit about me (please play 'Glory Days in the background).

Did all the right things, tertiary qualified, graduate qualifications and more cert IVs than Austing has LIC share certificates. Paid the house off and then left the professional sector, for good.

Stepped out on my own, did pretty well, made some $$ on investments during the GFC.....blah blah......it is over the twinkle of a young girl's eye......glory days

More importantly, married to an absolute doll who I adore and she me. Have a young male bunlee who is at the age that the text book says they get attached to dad, like clock-work, turned 7 then the text book was right on the money.

Great family, great life.

But some of the great posters and threads have put the seeds of wisdom, knowledge and doubt in my mind. I was ignorantly happy before I met you people

I don't like debt at all but have owed money on investments pretty much all my life. During this and future posts I am going to mention some (but not all) figures to give you context. I am cool with that.

The thing is that some people could laugh at the relatively small figures compared to them (but I know that this community is not like that) and some may think that there is bragging going on, I hope not. Cause here the kicker......the figures don't mean anything except to me cause they are only relevant in my game....personal finance is well errrr......ahhhh...just that....personal.

We live in a humble paid off place in a nice part of Sydney which is probably worth $1.24m today. We are simple people that don't want nor ask for much.

We have an IP in the same street as we live that is possibly worth $1.35m today.

The only debt we have is exactly $340k.......cross collateralised....remember my broker friends here who I respect, you have previously forgiven me for this sin

I am embarrassed in some way as really I should have put this under 'First world problem ' thread cause I have been walking around for the last few years starting to hate work and feeling a prisoner. I felt a slave to that debt and wanted to pay it off at all costs....unfortunately the cost was a personal one and one that made me work too hard and spend too much time away from my family.

In the last few weeks I was starting to really feel trapped. Typical guy, blocked it up for so long and kept a stiff upper lip and was so stoic.........silly.

The best thing that I did was sit down with my wife and few weeks ago during 3 days off and told her how I was feeling.

Her 1st reaction was that she would go back to work (she has been 100% since the little Bunlee landed). Of all the investments we have made, the investment for her to be a 100% mum was the best one. We decided very quickly that this is not the chosen option and it went off the table pretty quick.

We then looked at the figures. I earn a base salary around $75k give or take and around $20-25k pa in overtime. The IP in Sydney is about $6-8k cash positive pa. I also earn about $25k in passive income pa that was sourced in long term investment in AGRO )) the LIC and has since been sold and its funds dispersed to the 4 corners of the investment world.

Our income isn't huge but I was very keen to knock the $340k down asap and felt like a slave in my life and my work.

Looking back now, that was an absurd feeling.

Our conversation that ensued was fantastic, it humbled me and charted an investment approach that has change the course of my life.

Working with my wife freed me, the irony is the investment plan (I will share in the next post) freed me so much that it is irrelevant whether it is put in place or not, it doesn't matter.

The problem was not financial, it was how I was viewing things. I needed to step back and see things how they really are, I had been too close for too long.

I was free all along and I just didn't know it........I have business qualifications yet it took an ex engineer to set me straight on figures

I can't believe I am sharing my silliness with you all but it is warts and all and really should go straight to the 1st world problem thread.

Share details, next and last post on this issue

Best to all

 

I feel it all the time... if you win the rat race, you are still a rat.

 

The "game" of life never stops until you expire which is the final release from the burden of performance

Congrats on achieving financial freedom btw.

 

You sound exactly like my husband . I've given up trying to reassure him about debt these days. How can facts and crystal clear spreadsheets win over years of early brainwashing? Glad to hear you trust your wife's opinion. Actually I think it was @Terry_w who told me ages ago when husband and I were disagreeing about investing that it's very often the husbands that worry most about debt or risk in investing (he'll correct me if I got that wrong).

Anyway, great you've been freed from the treadmill and can enjoy life more. P.S I think Sydney is a beautiful city but living there must feel like a double edged sword at times. Without a word of a lie one of my $200k country places looks exactly like a home that I saw in a nice part of Sydney that sucks up around $2m in equity. Imagine how soon you could be free if living in that area didn't matter to you one teeny bit? I get that it does matter a lot for some. Just saying it's much harder for some to get passive income from investing when living costs are so high.

Look forward to more of your posts.

 

Congratulations! And thank you for sharing your story. Not silly at all - I think a lot of people would empathise.
And well done on those wise early investments - most notably your S.O.

 

Regardless of anything else, you hit the jackpot there mate. From what I have seen, not too many people in life experience this kind of blessing.

 

You can retire when you die or die when you retire.

We all have a choice.

 

Hey all

Thank you for all your nice and constructive comments. I will reply to all.

It may be helpful to do this detailed post before I reply to individual comments, again, thanks.

O'k. During the discussion my wife said something like we have to look around and see we are doing o'k in all ways. She said that in the scheme of things we are really rich in world terms and that I was thinking like a poor person.

