Race from $2M to $4M...and Beyond!

[JoJoP]

Oh,  sorry if my one liner to Car Jack seemed harsh to him or others.  My apologies.  I sincerely did not mean to offend. 

 Believe me, it stems from sheer excitement about Real Estate.  We have always liked real estate and it's a very traditional way to build wealth in this country.  Including or not including the primary dwelling for this thread is up to the poster, but RE has made many people wealthy.  Many moms and pops have enjoyed a better life when they downsize or perhaps kept their starter home as a rental when they moved up.   Our NW exploded since going seriously into rental houses, beyond anything I could have imagined. I know I'm an outlier on this particular forum when I say this:  We can't justify putting money in the stock market because the returns seem low compared to rentals.  When we have extra liquidity, we buy another house.  This is actually normal behavior in some circles!

@Sword Guy said this:
Around 2013 we started buying rental properties.  Over the next 4 years we bought and fixed up 4 rentals, with a very long pause in the middle.   Investment costs were around $200,000 including renovation costs.   Those properties are now worth around $380,000 and provide an income of $20,000 a year.   Let's round that down to $350,000 to allow for realtor sale commissions.

If I had taken that $200,000 and put it in index funds, it would have taken about 8-9 years to get to that $350,000.


The property that I used in my example upthread was also bought roughly in 2013, and is similar to his excellent math.  Ours would net us about $430K,  but our rent return is higher in this HCOL area.   I'm not clear if Sword Guy's 20K a year is combined or individual for his 4 rental homes.  But, either way, his numbers are sweet and comments are on target.  There are tremendous possibilities with Real Estate and it might be worth looking into if you're trying to fast track your wealth.

 

[SwordGuy]

Sword Guy said this:
Around 2013 we started buying rental properties.  Over the next 4 years we bought and fixed up 4 rentals, with a very long pause in the middle.   Investment costs were around $200,000 including renovation costs.   Those properties are now worth around $380,000 and provide an income of $20,000 a year.   Let's round that down to $350,000 to allow for realtor sale commissions.

If I had taken that $200,000 and put it in index funds, it would have taken about 8-9 years to get to that $350,000.


The property that I used in my example upthread was also bought roughly in 2013, and is similar to his excellent math.  Ours would net us about $430K,  but our rent return is higher in this HCOL area.   I'm not clear if Sword Guy's 20K a year is combined or individual for his 4 rental homes.  But, either way, his numbers are sweet and comments are on target.  There are tremendous possibilities with Real Estate and it might be worth looking into if you're trying to fast track your wealth.

$20K profit per year in total.  I think of them as replacing a chunk of a bond portfolio.  They provide steady income at 10% of our investment without crazy ups and downs (because we set aside money for repairs and vacancy costs).     Not only that, but their resale value after commissions would be around $350k, which is a 75% increase in resale value over cost.

If I could get that kind of return in bond funds I would have upped the size of my bond portfolio even if I did have to work some weekends for a few years to get those returns.

[Exflyboy]

RE is an interesting approach.

I am not an RE investor but I do have two rental "properties" that provide about $20k/yr after costs. These are throwaway buildings, one is a trailer and the other a 1950's cabin that might just get hit with my tractor when the current tenant moves out.

The interesting part to me is that.. Just a little bit of income means a whole lot less is required in net worth. I.e $20k is a minimum of $500k if one had to generate that from the stock market. Similar to a pension of course.

What puts me off of being an RE type is that honestly, the less stuff I own I find the happier I am.... Not including the shit-ton of $$ of course. So the idea of owning multiple properties with the subsequent liabilities would keep me up at night, even though of course the risk can be mitigated with Umbrella insurance/LLC etc.

Certainly seems to be a great way to invest though.

[soccerluvof4]

RE is an interesting approach.

I am not an RE investor but I do have two rental "properties" that provide about $20k/yr after costs. These are throwaway buildings, one is a trailer and the other a 1950's cabin that might just get hit with my tractor when the current tenant moves out.

The interesting part to me is that.. Just a little bit of income means a whole lot less is required in net worth. I.e $20k is a minimum of $500k if one had to generate that from the stock market. Similar to a pension of course.

What puts me off of being an RE type is that honestly, the less stuff I own I find the happier I am.... Not including the shit-ton of $$ of course. So the idea of owning multiple properties with the subsequent liabilities would keep me up at night, even though of course the risk can be mitigated with Umbrella insurance/LLC etc.

Certainly seems to be a great way to invest though.

I tried for years to do it in my area but just never could find anything that made sense. I ended up flipping a couple because it was with a friend and it made more sense. I entertained the idea of perhaps going out of state to do it but like you , even though you could hire a managing company I just felt it would stress the hell out of me. But the pockets like Swordguy are in obviously it can really work. Houses like that are 2-350 easily where I live so you cant get the rents to justify it and thats a lot of coin to have out. One could go into the city but that is risky at a whole new level I would rather pass on. I know alot of people making money at it but guess I have learned its not for me at this point. I do find it intriguing though.

