How much property do you REALLY need???

Pretty much the same for us except we've got no kids so plan on selling them all eventually. At the moment we're living on a combination of rent from 10 ips and pay from me doing blocks of contract work for a few months each year. I'm selling down some cheapies and poor performers at the moment to pay off better performers.

At 50 I plan to sell 1 every year or 2 and live off equity plus rent from the remaining ones, also hubby's super until I get mine at 60. I'm working hard on increasing equity and cash flow at the moment because I like the challenge, not ready to stop just yet. We live cheaply though and don't need more than about $60-70k net per year.

 

Although I'm not speaking for @skater, I'd say how much she and Andrew live off isn't really relevant. Everyone has a different level of spending depending on their lifestyle. Of course, the minimum expenses required to live such as groceries, basic utilities, insurances etc, after these costs the 'lifestyle' costs very much depend on what kind of life you want. So although I understand why you are asking, I think each person's answer is specific to them.

 

I agree.
I think anyone who has reached financial freedom via property regardless of income is pretty awesome.

Its a forum not a competition, and No one on this forum is paying my bills, I dont care how much they earn or what they have, just paddle my own canoe so should everyone else, it certainly makes for a much more fulfilling life if we take this attitude....enough ranting I guess

 

I know of several LOL (little old ladies ) who live in mortgage free ppor, get the pension and are laughing. Even without extra investment they do ok.

Admittedly they will have to sell the ppor when they have to move into a nursing home but raising the >$500k from the ppor won't be a stretch.

 

Good on them.
I don't like that the current government is reducing peoples pension, even if they only have a little bit of super.

 

That's reassuring to know. Even though I think we have enough we have to push ourselves a bit to spend on luxuries just in case. Making a conscious effort this year to have more holidays/breaks, lunches out otherwise I wonder what was the point of all that effort just to pass the proceeds on to extended family who we rarely see.

 

@Azazel - these are LOLs in their 70s & 80s. Limited exposure to super as their husbands were self-employed. But aren't all assets outside of the ppor are counted?

 

I know someone who had their pension cut by more than $1k due to changes this year, only the PPOR and a little super. Mongrels.

 

I was actually there early and left at 10ish

Certainly meant how "much"

 

You can still have substantial assets outside of the ppor before you start getting the pension tapered - about $300k for a couple and phased out at over $1m linky

 

Agree everyone is different. The intention was not to pry but to get some SEMBLANCE of the how much is enough question from people who've done it.

For example, my how much is enough guesstimate just so happens to be about $100K pa not including a mortgage. That's with kids though - I'd ideally prefer not to wait another 20 yrs till they'e completely out of the house before I retire. However, if a couple said they were living on $30K pa, paying all their bills, eating well/healthily, have the heater on whenever they're cold and squeezing in an overseas holiday or two per year - that would be a decent indicator that we either have:

- set ourselves an unrealistic and unnecessary target or
- doing something wrong (without knowing it, because we THINK we live fairly modestly)


FYI this topic was covered somewhat in another thread re: budgets.

 

you must know mother

 

Serenity = Paid off PPoR + Inheritance + Pension

 

I don't need more income , i don't need more properties but i do need to have a hobby that keeps me physically / mentally active and properties does that.

 

then you could do BA for free

 

what about a book club, voluntary/community work? now if you lived in Perth you could join me walking my dogs

 

Well I don't look at it in terms of what I 'need', I think many people have passed the 'need' stage by now. For me its more about how far I can go and what else I can do. I thoroughly love what I do and I'm free to do whatever I want on most days so why stop? I wanna see how far I can go and grow. But everyone is different.

Cheers .

 

I Think it is a good point you raise, and one that is often overlooked by people who have big ideas about kicking back to live off a rental income stream to fund their retirement. I was surprised in that PC Poll the other day the number of people whos plan was 100% live off rent. For me equity gains, LOE, whatever you choose to call it also needs to play a big role.

In the example you give of the $3 million portfolio the cash flow is pretty poor, but in 10 to 15 years that portfolio may have added another $2-3 million in value. For me if you are transitioning to a phase where you need more income then one way or another that equity needs to be accessed or put to work in a higher yielding area than buy-hold residential property.

 

If you don't have a mortgage, why would you need 100K? I used to think that was my number for retiring but it can actually work for much lower. I guess if you have two kids at the most exclusive schools in the country you could be looking at 30K+ for school fees. My two are in a Catholic school and all up, yearly expenses wouldn't be more than 6-7K. Expensive regular holidays aren't really on the cards for me as holidays are limited to school holidays and the kids would prefer a week at a Big4 caravan park and then a week doing playdates with school friends than travelling Europe.

Think about what things you spend your money on? What things are related to work? Do you eat out a lot or buy pre-prepared meals because you are too tired/limited time to cook and eat at home? Are your properties negatively geared so you are having to top up the mortgages yourself? Do you take your kids to a play centre or other expensive activity so you can get some work done or you need some time out? Do you have expenses related to work that you wouldn't have if you were at home? eg after work drinks, $10-15 lunches at the local food court, transport expenses, work suits etc.

I've just gone from a high income source to a very low one and I don't feel much different. I don't go to the shops as often to buy clothes and my grocery shops are more thought out than before but I'm surprised at how little I need to spend.

 

Yeah, I dunno. They only have a PPoR and a small amount of super. Odd.