Does being full-time investors help you getting better return?

[bizaro86]

2 hours ago, SharperDingaan said:

 

If you live mortgage free, have no debt (car, carried visa balance, etc.), have a spouse, and are healthy; WTF do you need a 74K/yr+ annual income for? You AND your spouse COMBINED will be hauling in 100K/yr+ ... and this isn't enough? Millions of working couples every year earn a lot less than that, and endure daily expenses that are a lot higher.

 

If you continued to work until age 70, you may have an OAS of around 900/mo ( $10,800/yr). On the next 72K (10,800/.15) of income above 74K you will pay an additional 15% in addition to your 32% marginal tax rate (Ontario) - or 47%+. Nobody who is retired wants to be paying 47%+, hence the obsession.  

 

Different POV.

 

SD

 

I mean, I'm mortgage/debt free now and earn quite a bit more than that, enough that my combined marginal tax rate is 48%. I certainly don't spend/need that money now, which is why I spend time focusing on investing it. But like I said earlier if you gave me $25MM I wouldn't stop running my business, so why not keep doing things that you enjoy even if you don't need the money? 

[LC]

6 hours ago, rohitc99 said:

 

just show up, do your thing smartly and efficiently and be nice to people - i am sure a lot of people can work < 20 hrs/ week with that. with remote work, that frees up a lot of time to invest or do whatever else you want

 

100% 

 

Helps if you have a specialized skillet. 

[Dinar]

3 hours ago, SharperDingaan said:

 

If you live mortgage free, have no debt (car, carried visa balance, etc.), have a spouse, and are healthy; WTF do you need a 74K/yr+ annual income for? You AND your spouse COMBINED will be hauling in 100K/yr+ ... and this isn't enough? Millions of working couples every year earn a lot less than that, and endure daily expenses that are a lot higher.

 

If you continued to work until age 70, you may have an OAS of around 900/mo ( $10,800/yr). On the next 72K (10,800/.15) of income above 74K you will pay an additional 15% in addition to your 32% marginal tax rate (Ontario) - or 47%+. Nobody who is retired wants to be paying 47%+, hence the obsession.  

 

Different POV.

 

SD

Might work in Canada, will not work in the US due to an insanely expensive health care system, and property taxes in many places north of USD 30K per annum on a four bedroom home

[Spekulatius]

23 minutes ago, Dinar said:

Might work in Canada, will not work in the US due to an insanely expensive health care system, and property taxes in many places north of USD 30K per annum on a four bedroom home

It seems to me that if you retire early, one of the most logical things to do is to move to a low tax lower cost state. There are a lot of states where you can own a home and pay $3K in taxes and pay less than 5% income taxes or even zero which goes a long way to reduce your cash outlays without lowering your standard of living.

Edited September 6 by Spekulatius

[thepupil]

6 minutes ago, Spekulatius said:

It seems to me that if you retire early, one of the most logical things to do is to move to a low tax lower cost state. There are a lot of states where you can own a home and pay $3K in taxes and pay less than 5% income taxes or even zero which goes a long way to reduce your cah outlaysnwithout lowering your standard of living.

this is logical, but if one values relationships / ties to area where that isn’t the case then you gotta pay up / save more.
 

i actually don’t really know many boomers who actually move to a cheaper area where they have no ties. Most want to move to either be wherever grandkids are or (more likely) stay in same house/neighborhood where they built their lives.
 

Plenty of empty nesters out there in 3K, 4K, 6K sf houses. an alien looking down would conclude insanity but I understand the emotion behind it. 
 

 

Edited September 6 by thepupil

[LC]

17 minutes ago, thepupil said:

i actually don’t really know many boomers who actually move to a cheaper area where they have no ties. Most want to move to either be wherever grandkids are or (more likely) stay in same house/neighborhood where they built their lives.
 

Plenty of empty nesters out there in 3K, 4K, 6K sf houses. an alien looking down would conclude insanity but I understand the emotion behind it. 

100%

 

My folks finally left NY to move to....CT

4k sqft house for 2 people. 3 acres for two 70year-olds. Seems insane to me.

