Leave my night job? UPDATE:

[gtmeouttahere]

New to this board and I have a question.  at 33 yoa, I have taken advantage of a strong real estate market and strong home sales to propell myself into position I never thought likely. 

I have been buying land in the last 3-4 years and have moved my family from place to place, 2 years at a time to get tax advantages, within the same school district.  Every two years I have built a home for myself to move into and have sold my prior home.  Plus I have done some other developing on the side as an extra income producer.  I really enjoy the work but have a dillema of sorts.  I still have a full time job where I make about $50,000 a yr and my wife works part time at $29,000 a year.  I also am a disabled vet with two children.

Here's the deal.  I hate my job and it sucks the life outta me.  I really enjoy developing and have done well at it.  I'm not saying I want to necessarily retire, I would like to semi retire within the next few years and build houses on the side.   I have family in 3 different states and know many people who could help me make developing work in them areas.  I work smarter not harder doing these developments and I keep them small.

Here is my portfolio.  Have $225,000 in investments other than real estate.  Have $250,000 equity in my current home, have approximately $80,000 equity in one of my project homes.  Am building a luxury waterfront home in seattle area on some land I purchased 3 years ago and am planning to move into that for two years and move to Minnesota where it is cheaper to live and have family back there.  Comps show my equity after all is said and done at about 1 million+ (current market value).  Also have two more lots to develop in the near future.

Why am I procrastinating?  I am still working a job that makes me far less money and causes me to work twice as hard and I don't enjoy it.  I guess it is a traditional way of life and i have a certain amount of fear cutting myself away from the normal steady paycheck.

I really want to spend more time with my family and want to coach High School sports also have many hobbies I don't have the time to do. 

I guess I don't know what I am looking for but maybe some direction and some confidence to move on to the next level in my life.  There's got to be more to life than work I don't enjoy.  The last few years have been a blur and like I said, I didn't expect this kind of sucess so fast so it caught me off guard.  In a good way, don't get me wrong.  I don't need a lot of money but I do have two kids a 10 yo and a 4 yo and realize education is not getting any less expensive.  But also realize they don't stay young forever. 

I am very proud of my accomplishments because back in 1996 my wife and I bought a trailor in a trailor park on a rented lot in tornado country.  We were broke and I vowed to myself to never allow myself or my family to live that way again.  So that may be the fear talking as well.  I know what it's like to be broke. 

 

[Rich_by_the_Bay]

Re: semi-retirement

Sounds like you are off to a great start. Personally, I would hesitate to give up a steady paying job if I were in your circumstances (though finding one other than your current job sounds very good!).

- Health insurance (especially being disabled) may be hard to get on your own, and a major incident without great coverage could wipe you out fast. If you feel that every aspect of you and your family health care is covered by the VA or other sources, this may not apply.

- You sound like you have great real estate instinct and talent. As such, you do realize of course that the market can seriously tank for rather long periods of time. Could you withstand that?

- Frequent moves and living apart may be OK for you and your family now. Do you think this is something that can comfortably continue indefinitely? If so, not a problem. If not, you might appreciate the day job so you can regroup down the road.

- Your net worth is amazing for your age, starting from scratch. I suspect, thouth, that a big chunk of it is not liquid.

- Young kids, lots of them.

Just some first impressions. If it were me, I'd feel real good about what I have done, look for a less obnoxious day job, and hang in there for however long it takes to accumulate enough slam-dunk money for these factors to be less uncertain. At the current rate, you could be there by age 40, still not too shabby.

 

[Maximillion]

Re: semi-retirement

your Net Worth is IMPLIED Net Worth, if Real Estate dives, there goes your Net Worth.

First, get a Home mortgage free for your family, then keep your job but try flipping a property that you renovate.

if you make money, try it again, but do keep the renovated Properties under a company so you don't lose your home if you guess wrong.

