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Recognized Social Butterfly
Posts: 793
Registered: ‎03-06-2010

Re: Purchasing a Home After Retirement

Message 1 of 18 (761 Views)

ttryu,

Your post shows that sometimes you can overcome setbacks and succeed!  2008 was a catastrophic year financially for so many (including myself) but you endured a loss of job and divorce.  I am so glad your life has improved.  Would love to know how you are doing.

 

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ttryu wrote:

Hi, I can understand your situation.  I myself have lived in Brookly/Queens for 25+ years.  Just like yourself, I have never been good at driving.  Instead of mostly renting, I did own a couple of houses at one point in Queens.  However, I could not support the payment well at the time.  So I had to sell.  After a very bad year in 2008, the year when I lost my job of 17 years working in a bank, I got divorced, and my investment lost over 360k, I have come to Las Vegas and used cash to buy my condo.  my goal at the time was to duplicate my real estate investing success in NYC.  I first came here without a job.  Without a steady job, no one was willing to lend me money to buy.  Even after I got a job, I still had trouble to get a loan in the beginning because my job history was too short.  I did not get discouraged and got a loan from the builder to buy my primary residence.  Fast forward to today, I now own 5 rentals and plan to buy more.  I also have uncovered many more finance options to buy even more rental houses.  All these things have happened in my late 40's early 50's.  I know sometimes investing in real estate involves luck such as my coming to Vegas at the right time (2010).  Timing and doing research are more important than just being lucky.


 

Bronze Conversationalist
Posts: 16
Registered: ‎07-17-2011

Re: Purchasing a Home After Retirement

Message 2 of 18 (1,379 Views)

yuffie, you need to check on doing a file and suspend.  The rules changed and the last word I've seen says you can't do a file and suspend to draw spousal benefits if you are entitled to your own benefit that is more than the spousal benefit would be.

Bronze Conversationalist
Posts: 23
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 3 of 18 (1,741 Views)

Usually, there is a great deal of luck with a first time success.  Still, you need to see the opportunity for what it is and take the plunge.  That is where reserch is needed. Like finance, you need to know your stuff to be successful. You are fortunate to have aquired that information so early.

 

Pat yourself on the back for getting out of that hell hole!  Not that it is really a hell hole if you have a job but is was and still is one for a banking professional looking for work or in any financial position.  My wife and I have a good bit of our family there.  The banker survived because she was the only one in the US at the bank that had her level of expertise and could write up a disclsure on how the bank would respond to several disasters.  The D F bill mandated every bank was required to provide this discloseure. They had a 50% cut then another 50% cut a year later.  What a horror!  My brother's wife survived a 90% cut in a brokerage firm.  Now the job is 1.5 hrs away in NJ.  I have meet refugees from that area coming to my area for work.  They had been looking for a job for years.  If you look at job participation rates instead of unemployment you will see a 10% permenant cut in jobs for US citizans.  Alians and illeagals have increased 11-12% and that is why we have more jobs now than 8 years ago.  That is no help to anyone out of work in an environment with few openings and hoards of persons trying to fill the job. 

Conversationalist
Posts: 6
Registered: ‎10-10-2012

Re: Purchasing a Home After Retirement

Message 4 of 18 (1,802 Views)

Hi, I can understand your situation.  I myself have lived in Brookly/Queens for 25+ years.  Just like yourself, I have never been good at driving.  Instead of mostly renting, I did own a couple of houses at one point in Queens.  However, I could not support the payment well at the time.  So I had to sell.  After a very bad year in 2008, the year when I lost my job of 17 years working in a bank, I got divorced, and my investment lost over 360k, I have come to Las Vegas and used cash to buy my condo.  my goal at the time was to duplicate my real estate investing success in NYC.  I first came here without a job.  Without a steady job, no one was willing to lend me money to buy.  Even after I got a job, I still had trouble to get a loan in the beginning because my job history was too short.  I did not get discouraged and got a loan from the builder to buy my primary residence.  Fast forward to today, I now own 5 rentals and plan to buy more.  I also have uncovered many more finance options to buy even more rental houses.  All these things have happened in my late 40's early 50's.  I know sometimes investing in real estate involves luck such as my coming to Vegas at the right time (2010).  Timing and doing research are more important than just being lucky.