 

I tried to get them out to Colorado. But their whole life is in the tristate area. All their friends, hobbies, favorite places...at a certain age why bother moving? To save 50k? Biggest issue was "now we have to change our address for all the services, find new doctors, dentists, etc."

[Spekulatius]

At some point, you don’t own stuff, the stuff owns you. This is particularly true if you get older.

[UK]

5 hours ago, Spekulatius said:

At some point, you don’t own stuff, the stuff owns you. This is particularly true if you get older.

 

'The Chains of Habit Are Too Light To Be Felt Until They Are Too Heavy To Be Broken'

 

Between me and my wife we have three parents (and than some other close people) who are living alone and separatedly in an oversized too big home for each of them at this stage, which cost them dearly (and not only financially), but they do not want or are afraid to change anything, so I am jokingly almost consider them becoming some kind of a prisoners of their home's. Seeing this I am almost afraid to own a house for myself at this point:). Better to remain free and enjoy more sun somwhere, while you can, than to shovel snow all dark winter alone, in my opinion:))

 

This 'you live as if you were destined to live forever' or 'saving sex for the old age' is another very important thing to remember and to balance, while considering early retirement, or parenting, or whatever. And finding not what is necessarily right or super optimal, but what works for YOU is more important than anything.

 

Edited September 6 by UK

[John Hjorth]

4 hours ago, Spekulatius said:

At some point, you don’t own stuff, the stuff owns you. This is particularly true if you get older.

 

Yeah,

 

YouTube : (Explained) The Things You Own End Up Owning You...

 

- Especially, like in the first comment : 'Don't buy shit. Steal it!' [Which is actually what we aim at ...  ]

[Kizion]

Relevant for the discussion yesterday on WR: https://www.barrons.com/articles/retirement-savings-withdrawal-rate-cash-bonds-c1c356f4?mod=hp_RETIREMENT

Edited September 6 by Kizion

[73 Reds]

13 hours ago, SharperDingaan said:

 

If you live mortgage free, have no debt (car, carried visa balance, etc.), have a spouse, and are healthy; WTF do you need a 74K/yr+ annual income for? You AND your spouse COMBINED will be hauling in 100K/yr+ ... and this isn't enough? Millions of working couples every year earn a lot less than that, and endure daily expenses that are a lot higher.

 

If you continued to work until age 70, you may have an OAS of around 900/mo ( $10,800/yr). On the next 72K (10,800/.15) of income above 74K you will pay an additional 15% in addition to your 32% marginal tax rate (Ontario) - or 47%+. Nobody who is retired wants to be paying 47%+, hence the obsession.  

 

Different POV.

 

SD

Well, yes and no to your question "and this isn't enough"?  If you've got kids/grandkids, each one's higher education costs alone may cost you a good chunk of that sum alone.  If you own a house, roofs, HVAC, major repairs all cost money.  Uninsured health care - you better have significant income unless your savings are substantial, particularly as you get older.  Personally, I don't know too many people who live "well" on less than $200k/year income.  For my own daughter, more than 1/2 of that amount would be necessary just for rent and state/local taxes.     

[thepupil]

28 minutes ago, 73 Reds said:

Well, yes and no to your question "and this isn't enough"?  If you've got kids/grandkids, each one's higher education costs alone may cost you a good chunk of that sum alone.  If you own a house, roofs, HVAC, major repairs all cost money.  Uninsured health care - you better have significant income unless your savings are substantial, particularly as you get older.  Personally, I don't know too many people who live "well" on less than $200k/year income.  For my own daughter, more than 1/2 of that amount would be necessary just for rent and state/local taxes.     

 

the difference in cost of living for young-ish people living in urban areas, particularly dual income households paying for childcare/education, versus older people elsewhere (assuming they don't have other familial funding obligations) is....massive. 

 

relatedly....

 

https://www.washingtonpost.com/opinions/2023/01/29/400000-a-year-rich-feeling-poor/

Quote

Periodically, some commentator suggests that in many American cities, someone with a very comfortable income is actually barely getting by. It is a venerable genre, but the first such instance I can remember came from law professor Todd Henderson back in 2010. The most recent is from Bret Stephens, a columnist at the New York Times.