 

[Nords]

Re: semi-retirement

Here's the deal.  I hate my job and it sucks the life outta me.  I really enjoy developing and have done well at it.  I'm not saying I want to necessarily retire, I would like to semi retire within the next few years and build houses on the side.

Welcome to the board, GMOH.

Sounds like you have a great plan, skills you like, and plenty of work to be done at it.

Sounds like you also have a job you don't like. Unfortunately for many that's also the source of health insurance, and if any of the spec homes involve financing then your "regular" income may be part of the equation.

If you can pay for health insurance in your budget, and if you can continue to obtain the money to buy spec homes without having to depend on the income from your day job, then it sounds like you have no need for a job you don't like.

Kids don't miss what they never had & don't know. Thousands of military families move their kids every couple of years (some even more frequently) and things turn out fine. I think there are more important factors in the quality of a kid's upbringing/life than in whether they stay at the same address.

Have you read Bob Clyatt's "Work Less, Live More"? It's a plan for the lifestyle you propose to lead.

 

[gtmeouttahere]

Re: semi-retirement

Sorry I could not respond earlier and thanks guys for the feed back.  I work nights and it is the only time I have for something like this as I am busy during the day trying to sleep and balance my endeavors w/my family life.  To answer Nords question, yes, I have read Bob Clyatts book "Work less, Live More" and found it a very entertaining read.  I have read tons of books on finances, real estate, stock market etc... and learn something new every time I pick up a new book.  However I stress this important point, I NEVER take anything for gospel. 

I am almost completely self educated but I will say this, whenever I meet someone successful, I always ask them how they did it and allow them to brag as much as they want to me about themselves. I find it fascinating how nobody seems to ever ask these people how they did it, most have plenty of time and are more than willing to share their ideas and past experiences.  You can learn a lot from past generations sucesssful or not and people in general.  I NEVER take it for granted that you can't learn something from someone.  However, I rarely listen to negative people, they are not headed in the direction I want to be going, but you can learn a lot from them as well.

I really am impressed with this board since it allows people from all different walks of life to share their experiences confidentially.

A little more on my previous post:  I am covered as far as medical for myself through the VA.  My wife has excellent benefits through her part time work.  My goal is to create more TIME for myself and my family.  We have moved a lot, yes, but it has been all in the same school district so it actually is not at all like moving all over the country, I did that in the service, Semper Fi.   

I will be selling my current home within the next year and moving into the waterfront home I am currently building by July 2007 if all goes well.  I will be selling my spec home within the year as well.  I want to stress that I was being conservative in my estimated equity in my homes, taking into account extreme market downturn.  If the housing market does not crumble w/in the next year, my take home numbers will be greater. 

I do plan on selling and moving out of my waterfront home by 2009 and moving back to Minnesota where I have a large amount of relatives and it is cheaper to live.  I am a transplant in Washington state as I got married here while in the USMC. 

I am currently working on a deal with a bank to extend me a credit line primarily used for builders/developers, leveraging my current properties to build more homes within this coming year and it is looking favorable so far.  If that goes through I may not be able to stay at my current job w/out going a little crazy.  Is it too early to bail if I land this credit line.  In the past you would be right that I needed my income to buy into more, but doesn't this change things? 

I feel I am wasting precious time doing my current job given the soon to come instability in the housing market.  I want to build as much as I can w/in the next year or two.  I keep telling myself the worst case scenerio is that I could return to my J.O.B.  If I fail I don't plan on stopping there.  Get back up and dust myself off so to speak.  I am a capitalist at heart, I'll find something else to be good at. I just am having problems justifying leaving my job.  It pays pretty well but doesn't afford me the time to do what I feel is important in life.

As you read this, you can tell, I have darn near made up my mind on the direction I want to go, I just probably need a push.  Fear of the unknown and seldom taken path is whats holding me back. 

Am I crazy or just a little nuts?  My mind is constantly working for and against me.
feedback would be appreciated very much.  Thanks for taking the time to read my post.

