Author Topic: Has anyone here FIRE'd while being a renter?  (Read 4308 times)

newgirl

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Has anyone here FIRE'd while being a renter?
« on: January 04, 2018, 09:14:33 PM »
... and what is your budget/annual spending and city?

Notch

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Re: Has anyone here FIRE'd while being a renter?
« Reply #1 on: January 04, 2018, 09:53:05 PM »
PTF.  I'm renting and have < 2 years until FIRE, so keen to see the stories.

soccerluvof4

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Re: Has anyone here FIRE'd while being a renter?
« Reply #2 on: January 05, 2018, 06:05:01 AM »
Not sure why renting or owning a home would make a difference. Either way you have costs.

newgirl

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Re: Has anyone here FIRE'd while being a renter?
« Reply #3 on: January 05, 2018, 07:07:27 AM »
Not sure why renting or owning a home would make a difference. Either way you have costs.

There is a difference in costs between a paid off home vs. renting a home/apt

Syonyk

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Re: Has anyone here FIRE'd while being a renter?
« Reply #4 on: January 05, 2018, 07:26:44 AM »
You can calculate the costs either way, but good luck renting in a lot of areas without proof of a job/income.

It doesn't make much sense, but "I have the wealth to pay for this" is seen as quite different from "I have the job with monthly cashflow to pay for this."  I expect a lot of landlords won't want to bother with someone who doesn't fit the easy "Prove you have a job and income" checkboxes.

mrteacher

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Re: Has anyone here FIRE'd while being a renter?
« Reply #5 on: January 05, 2018, 07:35:02 AM »
You can calculate the costs either way, but good luck renting in a lot of areas without proof of a job/income.

It doesn't make much sense, but "I have the wealth to pay for this" is seen as quite different from "I have the job with monthly cashflow to pay for this."  I expect a lot of landlords won't want to bother with someone who doesn't fit the easy "Prove you have a job and income" checkboxes.

Are you assuming or have you tried this? I am curious to hear from people who have tried saying some version of "I am retired (early) but am good for monthly rent." I wonder if you could show proof of savings account? There must be a way to get the landlord to feel at ease and rent to someone who is FIRE.

Syonyk

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Re: Has anyone here FIRE'd while being a renter?
« Reply #6 on: January 05, 2018, 07:48:50 AM »
Are you assuming or have you tried this?

I've certainly been unable to get a mortgage when between jobs, with a new signed employment contract for a few months out.  The basic argument was, "Well, yes, you have plenty in your accounts to cover several years of payments, but what's stopping you from going to Vegas tomorrow?"

joonifloofeefloo

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Re: Has anyone here FIRE'd while being a renter?
« Reply #7 on: January 05, 2018, 08:02:59 AM »
There is a difference in costs between a paid off home vs. renting a home/apt

Yes, and for me renting has been cheaper than the paid-off house scenario:
https://brainquirkcash.com/2016/06/23/how-to-avoid-paying-market-rent/

For me, keeping shelter costs as low as possible has been key to making it all work.

Zamboni

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Re: Has anyone here FIRE'd while being a renter?
« Reply #8 on: January 05, 2018, 08:09:58 AM »
You can calculate the costs either way, but good luck renting in a lot of areas without proof of a job/income.

It doesn't make much sense, but "I have the wealth to pay for this" is seen as quite different from "I have the job with monthly cashflow to pay for this."  I expect a lot of landlords won't want to bother with someone who doesn't fit the easy "Prove you have a job and income" checkboxes.

Are you assuming or have you tried this? I am curious to hear from people who have tried saying some version of "I am retired (early) but am good for monthly rent." I wonder if you could show proof of savings account? There must be a way to get the landlord to feel at ease and rent to someone who is FIRE.

I went through exactly this. My target complex wouldn't rent to me even when, as a last ditch response to their "you don't have a job and you could stop paying rent" argument for rejecting my application, I offered to pay the entire year's rent up front with cash. Her response "you could be a drug dealer, and we don't accept cash. Tenants have to pay using our website." Ugh! Many big rental complexes just won't buy the retirement angle no matter how much money you have unless you are what they personally judge as a suitable age to be retired. No current paystub, no go. The people making these determinations are mindless cogs in the machine. It is odd.

newgirl

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Re: Has anyone here FIRE'd while being a renter?
« Reply #9 on: January 05, 2018, 08:12:44 AM »
You can calculate the costs either way, but good luck renting in a lot of areas without proof of a job/income.

It doesn't make much sense, but "I have the wealth to pay for this" is seen as quite different from "I have the job with monthly cashflow to pay for this."  I expect a lot of landlords won't want to bother with someone who doesn't fit the easy "Prove you have a job and income" checkboxes.

Are you assuming or have you tried this? I am curious to hear from people who have tried saying some version of "I am retired (early) but am good for monthly rent." I wonder if you could show proof of savings account? There must be a way to get the landlord to feel at ease and rent to someone who is FIRE.

