[(former)FormerSanDiegan]

George Bush screwed everything up to the point that there is no way to recover, so what’s the point in trying ?

[(former)FormerSanDiegan]

[img_assist|nid=15320|title=Temecula Zillow|desc=|link=node|align=left|width=399|height=300]

I follwed the advice further up on the thread.

The results indicate that prices in Temecula in aggregate are currently about 44% off peak. (At the trough they were about 49.8% off peak).

The particular house shown in the chart (orange line) is a foreclosure and is more than 50% off peak.

With these facts in hand, you may now continue your little spat.

[(former)FormerSanDiegan]

[quote=ice9]

You’re probably right about the 5.5% yield being difficult to achieve. Apparently a 4% withdrawal rate is “safe”. [/quote]

The 4% “safe” withdrawal rate is for typical retirees who have 25 years of living expenses ahead of them and the benefit of medicare, not someone who is 40 and has to plan for 50 years of expenses.

I think that the number of uncertainties over the next 40 years is too wide to plan to retire in your early 40’s. You would need a pretty decent nest egg to hedge against multiple outcomes over that period. Inflation could wipe you out in a decade. The most important hedge against inflation is to maintain your ability to work. You already hit on a key compnent of that (maintaining health care coverage).

I empathize with you, however.
Perhaps a better approach is to try to downsize your work hours or shift into a new phase. Turn a passion (real estate?) or hobby into a second career. Try some part time work.

I think you are too young and the financial world is too cruel to allow you to retire at 40 or even 45 on 1.5 Million …

Unless…
you could live on 35 K a year (before taxes and any early withdrawal penalties)

Here’s how it might work:
Work a few more years to get a nest egg in the 1.5 Mil range, say at age 45.

Put aside $1 Million of that to be invested for your “real” retirement at age 60-65. Hopefully that chunk would grow to at least $3 Mil over a 20-year period.

Could you make it 15 to 20 years on the income from the other 500K ?

If you made a rate of return of 3% and withdraw 30-35 K per year, you could.

Problem is, what will that 35K get you 15 years from now after inflation ?

… Maybe it’s better to get work doing something you enjoy than to check out of the work force completely.

[(former)FormerSanDiegan]

[quote=ice9]

You’re probably right about the 5.5% yield being difficult to achieve. Apparently a 4% withdrawal rate is “safe”. [/quote]

The 4% “safe” withdrawal rate is for typical retirees who have 25 years of living expenses ahead of them and the benefit of medicare, not someone who is 40 and has to plan for 50 years of expenses.

I think that the number of uncertainties over the next 40 years is too wide to plan to retire in your early 40’s. You would need a pretty decent nest egg to hedge against multiple outcomes over that period. Inflation could wipe you out in a decade. The most important hedge against inflation is to maintain your ability to work. You already hit on a key compnent of that (maintaining health care coverage).

I empathize with you, however.
Perhaps a better approach is to try to downsize your work hours or shift into a new phase. Turn a passion (real estate?) or hobby into a second career. Try some part time work.

I think you are too young and the financial world is too cruel to allow you to retire at 40 or even 45 on 1.5 Million …

Unless…
you could live on 35 K a year (before taxes and any early withdrawal penalties)

Here’s how it might work:
Work a few more years to get a nest egg in the 1.5 Mil range, say at age 45.

Put aside $1 Million of that to be invested for your “real” retirement at age 60-65. Hopefully that chunk would grow to at least $3 Mil over a 20-year period.

Could you make it 15 to 20 years on the income from the other 500K ?

If you made a rate of return of 3% and withdraw 30-35 K per year, you could.

Problem is, what will that 35K get you 15 years from now after inflation ?

… Maybe it’s better to get work doing something you enjoy than to check out of the work force completely.

[(former)FormerSanDiegan]

[quote=ice9]

You’re probably right about the 5.5% yield being difficult to achieve. Apparently a 4% withdrawal rate is “safe”. [/quote]

The 4% “safe” withdrawal rate is for typical retirees who have 25 years of living expenses ahead of them and the benefit of medicare, not someone who is 40 and has to plan for 50 years of expenses.

I think that the number of uncertainties over the next 40 years is too wide to plan to retire in your early 40’s. You would need a pretty decent nest egg to hedge against multiple outcomes over that period. Inflation could wipe you out in a decade. The most important hedge against inflation is to maintain your ability to work. You already hit on a key compnent of that (maintaining health care coverage).

I empathize with you, however.
Perhaps a better approach is to try to downsize your work hours or shift into a new phase. Turn a passion (real estate?) or hobby into a second career. Try some part time work.

I think you are too young and the financial world is too cruel to allow you to retire at 40 or even 45 on 1.5 Million …

Unless…
you could live on 35 K a year (before taxes and any early withdrawal penalties)

Here’s how it might work:
Work a few more years to get a nest egg in the 1.5 Mil range, say at age 45.

Put aside $1 Million of that to be invested for your “real” retirement at age 60-65. Hopefully that chunk would grow to at least $3 Mil over a 20-year period.

Could you make it 15 to 20 years on the income from the other 500K ?

