Author Topic: FIRE Without Stockmarket  (Read 2811 times)

Kiwi Mustache

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FIRE Without Stockmarket
« on: August 24, 2016, 10:34:12 PM »
Has anyone achieved FIRE through alternative investments to the stock market?

I have no desire to invest into the stock market and prefer real estate. Anyone else have alternative FIRE investments to the status quo of index funds that the majority of MMM and early retirement community invest in?

seattlecyclone

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Re: FIRE Without Stockmarket
« Reply #1 on: August 25, 2016, 08:32:10 AM »
arebelspy FIREd on mostly real estate. It can be done.

mozar

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Re: FIRE Without Stockmarket
« Reply #2 on: August 25, 2016, 08:36:18 AM »
One poster here said he bought and sold classic cars.

Jrr85

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Re: FIRE Without Stockmarket
« Reply #3 on: August 25, 2016, 09:08:33 AM »
Has anyone achieved FIRE through alternative investments to the stock market?

I have no desire to invest into the stock market and prefer real estate. Anyone else have alternative FIRE investments to the status quo of index funds that the majority of MMM and early retirement community invest in?

I think real estate is probably an easier route to FIRE in most places.  Steadier returns where personal investment in learning and work can improve returns (much more so than the stock market, where arguably the vast majority of people can't on a risk adjusted basis) and then much easier to turn into cash flow producing investments over time, and if you want to manage them yourself, it gives you a part time job to keep yourself busy (and also boost returns).

The downside is you are either tied to a particular community/area, or you are investing in real estate in a place you don't live.  Neither are ideal to me but even so, if I didn't have the ability to put so much into tax advantaged accounts (basically up to $74k per year between my wife and me, although we're unfortunately not even quite to 50% of that number right now), I would be going more heavily into real estate than the stock market. 

lthenderson

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Re: FIRE Without Stockmarket
« Reply #4 on: August 25, 2016, 11:19:53 AM »
I was part owner of a company and made most of mine after cashing out my non-publicly traded shares of the company. I then plunked all that right into the stock market.

ahoy

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Re: FIRE Without Stockmarket
« Reply #5 on: August 26, 2016, 04:10:14 AM »
Yes, go with what works for you.   if you know real estate go with that.  Don't invest in something you don't understand.

Fishindude

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Re: FIRE Without Stockmarket
« Reply #6 on: August 26, 2016, 05:24:03 AM »
Absolutely.   I'm FI and going to part time shortly.
Have some money in stock market but it's only about 20% of net worth.   Majority has come from business endeavors and real estate.

I'm not too trusting of the stock market going forward and have some money that I need to put to work.  Leaning towards income producing real estate and / or some type of easy to run and manage business.

Another Reader

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Re: FIRE Without Stockmarket
« Reply #7 on: August 26, 2016, 07:00:28 AM »
You are not going to get the necessary returns on real estate where (per your user name) you are.  In the US, it requires a minimum of 1 percent of the value per month in rent to generate acceptable cash flow.  Add in appreciation and your returns should equal or exceed stock market returns.  Favorable tax treatment of real estate here also contributes.  You cannot count on appreciation for your capital growth.  Your market has increased in price dramatically, but the percentage increases are not sustainable indefinitely.

Rosy

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Re: FIRE Without Stockmarket
« Reply #8 on: August 26, 2016, 02:55:36 PM »
There is something to be said for the old adage, "stick with what you know". OTOH - diversification is a very good thing. It would make sense to me to have 20-25% in an Index Fund with Vanguard even if you go the Real Estate route.

arebelspy

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Re: FIRE Without Stockmarket
« Reply #9 on: August 27, 2016, 06:39:25 PM »
arebelspy FIREd on mostly real estate. It can be done.

Indeed.  In this podcast I did a review of real estate v. index investing for early retirement:
https://radicalpersonalfinance.com/78/

(It's U.S.-centric, though.)

You are not going to get the necessary returns on real estate where (per your user name) you are.  In the US, it requires a minimum of 1 percent of the value per month in rent to generate acceptable cash flow.  Add in appreciation and your returns should equal or exceed stock market returns.  Favorable tax treatment of real estate here also contributes.  You cannot count on appreciation for your capital growth.  Your market has increased in price dramatically, but the percentage increases are not sustainable indefinitely.

+1 to all this.
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, 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.