[Car Jack]

Seriously Car Jack. Let it go.

Like I said, there are no forum police looking to document claims of liquid net worth.

I periodically point out the first post, where I clearly (I think) defined what I considered to be the liquid investments we'd talk about.  The most common addition for net worth is a residence.  For most people, that doesn't become a revenue source until someone is going into assisted living or the like.  What's my house (your house) worth?  We can only estimate until it is actually sold.

If you want to include other stuff, I'm not going to stop you. 

[BlueHouse]

Not sure if I should be in this thread or not, but here I am.:)

I added up my taxable and retirement accounts, Daughter's 529, and two rental properties today and just squeaked over $2M ($2,000,888 to be precise).  Not sure it will last, but I did want to at least mark the milestone.  People seem to be using only LNW, which I guess would exclude the 529 and rental properties?  I haven't included any equity in my company as that is too speculative at this point.  I doubt that I will ever get to $4M, but I suppose stretch goals never hurt anyone. :-D

Congratulations Wile! 
The only reason I don't count my home equity is because I live here and I don't want to HAVE to sell my home in order to FIRE.   

[SwordGuy]

What's my house (your house) worth?  We can only estimate until it is actually sold.

Funny thing.   I can only estimate what my index funds are worth.  I find out what they were worth the AFTER I sell them.   At least with my real estate, I know what the exact price will be 3 days before closing date -- by law.  :)

Just for perspective. :)

[Bird In Hand]

As of close of the markets yesterday, we joined this race for the first time with an aggregate balance of $2.005M across all our savings/retirement/investment accounts.  TNW including home equity is somewhere a little north of $2.4M.

Congratulations, and welcome!

Congratulations, and welcome!

Thank you!

[MaybeBabyMustache]

We count our house, as we don't plan to live in an area as expensive as this post kids out of the house. To be more accurate, I should probably only account for the gap between what would be left after we sell this house, and buy another. I like that approach.

[Much Fishing to Do]

Just curious as to if the members of this group have umbrella insurance, how much, costs, and why did you get it/not get it? I'm just trying to figure out what to do with mine right now as I reevaluate expenses and risk heading into RE.

I have a $3M policy, which is close to my LNW.  So I do have around the rule of thumb of making it equal to your NW, though I realize this is a somewhat arbitrary amount to use (potential liability judgements seem somewhat arbitrary and potentially infinite....I could always get a judgement against me for $6M, at which point I've lost everything even with the insurance, or $1M, at which point I would feel like I maybe overpaid for $3M).

I guess vehicle accident lawsuits are at the forefront of my mind (esp with teen drivers).  It seemed relatively inexpensive (was around $30/mth I think for the $3M) but then a little more than doubled once my first teen started driving, and I have a second teen that will be starting before long.  I do have a rental property which I guess is the other area I see as creating potential liability claims, but thats under an LLC so I assume any risk there is limited to the LLC itself (basically the rental prop itself and the LLC checking acct set up for that), so I'm sure its not covered under the umbrella nor does it need to be.

[2sk22]

Just curious as to if the members of this group have umbrella insurance, how much, costs, and why did you get it/not get it? I'm just trying to figure out what to do with mine right now as I reevaluate expenses and risk heading into RE.

I have a $3M policy, which is close to my LNW.  So I do have around the rule of thumb of making it equal to your NW, though I realize this is a somewhat arbitrary amount to use (potential liability judgements seem somewhat arbitrary and potentially infinite....I could always get a judgement against me for $6M, at which point I've lost everything even with the insurance, or $1M, at which point I would feel like I maybe overpaid for $3M).

I guess vehicle accident lawsuits are at the forefront of my mind (esp with teen drivers).  It seemed relatively inexpensive (was around $30/mth I think for the $3M) but then a little more than doubled once my first teen started driving, and I have a second teen that will be starting before long.  I do have a rental property which I guess is the other area I see as creating potential liability claims, but thats under an LLC so I assume any risk there is limited to the LLC itself (basically the rental prop itself and the LLC checking acct set up for that), so I'm sure its not covered under the umbrella nor does it need to be.

I also have an umbrella policy too for a similar amount. As in your case, it has become quite expensive after my younger daughter has started to drive. We have had this policy for a long time but have increased the coverage amount in recent years as our net worth has grown.

[SuperSecretName]

A 6mil policy isn't going to provide you better defense than a 3 mil policy.  Part of getting the umbrella is so the company vigorously defends you.  You have that protection.

