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Finally getting the Courage
Old 07-04-2015, 07:14 AM   #1
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Finally getting the Courage

Itís officially one more year until I leave my FT job at 56. Last February 2014 I put my status up. Tuesdays are not near as much fun as Saturday. I am considering leaving a bit earlier, but will probably stick it out until July 5, 2016.

How do you get the Courage?

I have created a monster spreadsheet that tracks, projects, and double checks every which way possible to see what I am saving. I use Quicken too. I figure if I can save 100% of my gross megacorp pay, I do not need it. Prior to the beginning of 2014 I was not really tracking how much I was saving; I was just saving and buying more rentals. I was too busy to think about retiring.

In the ~18 past months, my portfolio has increased from $880K to $1.1M, and I even paid off a $189K rental mortgage in that timeframe. Rental RE equity is ~1.5M, plus another $250K for my own home.

My savings YTD in 2015 is $146K, with a goal to save over $200K in 2015. Some people cannot save that in a lifetime, I am fortunate enough to do it in a single year. In 2013 and 2014, I saved over $180K each year, which includes my 401K and match. It does not include any investment gains/losses. My salary is ~115K a year, so I clearly do not need it anymore.

No debt. The gross rental income has increased to $306K with the rent increases I have put through, and I still have a bit more room to run. Thatís almost another $1,000 per month in a year. Rental expenses run about half of that, which includes the mortgages, as most of my buildings are paid off. I manage and maintain my own properties, all 24 rentals. There should be plenty of rental profits to live on for the near future. As some point, I will sell, or have someone to help. It takes ~20 hours a month. I spend as much time analyzing my retirement planÖ

I gave up my snowplowing route and lawn maintenance accounts from my small business this spring. It wasnít that much money, and now I can sleep in a warm bed, rather than snowplowing and shoveling all night. It did help add funds to the accounts to spurt my real estate investing.

Pretty healthy for the most part, other than a few aches and pains until I get loosened up... Walk 3+ miles a day, blood pressure good, no prescription meds, non-smoker, basically a non-drinker. Healthcare is through the VA, although I may buy a supplemental policy, once I do not have a megacorp policy. I live ~5 miles from the VA hospital.

When I go to the VA, they bill my individual megacorp policy, so it offsets any deductible that I have on my megacorp healthcare plan, even though I do not pay any out of pocket. Dental will be VA dental for ~$20 a month.

The DGF of 25 years, 43, wants to retire with me. She has ~$500K, and no debt. She will retire when I do, and get an almost 100% subsidized healthcare plan, as her income will be low while she lets her financial assets grow. It will include healthcare, dental, pharmacy, and vision with a $0 deductible and virtually no co-pays. It even includes rides to and from the clinic if she requests them. Minnesota Care will cost her ~$20 a month.

DGF doesnít need much income if I pay all the bills. I can put the house in her name (Contract for deed, $0 down, $0 payments, 0% interest, 5 year balloon), she will get most of the property taxes refunded during that period. I should not have to pay any capital gains, as I have not received any money. After 5 years, we can cancel or renew the contract. How great it is to be low-income in MN.

We both have small pensions in the future (10 years out) and will have decent social security when the time arrives. I should have close to the max. I also have a small VA disability payment.

So, it appears all is going well. Expenses are less than $40K a year. All the retirement planners say all is well, even in an apocalypse.

I feel I do what I want, when I want now and want to continue that feeling. I want to ramp up the spending a bit and take 3-4+ trips a year, probably USA trips. Maybe visit all 58 National parks; I even have an Access Pass to get into all of them for free, for life. I have been looking at buying a used 5th wheel ($25K) and a new truck ($60K) to do things in.