 

Last week, in a conversation with colleague Gail Collins, Stephens argued that a couple with a combined income of $400,000 a year doesn’t necessarily have a lifestyle we’d describe as “rich”: “They’re scrimping to send their kids to college, driving a Camry, if they have a car at all, and wondering why eggs have gotten so damned expensive.”

“Granted,” said Collins, which was the most fascinating part of this exchange.

 

The left side of the internet dragged Henderson mercilessly for days after his remarks 12 years ago. But here was a left-leaning New York Times columnist essentially conceding the point. As for the internet, I saw exactly one right-leaning economist gently joshing Stephens for his remarks. How have liberals gotten so comfortable with the idea that $400,000 a year — more than what 98 percent of the population makes — is really just a middle-class income? A recent essay by Ross Douthat, Stephens and Collins’s colleague at the Times, offers one answer: These people are rich by any measure, and they are spending their money on things only rich people can afford, such as living in the best school districts and in or near amenity-rich megacities. However, they are rich in a peculiarly modern way: in the context of a meritocracy where elites are supposed to re-earn their position anew each day. 

Compared with the old establishment that survived on inherited wealth and social position, they are insecure, and many worry that their offspring will be downwardly mobile, which leads them to spend virtually all of their outsize disposable incomes on preparing the children to become star performers in the next round of competition.

 

(For this is primarily a problem of parents; you almost never hear a childless couple making $400,000 a year claim to really be just ordinary middle-class folks.) 

One way to cope with this insecurity is to try to lean into it, strive to accumulate so-called generational wealth, so your children never have to wake up at 4 a.m. wondering where the next tuition check will come from. Another is to look for a political solution, which might be one reason the highly educated have migrated toward the Democratic Party.

Unfortunately, generational wealth is an impossible dream for even most highly educated people for the very reason that it’s so attractive: the competition for scarce slots at a limited number of highly selective colleges (and the schools that feed into them) that function as the gatekeepers to the 2 percent, or the 3 percent, or the 10 percent. This zero-sum bidding war will consume any amount of extra money a normal professional can earn, because there is always something else you could be doing to give your kid a better shot at a good school and a good life — another tutor, another consultant, another enrichment program.

 

Through the magic of market competition, the price of that exclusive access will always be set at the maximum the least-affluent members of the class can just barely afford to pay for private school tuition or a well-located house. Moreover, because the upper income distribution resembles a pyramid with a wide bottom and a narrow top, most of the people in this class will be closer in situation to the desperate strivers — those who have zeroed out their 401(k)s, crammed the kids into too-small houses and borrowed all they could from family — than they are to the lucky few near the pinnacle who can write huge checks without blinking. 

Small wonder that they feel strapped, and not really surprising that people in this group have become increasingly friendly to the party that has historically promised to buffer us from the punishing demands of the market economy. The problem with this particular political solution is that government cannot give them what they crave: a low-effort way to ensure that their kids never fall out of their world.

There’s no shame in wanting this. What self-respecting mammals don’t want their children to have it at least as good as they did? At the median household income, that’s even a semi-plausible demand, because here all government needs to provide is median-grade public goods. But it cannot give everyone above-average doctors, schools, job satisfaction and earning potential — and in a democracy, it cannot promise to reserve those things for the children of those who already have them.

 

Thus, the unsolvable dilemma of the broke 2-percenter. If you would be satisfied knowing that your child had a secure but unremarkable life managing a Walmart in some exurb, the government could probably guarantee that. And, with a solid six-figure income, you could probably prepare them for that world without any government assistance. But then, if you could be satisfied with a solid ordinary life, you probably wouldn’t have spent decades working overtime and delaying gratification in order to make it into the 2 percent.

 

[73 Reds]

11 minutes ago, thepupil said:

 

the difference in cost of living for young-ish people living in urban areas, particularly dual income households paying for childcare/education, versus older people elsewhere (assuming they don't have other familial funding obligations) is....massive. 

 

relatedly....

 

https://www.washingtonpost.com/opinions/2023/01/29/400000-a-year-rich-feeling-poor/

 

Of course raising children is expensive.  But so is in-home health/nursing care for older folks.

[thepupil]

fair point, think my grandpa's round the clock care was maybe something like $300K for last two years of his life. 