[Dancin'Dog]

Trusts can protect your assets from liability also. 

[Much Fishing to Do]

A 6mil policy isn't going to provide you better defense than a 3 mil policy.  Part of getting the umbrella is so the company vigorously defends you.  You have that protection.

Yeah, this is why I would consider dropping it to $1M, I assume the same argument would apply.

[Exflyboy]

So the reason your umbrella policy increased was because you have teen drivers?

What if you don't carry your teens on your car insurance? I mean my parents wouldn't dream of carrying me, nor could they afford it.

A little bit of hedonistic adaption as we all got wealthier maybe?

[2sk22]

So the reason your umbrella policy increased was because you have teen drivers?

What if you don't carry your teens on your car insurance? I mean my parents wouldn't dream of carrying me, nor could they afford it.

A little bit of hedonistic adaption as we all got wealthier maybe?

True but it's very useful to have more licensed drivers in the household. I just dispatched my 17 year old to the supermarket to buy a few things for example :-) And its just for a matter of a few years in any case (hopefully).

[Much Fishing to Do]

So the reason your umbrella policy increased was because you have teen drivers?

What if you don't carry your teens on your car insurance? I mean my parents wouldn't dream of carrying me, nor could they afford it.

A little bit of hedonistic adaption as we all got wealthier maybe?

Sorry, I guess I don't understand the joke and/or facepunch, whichever this is.  I should have my high schoolers carry their own insurance?  And if they do and get in an accident the parties can't go after me?  Or do you mean I shouldn't allow them  to drive?  I guess maybe I shouldn't, but frankly one of the great things of the kids getting older is them driving themselves places.

I mean, I happily pay for their sports team dues as well.  And after my net worth rose above $2M I even bought myself a new car.  So yes, I guess I did succumb to "hedonistic adaption" as I got wealthier.  But continuing to spend $40k/year when I'm worth $4M I guess I just don't understand.

[secondcor521]

I have an umbrella policy.  I ignore the rule of thumb and got the policy amount based on my level of risk (average to below average) and the size of actual court awards in my state.

As for Exflyboy's comments, I'll let him answer for himself, but my interpretation of them is that it is a luxury for parents to pay for their teen's auto insurance and that teens should pay their auto insurance premiums so that they understand the true cost of driving and the attendant risks of speeding / DUI and the benefits of good grades.  I think it's a personal decision as to who pays for what when, but I think we all agree that insuring teen drivers is pretty expensive.

[Fomerly known as something]

I have a $5million dollar umbrella policy, mainly because Michigan’s no fault laws make it dirt cheap.  The insurance person stated Ivan never seen the price this low.  (Less than $300/year) I can’t remember the $1million price but I don’t think it was significantly cheaper.

[soccerluvof4]

I just had this conversation with my agent the other day because I sold my 21 year old the car he was using. If he didnt stay on my insurance he would pay about 35% more BUT we just figured his cost and he has to pay that with his car payment now to me every month. Plus they indicated all kids if living at home have to be on your insurance plan. I found that odd.  My concern having 3 kids soon to be 4 on my Insurance is all the risk and currently have a 1 Million dollar umbrella and when I asked if that was enough they made it sound like it was. All my kids even the 21 year old unless they have a 3.8 or above GPA then they had to work jobs in HS and pay for car insurance. We get the student discount at 3.0 so if there not above that then they dont drive period. That hasnt been an issue.

[2sk22]

So the reason your umbrella policy increased was because you have teen drivers?

What if you don't carry your teens on your car insurance? I mean my parents wouldn't dream of carrying me, nor could they afford it.

A little bit of hedonistic adaption as we all got wealthier maybe?

Sorry, I guess I don't understand the joke and/or facepunch, whichever this is.  I should have my high schoolers carry their own insurance?  And if they do and get in an accident the parties can't go after me?  Or do you mean I shouldn't allow them  to drive?  I guess maybe I shouldn't, but frankly one of the great things of the kids getting older is them driving themselves places.

I mean, I happily pay for their sports team dues as well.  And after my net worth rose above $2M I even bought myself a new car.  So yes, I guess I did succumb to "hedonistic adaption" as I got wealthier.  But continuing to spend $40k/year when I'm worth $4M I guess I just don't understand.

Just a bit of wry English humor from @Exflyboy :-)

[MaybeBabyMustache]

Question to put out to the group about retirement accounts. . .

I'm about to hit $1M in my retirement account, and my husband is in a similar place with this retirement account. I'm 45 & my husband is 54.

We plan to continue to work (me, for another 2 years is the plan, & my husband has no plans to retire because he greatly enjoys his job.) I'm guessing we should continue to max our tax advantaged retirement accounts regardless of how much the balance is, because it reduces our taxable income. I've also been using a backdoor Roth (offered by my company) to save more. Should I stop & just start investing in non-retirement accounts? Do I have "too much" in my retirement account? Any recommended reading on investment strategies once you have a significant amount in your 401ks?

