Passive income = the best

[gstillson]

I have a COLA govt pension...you can't get any more passive than that. Every single month they give me 120%+ of what I need to live on and the only actions I've taken since retirement is to log on to my bank account to verify the monthly deposit.

I am guessing the original post was saying others could replicate the results in real estate but I do not know how many people will be able to replicate getting a COLA'd pension in this day and age.

 

[Huston55]

Have a great trip.

I also recommend calculating your return on current values.We sold our last rental in January. The reason was because the value of the house had outstripped the rent we could charge, (the return on the investment fell too low). You could then reinvest in properties with higher yields. But highly appreciated rentals are a nice problem to have.

So, did you “...reinvest in properties with higher yields” or, did you put it in the market?

 

[candrew]

My dental practice was a passive investment. All I had to do was fix a few teeth, keep my staff from cutting each-others' hearts out, make sure the equipment was working and the bills all paid, the lawn mowed(passive because I paid someone else to do the mowing), get the bills out on time, pay my bills on time, run payroll, .... passive.

Sometimes, generating passive income can feel like pulling teeth.

 

[Clone]

Interesting thread. For a moment, I thought I had stumbled into the MMM forum, or perhaps the /financialindependence Reddit group...

I was thinking it was more like /iamverysmart !

 

[Amethyst]

I have one too. The only things I invested were 7% of my income, and 34 years of service. Most of which seemed rather active to me I know some people whose "service" was pretty passive, though, especially in the later years!

I have a COLA govt pension...you can't get any more passive than that. .

 

[Huston55]

I have one too. The only things I invested were 7% of my income, and 34 years of service. Most of which seemed rather active to me I know some people whose "service" was pretty passive, though, especially in the later years!

In the military, we called them “ROAD Officers”...Retired On Active Duty.

 

[Chuckanut]

I have a COLA govt pension...you can't get any more passive than that. Every single month they give me 120%+ of what I need to live on and the only actions I've taken since retirement is to log on to my bank account to verify the monthly deposit.

Mr. Music Lover

You need to spend more money!

 

[calmloki]

Yes, but there is also much to be said for dividends that keep coming in, regardless of the current stock market direction. In the long run, the short term market decreases actually helped me to arrive at FIRE status because the reinvested dividends bought more additional shares compared to when the market was high. Those additional shares are paying off today in additional dividend income.

One other helpful tactic: buying only companies that have a long history of increasing their dividends each year. Now I consider that my annual "raise."

Lots of ways to skin a cat - we all make the choices that seem best to us. I remember buying for dividends (bear in mind I'm NOT,nor was, any kind of savant investor) back in 2007. BofA had great consistent dividends, so I sold the gal on investing in the stock, which promptly went down. Perfect! We can buy more shares cheaper honey! So plunked more money in. And it dropped again. Think we bought several times as it fell and I believe dividends were cut, but don't really remember as I was caught up in a rock solid bank falling from $40 to $3~. We did sell, as opposed to the GM stock we held until they went banko and declared our stock worthless.

Many have gone bust with real estate as well, and I can imagine rent controls and onerous regulations that could ruin us. Shoot, various municipalities and companies and whole countries have reneged on their pension promises, right? So are pensions rock solid? No sure things in this world, just choices. I'm too chicken to go with just one option, so we have rentals and stocks and contracts and loans and cash - and we might not be considered retired because we keep pretty direct control of a lot of our nest egg.

 

[Chuckanut]

I am guessing the original post was saying others could replicate the results in real estate but I do not know how many people will be able to replicate getting a COLA'd pension in this day and age.

I must disagree to a point.

That may be what the OP meant (I don't know as I can't read minds) but I am pretty sure most of us cannot replicate the situation he has in regards to who is looking after his properties while he does little or nothing. He is in a rather unique position in that regard.

I have a very unique situation with my rental manager and my properties, it’s a close friend of the family that I trust 100%, properties are 75 miles from my hometown but my brother lives there, I use the property manager to oversee the properties and my brother to over see the properties and property manager.