[coc]

13 hours ago, Dinar said:

Might work in Canada, will not work in the US due to an insanely expensive health care system, and property taxes in many places north of USD 30K per annum on a four bedroom home

 

Where? My 4BR is ~13k in taxes. >4k sqft. Wouldn't say I live in a low tax jurisdiction at all. 

 

Supposing I could get family healthcare for 1.5k/month, that would be ~2,500 for healthcare and property taxes. Add in 500/wk for food (w/ kids at home, going out etc.), that's $4,750, utils another ~$700-800 (heat, AC, electric, internet), that's $5,550 for the "basics". House maintenance/mowing/pest control adds another ~$200-300. Add in $1k/month for other stuff and basic fun living and that's ~$7,000/month, maybe $10k/month pre-tax (assume all-in 30% tax rate), so roughly $120k/yr gross needed if no mortgage/car payments. At 4% withdrawal that'd be $3 million liquid to be financially independent, plus a free and clear house.

 

Not too easy a bar for most, but not totally out of reach either. Obviously I'm painting an upper-middle class lifestyle. 

Edited September 6 by coc

[Red Lion]

13 hours ago, Dinar said:

Might work in Canada, will not work in the US due to an insanely expensive health care system, and property taxes in many places north of USD 30K per annum on a four bedroom home

It could work, but you’d need to craft a special plan to game the ACA subsidies. 
 

I know multi millionaires in CA that have low property taxes on their homes and make all “income” from real estate cash flows that are offset by non cash depreciation expenses. They’re able to get ACA subsidies and get close to free insurance.
 

 

[MMM20]

I'm in my mid-30s and "retired" 5 years ago, giving up a $300-500K/year job that wasn't worth it b/c the opportunity cost was too high. I've had health scares so I’m probably more aware of my own mortality than the average mid-30s guy. That was part of it. I also didn't fit in in the corporate world so I knew pretty early on that I was prob on the ~8-10 year plan. I'm convinced I wouldn't have had the ability or conviction to identify and buy/hold a couple of big winners and compound at ~25-30% (with a lot of luck!) since then if I still had that job. But I have little kids and spend most of my time with them so I guess that's not "full time investing" anyway. It can be hard but a better kind of hard. It works for me. Find what works for you.

 

Edited September 7 by MMM20

[SharperDingaan]

The expectation is that you live (in Canada) where your money comes from (Canada). However, nothing prevents you from receiving Canadian income while living like a king elsewhere (South Africa, Caribbean, South America, etc.) for part of the year. Thousands of snowbirds live in Florida every winter, at CAD 1.35/USD 1.00. However, live in South Africa every winter; and it's ZAR 13/CAD 1.00, plus your same spend goes 2-3x further ... even at tourist prices.

 

At 70+ the kids have grown up and either fled the house (nobody wants to live with gran/grandpa) or been forcibly fledged (lower food/utility bills). You are also running down the property, as you intend to sell it vs keep it (minimal upkeep). A common US practice is to sell the home and live in a very high end trailer, in a trailer park; abandoning the trailer when its time for a home.

 

That banger in the driveway is smaller (mini, fiat, smart-car, etc.), paid off (no lease, monthly debt payment), but older and perfectly good ... if you can still drive/park it. For most city dwellers at 70+ the 'road-trip' is now the Sunday afternoon drive and dinner 'out' (lower transport and entertainment costs). 

 

How many 'old people' do you see gaming? making good use of a smart phone?, or making use of computer/device streaming subscriptions ? Not very many, and most have to have someone set it up for them (lower telecom).

 

How often do you see 'old people' travelling, and when? it mostly depends on where (Europe) and how (Ship/Train/Coach). There's a lot of joint travel in the go-go years... then a temporary bump when grandma goes cruising/coaching with 'the girls' after grandpa croaks out.  Lower travel costs the older you get. 

 

Canadian healthcare will keep you alive and housed until death; but sure - you may not like the wait times, the choice of drugs, or the accommodation in your final 'home'. While wealth has privilege, and can allow you to skip lines, access better drugs/treatment, live in a better place, and possible even live a year or two longer (Toronto vs Newfoundland); does it really matter at the end - if you are not in pain, but have advanced dementia &/or advanced MS, are permanently housebound, and essentially a cabbage? MAID exists for a reason. 