It's true that this would be more difficult, I was thinking along the lines of someone who already had secured a rental pre-FIRE and just decided to stay there. We rent currently and our landlords don't require us to re-apply or prove our employment status/income every year. They'd never know if we quit our jobs.

Zamboni

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Re: Has anyone here FIRE'd while being a renter?
« Reply #10 on: January 05, 2018, 08:18:37 AM »
^This is absolutely true.

Also, I forgot to mention another angle: some places have no income stream expectations for students. I think that is stupid, but I encountered it first hand. That was how we got around the fussy lady in the complex where we wanted to relocate. One of us was going to be enrolled at big school down the street, and suddenly we were no longer "possibly drug dealers" and she could approve our application.

rubybeth

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Re: Has anyone here FIRE'd while being a renter?
« Reply #11 on: January 05, 2018, 08:26:44 AM »
You can calculate the costs either way, but good luck renting in a lot of areas without proof of a job/income.

It doesn't make much sense, but "I have the wealth to pay for this" is seen as quite different from "I have the job with monthly cashflow to pay for this."  I expect a lot of landlords won't want to bother with someone who doesn't fit the easy "Prove you have a job and income" checkboxes.

Are you assuming or have you tried this? I am curious to hear from people who have tried saying some version of "I am retired (early) but am good for monthly rent." I wonder if you could show proof of savings account? There must be a way to get the landlord to feel at ease and rent to someone who is FIRE.

I went through exactly this. My target complex wouldn't rent to me even when, as a last ditch response to their "you don't have a job and you could stop paying rent" argument for rejecting my application, I offered to pay the entire year's rent up front with cash. Her response "you could be a drug dealer, and we don't accept cash. Tenants have to pay using our website." Ugh! Many big rental complexes just won't buy the retirement angle no matter how much money you have unless you are what they personally judge as a suitable age to be retired. No current paystub, no go. The people making these determinations are mindless cogs in the machine. It is odd.

Seriously? What about all those 55+ rental units, assisted living rentals, etc.? What about setting up your own LLC and showing proof that your investments are paying your salary each month? I guess if they won't rent to you even after proving you have money, it's not somewhere that wants your money. I'd just say, "Well, then I guess me and my huge amounts of money will go elsewhere, good luck with that."

Syonyk

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Re: Has anyone here FIRE'd while being a renter?
« Reply #12 on: January 05, 2018, 01:20:04 PM »
Seriously? What about all those 55+ rental units, assisted living rentals, etc.? What about setting up your own LLC and showing proof that your investments are paying your salary each month? I guess if they won't rent to you even after proving you have money, it's not somewhere that wants your money. I'd just say, "Well, then I guess me and my huge amounts of money will go elsewhere, good luck with that."

If you're over 55, then obviously you can be retired.  Plus, most people over 60 or 65 are getting monthly income in terms of a social security check.

Remember, at least in the US, you rent because you can't afford a home.  "Not 55+, doesn't have a job, wealthy enough to retire, and wants to rent" is a niche category that you could safely assume many people who claim they're in it are full of it, or into something sketchy.

Zamboni

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Re: Has anyone here FIRE'd while being a renter?
« Reply #13 on: January 05, 2018, 01:31:45 PM »
I don't think it would have been a problem if we had been traditional retirement age. Pretty sure she was just following some sort of flow chart with yes/no gates and approved/not approved at the end of streams.

neil

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Re: Has anyone here FIRE'd while being a renter?
« Reply #14 on: January 05, 2018, 05:52:55 PM »
I'll buy a home, get a mortgage or not, or rent, as it suits my lifestyle.  I'm not going to worry about it.  If someone doesn't want to approve my loan or rent to me and they are happy to do so with broke people, their loss.  I like my mobility and I plan to utilize it even more post-RE.  In RE you don't have the typical constraints and should be carving out a life based on cost and value rather than proximity to work. 

Frankly, I'd like to find a smaller organization that isn't going to impose a pile of other BS on tenants anyway; even better if the owner is MMM-minded and willing to negotiate directly.  Someone living off your rental payments will appreciate the value of zero eviction and payment risk. 

My current budget is roughly rent+15K (easily push down to 5K if I worked at it and cut vacation).  I'm married now and discussion of FIRE aspects of that plan is kind of out the window, but the math isn't hard to do.  Rental inflation simply becomes an extra variable versus ownership and you have to be more open minded to exiting your locale if you get priced out.  Since I value moving around, this isn't exactly a sacrifice from my perspective anyway, so I don't worry about it too much.

If you really want to live somewhere specific for the rest of your life, long term I would buy.  I don't think anyone living in the CA south bay area in the 70s thought their home values would appreciate 100x.  As a renter, you'd easily get priced out eventually.

MoseyingAlong

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Re: Has anyone here FIRE'd while being a renter?
« Reply #15 on: January 05, 2018, 06:28:57 PM »
I wasn't FIREd, more just taking a break,.and rented at 3 different complexes in 2 different states while in my 30s and 40s. These were the first places I applied, I didn't get turned down anywhere.

