It looks like financially you can retire, and the real question is about your goals and interaction with your partner but I've got a few questions:
Rental income, is it $35k
Income-wise: With my main job, side hustles, and rentals I currently make about 120k gross (65 Primary job, 20 part time job, 35k rental properties, 10 from dividends)
or $26k?
Real Estate: 3 rental properties with an aggregate value of ~ 525k or so, yielding 26k Net income, no debt.
Even with $26k net rental income + $16k investment income following the 4% rule ($400k x 0.04) means you should be fine and have a safety margin. On top of that, you've got some future pension benefits (it would be good to know if you get anything from 'big gov't pension' if you leave now) and plans to lower expenses. If I was in your shoes financially with a job I didn't like, I would be retired.
The bigger issue is personal. I think you need to figure out the plan with your partner, if his work is fulfilling and your FI plan is to urban homestead and volunteer at non-profits you might not have a big change in your life other than you being happier. His being in college (at age 50) also makes me think, he has professional goals that involve working for a very long time. Others here are way better at giving advice on relationship dynamics but I think the FI issue might be more loaded that presented in the original post.
Thank you for the comments, and let me clarify :) I'm awesome at being incredibly murky.
My net off rental properties is 26k, the gross is 35k. Total income for me (Right now): 120k gross // ~88k Net. I have ~8k/yr in mandatory pension contributions I don't count. I will be right around 48k Net when I leave my primary job. AGI after leaving, roughly right around 15-20k with 9k in taxable dividends, 24-29k total.
With the rentals:
- ~9k in expenses (property taxes, maint, insurance) attached to them as a total. My personal expenses in my original post don't include this amount at all - I keep it separate and concern myself with the real Net income after all expenses and deductions are considered. That said, my cash float for maintenance/taxes is very low so I do worry and recognize that I need to raise rents at the start of 2018.
- After tax ROI on 2 of my properties are 6% and 6.2%, which is almost wiped out by depreciation (thanks to the incredibly awesome tax code we have).
- The 3rd property, that needs to be renovated and sold, has a high HOA fee associated with it leading to a 3% after tax return. With depreciation, I am taking a tax loss on that one (and my LLC shows a small tax loss overall, yay!). When I renovate and sell, I'll raise the cost basis back up with the renovations to show less in cap gains. It's in an older neighborhood, somewhat shady, near the city center where complete teardown and rebuilds are becoming common. Kind of spec RE, I couldn't let it go by for the price - I mitigate some risk by having an amazing tenant / handyman with a 24-36 month timeline that desperately needed a financial break on rent. Renovated units near it rent for 40-50% more than mine currently.
My partner & College:
- His daughter is in college, for another couple years. He is supporting her through college, I respect that and that's his choice. She's extremely bright and picked up scholarships for this year and for next.
- I believe he's pretty burned out on institutional education, however, I'd love to see him get some education on power tools at home depot so I'm not concerned about him maiming himself...but that's another story for another forum.
- Job-wise / Relationship conflict: He does love his job, but never gave a thought to retirement until I entered the picture and I'm pretty sure he thinks his situation is near hopeless.
Our only conflict is financially-related: We do sometimes have heated discussions over numbers; I'm always searching for investments, and if there are things that seem logical to me, with an expected ROI above what I make now, with the same or lower risk...then I do them and find a way to pay for them as I go. This leads to situations where I will buy things or make investments without having a cash cushion solidly in place at decision time. Our "discussions" are because if I think something is a no-brainer...then there is no consultation, I just go, even if it is an investment with joint money.
In summary: I am obsessive with math and research, and may (at times) impulsively make decisions that make or save money (sometimes with money that may be his).
My awesome big gov't pension:
If I leave before 20, I qualify for nothing. Thanks military. On the bright side I can serve openly, for now, and I will probably have VA claims sometime in the future....maybe VA isn't really a bright side though.
- I am geographically separated from duty station - so I do incur a significant amount of expenses commuting to/from once a month. All of this can be claimed without itemizing on my tax return (Drilling reservist deductions). The deductions can be very generous if done correctly and the part time income listed in my original post already takes that real cost into account.