Bronze Conversationalist
Posts: 23
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 5 of 18 (1,847 Views)

Firstly, congradulations for retiring in style as I do the others who responded to my post.  You have all done very well.  There are many ways to do that and it dosen't matter how you accomplish it as long as you are successful. 

 

I now regret I have not done more in the landlording but I am less handy than many of you.  Being able to DIYS makes that easier.  I have actually gotten handier when I was out of work for an extended period of time.  Our next house will be mostly a rental vacation house. I would welcome any suggestions anyone has.  I have made my mistakes in the financial arena and learned from them but I have stayed out of realistate.  I am in my late 60s and am too old to be able to make stupid mistakes. I do believe not investing in a beach house was a missed opportunity.  We live only a few hours from the beach and realistate has doubled to quadrupled in my area. I have lost the chance to learn the ropes when I should have.  

 

I have little reguard for financial advisers. They are not tallented enough to become successful brokers/portfolio managers. Their biggest contribution is that they provide independent and detached advice.  This is more important for someone who can't apraise their plans from a detached view.  The concept that how much you need to save anually is calculatable is hog wash.  What you need mostly depends on the year you will die and how much money your investments will make each year.  These are not knowable. You ought to save as much as you can. I don't recall anyone complaining that they have too much money.

 

I do believe you need to reduce your risk after you retire.  I see my future mortgages as small managable risks.  I have a bit more than 80% equity on my home.  On our next purchase I will ask the loan officer how much we should plunk down.  We would never concider a home we couldn't very confortably buy outright. Our retirement income will be about what it is now after adjusting for the cost of working.  Unearned income is actually more relyable than earned income.  I learned that in 1998.  I thought my career was unsinkable.  I learned the hard way that that is never true.

 

For the 'younger' members, you must have a plan to get you where you want to be in your 50s.  Your 60s is a time to be amassing your nest egg.  By then you had better have made all your mistakes in the past and have learned from them.   

 

Good luck to all of you!

Conversationalist
Posts: 6
Registered: ‎10-10-2012

Re: Purchasing a Home After Retirement

Message 6 of 18 (1,985 Views)

Good for you.  I don't think it is a must to pay off all mortgages after you retire.  As long as all payments are covered by your rental income, you could keep the mortgages and invest your free cash in better opportunities.  I am in my early 50's.  I own six homes and four have mortgages on them.  The reason is that my kids are still young.  Instead of being a grandparent, I am a parent of a teenager and a 2-year old.  Therefore, I have to plan for both my retirement and college education for my kids at the same time.  I have done well for my retirement savings (> 1mil).  However, I cannot say the same with my college savings.   My college expenses will come after I retire.  So having a good reliable income after I am unable to work  is critical.   Currently, my rental income covers all of my mortgage payments and left me with some extra cash.  It sounds good but it is not a smooth ride.  Sometimes I lose tenants because of natural disaster or other reasons.   Fixing up here and there is a common undertaking and the expenses are high sometimes.  I do hire property managers to manage my properties so I don't have to deal with the headache of collecting rents and screening for good tenants.  Being a landlord is not as easy as 1-2-3.  It requires a lots of patience and a good financial cusion.  There are many unexpected things happen and none are pleasant.  However I do like the idea of being a landlord.  I am 100% certain to buy at least one rental this year.