Yep, grew up with nothing, fought, studied and worked hard but no matter what I did I was not good enough (play Mike and the Mechanics - Living Years in the background). Wanted to give my son all the opportunities and understanding that I did not get. Reality check - we are doing o'k and all he wants is his dad.

We looked at our options:

1. Move into the nicer house up the street (IP) and rent out our place.

Well, Terry and all the great brokers here are right. Live in the IP with a debt of $340,000 (now non-deductible) and the net rent from the old PPOR now taxable income.

Only 50% of net rent would be taxed as my wife would use the threshold and pay no tax.

Not the best option but I would still feel as slave - you will see going through the next options this slave to work thing starts to disappear.

2. Move into the IP and sell the old PPOR

This part of the discussion was realty hard for me - I mean the game was about accumulating and not starting to unravel the 'empire' )). NO - not an option!!!!

Wait - picture yourself living in a better place up the street and no debt - suddenly it became an option for me

The property is just a thing and things don't matter

Ok - if I do this, pay the debt off and have about $900k extra to invest. Pay off the loan (fixed with 2 years to run 4.99% - break fee not too much)

I heard Terry in the background yelling "It is your PPOR - don't forget all tax free!!!!!)

Then I heard him & the Brokers say "Don't you read his tax tips and our posts? - don't pay off the loan - into the offset - $340K just sitting there no more applications and you can send the whole $900k to work for you if you want.

3. We locked in the thought of selling the PPOR and moving into the IP (better place and 50% bigger)

Basic figures (these are incremental / additional figures as we have a few investments & cash around the place)

$900k into Vanguard funds @ 5% = $45k income pa

Add $25K a year from some other investments

Total $70k a year income, income from other investments, maybe live off some cash we have stashed away (not the offset) if we have too good of a time - I coast into retirement age and then pick up my tax free super pension and over 10 years later (how did I ever land her?) my wife picks up her tax free super pension.

I can leave work now!!!!!

4. Hang on - I don't want to leave work now........what the..............

In the blink of an eye my attitude to work and life changed. I have real options, I am not a prisoner and the debt that I have been fighting with is just a number on the page that can be taken away at any time we choose.

I don't need to feel a prisoner nor a slave to debt - I don't have to chase overtime and I need to spend more time with my son.

Our decision

In Feb next year we will pop into our RE and have a chat - if we can get the 1.24 for the PPOR we will sell it and move into the IP.

The proceeds of $1.24mdisbursed in the following way (ownership of assets based on tax efficiency);

$340k into the offset - no net debt and access if needed (thanks guys)
$400k into Vanguard wholesale Australian Shares Index Fund (reinvest distributions)
$200k into Vanguard wholesale Australian shares Index Fund
$300k into my super over time (invest in cash account and drip feed into super)

If we can't get the 1.24m for the PPOR - we may take less but we won't be forced sellers - we don't have to be. The beauty is that it doesn't matter what we do with the PPOR now - the discussion and decision process was the key for me.

The best decision

Regardless of what we end up doing - it really doesn't matter - we may stay I our PPOR and keep the investment property and go P&I when fixed rate finishes.

It really doesn't matter any more

I am now happy to work, I am in the FU position but my attitude is now anything but FU - funny isn't it?

Pulling back from O/time at work
Making work fit in for me
Pumping money into super for tax efficiency
Loan is just a number I don't care about any more
Release the purse strings
Forget about the loan
Spend more money and invest what is left at the end of the year, if we want to.
etc, etc.

My game is over in a sense and in a sense it is just beginning. The difference now is I am making choices and not a slave to anything.

I hope this all makes some sense good people.

Best regards

 

Hey Biz

Looks like it is the white flag in end - final lap - hope I got the fuel level right.

best regards

 

Wish I could be like that - maybe I can change to that degree - there is hope for me after all.

best regards

 

Yep, important to have a great relationship. We are as different as chalk and cheese but our values are matched. The other thing is that I am the creator and custodian of the spreadsheets but I could not see the forest for the trees.

Agree re your comments on Sydney - we do live in a lovely pocket f the place though.

Plan z is rattling around the back of my head - rent the IP out again and leave Sydney - add about $30k in net rent to the figures...........too much change too soon for me.......maybe in the future

Thank you for comments

Best regards

 

Thank you!!!

Yep - hit the jackpot with her, and genetics - the boy has her looks and nature - double luck

Best wishes

 

Thanks Leo - she makes me want to be a better man mate

Hope all is great for you mate

 

I now know that I have a choice, err choices....I will try and use them wisely.

Best wishes

 

One final thing as I am all typed out

Special thanks to poster MTR - I have noticed over the last few months you have started some 'alternative' thought provoking threads - the ensuing discussions have been very helpful to me and I trust that others have benefited too - thanks

regards