Imagine if I said "Hey passive income is great. My son-in-law invented a new bottle cap maker and asked me to buy in by investing $20,000 for 10% of the company. That company sold for Two Billion dollars and I got my check for $200,000,000 yesterday. And I have never made even one bottle cap! " It's a great story but not applicable to most of us.

I am happy for the OP and wish him continued prosperity and the health to enjoy it. But, must of us have no family member whom can do what his brother does, nor do we have a close friend who we can implicitly trust to manage properties. That job would fall on directly on the shoulders of most of us, unless I am severely mistaken.

 

[ERD50]

I must disagree to a point.

That may be what the OP meant (I don't know as I can't read minds) but I am pretty sure most of us cannot replicate the situation he has in regards to who is looking after his properties while he does little or nothing. He is in a rather unique position in that regard.

... .

It may be 'passive' for OP. but maybe not for his brother!


-ERD50

 

[Free bird]

I use the passive aggresive strategy. Maybe you've heard of it. It runs in the family. Am I in trouble again? I really don't know when I've crossed the line in this little community.

 

[Music Lover]

Mr. Music Lover

You need to spend more money!

I've started...I bought a new (used) car a few months ago, and will have to replace my roof within a year or so. I'm also contemplating on adding a half bathroom to the basement.

 

[Amethyst]

Oh, go for broke....put in a shower!

I've started...I bought a new (used) car a few months ago, and will have to replace my roof within a year or so. I'm also contemplating on adding a half bathroom to the basement.

 

[JoeWras]

I use the passive aggresive strategy. Maybe you've heard of it. It runs in the family. Am I in trouble again? I really don't know when I've crossed the line in this little community.

You are fine, unless you open a new thread titled "$150 Oil by winter"

 

[Free bird]

Yeah I tell you this internet site doesn't appreciate my vibrant dynamic personality. It reminds me of a govt site I worked at. Check your sense of humor & personality at the gate.

 

[Sojourner]

I am happy for the OP and wish him continued prosperity and the health to enjoy it. But, must of us have no family member who can do what his brother does, nor do we have a close friend who we can implicitly trust to manage properties. That job would fall on directly on the shoulders of most of us, unless I am severely mistaken.

+1

I wonder what it costs OP to pay his brother and trusted friend for all the (seemingly) hard work they are doing to manage and maintain his rental properties and provide him with all this "passive" income.

As Chuckanut rightly points out, the vast majority of us have no such people we can rely on to help us generate substantial passive income via rental properties, whereas everyone has access to low-cost, diversified mutual funds and ETFs that can provide ample passive income for most people over time.

 

[travelover]

..........Am I in trouble again? I really don't know when I've crossed the line in this little community.

You might be now that the original Freebird is back.

 

[REWahoo]

You might be now that the original Freebird is back.

+1

And if you keep taking cheap shots at the membership on this forum like this one:

Yeah I tell you this internet site doesn't appreciate my vibrant dynamic personality. It reminds me of a govt site I worked at. Check your sense of humor & personality at the gate.

 

[flintnational]

So, did you “...reinvest in properties with higher yields” or, did you put it in the market?

In our case we were ready to be out of rental management (see edit). The funds were merged into our 70/30 AA. The 30 is short term bond index and cash. But, we owned rentals for 20+ years and were happy with the experience.


Edit to add: Readers, interpret "rental management" to mean either passive or active depending upon your preference. (I am still trying for the "Forum Member of the Month" award.)

 

[Denverite]

Lots of ways to skin a cat - we all make the choices that seem best to us. I remember buying for dividends (bear in mind I'm NOT,nor was, any kind of savant investor) back in 2007. BofA had great consistent dividends, so I sold the gal on investing in the stock, which promptly went down. Perfect! We can buy more shares cheaper honey! So plunked more money in. And it dropped again. Think we bought several times as it fell and I believe dividends were cut, but don't really remember as I was caught up in a rock solid bank falling from $40 to $3~. We did sell, as opposed to the GM stock we held until they went banko and declared our stock worthless.

