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485 | Must the Plane Have Landed BEFORE I Retire?

 

Is 64 too old to be starting a property portfolio?  

Must your investment property be fully funded by the time one retires?  

And why does investing with intention matter – even after you’ve acquired 5 properties?  

In today’s Q&A we’re answering these fantastic questions that explore the many layers folks should consider BEFORE they choose to enter or exit the property game.  

This episode highlights the importance of planning and intention, from calculating how much you really need (and gaining clarity around your next step) to why you shouldn’t invest in property like stepping stones. 

Plus, we have a Listener Tale (or horror story) highlighting why property management matters. Listen now! 

 

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Questions We Answer

Q1) How important is it that an investment property is fully funded by the time you retire? from Richard  

Hi Ben and Bryce, Richard here.

I just wanna start by thanking you both for everything that you do for the community. It’s real eye opener and it helps me to get my head in the right spaces.

I look towards everyone my house fully paid off and looking to start my 1st investment, but my question is, I’m 52 just about paying my own property out.

How important is it that an investment property is fully funded by the time you retire, or is it okay if it’s just looking after itself and can continue on for another few years, whilst your in retirement and fund itself in the background, if you can give us any help on that, that would be great.

Thank you.

 

Q2) Investing at 64 from Ralph 

Hi, I just wanna know if I can build a property portfolio at the age of 64. Thank you. 

 

Q3) Multiple IP’s already and wondering what to do next? from Matt   

Hi guys, it’s Matt here. 

I live down in Torquay, VIC. We have a number of investment properties: 2 in Queensland, 3 Victoria and we own our home. 

We own most of our investment properties. There is still a little bit of debt there. 

Basically, just looking for a financial plan or some advice as to what to do to move forward. I plan to step away from our business within the next five years and just see whether we can somehow live off the equity. 

I basically just want a plan and just maybe get you guys to have a look at our overall situation and offer some advice, and look forward to hear back from you. Bye. 

 

Listener Tale: The Importance of Property Management 

Hey Ben and Bryce, 

Just wanted to reach out and say Ep. 480[How to Fail to Retire on $2k per week] 

Guys! This is phe . nom . enal ! I can relate to some if not all of the “how to fail to build” points you raised here. 

My true story goes a little something like this:  

I bought my first house and land package as a PPR just before the GFC hit and after living in it for a year, rented it out because I went off traveling the world in my mid 20s for the next 8/9 years. After the real estate agency secured what I thought was a good tenant, I gave them the flick and managed the property privately. Thought it was a great idea to save a few dollars on fee’s right. Those same tenants moved out 5 years later and I had to replace all the carpets, repaint the walls and replace some fans the kids had swung off of. Needless to say, the bond certainly didn’t cover this. I kept the bond and offered the tenants to pay the rest of the bill. Obviously, I heard crickets from them so had to pay the rest out of my own pocket. I had landlords insurance but this is a worst case insurance for me and I never use it to claim small things. Its just for the “what if the house burns down”. 

You’d think I’d learn right? Wrong. I went and got another tenant, funny enough it was the family next door and they were moving out of that house because it was up for sale. I saw an opportunity to save of management fees again and 2 weeks rent the real estate would have charged for finding a new tenant. The new family moved in under a private agreement. Sweet as right? Nope.. after trying to manage this house from a yacht somewhere in the Bahamas (which I worked on btw not owned) I found out while doing my own tax return one year that they had under paid me rent. I had to send them emails and show them spread sheets from a far of how much they were behind and it was more than 5 grand. I thought enough was enough and got a property manager to helped sort them out and they did pay me what I was owed and all was fine. 

But do you know what the kicker is, well it’s not keeping up with what the rental market is doing. I.e. rents around my house had gone up and considerably, but because I was managing this house myself from a far I didn’t have the finger on the pulse. After all of this learning, let me tell you fella’s.. I have now learnt! I maintained a property manager for this house from then on. 

That lesson had taught me about property management and it’s importance. What it didn’t teach was having the right strategy in place, and so I sold that house at roughly the 10 year mark (insert palm in face emoji). 