We have no plans to tap our retirement accounts until my husband hits 60 (at the earliest) & will have a paid off house when he retires.

[couponvan]

https://www.mrmoneymustache.com/2011/11/11/how-much-is-too-much-in-your-401k/

MMM has some opinions on this. :-)

Once your DH is the solo earner, I'd see what your tax brackets are vs. where your tax brackets are going to be in retirement. That will decide on whether you want to do 401(k)s.  If there's any match, I'd at least contribute up to the match, as that's free money.

[MaybeBabyMustache]

Thanks, @couponvan . That's useful. I'll check out what MMM has to say.

Our company does offer a generous amount, and in our current tax bracket, any advantages are ones we will leverage, so planning to continue the full contribution. (I maxed my 2021 amount today anyway, as we receive our annual bonus.)

[Dancin'Dog]

The real estate folks here are missing out on the "fun" of watching the market correction this morning.  I'm down $165K and it's not even lunchtime yet.  ;)   Maybe I should read up on real estate!!

[Dicey]

The real estate folks here are missing out on the "fun" of watching the market correction this morning.  I'm down $165K and it's not even lunchtime yet.  ;)   Maybe I should read up on real estate!!

Ooh, you mean it's a good day to go on a stock shopping spree? Yippee!

[Dicey]

https://www.mrmoneymustache.com/2011/11/11/how-much-is-too-much-in-your-401k/

MMM has some opinions on this. :-)

Once your DH is the solo earner, I'd see what your tax brackets are vs. where your tax brackets are going to be in retirement. That will decide on whether you want to do 401(k)s.  If there's any match, I'd at least contribute up to the match, as that's free money.

Another important question is how much you have in taxable investments. That's a key part of retiring early. The best thing about taxable accounts is their flexibility. You can use it (or not) when ever and how ever you want. 

The benefit tax deferred accounts is it puts more soldiers in the field faster, thus increasing their effectiveness. Once you have an army the size you do, that boost is less important. They're going to keep working on your behalf, even as you shift money into Roths or other taxables.

I agree with coup. Get the match, then look at other investment options that give you more control. Also, when youre not locked into your employer's plan, you will have more choices and more control over the fees you pay, which can really add up.

[MaybeBabyMustache]

Thanks, @Dicey . We don't have a ton in our taxable investments ($400k), but we are planning to move somewhere less expensive & will be leveraging equity in our existing house (expect to have ~$2M left over after we buy another house, but pre closing costs, etc.)

I agree with the larger point. I'm going to continue to the full 401k amount, but dial back the backdoor Roth contributions & funnel that to taxable investments.

[markbike528CBX]

Question to put out to the group about retirement accounts. . Snip.....
I'm about to hit $1M in my retirement account, and my husband is in a similar place with this retirement account. I'm 45 & my husband is 54....Snip...
Should I stop & just start investing in non-retirement accounts? Do I have "too much" in my retirement account? ....Snip....

As a reminder, "taxable" does not necessarily mean taxed. 
As you only have to pay taxes on gains and distributions on stock-like stuff, for a 20year early retirement, the gains will be a fraction of your withdrawal.
Further long-term (>1 year) and qualified dividends are taxed at 0% up to $80,000.*
https://www.gocurrycracker.com/never-pay-taxes-again/ mentioned this.      I wish that I had realized this earlier.   
But I concur with others that you should contribute at least to the match in you 401(k). 
How much of your cashflow is split between 401(k) and taxable is your call and may depend on your desire to minimize your current taxable income for various reasons (taxes?).

*See the Qualified Dividends and Capital Gain Tax Worksheet—Line 16 on page 35 of the 2020 Instructions for Form 1040.   Line 9 (amount taxed at 0%) is sometimes a jaw-dropping number.
   

[ixtap]

Thanks, @Dicey . We don't have a ton in our taxable investments ($400k), but we are planning to move somewhere less expensive & will be leveraging equity in our existing house (expect to have ~$2M left over after we buy another house, but pre closing costs, etc.)

I agree with the larger point. I'm going to continue to the full 401k amount, but dial back the backdoor Roth contributions & funnel that to taxable investments.

Why? While it is important for most people to have some amount in taxable, why do you plan to prioritize taxable over Roth at this time?

[MaybeBabyMustache]

@ixtap - my understanding was that it gave me more flexibility on how/when I access that money in the future. Sounds like I have more research to do!

[Bird In Hand]

The real estate folks here are missing out on the "fun" of watching the market correction this morning.  I'm down $165K and it's not even lunchtime yet.  ;)   Maybe I should read up on real estate!!

