Thoughts on strategy to early semi-retirement

Commercial leases often have a ratchet clause, annual increases at CPI or greater, market rent reviews or a combination.

Risk is the downside of commercial property - if economy is down so are occupancy rates.

 

But you only need one tenant haha=buy a post office?

 

I listened to it and it includes interview with the late john boggle. Interesting

 

Retire early with kids? Good luck with that! The bills haven’t even started for you!

 

Yes

Hi "Henry F"
You are one smart man and I totally agree with you
1: One tenant one property is enough for the rest of my life
2: Yes Post Office , you hit the nail on the head
Government signs off on Sydney GPO sale
Return to sender: Australia Post to sell 1 Martin Place - Sydney GPO Our Heritage
If I was the landlord of the Canberra GPO and owned that land I would need no more and I would be laughing too ha ha hee hee!
After all they have invested in the building they would certainly not walk!
You must add some more wise tips on PC
Here is another site where the purchaser paid $23m and is putting a $49m building on a lessors interest site
Cloud-like pod proposed for the top of a heritage-listed Sydney substation
They will not walk when they have invested $72m on your site
Land appreciates buildings depreciate ...buy the land

 

Fair enough though it is semi-retirement and there’s no way I’d send my kids to private schools

I guess if anyone has actually undertaken the journey with kids I’d love to hear their experiences including yours as I’m sure you’re on these forums because you invest in property/shares.

 

Where do I start...

All your utility bills increase because your catering for more people. Same with groceries.

You need a bigger car because you’re carting around kids including all their stuff. More fuel, more wear and tear.

Bigger house, the 2 bed unit isn’t going to cut it anymore.

Day care costs. Per child 3x days a week you’re looking at around 8-10k a year after rebates.

Both working now? Kiss one income goodbye or at best one becomes part time. Have to leave the kids somewhere when you’re not there. See day care costs above.

Party’s party’s party’s.

Sports.

Your borrowing capacity takes a hit because you now have dependents.

Sydney/Melbourne without a mortgage or rent costs you need to be clearing 70k a year NET to be living an average life with a family of 4. Drop an average 500k mortgage on top you need another 30k NET. So around 2k a week NET just to be getting by.

Unless you have a solid business or exceptional income you ain’t even semi retiring early with kids.

 

You’re right of course about all the expenses. It’s no surprises that the majority of examples of early retirements and FI are from people with no kids.

Regardless of what the future holds it makes me think I should maximise what I can do now and for the next couple of years to help set up a future passive income even if it won’t cover all the expenses.

 

Have the kids fend for themselves?

 

Good luck with that!
I have 3 adult children, who still at times rely on the Bank of Dad. It's simply just a part of parenting.

 

The other thing I would have done in hindsight, is to strategically position my career to be in a position to do part time or consulting where I set my own hours, or if I were to go back even further, do a trade before going to uni, and keep the trade work as a side business.

Cheers,
Inertia

 

This is the new Fab and Fashion, work you own hour, retire young etc ...
like anything else it will works for some people and people find hmm I can do this and think the mass can do it.

you better off work in a less stressful job, find job that you enjoy doing, enjoy life every day
then that just as good as retirement but with something you love to do.

by all mean invest, stack up your capital and passive income but you find retiring early can be elusive as you cant predict the nature of your investment return and cash flow unless you have many millions stacked up then you can cater for all scenarios but for most it is elusive

 

Sound good in practise pretty hard to do, especially if you want consistent cash coming in and the number of hours you can get paid doing it and profitable trade every week.

 

$200K a year net income with $50K expenses equals 75% savings rate and retirement possible in only 6.8 years.

Calculator showing this here: Early Retirement Calculator

Maths behind it here:The Shockingly Simple Math Behind Early Retirement

 

Come on Pands, no one is going to pay thousands for a seminar or buy books to read stuff like this!

 

Haha you're pretty spot on. I can't wait until the little one is out of daycare (currently 5 days a week). Will be another $12k in our pockets even after paying for the years school fees, uniforms, excursions, books etc.
That's a damn good yearly holiday for us!

This calculator is pretty cool. It solidifies all my calculations of when I think we should become financially independent....

....Only 85 years to go!

 

Continuing the shockingly simple theme, you can reduce this time to retirement by earning more, spending less or doing both

 

I am sort of semi-retired but with a huge mortgage still hanging over us.

We had the kids first, then later went into property investment. Regarding raising kids, these are some of the things we did that are generally different from the proverbial "must have" money sucking adventures.

We started out with a frugal mindset, and only participated in family activities that were also very frugal or great value for money. EG watching movies at home with supermarket snacks rather than going to the cinema and buying junk food. Save $100 a week this way and you get a week-long family ski trip or cruise each year instead. Just don't travel anywhere with little kids - wait until they can feed themselves, go to the bathroom themselves and remember the experience afterwards. Adults who take a three year old to Disneyland are doing it for themselves, not for the child's benefit.

I found it was more economically viable to be a stay at home mum than to pay for child care, although other people's situations can vary. These days it is accepted that the Dad can stay at home if Mum is in a better position to work post-kids. My savings on transport, clothes, good shoes and grooming balanced any cost of childcare. If you relocate to a rural property, you can have all the free-range kids you like and they will not cost much at all - and think of the housing savings. As long as you have good wifi, you will be set.

Before I had the first Bub, I stocked the pantry with ten week's worth of non-perishable essentials, like coffee and chocolate - and then used my time later to shop wisely and home cook.

In summary, we can afford a comfortable lifestyle for two adults on $50ooo per annum if there was no mortgage costs. I work 4 days a week for 40 weeks per year and earn 60% of that amount. If Mr Angel were to leave his day job, he could easily pick up another $20k a year in casual fifo work, leaving plenty of time for us to travel together before we get too old and cranky.

 

I’m pro keeping the kids at home as long as possible, at least until they are 3 if you can. Cost aside though, what I have found is that the kids who didn’t go to pre school a couple of days a week are really behind in kindergarten. I suspect It would be different in rural areas but in the cities nearly all kids would be in pre school.

 

O Pre school and Kindergarten are awesome. Full day care from six weeks of age is absurd (in my opinion) (Kindy is optional in Qld and Pre School is what you call Kinder)