If you made a rate of return of 3% and withdraw 30-35 K per year, you could.

Problem is, what will that 35K get you 15 years from now after inflation ?

… Maybe it’s better to get work doing something you enjoy than to check out of the work force completely.

[(former)FormerSanDiegan]

[quote=ice9]

You’re probably right about the 5.5% yield being difficult to achieve. Apparently a 4% withdrawal rate is “safe”. [/quote]

The 4% “safe” withdrawal rate is for typical retirees who have 25 years of living expenses ahead of them and the benefit of medicare, not someone who is 40 and has to plan for 50 years of expenses.

I think that the number of uncertainties over the next 40 years is too wide to plan to retire in your early 40’s. You would need a pretty decent nest egg to hedge against multiple outcomes over that period. Inflation could wipe you out in a decade. The most important hedge against inflation is to maintain your ability to work. You already hit on a key compnent of that (maintaining health care coverage).

I empathize with you, however.
Perhaps a better approach is to try to downsize your work hours or shift into a new phase. Turn a passion (real estate?) or hobby into a second career. Try some part time work.

I think you are too young and the financial world is too cruel to allow you to retire at 40 or even 45 on 1.5 Million …

Unless…
you could live on 35 K a year (before taxes and any early withdrawal penalties)

Here’s how it might work:
Work a few more years to get a nest egg in the 1.5 Mil range, say at age 45.

Put aside $1 Million of that to be invested for your “real” retirement at age 60-65. Hopefully that chunk would grow to at least $3 Mil over a 20-year period.

Could you make it 15 to 20 years on the income from the other 500K ?

If you made a rate of return of 3% and withdraw 30-35 K per year, you could.

Problem is, what will that 35K get you 15 years from now after inflation ?

… Maybe it’s better to get work doing something you enjoy than to check out of the work force completely.

[(former)FormerSanDiegan]

[quote=ice9]

You’re probably right about the 5.5% yield being difficult to achieve. Apparently a 4% withdrawal rate is “safe”. [/quote]

The 4% “safe” withdrawal rate is for typical retirees who have 25 years of living expenses ahead of them and the benefit of medicare, not someone who is 40 and has to plan for 50 years of expenses.

I think that the number of uncertainties over the next 40 years is too wide to plan to retire in your early 40’s. You would need a pretty decent nest egg to hedge against multiple outcomes over that period. Inflation could wipe you out in a decade. The most important hedge against inflation is to maintain your ability to work. You already hit on a key compnent of that (maintaining health care coverage).

I empathize with you, however.
Perhaps a better approach is to try to downsize your work hours or shift into a new phase. Turn a passion (real estate?) or hobby into a second career. Try some part time work.

I think you are too young and the financial world is too cruel to allow you to retire at 40 or even 45 on 1.5 Million …

Unless…
you could live on 35 K a year (before taxes and any early withdrawal penalties)

Here’s how it might work:
Work a few more years to get a nest egg in the 1.5 Mil range, say at age 45.

Put aside $1 Million of that to be invested for your “real” retirement at age 60-65. Hopefully that chunk would grow to at least $3 Mil over a 20-year period.

Could you make it 15 to 20 years on the income from the other 500K ?

If you made a rate of return of 3% and withdraw 30-35 K per year, you could.

Problem is, what will that 35K get you 15 years from now after inflation ?

… Maybe it’s better to get work doing something you enjoy than to check out of the work force completely.

[(former)FormerSanDiegan]

That being said, we once bought a less than 900 square foot house (circa 2000) in an area we liked because it was where we wanted (locaiton), the price was right and there really weren;t any turn key properties that didn;t need some work (older, established area with a view).

Within a year we added about 1000 square feet (we kept the old living room and a couple bedrooms) with completely new kitchen and baths, etc.

We lived in it for about half the renovation (until both the kitchen and only bathroom were knocked out of commission).
Although it took twice as long and cost about 50% more than we originally planned, for us it was definitely a worthwhile experience.

Unfortunately (from an emotional perspective) or fortunately (from a financial perspective) we sold this property in 2005.

Our current house was essentially a turn-key purchase. We weren’t necessarily looking for something that didn’t need some work, we just stumbled into it in the area we were looking.

So, my suggestion is find the place you want (location) and be flexible on whether you get something turn-key or something that needs work.

[(former)FormerSanDiegan]

That being said, we once bought a less than 900 square foot house (circa 2000) in an area we liked because it was where we wanted (locaiton), the price was right and there really weren;t any turn key properties that didn;t need some work (older, established area with a view).

Within a year we added about 1000 square feet (we kept the old living room and a couple bedrooms) with completely new kitchen and baths, etc.

We lived in it for about half the renovation (until both the kitchen and only bathroom were knocked out of commission).
Although it took twice as long and cost about 50% more than we originally planned, for us it was definitely a worthwhile experience.

Unfortunately (from an emotional perspective) or fortunately (from a financial perspective) we sold this property in 2005.

Our current house was essentially a turn-key purchase. We weren’t necessarily looking for something that didn’t need some work, we just stumbled into it in the area we were looking.

So, my suggestion is find the place you want (location) and be flexible on whether you get something turn-key or something that needs work.