Ooh, you mean it's a good day to go on a stock shopping spree? Yippee!

I must have blinked and missed the correction, but I do see that the major indexes are down about .75% today.  YAY, it feels like the majority of the time the indexes are up on my pay days, so I always cheer a bit when they're down.  Buying my retirement funds at a slight discount makes me very happy!

[Dicey]

Thanks, @Dicey . We don't have a ton in our taxable investments ($400k), but we are planning to move somewhere less expensive & will be leveraging equity in our existing house (expect to have ~$2M left over after we buy another house, but pre closing costs, etc.)

I agree with the larger point. I'm going to continue to the full 401k amount, but dial back the backdoor Roth contributions & funnel that to taxable investments.

Why? While it is important for most people to have some amount in taxable, why do you plan to prioritize taxable over Roth at this time?

I will answer the first two questions. @MaybeBabyMustache can answer the third one. I didn't say it was important for "most" people. However, if your 401k is fat enough, taxable investments may present more and possibly better options. If you plan to retire before 59.5, it's easier money to access. You also have more investment/low fee options in the open market than most employer plans. In a word: control.

[ixtap]

Thanks, @Dicey . We don't have a ton in our taxable investments ($400k), but we are planning to move somewhere less expensive & will be leveraging equity in our existing house (expect to have ~$2M left over after we buy another house, but pre closing costs, etc.)

I agree with the larger point. I'm going to continue to the full 401k amount, but dial back the backdoor Roth contributions & funnel that to taxable investments.

Why? While it is important for most people to have some amount in taxable, why do you plan to prioritize taxable over Roth at this time?

I will answer the first two questions. @MaybeBabyMustache can answer the third one. I didn't say it was important for "most" people. However, if your 401k is fat enough, taxable investments may present more and possibly better options. If you plan to retire before 59.5, it's easier money to access. You also have more investment/low fee options in the open market than most employer plans. In a word: control.

None of that addresses why one would prioritize taxable over the backdoor Roth, as was being addressed. In a Roth IRA, you have easy access to your contributions, without triggering a taxable event, and you have access to the same investments that you have in taxable. Again, I am not denying that there may be some advantages in taxable for some situations, but OP already has a sizeable taxable account and should only prefer that if they have a clear plan for why. I would argue that for most early retirees, the Roth IRA gives you more control than a taxable account because you have added control over your taxable events.

[MaybeBabyMustache]

Thanks, @Dicey . We don't have a ton in our taxable investments ($400k), but we are planning to move somewhere less expensive & will be leveraging equity in our existing house (expect to have ~$2M left over after we buy another house, but pre closing costs, etc.)

I agree with the larger point. I'm going to continue to the full 401k amount, but dial back the backdoor Roth contributions & funnel that to taxable investments.

Why? While it is important for most people to have some amount in taxable, why do you plan to prioritize taxable over Roth at this time?

I will answer the first two questions. @MaybeBabyMustache can answer the third one. I didn't say it was important for "most" people. However, if your 401k is fat enough, taxable investments may present more and possibly better options. If you plan to retire before 59.5, it's easier money to access. You also have more investment/low fee options in the open market than most employer plans. In a word: control.

None of that addresses why one would prioritize taxable over the backdoor Roth, as was being addressed. In a Roth IRA, you have easy access to your contributions, without triggering a taxable event, and you have access to the same investments that you have in taxable. Again, I am not denying that there may be some advantages in taxable for some situations, but OP already has a sizeable taxable account and should only prefer that if they have a clear plan for why. I would argue that for most early retirees, the Roth IRA gives you more control than a taxable account because you have added control over your taxable events.

Thanks for all of the input here. @ixtap - refinement on my question. Given my husband plans to work at least until full retirement age, does that change your thinking? Put another way, I'll be an early retiree, but it's very unlikely he will be.

[ixtap]

Thanks, @Dicey . We don't have a ton in our taxable investments ($400k), but we are planning to move somewhere less expensive & will be leveraging equity in our existing house (expect to have ~$2M left over after we buy another house, but pre closing costs, etc.)

I agree with the larger point. I'm going to continue to the full 401k amount, but dial back the backdoor Roth contributions & funnel that to taxable investments.

Why? While it is important for most people to have some amount in taxable, why do you plan to prioritize taxable over Roth at this time?

I will answer the first two questions. @MaybeBabyMustache can answer the third one. I didn't say it was important for "most" people. However, if your 401k is fat enough, taxable investments may present more and possibly better options. If you plan to retire before 59.5, it's easier money to access. You also have more investment/low fee options in the open market than most employer plans. In a word: control.

