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Hi.. I am 32, retire at 39? Should I?
Old 11-22-2007, 02:29 AM   #1
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Hi.. I am 32, retire at 39? Should I?

Hi everyone,
I am 32 y.o. a Marketing Analyst in the Automotive Industry and I have a house with 8 more yrs to go on my mortgage. I am single and no kids. I have no savings, as most of my $ goes to my mortgage, prop. tax, hot cars, and hot dates.

My Stepfather 70 y.o. no kids, planning to give me his 500k house in CA in the next 8-10 yrs. The house is paid-off, monthly property tax is about $350.

Now, I am thinking about retiring once my house is pay off in 8 yrs. My retirement income would consisits of rental income from both of the houses (approx. $2700 after-prop.tax), and I will be traveling and living aboard like I have always dream of.

There is the catch, if I do this I will lose my current job which I make about $95/yr, also I will lose health and dental care. Not to mention, stop adding money to my 401k/SS.

Here is my question, I always dream of traveling and living aboard, and it is very likely I will be max-out at 100k to 120k/yr in my current profession (don't think I have the background to become corp exec). Will anyone willing go with this insane idea and giving up everything to travel and live aboard?
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Old 11-22-2007, 07:40 AM   #2
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ahhhh, no.

Rule #1: Never base your expected retirement on an inheritance or gift you have not yet received.

Also, trying to manage rental property in California while you are abroad could be a disaster.

And another thing...you have no savings at age 32? If you are single and making $95K a year, you should have saved something by now. At the very least, you should start a saving plan today, not tomorrow.
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Old 11-22-2007, 11:33 AM   #3
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minibataar,

You save nothing on a $95k salary and plan to cut expenses to $31.4k in eight years? While traveling and managing two rental houses?

Not likely.

If you're truely interested in this plan, cut back on spending NOW, save the difference, sell both houses if you do get the CA house (TickTock Rule Of Finance - discount heavily promises of future money/gifts/etc) in eight years, and then go for it.

You need to decide what's more important to you - fast cars and fast dates, or ER and perpetual travelling.
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Old 11-22-2007, 09:46 PM   #4
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Quote:
Originally Posted by minibaatar View Post
Hi everyone,
I am 32 y.o. a Marketing Analyst in the Automotive Industry and I have a house with 8 more yrs to go on my mortgage. I am single and no kids. I have no savings, as most of my $ goes to my mortgage, prop. tax, hot cars, and hot dates.

My Stepfather 70 y.o. no kids, planning to give me his 500k house in CA in the next 8-10 yrs. The house is paid-off, monthly property tax is about $350.

Now, I am thinking about retiring once my house is pay off in 8 yrs. My retirement income would consisits of rental income from both of the houses (approx. $2700 after-prop.tax), and I will be traveling and living aboard like I have always dream of.

There is the catch, if I do this I will lose my current job which I make about $95/yr, also I will lose health and dental care. Not to mention, stop adding money to my 401k/SS.

Here is my question, I always dream of traveling and living aboard, and it is very likely I will be max-out at 100k to 120k/yr in my current profession (don't think I have the background to become corp exec). Will anyone willing go with this insane idea and giving up everything to travel and live aboard?

You say "no savings", but then you say if you quit job then you "stop adding to 401K". So if you do have 401k how much is in it? (That kind of counts as savings!).

Also, assuming you do inherit the house in CA and turn it into rental, I thought CA on change of ownership upped the frozen property tax rates on real estate. That is, you may find yourself paying property tax of well over $350 month on that CA house when you own it as compared to now when SF still owns it. So your net income, if you were a "successful longdistance" landlord (which many landlords would say is an oxymoron), may well be lower than you are counting on.

You lose health benefits when you quit job and will have to pay for your own health insurance. Unless you can get yourself qualified in one of those foreign countries for receipt of their "free" socialized health care. Don't know if they do that for the non-citizens though. Self-pay medical insurance is expensive. Then you would have the problems of finding such insurance which covers overseas.

All in all, from a financial planning standpoint, you have no well-thought out plan, but lots of ill-definded expectations.

From a purely financial standpoint, I'd say forget it--looks like a longterm disaster waiting to happen. Now if you can put it off to age 49, and in the next 17 years be diligent and serious on planning, preparing, saving, I'd say get to it. You could have your foreign travel cake and still have a decent retirement after that.

If you don't care about throwing your old-age retirement life to the winds, and cannot wait to sate your foreign travel dreams at age 39, well, then you cannot wait.

Another question, if you did quit at 39 and travelled/lived overseas, do you expect to do that the rest of your life? Or for 10 years? Or would you come back after a while to resume a working career here for 5 or 10 years?
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Old 11-22-2007, 09:53 PM   #5
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Why not get your travel itch out of the way by coming to Asia and eventually look for a job in either Hong Kong or Singapore? Shortage of financial professional out here and very good job prospects. Met a guy yesterday who came out this way 10 years ago. Came armed with a backpack, long on dreams and short on cash. He's now a partner in an investment management firm. Originally from Illinois.
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Old 11-22-2007, 10:21 PM   #6
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I say go for it....why let something so small as no savings stop you
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Old 11-23-2007, 06:37 PM   #7
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Hmm, at 32 I was a single marketing guy.

At 44 I was a married retired guy with a son.

Life comes at you pretty quickly. Sometimes, not so much. Plan accordingly.
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