Can or Will you retire on property alone?

It's more than 40 years away for me so who knows how much growth my portfolio will have, how much I'll spend or how much left. I've got enough sense to balance my finances going forward though. I've always been quite frugal and don't need 'stuff' so will return to this at 90 if I need to. None of my plans have ever required alot of money, and I've done alot in life. A last minute swim with the crocs or similar exit is unlikely to cost much money and more appealing to me than long term old age nursing care.

 

i think i get it - without negative gearing you cant subtract rental income losses against your employment income. so if you are positive then you would be better off wouldnt you? because you wouldnt have to add rental income to employment income?

this explains it pretty well if anyones interested
What negative gearing changes could mean to you

 

We must come from the same planet as I agree with you except that bit about being croc feed.

A bullet through the brain might be cheaper and less painful .

 

The NG removal debate comes up all the time and never has been successful because if you think of the property like a business then why cant you claim these losses. Sometimes it is a paper loss (e.g. depreciation), some people might call that unfair but the building is worth less than what it was worth a year ago or even 10/20 years ago.

Think of a house in its original condition (absolutely no work done) from 50 years ago the house is pretty much worth zero and some might consider it better to knock down and start again. So if someone then decides to renovate it and spend $50k why can they not claim this deprecation as again in 20 years that '$50k' is now worthless.

Also any changes to NG would need to be grandfathered same as CGT. Maybe one day it might change but then you would also have to change it so businesses also cannot claim it...

 

that is not true
James Howard Marshall at 89 cost of living increase a lot and his pace of life increased ...he married Nicole Smith age 26 lol

 

Well said mate. I'm doing the same.

For me super is like a bonus - maybe you'll get it or maybe you won't. Ultimately it's up to the government to do whatever they want with your super. I rather prefer something I can control myself (e.g. investing opm in IPs).

 

I also see super as a bonus if I live that long, I think the government will increase the preservation age later which will suck. But I will do all I can along the way to better returns when possible. I won't put extra in now (@37) as I can invest the funds elsewhere, but I will switch it to smsf when the time is right so I can buy the investments I want and reduce the management fees along the way. Will re asses at 45 and see what serves me best on where additional money should go too.

 

That is truly sad.

 

He might run into Harold.

 

This is gold. It's all relative to ones age. As a younger folk wanting to retire much earlier than 60 and having seen what the government in the country I came from can do to people's super (and having seen the way my mom retired) I have no faith in it. If I eventually get some super - good, if no - so be it. I rather prefer to count on what I can do myself now for my early retirement.

 

Still playing his tuba no doubt.

 

Pray tell what country that was as super was a tradeoff for a wage rise, it's not the government's slush fund. Some countries had overly generous schemes which were totally unfunded liabilities allowing early retirement and generous 'pensions' thus contributing to many European countries financial woes.

 

@Scott No Mates It was USSR where I was born. People also did contributions towards retirement plans, saving for the time when they can retire. All went to dust with the collapse of the union (or a bit later in some cases as the young republics needed to get money from somewhere). People were left with pretty much nothing. It's a really sad story.

It can really be "the government's slush fund". Luckily, Australians haven't experienced this yet.

 

Property could be the government's cash cow. We haven't experienced this yet but it could happen just as easily as changes to super

 

Sorry, hit post early.

Ive run a financial plan for a decade or so that seeks to balance my pre and post 60 income in the most tax effective manner.

I used to work in an actuarial role - so it is reasonably accurate.

The early retirement piece has been supported by residential property, and has overachieved my estimates, allowing a late 30's retirement. Could this have been done better with other assets classes? Sure.

Regarding Super. Preservation age has not changed. It is either 55 if you are a boomer or remains at 60. Agree it is not as attractive as it once was, it is now harder to get money in - but even with $1.6m caps 15% till beats 50% tax.

 

I read the first post and skipped the rest but the end game IMO should always be use residential to build equity, transition into commercial for cashflow in retirement.

Much higher yields with tenant paying all outgoings.
Yea Yea higher vacancy and all that jazz but it's about buying right, just like any property.

 

Current Sydney portfolio since 2012.

$1.2M total (PP + fees + SD + reno + const. costs).
$113,880/yr rent.
9.49% ROI

Rents haven't moved much since original purchase dates. Capital sky rocketed.

Paid down since then so sitting at a higher ROI and expanding to different strategies and places now.

It's possible. Though still meeting a lot of people focused on no. Of houses and not the numbers needed to get them out of a day job.

 

And everyone got a pay rise (6% from memory); it was borne by employers and it was not performance based.

I remember we started documenting employees pays as 'salary + x% Super'.

We quickly changed this to 'salary including x% Super' once the government started increasing the 'x'.