I can whole heartly say that the net of the money I 

saved in management fee’s over the years was surely a net negative and as you can see to top it off I sold the property and paid commission to do so. I can’t bring myself to check the growth of that suburb and what the house would be worth now or event to check what it’s rental yield would be. For context I sold it in 2022. 

Final point I’ll make on this and for people who may read this, I wish I got accredited professional help because my future self would have thanked me for it. My wife and I have now got that help through Empower Wealth and we are on a path of retribution. 

I am a dedicated listener to your podcast. Keep up the great work! 

You guys are my Joe Rogen! 

Cheers Trev. 

 

Timestamps

  • 0:00 – Must the Plane Have Landed BEFORE I Retire? 
  • 1:39 – The lengths we go through, Moorr webinar & a listener message!  
  • 7:29 – Mindset Minute: Rich vs Poor Mindset 
  • 12:17 – Q1) How important is it that an investment property is fully funded by the time you retire? 
  • 14:13 – If you wait, you rob yourself of the power of…  
  • 15:47 – We need to understand THIS before we start 
  • 18:05 – What your investment property should look like in retirement  
  • 19:34 – Why property investing isn’t like stepping stones  
  • 21:29 – “Strategy has to be informed by cashflow 
  • 23:53 – Q2) Investing at 64 
  • 24:50 – Work back from your needs 
  • 27:39 – Considerations for older investors 
  • 28:13 – Why market cycle timing is important 
  • 30:13 – Access to funding & lenders  
  • 34:41 – Q3) Multiple IP’s already and wondering what to do next? 
  • 35:42 – Why intention matters!  
  • 36:42 – Should Matt live off equity?  
  • 38:46 – How to figure out what is possible 
  • 39:49 – When rates or costs of living go up, how does it affect a Living Off Equity strategy? 
  • 41:57 – This is a perfect “What if” example 
  • 44:06 – The 4 Expense Categories  
  • 45:59 – What living off equity means  
  • 46:45 – Listener Tale: The Importance of Property Management 
  • 50:42 – You either pay with money or time!  

And… 

  • 52:13 – Lifehack: With or Without Me energy  
  • 55:22 – WMPN: Moving the dial for women!  

296 | (Part 2) How To Reach The Summit: Achieving $2K Per Week in Passive Income – Q&A

We’re picking up where we left off last weekhow to create $2,000 per week in passive income and actually design the lifestyle you’re proud of (instead of just daydreaming about it)!

This means we’re riffing through a stack of listener questions, including how to speed up the process (and what’s at stake if you do), the true power of compounding and the ‘secret sauce’ of property investing that has nothing to do with the amount you earn.

Plus, we’ll explain WHERE the smart money goes and why there’s always a “Flight to Quality” (something we’re currently witnessing… even during a pandemic!).

You’ll get the pros and cons of active vs passive investing, a mindset reframe on how to look at debt and, excitingly, a case study demonstration of capital growth versus yield! (yeah, Ben did a bit of homework for this one… shock horror!)

We obviously blew out with our answers (as per usual) so it’s another epic episode, but we’re positive the science of achieving $2K per week as a passive property investor (aka. reaching the summit!) is going to help set you up for life and take your property, finance and money management knowledge to the next level 😉

All Q’s listed below. Enjoy!

 

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And here are the questions!

Question from Esha Frykberg
Any advice for those who want to be able to semi retire on less with the portfolio sitting in the background working towards that goal? i.e. having a portfolio that is making $1k/week by age 50 with the aim to be making $2k/week by 65, or is this just going to be the natural progression of a maturing portfolio. Would like to be able to gradually have the option of winding back work rather than working hard for 20 years and stopping.

 

Question from Craig Chalmers
If looking to keep a $2k per week passive income in retirement. When do you switch from growth to yield assets for passive income? Or do you purchase both during acquisition phase as a balanced portfolio and then sell down the growth asset to realise the gains and pay off the yield asset for holding for passive income?

 

Question from Steve Gilmore
In retirement would you prefer $2 million worth debt free, or $4 million with 2 million debt?

 

Question from Adam Wild
Legends! first time caller, long time listener. What are the pros and cons of a passive vs active strategy to retire debt? What would you guys prefer given the choice to do either?