Hopefully all is well with your own plans and thank you for all the great advice over the past few months.
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FIRE no later than 7/5/2016 at 56 (done), securing '16 401K match (done), getting '15 401K match (done), LTI Bonus (done), Perf bonus (done), maxing out 401K (done), picking up 1,000 hours to get another year of pension (done), July 1st benefits (vacation day, healthcare) (done), July 4th holiday. 0 days left. (done) OFFICIALLY RETIRED 7/5/2016!!
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Finally getting the Courage
Old 07-04-2015, 07:20 AM   #2
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Finally getting the Courage

Congrats! Seems like you're in great shape. Wishing you continued success and a quick OMY.


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Old 07-04-2015, 07:49 AM   #3
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Congratulations!!! I think you mean your rental income is approaching $1,000 per day.

I would be careful regarding your plan to sell DGF the house for nothing. I'm not sure that the IRS will consider that you have no taxable gain. If you are audited, you could get a nasty surprise.

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Since there is no actual price attached to a real estate gift, the IRS uses "fair market value" to establish the taxable value of the transferred property.
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Old 07-04-2015, 08:02 AM   #4
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Congratulations!!! I think you mean your rental income is approaching $1,000 per day.
yes, the gross rental income is near that. I never thought of it that way. $838 per day when full.

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I would be careful regarding your plan to sell DGF the house for nothing. I'm not sure that the IRS will consider that you have no taxable gain. If you are audited, you could get a nasty surprise.
I still need to talk with an accountant, but there would be a contract amount, just no amount paid for a while. It would all be in the future.
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FIRE no later than 7/5/2016 at 56 (done), securing '16 401K match (done), getting '15 401K match (done), LTI Bonus (done), Perf bonus (done), maxing out 401K (done), picking up 1,000 hours to get another year of pension (done), July 1st benefits (vacation day, healthcare) (done), July 4th holiday. 0 days left. (done) OFFICIALLY RETIRED 7/5/2016!!
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Old 07-04-2015, 08:43 AM   #5
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You sound like the "No Nonsense Landlord".

It's one of the best Landlording blogs and website out there. After reading one of your "No nonsense" stories, I realized I was hurting myself by letting one of my tenants have her criminal boyfriend move in (without my permission, as required by the agreement). I followed the process to evict them and got a great tenant who pays on time, respects the property, and respects the other tenants.

I am about 5-8 years behind you, financially speaking, due to a divorce and putting 5 kids through college - but absolutely no regrets about any of that.

Many thanks for your inspirational examples,
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Old 07-04-2015, 08:53 AM   #6
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Congratulations. And I compliment your choice of RVs: a fifth wheel with a solid rig has gotta be the best way to camp and travel the open highways of North America.
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Old 07-04-2015, 08:54 AM   #7
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With the responsibility of managing and maintaining all of your own properties, how will you handle the problems that come up when you are traveling and out of town?
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Old 07-04-2015, 02:20 PM   #8
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Sounds like you are ready for your personal Independence Day! Congratulations!
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Old 07-04-2015, 02:58 PM   #9
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Congratulations. And I compliment your choice of RVs: a fifth wheel with a solid rig has gotta be the best way to camp and travel the open highways of North America.
I am going to buy a Keystone Monatana class of 5th wheel. 35' or so. 3+ slides.


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You sound like the "No Nonsense Landlord".
It's one of the best Landlording blogs and website out there.
That's me!

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With the responsibility of managing and maintaining all of your own properties, how will you handle the problems that come up when you are traveling and out of town?
Most problems can be handled over the phone. I can take a call and make a call. I do the fixes myself now, but there are plumbers, electricians, HVAC people etc. that can be called. I will hate paying for it, but that is the price of freedom. There really is not that much to do except for apartment turns. I generally turn apartments and rent the next day. Better tenants is the key.
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FIRE no later than 7/5/2016 at 56 (done), securing '16 401K match (done), getting '15 401K match (done), LTI Bonus (done), Perf bonus (done), maxing out 401K (done), picking up 1,000 hours to get another year of pension (done), July 1st benefits (vacation day, healthcare) (done), July 4th holiday. 0 days left. (done) OFFICIALLY RETIRED 7/5/2016!!
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