None of that addresses why one would prioritize taxable over the backdoor Roth, as was being addressed. In a Roth IRA, you have easy access to your contributions, without triggering a taxable event, and you have access to the same investments that you have in taxable. Again, I am not denying that there may be some advantages in taxable for some situations, but OP already has a sizeable taxable account and should only prefer that if they have a clear plan for why. I would argue that for most early retirees, the Roth IRA gives you more control than a taxable account because you have added control over your taxable events.

Thanks for all of the input here. @ixtap - refinement on my question. Given my husband plans to work at least until full retirement age, does that change your thinking? Put another way, I'll be an early retiree, but it's very unlikely he will be.

In my mind, it probably makes Roth even more valuable, as you may never be in a significantly lower tax bracket to a)pull from taxable without taxes or b) do Roth conversions.

[MaybeBabyMustache]

Awesome. Thanks for all of the input. Adding learning about Roth conversions to my list.

[ixtap]

Awesome. Thanks for all of the input. Adding learning about Roth conversions to my list.

We were talking about whether or not to continue backdoor Roth, but yes, I believe it is important to learn about conversions and figure out how they may fit into your particular situation.

If you haven't already, you may also want to look into mega backdoor Roth. The main advantage of taxable is tax loss harvesting and frankly you have to lose money to do that and/or be able to leave money sitting for your heirs.

[Bird In Hand]

As of close of the markets yesterday, we joined this race for the first time with an aggregate balance of $2.005M across all our savings/retirement/investment accounts.  TNW including home equity is somewhere a little north of $2.4M.

Still holding the line at $2.029M LNW after a couple weeks.  I know we're likely to dip below $2M from time to time, but for now it's fun to see our balances staying (just) above that threshold.

The RE market has been pretty strong here as of late, and SmartZip now estimates our paid-off house at $472k.  Probably unrealistic, but I like how it makes our TNW +/- $2.5M.

[Bateaux]

I wish I was in a position to work real estate for profit like many here.  We have 3 houses.  The Florida house is lived in about a tenth of the time.   The of the two Louisiana ones, both have been money pits for a long time.  We rented one for a while but it was a pain.  I can't wait to offload the two Louisiana houses and just have one.   Our taxable accounts are really low.  I guess when we sell the two in Louisiana that will go into taxable accounts.  I can't wait till almost all our assets fit inside my cell phone.

[BigEasyStache]

My experience with rental property:

I had a single family rental home in the suburbs of NOLA.  I rented for 16 years. And while the money was good (this property generated a realized net annual gain of about $7,000) I absolutely don't miss:
Sewer line backing up while toilet doesn't shut off and house is flooded with fresh toilet water.  All carpets wet.
Tenant abandoning property without telling me and vandals breaking the windows.
50 foot red leaf maple tree (unknown that it was infested with termites) falling on neighbors house and destroying my fence and gazebo.
Anxiety every time a hurricane enters the gulf.  It's bad enough to take care of the home you live in but when tenants depend on you it sux.

The good part was that after 16 years of really hot appreciation, I sold the house for a very nice profit.....though I had 20% capital gains to pay since I didn't reinvest in more rental.

Yes, the returns are good...but I absolutely don't miss the headaches.

YMMV

[Exflyboy]

My experience with rental property:

I had a single family rental home in the suburbs of NOLA.  I rented for 16 years. And while the money was good (this property generated a realized net annual gain of about $7,000) I absolutely don't miss:
Sewer line backing up while toilet doesn't shut off and house is flooded with fresh toilet water.  All carpets wet.
Tenant abandoning property without telling me and vandals breaking the windows.
50 foot red leaf maple tree (unknown that it was infested with termites) falling on neighbors house and destroying my fence and gazebo.
Anxiety every time a hurricane enters the gulf.  It's bad enough to take care of the home you live in but when tenants depend on you it sux.

The good part was that after 16 years of really hot appreciation, I sold the house for a very nice profit.....though I had 20% capital gains to pay since I didn't reinvest in more rental.

Yes, the returns are good...but I absolutely don't miss the headaches.

YMMV

I absolutely agree!

The money is good, I make about $20k on two buildings (one a manufactured home) and those buildings are on the same property where we live.

There is always something going wrong with something. The thing is if something breaks in your own house thats something you can decide to put off fixing. But not really with renters.

They are paying for a service and you really want to keep them happy.

I have done very well though.. paid off my property in 6 years vs 30 years, thus saving over $300k in interest payments.

In 24 years I have ONLY had.

1) water pipe got chewed through by a rat.. Renters heard water running for 3 days before they thought they should tell me!!!

2) Renter got arrested and dragged out in handcuffs. His GF then filed a restraining order and the court evicted him.. He then started to go on a tirade about how he was going to sue ME for evicting him!.. geez.

3)  few days of sewers backing up before I found the root cause of the problem. Thankfully an easy fix.