Each was satisfied with an account statement that showed I had some assets. Based on that limited experience, I don't think it's that difficult. I do recommend approaching the deciding party with respect for them as an individual and acknowledging that you have a non-standard situation. I just asked what proof of investments would work and/or offered to pay in advance. They told me their requirements and we moved on.

I think it'd be fine in a FIRE situation,

Peony

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Re: Has anyone here FIRE'd while being a renter?
« Reply #16 on: January 05, 2018, 06:44:26 PM »
I've proven my income for purposes of renting by offering to show my tax returns, and have also offered a larger-than-usual security deposit (not cash, though).

Bracken_Joy

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Re: Has anyone here FIRE'd while being a renter?
« Reply #17 on: January 05, 2018, 07:06:53 PM »
A friend of mine is an entrepreneur and rents. He's run into this in the past. He was making no money out of the company at the time, just living off savings.  He's ended up proving assets- I think he had to prove 3x the year's rent? Anyway, it went over just fine, but that could be because Portland is... well, Portland.

Zamboni

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Re: Has anyone here FIRE'd while being a renter?
« Reply #18 on: January 05, 2018, 07:30:35 PM »
^Just curious: where in Europe have you been living? This is what we are going to do upon fire . . . and we will definitely rent as we would like to slow travel.

MrThatsDifferent

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Re: Has anyone here FIRE'd while being a renter?
« Reply #19 on: January 05, 2018, 07:35:04 PM »
We rent and have no plans to own, way too expensive where we live, extreme HCOL. Plan on FIRE in 4 years if all goes well. Thing is, we won’t be able to stay here, so we’ll be slow traveling to LCOL places.  If we ever buy, not sure where we’ll do that at or when. No desire at the moment, seems like a waste of money.

joonifloofeefloo

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Re: Has anyone here FIRE'd while being a renter?
« Reply #20 on: January 05, 2018, 10:17:04 PM »
I've been thinking and thinking about how I've made this happen, because I had definitely experienced the barriers people are mentioning. Realized it's because I rent by pitching to landlords or managers I know personally (even if barely), or someone offers me a place. This has worked out wonderfully! So I don't rely on people to know my finances; I rely on people to know me.

fecklesslayabout

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Re: Has anyone here FIRE'd while being a renter?
« Reply #21 on: January 06, 2018, 06:25:59 AM »
I haven't FIRE'd while doing it, but the apartment I live in now we started renting while in the middle of a break from work (we'd spent the previous year traveling). I expected it to be a nightmare, but it was NBD: we live in a smallish rust belt city and rented directly from a guy who owns and maintains a couple of buildings himself, not from a big faceless corporation. We met in person and explained the situation and it was fine. I'd say outside of a crazy competitive rental market like NYC it should be doable. Our rent is 865 bucks a month not including utilities: total expenses for two people around 1,600-1,700 a month.

BPA

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Re: Has anyone here FIRE'd while being a renter?
« Reply #22 on: January 06, 2018, 06:56:02 AM »
I've been thinking and thinking about how I've made this happen, because I had definitely experienced the barriers people are mentioning. Realized it's because I rent by pitching to landlords or managers I know personally (even if barely), or someone offers me a place. This has worked out wonderfully! So I don't rely on people to know my finances; I rely on people to know me.

Cool.  It's good to know that social capital counts for something.  You are a go-getter and a good person, so I could see this working. 

joonifloofeefloo

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Re: Has anyone here FIRE'd while being a renter?
« Reply #23 on: January 06, 2018, 08:11:48 AM »
Hey, thanks, BPA!!! :)

HipGnosis

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Re: Has anyone here FIRE'd while being a renter?
« Reply #24 on: January 06, 2018, 02:28:55 PM »
Yes, and for me renting has been cheaper than the paid-off house scenario:
https://brainquirkcash.com/2016/06/23/how-to-avoid-paying-market-rent/

I'm calculating that needing to pay other people to do the repairs and possibly maintenance as one ages is a substantial factor in this.

vseddie

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Beard N Bones

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Re: Has anyone here FIRE'd while being a renter?
« Reply #26 on: January 23, 2018, 05:54:31 AM »
Most people that rent should be able to FIRE earlier than those that own homes because of Opportunity Costs involved with home ownership.
http://moneyboss.com/think-life-warren-buffett/
http://therichmoose.com/post20170308/

MonkeyJenga

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Re: Has anyone here FIRE'd while being a renter?
« Reply #27 on: January 23, 2018, 09:01:41 AM »
I FIRE'd last November after a decade renting in NYC. My expenses varied, and once went as high as $45k when I wasn't on the FIRE train, but my last year, I spent around $15k. Basic monthly breakdown for that year:

$500-ish for rent and utilities
$100 MetroCard
$60 health insurance
$150-200 food
$20 cell phone

Then some medical and travel expenses, not much else.

Now I'm spending under $200/mo since I'm not paying rent or almost anything else. Can't last forever, but it's fun couchsurfing for now. I tend to rent rooms off Craigslist, which should make the income verification less of an issue. I'll be negotiating with my future roommates or a small landlord.