 

[Sheryl]

Re: semi-retirement

As you read this, you can tell, I have darn near made up my mind on the direction I want to go, I just probably need a push.  Fear of the unknown and seldom taken path is whats holding me back. 

Am I crazy or just a little nuts?  My mind is constantly working for and against me.
feedback would be appreciated very much.  Thanks for taking the time to read my post.

PUSH-> -> -> -> -> -> -> Go for it!

You sound like you really know what you are doing with the development, as long as you watch out for that bubble.

You can always go back to work if you need to right?

 

[Arif]

Re: semi-retirement

gtmeouttahere,
I just sent you a pm. Just click on the word "messages" at the top left of the screen.

 

[RF-4WAD]

Re: semi-retirement

Good to see other military or retired military. I am still US Air Force Reserve and still 8 years and my wife 7 years from our civilian retirement. Between active duty, reserves and my civilian career, I am ready to stop and smell the roses. I know my wife is. We too plan to retire to the gulf coast. I did notice a post that brings something to mind. I have a couple of friends who have been retired for a few years now. When they were working, they were tough, competitive guys. Now retired, they are out of that game and are about as laided back and mellow as one can get. So, I guess retirement does give one a whole new reference of what is important. Anyway, I am also looking forward to hearing from any retired military, especially if they have any heads up on benefit changes or cuts.

 

[Dog]

Re: Leave my night job?

I do plan on selling and moving out of my waterfront home by 2009 and moving back to Minnesota where I have a large amount of relatives and it is cheaper to live. I am a transplant in Washington state as I got married here while in the USMC.

You may end up not wanting to leave the waterfront home....hard to give up the view once you get use to it. Also, the housing market is strong in Washington (Puget Sound) w/a great outlook for jobs. No bubble expected here. Just tougher building codes.

 

[Chris24]

Re: Leave my night job?

IF you want to head back to Minnesota, can you "translate" what you are doing now in Puget Sound in Minnesota, or wil it be just a family reunion. AND is your family on board with the move. Having a network, which "a large amount of relitives" are .. esp if ... can mean alot. BUT you are doing this alone, if the Fam is up for it, go for it.

 

[gtmeouttahere]

Re: Leave my night job?

  Also, the housing market is strong in Washington (Puget Sound) w/a great outlook for jobs.  No bubble expected here.  Just tougher building codes.

I agree with you for the most part about the housing "bubble".  However it should slow down soon, hopefully not.   You are right on about the building codes, it already is a pain in the butt.

You may end up not wanting to leave the waterfront home....hard to give up the view once you get use to it.

I NEVER fall in love with a property.  That is my first rule of business.  The taxes are extremely high on the waterfront and yes, it is beautiful, but it is a luxury.  I can have all that later if I play my cards right.  Hell, I'm only 33. 

IF you want to head back to Minnesota, can you "translate" what you are doing now in Puget Sound in Minnesota

Yes.  Most of my family does some form of construction however, I would plan on doing it in both states.  I have a great team set up in WA (It almost runs itself).  BUT....

My plans may have changed once again.  I live by the seat of my pants.  I have made a friend on this board.  He and I have been talking a lot.  I am contemplating a move to Panama with my family.  I have done a lot of research and asked him a TON of questions(Thanks ARIF).  He is living the good life with his family down there.  Everything we have read and talked to him about sounds like a perfect fit for us. 

I was in the military and have done a lot of travelling, so I always thought I could live a good life abroad.  But never in a million years would I have thought my wife would ever be into such a thing.  It goes to show you, you can know a women for 14 years and still not understand them.  Don't know if I EVER will. 

I was just telling her about my friends adventure and what he was doing and she was like, "WOW, why don't we do something like that?"  I was at first, shocked, then gave her the "you must be joking" look, long pause....  She said I'm not kidding.  So I ran with it.  She is more exited about it than me I think.  She read a book on life in Panama in about 2 days and was hooked.  My daughter is also extremely exited and read the book right along with my wife.