Bronze Conversationalist
Posts: 23
Registered: ‎07-05-2013

Re: Purchasing a Home After Retirement

Message 7 of 18 (2,003 Views)

I retired on December 31, 2011. We were living in our first home purchased in 1985. When we purchased it with my VA loan, it was a fixer upper, and we totally remodeled it over the years. We paid $95,000 for it in 85, and when I retired it was worth about $450,000. We purchased our new home six months before I retired, and moved in on January 1, 2012.

 

We rent out the original home for $2,600 a month, and it pays both mortgages. I got another VA mortgage for a ridiculous 2.75% interest rate and no money down, so I don't pay any extra principal on the mortgage for the new home. Our original mortgage will be paid off in two years. Once it is paid off, we will stop renting it out and claim it as our second home for a couple of years to avoid capital gains. In the meantime, we keep upgrading every time a tenant moves out. We have a new tenant and just relandscaped the front yard to go to a water-wise landscaping to minimize water use.

 

Almost all financial advisers will tell you to pay off your mortgage before you retire, but all situations are different. I am very lucky in that I have a great pension, great health insurance, and I have not started drawing my SS yet. I am 67 and will hold off until I'm 70 to claim SS. By waiting my SS payment will be $2,880 per month approximately, instead of $2,200 per month, again approximately. I don't remember the exact figures off hand. My wife will be 66 in August, and she will claim her SS, and I will file and suspend and claim my spousal benefit under her SS. Hopefully, I will live as long as my family elders, who have lived into their late 80s and 90s. 

Conversationalist
Posts: 5
Registered: ‎04-08-2013

Re: Purchasing a Home After Retirement

Message 8 of 18 (2,143 Views)

After a lifetime of working and paying ever higher rent in NYC, I realized I had to buy a home for retirement in a place with much lower living costs. I managed to buy a nice condo in 55+ community in Florida with a  mortgage. I closed only 3 months before I found out I was being forcibly retired. I was very lucky. With the cash I had, I would have been able to afford only a small unrenovated condo in a community without amenities. For anybody nearing the dangerous ages, look around and buy something while you are still on a payroll  or still receiving payment for work and can get a mortgage. Since Im alone and don't drive, it was vital for me to find a community with private bus service around and to shopping and doctors. Even if you drive now, bus service will come in very handy later in life. And you make friends on the bus.  

Bronze Conversationalist
Posts: 26
Registered: ‎06-14-2014

Re: Purchasing a Home After Retirement

Message 9 of 18 (2,401 Views)

We lived in South Central Texas and the heat and water shortage finally caused us to start looking for a new place to live.  We are both retired for some time with very good pensions, social security, and military healthcare for life.  We didn't have anything to keep us there so we pulled out a map and started looking for a state where we wouldn't have snow, near our friends on the East Coast and not far enough South that we would have the high temperatures.  Without ever having been there, we picked South Carolina near Hilton Head Island. 

 

We flew out to check the area and loved it.  We purchased in a development and had the house built that we wanted.  It cost about $150K more than what we sold our house for.  We chose a 15 year fixed mortgage.  The payment was $2.2K but we wanted to pay it off sooner so we've been paying $4.2K per month.  We'll have it paid in another couple of years.

 

We have learned two things with this move.  First, make sure your payment doesn't cramp your cash flow.  In a couple of cases, we have not had the cash flow to take advantage of some deals.  Of course we could have held back the extra $2K but my wife is totally fixated on paying off the mortgage.  Second, check out the active senior living communities.  After we had purchased this home we learned of the one closest to us.  We volunteer several times a year and we usually are volunteering with people from the community.  I think if we had thought to check that out, we would have purchased a home in that community.  Perhaps in a couple of years we will sell and move to the active senior living community.

Bronze Conversationalist
Posts: 23
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 10 of 18 (2,638 Views)

Why the loan?  If you think you might be short, tack more on your mortgage. They are always much lower than any other kind of loan.  After a mortgage your crediit score might dip for a few years so take it while the getting is good.  Enough of my envestments are liquid enough to take care of any needs I might have. My account always has that kind of cash to take advantage of a bargin.