Apparently you need 2mil worth of IP for a comfortable retirement. Is anyone there yet?

People are rich mostly by choice
People are not ususlky poor by choice and people are definitely not poor because they have chosen to be happy instead. There are so many flawed premises relating money to happiness or morals or friendship or any other silly thing people make up

 

Happiness comes from within....
Happiness comes from taking control and responsibility of your life.

And often, people are wealthy because they have control and have taken responsibility in their life, so happiness and wealth tends goes in hand with the other. And, yes, it has been said, wealth allows you to avoid things you don't want to do. And... wealth will also assist in buying you better healthcare if you ever need it, and it buys good food. So you get better health. Wealth gives options.

Of course, you could be wealthy by being corrupt or having an inheritance. But deep down I couldn't be happy living a corrupt life - my moral compass wouldn't let me. And my sense of pride means I want to strive and put some effort into making my life the best it can be.

Just some musings...

 

Very true, the trick would be to pick which are the flawed premises, perhaps some people suffer from cognitive bias.

 

First a disclaimer; I like having money.

I rarely read the finance or advice sections in the media mainly because, over the years, in general it's a reiteration and regurgitation of similar comments made in the past.

Having said that, this one caught my eye in which a person was inquiring about obtaining the Commonwealth Seniors Health Card to access the concessional co-contributions. The response gave the technical details but I liked the manner in which the author finished. It resonates with me and reflects what I think of some of my peers and former colleagues, especially the former public servants on defined pensions who I now avoid if at all possible.

 

I'll also add that it also gives you
1) The funds to fly off at a moments notice to investigate why an elderly family member has been left penniless.
2) The time to do the investigations during business hours & attend to the various services which take a huge amount of time (police, banks, solicitors etc)
3) To not give a flying f*** if you get any inheritance and the determination to put things right & make sure that the family member can enjoy what time they have left, and the ability to fund it, if necessary.

 

So true.
There’s really not much that much that money can’t buy in one way or another.

 

i see we have stray far from the opening title and moved towards question what is the value of money. so i gift you a fantastic quote a wiseman gave me about 2 years ago.

"Money is not everything, but without money you are nothing".


not everyone will agree with this statement... but its kind a true.

 

Well, the heading was misleading to begin with.

It states $2m in IPS , but in the text states "$2m comprising of 4 properties, ONE OF WHICH IS THE PPOR"!

So if properties equally valuable, then it refers to a PPOR plus $1.5m in IPS.
Marg

 

My PPOR is worth more than 500k so I could be need less!

 

So is mine, but we always ignore the PPOR when calculating retirement needs.

If you include the PPOR, the figure would be closer to $3m.
Marg

 

I dislike how the PPOR isn't included as an 'asset' according to financial planners as it doesn't generate an income. Although it does save an expense, yet if I was to rent out the PPOR and rent a place higher than what my total return for the PPOR rented it is now an assets even though I am in a worst cash flow position.

 

Tbh 2mil in IPS doesn't mean anything. Even 10mil in IPs is meaningless if the LVR is 90%. Its all about Net worth, not the amount of debt you have in the end.

 

YES YES YES!!!
Wealth is attracted through happiness and self development.

 

self development first

 

I guess "ignore" was the wrong word.
Maybe I should have said "as well as" our PPOR.
Marg

 

This+1.
So $2M unencumbered @ 5% return will give you around $100,000 pa.

But reading between the lines it is not going to be easy to achieve this with resi.
If you had 4 properties you need to double your money relatively quickly to achieve this income and then to sell down.

The question for the buy and hold investors is how many property boom cycles do you need to retire?
If you captured Sydney and Melbourne boom cycles at 500K a pop x 4 IPs, doubling within 3 years.... are you there after expenses??

MTR

 

What is it after expenses?

 

Some of the happiest people are l know are practically penniless. One gave everything away and converted a big van into a bedroom on wheels. She has just enough clothes & crockery etc to live with in the van and a life of freedom and she's always smiling. Interestingly, she works in aged care so perhaps being around dying older people all day has made her want to really live?

Another gave everything away and also refuses money for his work, instead preferring payment in food and trade, he is also extremely happy. He is a fit, healthy young man who has turned away from many modern luxuries and spent a lot of time with the Harry Chrishners, I love catching up with him, he has an amazing outlook on life and some very interesting philosophies.

Another is a yoga teacher, she works as a live in gardener on an estate, (she has a tiny one room annex ), she spends her days teaching and practicing yoga, she has very little in the way of material possessions and is possibly the happiest person I know. What she does earn she saves then travels, she'd be in her late 50's I'd say.

Not sure how the first two will get on into their old age, but the third lady will be right, she's already got her exit plan. I think of her often as I drag myself out of bed to be a mortgage slave, earning, saving and investing to maintain my current lifestyle into old age whilst friends like her have been able to just let go and live.

On the flip side, some of the most shallow, selfish, bitter, stressed and unhealthily people I've known over the years have been the wealthiest. Striving to portray a veneer of happiness but not really believing in themselves that they were actually happy.

I think I lie in the middle somewhere.