Delaying FIRE for dream home

Discussion in 'Financial Independence, Retire Early (FIRE)' started by scientist, 30th Jun, 2021.

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  1. scientist

    scientist Well-Known Member

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    Has anyone here reached their FIRE goals, only to then use a large portion of their invested capital towards upgrading the PPOR to their 'dream' home?

    Seeing as this is a property forum, curious to hear from people who have done something like this. Any regrets / reflections and insights?
     
  2. Anne11

    Anne11 Well-Known Member

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    What would reaching FIRE mean to you? If it means that it allows you to purchase your dream home then it has served its purpose, but if reaching FI means you want to stop working and by buying your dream home stopping you from reaching FI then it depends on what makes you more happy.

    if you can reach FI now, I think you can buy your ‘dream home’ now and reach FI again in the future
     
    Last edited: 30th Jun, 2021
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  3. Mark F

    Mark F Well-Known Member

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    It seems to me that in the scenario you lay out you have not reached your FIRE goals as you will spend much of your capital on your new ppor and will not be able to retire early - the RE in FIRE
     
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  4. scientist

    scientist Well-Known Member

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    Yeah I recently did this - diverted a large portion of invested capital to swap PPOR for a nicer area, somewhere we'd be happy to stay forever. It wasn't an easy decision but mainly came down to - I started feeling boredom day-to-day, and with young kids, we can't really go off travelling for months at a time anyway, notwithstanding covid. Next long-step is to restore the invested capital base to comfortable levels.
     
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  5. DoingOK

    DoingOK Well-Known Member

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    We did this a while back. Our ppor is now intergenerational and will potentially be in the family for a hundred years- literally. While it never really came near hurting our fire. I would say go for it. Your ppor is what you want it to be. For me it's a monster house (I mean monster) with a 3 br granny flat (house) on 3000m2 in the middle of suburbia. I have no need to leave my place while in this or the previous Brisbane lockdown and that's good enough for me. Even if I do need to leave its 400 m to a shopping centre. Again, go for it. You will never regret having the ppor that you want.
    Doing ok
     
  6. MTR

    MTR Well-Known Member

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    Did this 13 years ago, absolutely no regrets. We love it, large period inner city home,
    It never stopped us continuing investing.

    I am a believer of rewarding yourself for doing the hard yards.
     
    Last edited: 1st Jul, 2021
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  7. Never giveup

    Never giveup Well-Known Member

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    I am partially in the same scenario, I am 37 and work FT, bought a house that is going to be family home and it has mortgage.

    Wants to start family and also have 2 IPs but very small share Portfolio. I am not in rush for FIRE and @MTR profile tag line got to me lol (Hard work never killed anyone, but why take a chance)


    We are good with money but having a large PPOR mortgage is kinda daunting, we will be fine paying it off slowly n steady but given it is our family home. I am tossing with an idea of selling both IPs and share portfolio to pay off the PPOR and then start fresh as we won't have any debt etc....

    The main flaw is that we have to pay heaps of CG tax and also to enter back into the market won't be easy.

    Currently, instead of doing Active Debt recycling. We just pull some equity from PPOR and invest in the market to claim Interest for Tax purposes.

    Our super balance isn't heaps and considering salary sacrifice as well and when I read people with 1.6 million supper or share portfolio of $2 mil - it seems like way far out of our reach....


     
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  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Yes, I have done that in the past and so have many of my clients. Some sell several properties just to get into their dream home and they seem to be happy having done it.
     
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