Author Topic: More nonsense from MSN regarding how to retire Early  (Read 4665 times)


arebelspy

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Re: More nonsense from MSN regarding how to retire Early
« Reply #1 on: April 05, 2015, 05:39:20 PM »
Ouch. That case study is quite an interesting picture.  The thing is, he wouldn't be doing half bad if they adopted a few Mustachian principles.
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cshaw

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Re: More nonsense from MSN regarding how to retire Early
« Reply #2 on: April 05, 2015, 05:42:54 PM »
My thoughts exactly: kick the savings rate into high gear and cut the expenses and he'd be able to retire much sooner than 55 with his income level.

zephyr911

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Re: More nonsense from MSN regarding how to retire Early
« Reply #3 on: April 06, 2015, 07:53:30 AM »
Wait... the rentals are generating positive cash flow but they still advised him to sell?
WHAT THE ACTUAL FUCK, PAUL? YOU HAD ONE JOB.
Assuming those are financed rentals, anything above break-even (in immediate cash-flow terms) is a long-term moneymaker through equity accumulation and appreciation. And that small positive cash flow means he's probably in that Schedule E sweet spot where depreciation makes them a loss on paper, reducing the taxable portion of that six-figure income. The best thing to do if you're overextended there (but not badly so) is just tighten up and hang on.
Just the transactional costs alone on selling three properties could run tens of thousands between cosmetic repairs, commission, and capital gains taxes.

arebelspy

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Re: More nonsense from MSN regarding how to retire Early
« Reply #4 on: April 06, 2015, 08:03:06 AM »
I doubt they are, but they do claim so from the information given.  Seems inconsistent.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

zephyr911

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Re: More nonsense from MSN regarding how to retire Early
« Reply #5 on: April 06, 2015, 08:22:47 AM »
I doubt they are, but they do claim so from the information given.  Seems inconsistent.
Yeah, net positive $338 a month or whatever, but racking up credit card bills for maintenance? I don't get it.

AH013

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Re: More nonsense from MSN regarding how to retire Early
« Reply #6 on: April 06, 2015, 10:20:01 AM »
Well the good news is that all of his IRA money is 100% in Ford stock.  We all know it's going to return 20x over the next 10 years, so he's actually all set already and just doesn't know it.  Unfortunately he could have shaved another 5-8 years off his retirement date if he just took a little drive east to Vegas and put it all on Red 30...35x payoff right there, especially when you just know exactly which stock or number will be a winner and don't have to spread the risk.

larmando

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Re: More nonsense from MSN regarding how to retire Early
« Reply #7 on: April 06, 2015, 11:13:05 AM »
"waiting to sell until they have trouble finding tenants", of course, because that's clearly the moment the properties have high value, right? (not saying that they will have such a moment, but if they do that's also correlated with low value)


ash7962

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Re: More nonsense from MSN regarding how to retire Early
« Reply #8 on: April 06, 2015, 11:17:24 AM »
Well the good news is that all of his IRA money is 100% in Ford stock.  We all know it's going to return 20x over the next 10 years, so he's actually all set already and just doesn't know it.  Unfortunately he could have shaved another 5-8 years off his retirement date if he just took a little drive east to Vegas and put it all on Red 30...35x payoff right there, especially when you just know exactly which stock or number will be a winner and don't have to spread the risk.

How did that not get more attention?  Full on ford stock?  Without knowing all the facts, it kinda sounds like he was going for the get rich quick type of investments instead of researching a good strategy.  Also, did anyone notice that 3 months expenses was 21k?  Jeez that family is living on 7k/month or 84k/year.  I suppose they're in California which could mean high cost of living, but still 84k seems like a lot.

zephyr911

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Re: More nonsense from MSN regarding how to retire Early
« Reply #9 on: April 06, 2015, 11:43:06 AM »
Well the good news is that all of his IRA money is 100% in Ford stock.  We all know it's going to return 20x over the next 10 years, so he's actually all set already and just doesn't know it.  Unfortunately he could have shaved another 5-8 years off his retirement date if he just took a little drive east to Vegas and put it all on Red 30...35x payoff right there, especially when you just know exactly which stock or number will be a winner and don't have to spread the risk.

How did that not get more attention?  Full on ford stock?  Without knowing all the facts, it kinda sounds like he was going for the get rich quick type of investments instead of researching a good strategy.  Also, did anyone notice that 3 months expenses was 21k?  Jeez that family is living on 7k/month or 84k/year.  I suppose they're in California which could mean high cost of living, but still 84k seems like a lot.
For fixed recurring expenses, yes... it's too much.
As for Ford, they were probably just afraid of appearing to bash the company itself, as opposed to the investment strategy.