Endgame - What are you aiming to live off?

Interesting story - would make a great movie.

 

Terry, everybody knows this story, except maybe those who might suffer amnesia....

Is there something you should tell us?

Kerry might also like to know .. in a loose sort of sense...

 

I was playing squash at the time, that is why I don't know about it.

 

Hmm, can I ask, innocently of course, if your logo contains a pair of crowbars?

And, not only were you participating at a sporting event at the time, but have never been aware of this event of foul play in the following 11 years?

Maybe Kerry lost his gold betting against a Royal Flush....

 

The end game is to do what you enjoy.

 

Just out of curiously (for the people who voted combination - like my self + share dividends now that I've taken the property only blinders off) How have you broken up or how will you live of a combination?

I'm still sussing this out myself. But I think (well at least at the moment) that I will choose to cover certain expenses (possibly rent & holidays?) with my equity (via LOC) and as long as the LVR is low enough on a few IP's to have the rent cover P&I payments on my LOC.

Will be crunching some numbers once my swing at work is done to see if it is practical/sustainable.

What are your plans?
Do people generally say, ok for 'x%' of my living costs ill LOE?

Are you jus working this out as you go along (like myself)

Would love to hear of anyone's thoughts on this and what their plans are - or if anyone is actually LOE (partially or completely) at the moment and wouldn't mind sharing how they break it down

Thanks
KJB

 

Borrowing to pay private expenses would be a waste of good borrowing power.

 

I voted combination, we live off rental income - six figures, profits from developing property each year which is reinjected back into the next/future projects.

We have partially LOE as we have money coming in and coming out, like a revolving door, dependent on what is happening. The key for us is to continue to increase asset base and cash flow.

 

Due to the lumpy nature of development cash flows, LOE is bound to be a partial strategy for me too. I don't really consider it LOE though, just borrowing cash flow and returning it.

 

your right
The idea is actually to fund your own developments and you become the bank/lender. Your trust buys land and develops, still working on this one and how to minimise tax

 

In the governments favour of course.

That the now game and the end game.

This is how the big boys roll, hence there continued exponential success. Im also going for this approach, slowly but surely.

 

I don't understand how this can be true forever. At some point you retire, you're 60+ years old. Equity redraw is tax exempt, and easier to access than constant purchases and living off taxed rental income - assuming you can even find the property and the additional risk / management overhead.

Did I miss something because it's a reasonably well advertised retirement option.

 

Does super count? I don't use a SMSF for property, and I salary sacrifice to increase it. That'll provide quite a nice pension by itself. Plus I have public service super which has a pension as well.

If it is only property then I'm just making it up as I go. But I'll be working for another 30b years yet, so I don't think it's important yet!

 

On that topic part of my strategy is to purchase well located commercial office space to run my business from as well as sublet, via SMSF.

I beleive once property is paid off the rent is tax free come retirement age, under current legislation?

That alone could fund a decent retirement but definitley not relying just on that. Will aim to have 3-4 sources of passive income.

 

I'm not an accountant, but my understanding is if you pay contribution tax (15%) on earnings within your super it is tax free on payment. If that is not true then I'm super (get it?) keen to know.

 

Jj

A well advertised retirement option in a country where the vast majority of people require welfare to survive retirement doesnt give me a lot of comfort

 

Looks like you missed this:
5 Living Off Equity Strategies to Speed up Retirement 5 Living Off Equity Strategies to Speed up Retirement

Why not borrow to pay investment expenses, have the interest deductible and then live on the rents.

Without a job it may be hard to borrow too.

 

The rent would be income to the SMSF and taxed at 15%. Once you are drawing a pension from the fund it could be tax free to the fund.