 

Question from Megan Mary
How do you achieve it without waiting 30 years+?

 

Question from Craig Cooper
How truly do-able is it over a 10-year time frame?

 

Question from Jeff William Simons
How do you keep patient and resist the temptation to sell?

 

Question from Kosta Dokolas
What strategies do you recommend to retire down the debt sooner than the 20-25 year slog? Thinking about older investors close to retirement or ambitious investors looking to get to that 2k per week sooner. Love your work, go blues! 😜

 

Question from Steven Jermey
Tips on speeding up the process on one income, ie 70-90k pa. I’m onto 3rd property (cheeper properties while renting. Interested on your take for the lower “average” income. For me it’s taken a long time, and balance between quality of life now (with a family) and looking to the future.

 

Question from Jared Kennedy
Is it possible on a single income (without any dependents)? Earning between 70 – 80k a year?

 

Question from Arty McFarty
I’d like to see the figures behind your claims.

 

 

 

 

295 | How To Reach The Summit: Achieving $2K Per Week in Passive Income – Q&A

So… earlier this week, we posted this on our Facebook page:

And the response was overwhelming! Thank you to everyone that everyone that wrote in and that’s why, in this Q&A episode, we cover everything you need to know to build a property portfolio that pays you a passive income you can live off.

Here’s the deal… if you’ve listened to us for some time, you’ll know already that we bang on about “$2K per week” a fair bit. So, first we’re going to tell you what we mean by this “magical” number. Including why it’s NOT magical at all, but instead is actually ACHIEVABLE for many folks!

From there, we’ll dive deep on the considerations and investment strategies to build a portfolio, like the big one – how to finance multiple properties without significantly impacting your cashflow! Plus, we’ll walk you through heaps of new questions on this topic AND share the secret of reaching the summit of $2K per week!

It’s a big episode, but we’re about to deliver some fresh gold nuggets as well as some quality reminders. Tune in now & let us know what you think!

Psst… We’ll be continuing this episode next week as we received a tonne of questions on the “Who, What, When & How” of achieving a passive income… so keep an ear out for that.

You can suss all of the questions we answer today further down 😊

 

To the summit we go!

 

Free Stuff

 

Questions Answered In This Episode…

Question from Mark Bradicich:
Is it $2k clear of expenses?

 

Question from Samantha Dean:
How many properties, earning how much per week would you need to acquire within your property portfolio in order to earn a passive income of $2000 / week ? And would this be $2000 / week income be during length of loan (say year 10 of the loan – when it’s negatively geared?) or once loan is entirely paid off and all income coming from said property is positively geared?

 

Question from Hugh Nitt:
2k is a great target! Is it possible/likely for a couple to achieve this income individually as a goal? Granted that every couple would have their own set of specific financial / income scenarios that impacts this goal. For example, a combined 2k each. 4k total passive income. How rare is this to achieve?

 

Question from Christine Browning:
If you are over 58 can you still achieve this?

 

Question from Helen Harrison:
I’m 52 years old and woken up to passive income. Have I left it too late to build wealth? Have equity in my home of residence. Educating myself including a daily lunchtime dose of your podcast!! Thanks

 

Question from Jenny Ann:
With $500k to invest and low cash flow, can this be done and how? (Ps I’m 54, single and a sole trader with only 4 months income statements, otherwise debt free).

 

Question from Sabrina Gajnabi:
What is the best way to find an investment savvy mortgage broker?

 

Question from Benjamin Tuxford:
What is the best way to find an investment savvy mortgage broker?

 

Question from Angus O’Loughlin:
At what stage do you go to principal and interest to try and retire the debt?

 

Question from Angela Niznik:
s it a good idea to sell an investment property to wipe out most of the mortgage on own home and significantly improve cashflow for further investments property purchases?

 

Question from Mat Newbury:
Is using LMI a good strategy to buying a third investment property to get in quicker? Seeing as the LMI is tax deductible. Rather than waiting for the equity to build and potentially missing out on a good buying opportunity in that time. Currently have one in Melbourne and one in Brisbane and am a borderless Investor. Would love your advice!

 

 

 

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