We are planning our escape with a little caution though.  We plan on visiting Panama and the friend I made on this board in July.  If we like what we see, we will never look back.  We will get everything in order and rent a home there for a year before we commit to a house.

We figure the worst that could happen is we would get a year vacation (if we move there) and our family will have an experience that they will never forget.  That to me is a win/win situation.  That is living life.

You never know what cards life is going to hand you. 

And YES, I'm as crazy as a loon!!!

Any questions, comments, or concerns, please feel free..... 8)


 

 

[gtmeouttahere]

Also, one more thing....

There has been a big layoff within my company with a target date of Jul. I recieved notice that I would keep my job but get a demotion. I was extremely angry because there was a lot of politics involved.

But....the very next day I got a call from my bank saying I got approved for a business line of credit and it is going to allow me to build more homes this year. It was something I had been working hard for for the last few years (being self sufficient).

So....

I took a voluntary layoff and will be out on my own with a unemployment paycheck and maybe a small severence (still getting all the details) while I build my business.

Funny how life throws you for a loop.

 

[Jane_Doe]

GMOH-

Welcome to the "Board"! Very interesting thread. Some of your situation really hits home with what my DH and I have done.

Two things to keep in mind - first - when you build your spec houses are you doing it under a corp.? An S-corp works as a pass-thru and your income or profit from the sale of the home is not subject to ss and medicare taxes as it is if you would on your personal tax returns. Hit us hard when we first started out before we incorporated. We got a really good accountant who works with us - doesn't charge for phone calls or even us going in, sitting down and running our ideas by him. (I don't bug him much at tax time, tho!!) Very extremely helpful in planning. Does our yearly corp and pers returns - that's all we pay for. Well worth any money paid out - probably ten-fold at times.

Also, we very seriously thought about moving to Costa Rica back when our daughters were 6 & 9 y.o. - go visit Panama first before deciding. If you can get into a good expat group there that will be a good support system that will help a lot. Very far to come back for medical care and for any family emergencies at home, but lots of plusses as well. Building in a third world country can be very difficult as well - don't know about Panama but have checkied into other areas and are considering buying something (second home) that is already built over trying to build. You being younger may not mind enjoy that stress extra effort needed to get subcontractors to show up/do quality work, etc.

Not trying to be negative - just remember to go in with your eyes open. There are trade offs. But, the idea of living ina paradise sure is appealing!!!!

We may even come visit you and Arif in Panama someday - who knows!!

Wishing you the best!

Jane

 

[gtmeouttahere]

when you build your spec houses are you doing it under a corp.? 

In the process of setting one up now.

We got a really good accountant who works with us - doesn't charge for phone calls or even us going in, sitting down and running our ideas by him.

Me too.

Very far to come back for medical care and for any family emergencies at home,

Why go back to the US for medical care?  From what I understand they have excellent medical care in country, also affordable Health Insurance.

You being younger may not mind enjoy that stress extra effort needed to get subcontractors to show up/do quality work, etc.

Won't have anything else to do, why not?

go visit Panama first before deciding.

We are planning to go and visit for a few weeks, If we like it, we will move there and rent for a year or so and get used to the life.  If it doesn't work out, I have a spare home back in the states to move back to.  Worse case senerio, we get a year long vacation.  We will also be looking for a furnished home to rent so we won't actually have to move our stuff unless we decide to stay.  Hopefully it will be just what we have been looking for.

I will be in a good situation as far as money goes so what do we have to lose?  Hell, we need a vacation anyway. 

We may even come visit you and Arif in Panama someday - who knows!! 

That would be great!!!  Sounds like we all have a lot in common.

Wishing you the best!

You as well!!!  Feel free to send me a personal message if you want to chat. Sure we have a lot of similar stories. It could be quite hilarious!!!