Retirement

Whether you plan to sit on a porch and rock when you retire or be “refired” into some inspiring and fulfilling second career, you are still going to have expenses. There is no reward this side of heaven for patient long-suffering devotion to your work and fulfilling your responsibilities to yourself and others that may depend on you without money.
Traditionally, company, union, government sponsored pensions and or Social Security have helped meet the need providing you pared down expenses and lived simply or moved somewhere where expenses are less than you are used to paying now.
In addition to these pensions there are IRA’s that some people contribute to yearly, from which you are able to withdraw without penalty beginning at age 59 ½. If you can live without this money until you are 70, you must take payments and that could be a nice nest egg to have.
Or you could have managed to be born into a family where trust funds have provided for your future along with your children and grandchildren. Unless the stock and bond markets all crash and then you will be standing in line for handouts along with the rest of the country.
Forty years ago and more people looking forward to retirement also had their homes as security. It was considered desirable to pay down your mortgage and live securely, during retirement in a home that was all yours. With only taxes and insurance to worry about, your monthly obligations would be considerably lower than they were with mortgage payments and that could keep you at home in familiar surroundings perhaps until the end of your life.
Today families have begun to refinance their homes every time they want to remodel their home, pay college tuition, or pay for extraordinary medical expenses. By the time they retire, their home is worth less to them than perhaps when they bought it. Still mortgaged up to the hilt, they are hit again if the housing market is in a dip and the value of their home is less than the value for which they refinanced.
Or perhaps people who are close to retiring have been “Enronned,” the new action verb cloned by the bankruptcy of the large energy company that was supposed to be a solid investment for their employees and stockholders. In 1929 almost all of America was shut down this way because of the stock market crash. Stocks became worthless and fortunes were worth less than yesterday’s chewing gum.
I have a plan that will work to protect you from financial disaster and provide for your future unless we have a nuclear or other disaster from which almost no one will escape. The plan for that future is only in the plan of salvation and if you don’t know what that is, e-mail me for more information.
The financial plan lies in real estate. When I was 25, I had never heard of this plan. Now many years later, I am continually grateful to my former dentist, Dr. Pat Tigani, who advised me to go this way and I have never looked back.
Here’s how it works.
Buy a home, condo or townhouse, some well-chosen piece of real estate that you can afford, that costs less than 35-40% of your take home income. Have the payments be as low as you can go and still be habitable and in a good location. A good realtor will help you get started. Resist paying a lot.
First live in this place for at least 2 years, so you can avoid paying investor’s mortgage rates, which are higher than what you would normally pay for a residence. Make sure that your monthly payment of principal, interest, taxes, insurance and other fixed fees like condo fee are equal to or less than what you could get as rent for the property. While you are living there, tastefully and reasonably fix the place up for the long haul. You intend to rent this out forever.
After 2 years, rent out the place and move on to another future rental home and follow the same guidelines.
At retirement, you will own at least one, perhaps 2 or 3 properties with paid off mortgages that will offset your pension. Stocks may come and stocks may go but real estate is forever.