[(former)FormerSanDiegan]

That being said, we once bought a less than 900 square foot house (circa 2000) in an area we liked because it was where we wanted (locaiton), the price was right and there really weren;t any turn key properties that didn;t need some work (older, established area with a view).

Within a year we added about 1000 square feet (we kept the old living room and a couple bedrooms) with completely new kitchen and baths, etc.

We lived in it for about half the renovation (until both the kitchen and only bathroom were knocked out of commission).
Although it took twice as long and cost about 50% more than we originally planned, for us it was definitely a worthwhile experience.

Unfortunately (from an emotional perspective) or fortunately (from a financial perspective) we sold this property in 2005.

Our current house was essentially a turn-key purchase. We weren’t necessarily looking for something that didn’t need some work, we just stumbled into it in the area we were looking.

So, my suggestion is find the place you want (location) and be flexible on whether you get something turn-key or something that needs work.

[(former)FormerSanDiegan]

That being said, we once bought a less than 900 square foot house (circa 2000) in an area we liked because it was where we wanted (locaiton), the price was right and there really weren;t any turn key properties that didn;t need some work (older, established area with a view).

Within a year we added about 1000 square feet (we kept the old living room and a couple bedrooms) with completely new kitchen and baths, etc.

We lived in it for about half the renovation (until both the kitchen and only bathroom were knocked out of commission).
Although it took twice as long and cost about 50% more than we originally planned, for us it was definitely a worthwhile experience.

Unfortunately (from an emotional perspective) or fortunately (from a financial perspective) we sold this property in 2005.

Our current house was essentially a turn-key purchase. We weren’t necessarily looking for something that didn’t need some work, we just stumbled into it in the area we were looking.

So, my suggestion is find the place you want (location) and be flexible on whether you get something turn-key or something that needs work.

[(former)FormerSanDiegan]

That being said, we once bought a less than 900 square foot house (circa 2000) in an area we liked because it was where we wanted (locaiton), the price was right and there really weren;t any turn key properties that didn;t need some work (older, established area with a view).

Within a year we added about 1000 square feet (we kept the old living room and a couple bedrooms) with completely new kitchen and baths, etc.

We lived in it for about half the renovation (until both the kitchen and only bathroom were knocked out of commission).
Although it took twice as long and cost about 50% more than we originally planned, for us it was definitely a worthwhile experience.

Unfortunately (from an emotional perspective) or fortunately (from a financial perspective) we sold this property in 2005.

Our current house was essentially a turn-key purchase. We weren’t necessarily looking for something that didn’t need some work, we just stumbled into it in the area we were looking.

So, my suggestion is find the place you want (location) and be flexible on whether you get something turn-key or something that needs work.

[(former)FormerSanDiegan]

The original question here is akin to “how much does a car cost? I heard they are about $25,000.

It depends. Do you want a Mercedes, Hinda Civic, Ferarri ? The answer is, it’s somewhere between $20K and $300K.

Same goes for a house. You could spend between $30k to $300K for a remodel, depending on how extensive it is.

e.g.
1. Paint, carpet, appliances ~ 10-30 K
2. New windows, re-stucco ?
3. New roof? TIle, composit, flat, or blue tarps ?
4. Bathrooms ? COmplete re-do, replace vanity ? replace tub?, new shower ? new toilets ?
5. FLooring. 100% hardwood replacement ? Carpet ? linoleum ? dirt ?
6. Kitchen : resurface cabinets ? new cabinets ? reconfigure ? Combine area with dining room ?

[(former)FormerSanDiegan]

The original question here is akin to “how much does a car cost? I heard they are about $25,000.

It depends. Do you want a Mercedes, Hinda Civic, Ferarri ? The answer is, it’s somewhere between $20K and $300K.

Same goes for a house. You could spend between $30k to $300K for a remodel, depending on how extensive it is.

e.g.
1. Paint, carpet, appliances ~ 10-30 K
2. New windows, re-stucco ?
3. New roof? TIle, composit, flat, or blue tarps ?
4. Bathrooms ? COmplete re-do, replace vanity ? replace tub?, new shower ? new toilets ?
5. FLooring. 100% hardwood replacement ? Carpet ? linoleum ? dirt ?
6. Kitchen : resurface cabinets ? new cabinets ? reconfigure ? Combine area with dining room ?

[(former)FormerSanDiegan]

The original question here is akin to “how much does a car cost? I heard they are about $25,000.

It depends. Do you want a Mercedes, Hinda Civic, Ferarri ? The answer is, it’s somewhere between $20K and $300K.

Same goes for a house. You could spend between $30k to $300K for a remodel, depending on how extensive it is.

e.g.
1. Paint, carpet, appliances ~ 10-30 K
2. New windows, re-stucco ?
3. New roof? TIle, composit, flat, or blue tarps ?
4. Bathrooms ? COmplete re-do, replace vanity ? replace tub?, new shower ? new toilets ?
5. FLooring. 100% hardwood replacement ? Carpet ? linoleum ? dirt ?
6. Kitchen : resurface cabinets ? new cabinets ? reconfigure ? Combine area with dining room ?

[Author]

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