4) Constant worries about what my renters are flushing down the toilets on aging and sensitive septic systems.

I now have a septic system that has failed.. I might just take the opportunity to not renew the lease on the manufactured home and plumb my house to that system. Not sure what the market is like to used 1995 manufactured homes.

[alienbogey]

I updated all of our investment accounts today and, for the first time, our LNW has passed into "Beyond!".

:)

[Dancin'Dog]

I updated all of our investment accounts today and, for the first time, our LNW has passed into "Beyond!".

:)

Congrats! 


Hopefully, now you'll be able to get back to your homeworld.  ;)   Once you reach the "Beyond" the acceleration rate becomes exponential. 

[Exflyboy]

I updated all of our investment accounts today and, for the first time, our LNW has passed into "Beyond!".

:)

Congrats.. Our LNW is only (ONLY!) $5k short of $2.7M but I hope we will join you there one day..:)

[billsfan1_2000]

Hi all.

I am a frequent reader but only occasional poster here.  I read with interest your many chronicles of life.

Hoping to lean into your insight y'all....

I am 57, LNW just over $4M and 5 weeks away from the magical date of Feb 26 when the annual bonus arrives (around $100k pre tax), multiple tranches of restricted shares will have vested, the firm's annual lump sum contribution to 401k will have been made, college age son's last tuition payment (finally!!) will be behind me. 

I have had the date March 1, 2021 circled on the mental calendar for 2 years now thinking that's the day I call the boss, give them the news that I am leaving and move on to different things.

Wondering how all of you handled the Decision?  Any regrets? 

I find myself torn between the desire to leave behind the soul crushing meetings, endless powerpoints and serious issues of balance where - partly because we are COVID work from home - the lines between personal and work life are blurred and we are expected to be "on" pretty much 24/7.

On the other hand - I become bored quickly and after a few months of fixing up the house wonder what on earth I'd do (apart from golf daily)?

Anyone have any thoughts on how the leap of faith to this new world went for you?  What part time jobs that are fun and pay for health insurance are out there?

With the date now looming worried about the transition from working in the professional world for 30++ years, with all the prestige, money, not having to care about spending, to - something different....

Cheers!

[Dancin'Dog]

Hi all.

I am a frequent reader but only occasional poster here.  I read with interest your many chronicles of life.

Hoping to lean into your insight y'all....

I am 57, LNW just over $4M and 5 weeks away from the magical date of Feb 26 when the annual bonus arrives (around $100k pre tax), multiple tranches of restricted shares will have vested, the firm's annual lump sum contribution to 401k will have been made, college age son's last tuition payment (finally!!) will be behind me. 

I have had the date March 1, 2021 circled on the mental calendar for 2 years now thinking that's the day I call the boss, give them the news that I am leaving and move on to different things.

Wondering how all of you handled the Decision?  Any regrets? 

I find myself torn between the desire to leave behind the soul crushing meetings, endless powerpoints and serious issues of balance where - partly because we are COVID work from home - the lines between personal and work life are blurred and we are expected to be "on" pretty much 24/7.

On the other hand - I become bored quickly and after a few months of fixing up the house wonder what on earth I'd do (apart from golf daily)?

Anyone have any thoughts on how the leap of faith to this new world went for you?  What part time jobs that are fun and pay for health insurance are out there?

With the date now looming worried about the transition from working in the professional world for 30++ years, with all the prestige, money, not having to care about spending, to - something different....

Cheers!

Reinvent yourself.  Try anything that you've ever wanted to try.  Golf is for old guys & ladder climbing, you can always resume that later.  Go see the world.  Try something new.  Pick up an old passion that you'd given up to be a grown-up.  Do you like boats, motorcycles, airplanes, RVs?  What about crafts or hobbies?  Have you ever wanted to try pottery, glassblowing, woodworking, weaving, photography, orchid breeding, or growing the world's largest pumpkin?  Have you tried scuba diving, sky diving, river rafting, sailing, brewing beer, or racing gocarts?


If you're out of shape, well get in shape and then "go for it", whatever your its are.  Make a dream list & live some of your dreams.


Don't forget about volunteering.  Volunteers make the world a better place. 


Also, remember the saying "If you're bored it's because you are boring."  (or something like that) 


And...for another perspective, go visit a nursing home.  That's our next stop. 

[MaybeBabyMustache]

@billsfan1_2000 - chiming in, as I took a sabbatical last year to try & answer some of these questions for myself. I'm now back to work, with a clear exit timeline & a better picture of the future. Full disclosure - I don't need to be working right now (slightly over the $4m mark), but there are a couple of financial milestones that are easier to hit with me working a few more years, and it's what I've agreed with my husband.

