How Long Will it take to RETIRE on SHARES

Discussion in 'Financial Independence, Retire Early (FIRE)' started by MTR, 5th May, 2017.

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  1. MTR

    MTR Material Girl Premium Member

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    I think I started a thread some time ago now regarding whether you can retire on property alone?

    What about shares? I am very interested in comments your POV and strategies to achieve this.

    MTR:)
     
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  2. D.T.

    D.T. Specialist Property Manager Business Member

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    @austing wrote a beginners guide which might help answer this question
     
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  3. PandS

    PandS Well-Known Member

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    I can retire now on shares alone but still got small kids so load of things I need to fund them
    till they got their degree and I give them a sizable deposit to move out.

    I started the share Journey, 13 years ago
     
  4. Marg4000

    Marg4000 Well-Known Member

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    My brother invested in shares and retired when he was just over 50 when his dividend income exceeded his day job salary. Income has increased every year since. Only property is his PPOR.
    Marg
     
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  5. Nodrog

    Nodrog Well-Known Member

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  6. Barny

    Barny Well-Known Member

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    If your not borrowing any money, use a compound calculator. How much can you invest per week?
    How much income you chasing? Give us a figure.
     
  7. MTR

    MTR Material Girl Premium Member

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    Can you make up an example anything... :p
     
  8. Hodor

    Hodor Well-Known Member

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    Only points to the equation are; your inputs (savings), returns and desired income.

    Say you need $50k pa and expect 5% dividends ($1m capital)
    Have $10k
    Can save $2k per month
    Average return is 10%pa (5% dividends reinvested and 5% capital gains)

    It will take you ~17 years to get to your goal.
    If you work an extra 4.5 years (around 25% more) your income will increase by 50% if you need a little more.

    Reality rarely follows an equation/spreadsheet.
     
  9. evalord

    evalord Well-Known Member

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  10. Barny

    Barny Well-Known Member

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    1000 per week invested with a 4% return re invested for 20 years will see $1,590,000. That should generate min 5% cash returns 79,500 year.

    At 7% returns total 2,257,000. 5% cash on this is 112,850 a year.
    Tax will vary how you set it up.
     
  11. Hodor

    Hodor Well-Known Member

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    "I don't currently see good value in either shares or IP ATM. I'd guess that in a couple of years, IRs will be up a little, rents up a lot, prices still mostly flat with the share market in bubble territory." - Keith, Mid 2007

    :eek:
     
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  12. Mumbai

    Mumbai Well-Known Member

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    Sorry to piggy back, but hypothetically, if I have 250k cash in hand, should i invest it in one go or in smaller chunks?
     
  13. Nodrog

    Nodrog Well-Known Member

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    I thought this got discussed later in the thread.
     
  14. standtall

    standtall Well-Known Member

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    I know someone who is worth 8 figures at-least. He invested in Pakistan stock market in early 2000s when index was 1500 Rupees and now it has reached 48,000 Rupees in around 15 years.

    In other words, if someone had invested $100,000 in 2001, their portfolio would be worth well over $3 million with 8% average dividends per year.

    Sydney bubble looks nothing in comparison to this: Pakistan Stock Market (KSE100) | 1990-2017 | Data | Chart | Calendar

    He now lives in Australia but refuses to invest in ASX as it will be impossible for him to produce similar results here.
     
  15. Hazelnut_Flatwhite

    Hazelnut_Flatwhite Active Member

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    Agree with @Hodor, the most important factors are your saving/investing rate and your desired income.

    From what I've observed, the FIRE community seem to generally consider 4% a safe withdrawal rate from your investments (dividend or capital) and assume something like a 6 or 7% average annual portfolio growth and seem to be investing in ETFs.

    You just gotta figure out what 4% equals for you in real terms and the global stock market *just* has to keep it's general trend (over the long long term) of increasing in value.

    I obviously haven't tested it out, but this guy is like moses for that community, this relates to your question a lot The Shockingly Simple Math Behind Early Retirement
     
  16. D.T.

    D.T. Specialist Property Manager Business Member

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    Gotta be in it to win it :)
     
  17. Nodrog

    Nodrog Well-Known Member

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    Here one of many views:
     
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  18. samiam

    samiam Well-Known Member

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    hypothetically saying, if you now got 150k cash in hand, what'd you invest in? :D
     
  19. Archaon

    Archaon Well-Known Member

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    Hypothetical shares or Hypothetical property most likely
     
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  20. Barny

    Barny Well-Known Member

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    Casino-red or black. Almost 50/50 chance to double your cash. Property is too slow and you're at a loss soon as you buy. Shares are so boring you will end up selling and buying crap at the wrong times.
     
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