Is 35 considered "young?" Looking for new career advice!

[captain picard]

I'm not sure I qualify as young, but I am a dreamer so I thought it best to post in this category. I am looking for a new career or business opportunity. I'd welcome any advice or opinions on the matter.

A little background: I am 35 years old and living in the rust belt (Cleveland). I bought a crappy little house at age 26 for $15,000 in a transitional neighborhood and have managed to parlay that initial investment into a real estate portfolio worth approximately $1 million with a gross annual rental revenue of approximately $109k. My total outstanding debt on this portfolio is approximately $105K, currently being paid back at an interest rate of 6% (it's a private loan, which is why the rate is a bit high). I'm interested in finding a new job or business opportunity to fill my time, as I only have to spend 10-15 hours per week managing my real estate. Most of my net worth is tied up in the portfolio, but I do have approximately $90k in cash that I could spend on anything I want be it stocks, bonds, real estate, franchise, etc. I'd thought about using my cash reserves to simply wipe out the rest of my debt, but I'm also considering starting a new job/career/business instead if it will result in a decent addition to my annual earnings.

Any thoughts or suggestions? I'm happy to provide more info as needed.

 

[brucethebroker]

Congrats. You have done well, and yes, 35 is considered young to many of us.
1. 90k is a nice cushion, but not a tremendous amount of free money. It is nice to have when the next real estate, or other, opportunity comes around. Hold on to it, if possible.
2. What would you love to do for a "job"? Consider making that your job/business, even if you don't make big money doing it.
3. Do you have a hobby that could be turned into a small money maker? For example, I know of people who love to golf, but hate to pay big money doing it. By taking a part time job at a golf course, they get a "fringe benefit" of playing for next to nothing.
4. Personally, if I could go back in time for a second "job", I would seriously look into government work, or something else with a defined benefit pension after 10 years or so. If you enjoyed the work, the 10 years would pass quickly, and the pension would be a huge bonus when you are older.

Good luck!

 

[kgtest]

1. 90k is a nice cushion, but not a tremendous amount of free money. It is nice to have when the next real estate, or other, opportunity comes around. Hold on to it, if possible.

lmao. Man I must be doing it wrong, I'm 35 and we have about 10grand of cushion. I suppose I don't illicit cash deals on property either.

Different strokes for different folks. Got about 120k in the market though. No where near 1million in property, maybe half that. Your doing well, what do you like to do for fun, showing up to work and doing things you like makes a difference.

 

[Senator]

Pay off the private loan at 6%.

 

[captain picard]

Thanks for the replies!

I LOVE the idea of a government job (and its attendant pension benefits), but at 35 with no government experience I imagine I'd be under qualified for all but the most menial of occupations. IN addition, I'm not really looking for a 40-hour 9-5 type situation, although I wouldn't be opposed to it if it were the right fit. I'd also likely refuse any offers that carried a salary of less than $50k, which in my region is probably higher than they'd want to start me. I am willing to investigate this more though if anybody has suggestions.

I may simply pay off the remaining loan and enjoy a truly debt-free existence, or I could use the $90k to purchase a few more rental units. This would eventually mean more income with only a modest increase in responsibility. I don't wish to appear lazy, but one of the perks of my life I'd like to keep is my flexibility. My wife is angling for a baby sometime really soon though, so I suppose I can kiss that idea goodbye haha. Thanks again!

 

[plex]

Yea, I have that kind of flexible work from home government job, and almost all of them would require you to move at the start, would require 9-5 for at the very least a few years, and take awhile to apply for even if you do meet the background requirements, though they aren't unusually picky usually beyond the requirements.

Just pay off the last of the debt, and look into developing you interests that may be a little lucrative. Maybe do a blog about real estate and RE if you don't mind writing on a regular basis for a few years at least, and managing advertisers.

 

[Senator]

I may simply pay off the remaining loan and enjoy a truly debt-free existence, or I could use the $90k to purchase a few more rental units. This would eventually mean more income with only a modest increase in responsibility. I don't wish to appear lazy, but one of the perks of my life I'd like to keep is my flexibility. My wife is angling for a baby sometime really soon though, so I suppose I can kiss that idea goodbye haha. Thanks again!

Paying off the loan would give you another increase in cash flow. Maybe more than another rental property. Do not use all your cash reserves, just a portion. Get a HELOC on your own home and use the HELOC to pay the loan off. The HELOC should be a lower interest rate.

Once your wife has a baby, plan on her not working for a while, if she is working now. Plan on at least three months of living without her income, and then plan on either being a full time baby-sitter, or paying large sums of child care. That will also take care of your time dilemma.

At 35, your financial life is just starting. If you have $109K in gross rents, you should be keeping at least 60% of that, or 65K+, assuming all debt is paid off. Be sure that is enough, as in future years it may not be. You likely do not have much SS to count on as you have not paid into it for too many years. Probably no pension either.

At least half of that $65K should be tax free, with depreciation deductions. I gross ~3x that, and that is a pretty standard number.

Convert any IRA money to a Roth, if you have any. Buy property in a Roth, if you can. It will be tax free forever. A great deal on a property could translate to doubling your money in a few months.