BigNick
Thinks s/he gets paid by the post
We bought our home with a 15 mile commute in 1993 when the children were small, then sold in 2007 and moved into town where we now rent a 4-bed house with yard, garage, etc for 1550/month. Comparable homes would sell for 400K easily.
When we FIRE we may or may not move from this place straight away. We like our present home but we will realistically never have the chance to buy it (landlord's childhood home, sentimental value etc) and also it's probably more than we would need, or want to tie up in capital - neither I nor DW are big "ideal home" people.
Now, I'm thinking in general terms about whether we should plan to rent or buy. When we FIRE - hopefully in as little as 2-3 years - I expect that we will have about 3000/mo in pensions and a 4% withdrawal from a 1.2M portfolio, say another 4000/mo. That pretty much matches up with our current expenditure (LBYM: we save 5000/mo and are also putting 1500/mo aside for college, which will end in 2-3 years)
The raw numbers are easy: 1550/mo takes up 4% of 465K from the portfolio. So in theory a house or apartment which costs 250K leaves 215K more in the pot, giving another 715/mo to spend on [-]slippers[/-] [-]hearing aids[/-] travel and fine dining. We'd need to add something for maintenance, but I'm guessing that that is comparable in magnitude to the ongoing annual increases in the rental amount.
What else should we take into account? Experiences welcome.
When we FIRE we may or may not move from this place straight away. We like our present home but we will realistically never have the chance to buy it (landlord's childhood home, sentimental value etc) and also it's probably more than we would need, or want to tie up in capital - neither I nor DW are big "ideal home" people.
Now, I'm thinking in general terms about whether we should plan to rent or buy. When we FIRE - hopefully in as little as 2-3 years - I expect that we will have about 3000/mo in pensions and a 4% withdrawal from a 1.2M portfolio, say another 4000/mo. That pretty much matches up with our current expenditure (LBYM: we save 5000/mo and are also putting 1500/mo aside for college, which will end in 2-3 years)
The raw numbers are easy: 1550/mo takes up 4% of 465K from the portfolio. So in theory a house or apartment which costs 250K leaves 215K more in the pot, giving another 715/mo to spend on [-]slippers[/-] [-]hearing aids[/-] travel and fine dining. We'd need to add something for maintenance, but I'm guessing that that is comparable in magnitude to the ongoing annual increases in the rental amount.
What else should we take into account? Experiences welcome.