Many have gone bust with real estate as well, and I can imagine rent controls and onerous regulations that could ruin us. Shoot, various municipalities and companies and whole countries have reneged on their pension promises, right? So are pensions rock solid? No sure things in this world, just choices. I'm too chicken to go with just one option, so we have rentals and stocks and contracts and loans and cash - and we might not be considered retired because we keep pretty direct control of a lot of our nest egg.

Absolutely. No eliminating risk no matter what you invest in. And despite my concentration on stocks, I too have made bad investments there. Including GE and Citigroup. All it takes is one bad management team to trash a previously great company.

I got out of GE before things got really ugly. At the time I bought it, I thought I'd hold it forever. No such luck.

I read one investor's comment years ago that really resonated. It basically was: stocks will outperform other investments under one condition: you are willing to tie up your money for long periods. Many people miss the long term benefit of the market because they either panic/sell during short term decreases or they try to buy/sell their way to prosperity. No thanks. I'd prefer to buy, hold and use compound interest through reinvested dividends.

I've always found this web site's spreadsheet useful if anyone is interested.

The DRiP Investing Resource Center

 

[Amethyst]

I worked at one of those, and believe me, there is no resemblance between that workplace and the forum. (Actually we sneaked in quite a bit of humor at work, but don't tell the taxpayers).

Yeah I tell you this internet site doesn't appreciate my vibrant dynamic personality. It reminds me of a govt site I worked at. Check your sense of humor & personality at the gate.

 

[Bestwifeever]

Yeah I tell you this internet site doesn't appreciate my vibrant dynamic personality....

You might be now that the original Freebird is back.

Maybe to avoid confusion with the one and only Freebird
, “Free Bird” could ask for “Rodney Dangerfield”?

 

[ERD50]

Yeah I tell you this internet site doesn't appreciate my vibrant dynamic personality. It reminds me of a govt site I worked at. Check your sense of humor & personality at the gate.

Well help us out then. Which of your posts contained humor? The predictions (see, now that's funny!) ? Maybe we just need a little guideline to your style.

So we are supposed to appreciate your vibrant dynamic personality, but also check our personality at the gate?

Oh, it's a joke! (insert nervous, forced Sheldon laugh)... ummm, right? No?

You might be now that the original Freebird is back.

But I'm not likely to confuse the two based on the content of their posts!

-ERD50

 

[ponyboy]

OP was banned from another forum. He doesnt save a dime...he spends everything...no EF...nada. Those are his words. He's one of those people who are so sure he will never have a hiccup collecting rent.

It doesnt matter what anyone says...he will troll a thread till the end of days stating that there is no better way to invest. Real estate is the answer. You're a sucker if you have a 401k that you cant touch, etc etc, blah blah...he's a broken record.

He used to work as a beer delivery driver...then he worked at home depot for a few years. He always hated what he did. He's an angry person. Just look at all of the threads he starts. He wants to generate conflict for whatever reason. Im surprised he hasnt been booted from here yet. Its only a matter of time...right 97?

 

[corn18]

OP was banned from another forum. He doesnt save a dime...he spends everything...no EF...nada. Those are his words. He's one of those people who are so sure he will never have a hiccup collecting rent.

It doesnt matter what anyone says...he will troll a thread till the end of days stating that there is no better way to invest. Real estate is the answer. You're a sucker if you have a 401k that you cant touch, etc etc, blah blah...he's a broken record.

He used to work as a beer delivery driver...then he worked at home depot for a few years. He always hated what he did. He's an angry person. Just look at all of the threads he starts. He wants to generate conflict for whatever reason. Im surprised he hasnt been booted from here yet. Its only a matter of time...right 97?

Sept 2016 post by 97guns on another forum:

"i had a very good property manager that i trusted 100%, this morning he suffered a massive heart attack and passed away this afternoon. now i need to make some decisions.... whether to find another property manager or liquidate everything, ive had the experience of using many property managers over the course of my RE investing, 5 others before this one and every one of them became totally untrustworthy over time, nickel and diming me to no end.

if i liquidate i will clear around 950K and would dump it all into trust deed loans that pay 11-13%, netting me around $114K a year, a nice jump in income from my current $66K through the rents. im undecided and have only given it a few hours thought but im leaning towards selling because im pretty sure an honest property manager does not exist."