Nords got me

[bcurtis]

After reading the provocative email recently from Nords, I decided to become more of a participant on this insightful board.

I am a 46yo ER doc in TX currently making about $150K. I have a mortgage balance of about 12k on my home and a small lake house in the hill country with a mortgage of about 150k. I currently have around 700k in retirement accounts and 100k in after tax brokerage accounts. I have a raw land holding worth close to 800k. I don't have any outstanding debts other than the houses, though I am paying 1500/mo in child support for the next 4 years.

As Garth Brooks would say, I'm "Standing Outside the Fire", but I'm getting close.

 

[REWahoo]

Hello Curt, glad you decided to post. Not sure if it's due to months of underwater confinement, radiation exposure or simply a surfing accident, but whatever the reason, Nords is pretty slick devious accomplished when it comes to posting.

Sounds like you are indeed close to FIRE. Any target date or plans?

 

[Dawg52]

Welcome! Lots of good info posted here. Look forward to your future comments. Do a search on the Norwegian widow. You will see that soon enough. 

 

[bcurtis]

I would like to give up the full time nights/weekends/holidays in about a year. I doubt I would ever give up medicine, so I'm looking at a 10- 15 hr/week schedule for a few years after "retirement" which would bring in about 45-50K a year. I'm currently heavily involved in administration also, and have been for about 10 years, so I'm ready to drop out of that game yesterday.

 

[retire@40]

I would like to give up the full time nights/weekends/holidays in about a year. I doubt I would ever give up medicine, so I'm looking at a 10- 15 hr/week schedule for a few years after "retirement" which would bring in about 45-50K a year...

We call that semi-retirement and it's a great club to be in.

 

[brewer12345]

Curt, does the raw land generate any cash flow?

 

[bcurtis]

Curt, does the raw land generate any cash flow?

No, there isn't any cash flow right now, either in or out (except for low property tax) Perry bought the 300 acre tract north of me and Pulte bought the 500 acre tract south of me. If I sold, I would have about 500k in gains. I'm not looking for a 1031 exchange, so I would have to pay the IRS a sizable sum.

 

[retire@40]

...If I sold, I would have about 500k in gains. I'm not looking for a 1031 exchange, so I would have to pay the IRS a sizable sum.

It actually may be smart to sell while LTCG rates (15%) are at the lowest they may be in a long time and real estate is at all time highs (or just past all time highs).

Then take the cash and invest to get positive cash flow and wait for the next cycle.

 

[Nords]

After reading the provocative email recently from Nords, I decided to become more of a participant on this insightful board.

Well, thanks, Curt, and welcome to the board.

It sounds like you have Perry & Pulte right where you want them... let the bidding begin!

Isn't Raddr in Texas too?

Not sure if it's due to months of underwater confinement, radiation exposure or simply a surfing accident...

Yes. Sounds like the setup for a comic book character, doesn't it? Isn't this how Godzilla got started?

 

[REWahoo]

Perry bought the 300 acre tract north of me...

Perry as in the homebuilder or Perry as in the governor?

 

[Dawg52]

It actually may be smart to sell while LTCG rates (15%) are at the lowest they may be in a long time and real estate is at all time highs (or just past all time highs).

Then take the cash and invest to get positive cash flow and wait for the next cycle.

As it stands now, the 15% LTCG will expire at the end of 2008?

 

[bcurtis]

Perry as in the homebuilder or Perry as in the governor?

That would be Perry, the homebuilder. As the folks from Calif, Fla and NY sell out, their buying the 600K 5000sq ft houses on the lake here near Houston.

 

[Rich_by_the_Bay]

I would like to give up the full time nights/weekends/holidays in about a year. I doubt I would ever give up medicine, so I'm looking at a 10- 15 hr/week schedule for a few years after "retirement" which would bring in about 45-50K a year. I'm currently heavily involved in administration also, and have been for about 10 years, so I'm ready to drop out of that game yesterday.

Hey, Curt. Welcome -- glad to have another doc on the board. Your priorities have a lot in common with mine. I'm 57, full-time academic hospitalist at a comprehensive cancer center looking to semi-FIRE in 2-3 years.

We owned and sold lakeside property back when we lived in Wisconsin. Put it up for sale on 9/1/01. Needless to say, 9/11 came along and we figured we were in trouble, but within a week it sold at a decent profit. You've got a large proportion of your nest egg in that property, and it's certainly not liquid.

It'll feel good to actually see some of the money the land promises to deliver. I never had the stomach for real estate but sounds like you are alot smarter than I am about that area.

 

[SteveR]

Welcome Curt,

Yes, recreational property can be good or bad. We have a cabin that we have had for the past 5 years. We have been using it less and less and plan on doing a lot of travel (RV and international) so it will get used even less. Renting is not an option and is not desired so we are in the process of selling it. We also want to take advantage of the RE market before it contracts here too. We expect to get about a 80% increase in price since I bought it 5 years ago. We will use the profits to fund our tavels and to add to the nest egg's cash-like accounts so we don't have to liquidate anything else right now. We are on the countdown to ER.

Good luck with your FIRE plans.

 

[bcurtis]

I haven't sold the land yet because, in my possibly misplaced optimism, I think the value of this on-the-water property will continue to climb. The value over the last 5-6 years has been increasing about 20%/year. When I do sell, FIRE will seem more tangible.

 

[retire@40]

I haven't sold the land yet because, in my possibly misplaced optimism, I think the value of this on-the-water property will continue to climb. The value over the last 5-6 years has been increasing about 20%/year.

Well, that's what some people used to say about .com stocks, although I realize I am comparing land to air.

 

[SteveR]

I haven't sold the land yet because, in my possibly misplaced optimism, I think the value of this on-the-water property will continue to climb. The value over the last 5-6 years has been increasing about 20%/year. When I do sell, FIRE will seem more tangible.

We have talked about this too. We have looked at the current market for this kind of housing and in the area we are in along with what is going on in nearby areas and we and the realtors all agree that now is the time before the prices creep back down. They are at a high right now and there are few other cabins on the market so we want to sell before winter.

While I have mixed emotions about selling (not financially driven) I have concluded that I no longer wish to through money and personal time down this money pit. The reason we bought it has changed over the past couple of years and we desire to travel a lot starting next year. Keeping up two houses in an area with vast changes in weather from season to season is too much like work and will keep me tied down too much.

I know we will be putting money into a depreciating asset (RV) but knowing it will be more of a hobby than an investment keeps it all clear in our minds. We believe it is a fair tradeoff since we are not planning on doing it full time. It will truly be Recreational. Sometimes you just gotta do what you want before you can't.

 

[TargaDave]

I am a 46yo ER doc in TX currently making about $150K.

Welcome Curt. Curious where ER is on the medical pay scale and desirability scale when choosing specialties? Seems like very rewarding-exciting work but also stressful with big malpractice premiums. Frequent burnout?

 

[Jay_Gatsby]

Welcome Curt. Any chance your house is near the Guadalupe River?

 

[FIRE'd@51]

As it stands now, the 15% LTCG will expire at the end of 2008?

I believe the 15% rate on LTCG and dividends has been extended through 2010.

 

[bcurtis]

Welcome Curt. Any chance your house is near the Guadalupe River?

Unfortunately not. I'm looking at a plce near Inks Lake though, near Burnett/Llano.