Over the sabbatical, my experience was I'm not interested in things I've never been interested in (cleaning the house all day was as unenjoyable as it was when I was employed full time). But, the mental space gave me the capacity to evaluate other areas of interest. I started a volunteering job (very part time for now), I came up with very clear routines for myself, & I worked out a lot. I explored writing, traveled (non COVID times), etc. For me, it was clear that I needed routines, some sort of social interaction outside of the people in my family, & something workish, even if very part time & not for pay. What you need will differ, but once you've had the time & space, mentally as well as just actual time, some of that will come to you.

Also, on my sabbatical, you know what i never missed fondly? Emails, meetings, deck creations, fire drills, etc. I did miss the camaraderie of great people, but that can be replicated in many ways.

[soccerluvof4]

Hi all.

I am a frequent reader but only occasional poster here.  I read with interest your many chronicles of life.

Hoping to lean into your insight y'all....

I am 57, LNW just over $4M and 5 weeks away from the magical date of Feb 26 when the annual bonus arrives (around $100k pre tax), multiple tranches of restricted shares will have vested, the firm's annual lump sum contribution to 401k will have been made, college age son's last tuition payment (finally!!) will be behind me. 

I have had the date March 1, 2021 circled on the mental calendar for 2 years now thinking that's the day I call the boss, give them the news that I am leaving and move on to different things.

Wondering how all of you handled the Decision?  Any regrets? 

I find myself torn between the desire to leave behind the soul crushing meetings, endless powerpoints and serious issues of balance where - partly because we are COVID work from home - the lines between personal and work life are blurred and we are expected to be "on" pretty much 24/7.

On the other hand - I become bored quickly and after a few months of fixing up the house wonder what on earth I'd do (apart from golf daily)?

Anyone have any thoughts on how the leap of faith to this new world went for you?  What part time jobs that are fun and pay for health insurance are out there?

With the date now looming worried about the transition from working in the professional world for 30++ years, with all the prestige, money, not having to care about spending, to - something different....

Cheers!

Reinvent yourself.  Try anything that you've ever wanted to try.  Golf is for old guys & ladder climbing, you can always resume that later.  Go see the world.  Try something new.  Pick up an old passion that you'd given up to be a grown-up.  Do you like boats, motorcycles, airplanes, RVs?  What about crafts or hobbies?  Have you ever wanted to try pottery, glassblowing, woodworking, weaving, photography, orchid breeding, or growing the world's largest pumpkin?  Have you tried scuba diving, sky diving, river rafting, sailing, brewing beer, or racing gocarts?


If you're out of shape, well get in shape and then "go for it", whatever your its are.  Make a dream list & live some of your dreams.


Don't forget about volunteering.  Volunteers make the world a better place. 


Also, remember the saying "If you're bored it's because you are boring."  (or something like that) 


And...for another perspective, go visit a nursing home.  That's our next stop.

Very Well said! Totally agree.

[2sk22]

Hi all.

I am a frequent reader but only occasional poster here.  I read with interest your many chronicles of life.

Hoping to lean into your insight y'all....

I am 57, LNW just over $4M and 5 weeks away from the magical date of Feb 26 when the annual bonus arrives (around $100k pre tax), multiple tranches of restricted shares will have vested, the firm's annual lump sum contribution to 401k will have been made, college age son's last tuition payment (finally!!) will be behind me. 

I have had the date March 1, 2021 circled on the mental calendar for 2 years now thinking that's the day I call the boss, give them the news that I am leaving and move on to different things.

Wondering how all of you handled the Decision?  Any regrets? 

I find myself torn between the desire to leave behind the soul crushing meetings, endless powerpoints and serious issues of balance where - partly because we are COVID work from home - the lines between personal and work life are blurred and we are expected to be "on" pretty much 24/7.

On the other hand - I become bored quickly and after a few months of fixing up the house wonder what on earth I'd do (apart from golf daily)?

Anyone have any thoughts on how the leap of faith to this new world went for you?  What part time jobs that are fun and pay for health insurance are out there?

With the date now looming worried about the transition from working in the professional world for 30++ years, with all the prestige, money, not having to care about spending, to - something different....

Cheers!

What you chose to do depends a lot on your personality type. I feel happiest when I'm actually creating something rather than just passively watching videos or even reading stuff. I have been making good progress on actually getting back to creating stuff in retirement.

Although I worked in the software industry for thirty years, towards the end, I spent more time in endless meetings discussing what to do rather than actually writing code. After I retired last October, I have been thoroughly absorbed learning Swift (a new programming language from Apple)  and am planning to start releasing apps on the App Store.

Meanwhile, I have just finished renovating my basement and am getting back into building a model train layout - which has been my hobby since childhood.

The three big requirements for most hobbies are time, space and money - in retirement you will most likely have all three. Nothing stopping you from getting started 😀