 

Point here is that gifting to the kids isn't part of it. The kids benefit after you croak, not before; and nothing prevents you from owning part of their houses until then. You want grand-kids? lower the cost of raising them (by reducing your kids monthly mortgage payment). You want to set up those grand-kids for life? will your equity stake in the parental house to them. While in the meantime .... retaining full control of the money should there be a divorce.   

 

Not what many want to hear.

 

SD

 

Edited September 6 by SharperDingaan

[73 Reds]

9 minutes ago, SharperDingaan said:

The expectation is that you live (in Canada) where where your money comes from (Canada). However, nothing prevents you from receiving Canadian income while living a king elsewhere (South Africa, Caribbean, South America, etc.) for part of the year. Thousands of snowbirds live in Florida every winter, at CAD 1.35/USD 1.00. However, live in South Africa every winter; and it's ZAR 13/CAD 1.00, plus your same spend goes 2-3x further ... even at tourist prices.

 

At 70+ the kids have grown up and either fled the house (nobody wants to live with gran/grandpa) or been forcibly fledged (lower food/utility bills). You are also running down the property, as you intend to sell it vs keep it (minimal upkeep). A common US practice is to sell the home and live in a very high end trailer in a trailer park; abandoning the trailer when its time for a home.

 

That banger in the driveway is smaller (mini, fiat, smart-car, etc.), paid off (no lease, monthly debt payment), but older and perfectly good ... if you can still drive/park it. For most city dwellers at 70+ the 'road-trip' is now the Sunday afternoon drive and dinner 'out' (lower transport and entertainment costs). 

 

How many 'old people' do you see gaming? making good use of a smart phone?, or making use of computer/device streaming subscriptions ? Not very many, and most have to have someone set it up for them (lower telecom).

 

How often do you see 'old people' travelling, and when? it mostly depends on where (Europe) and how (Ship/Train/Coach). There's a lot of joint travel in the go-go years... then a temporary bump when grandma goes cruising/coaching with 'the girls' after grandpa croaks out!  Lower travel costs the older you get. 

 

Canadian healthcare will keep you alive and housed until death; but sure - you may not like the weight times, the choice of drugs, or the accommodation in your final 'home'. While wealth has privilege, and can allow you to skip lines, access better drugs/treatment, live in a better place, and possible even live a year or two longer (Toronto vs Newfoundland); does it really matter at the end - if you are not in pain, but have advanced dementia &/or advanced MS, are permanently housebound, and essentially a cabbage? MAID exists for a reason. 

 

Point here is that gifting to the kids isn't part of it. The kids benefit after you croak, not before; and nothing prevents you from owning part of their houses until then. You want grand-kids? lower the cost of raising them (by reducing your kids monthly mortgage payment). You want to set up those grand-kids for life? will your equity stake in the parental house to them. While in the meantime .... retaining full control of the money should there be a divorce.   

 

Not what many want to hear.

 

SD

 

Hmm, not sure I understand your point but unless constrained by means or health, older folks do all the same things as their younger counterparts, often even more.  Health care is indeed a concern as you age, which is why good health care is far more important than the local currency exchange rate if you are able to afford a second home somewhere else.  As a US citizen, I don't know any older folks who downsize to a trailer (I'm sure there are some but just saying..), drive smaller vehicles (if anything they drive LARGER vehicles) or haven't adapted to technology when it suits their purposes.   Maybe they just don't need all the bells and whistles of the latest i phone.  As someone who has lived AND WORKED both in the current age of technology as well as before the PC and cellular phone were hardly even in use, let alone necessary,  I can tell you that there were very distinct advantages in both times (albeit for vastly different reasons) and if forced to choose,  I would have to admit that work and life in general was probably more enjoyable back then - for reasons that a lot of young folks may probably never understand. 

[SharperDingaan]

1 hour ago, 73 Reds said:

Hmm, not sure I understand your point ....

 

Retired Ontario/Quebec/Atlantic snowbirds winter in Florida for the climate, and have done so for decades. Back in the day it was cheap, a built-in road trip getting to/from, and your CAD went further than it does today. In 2020, it is much more common to winter in the southern hemisphere (where its summer) vs Florida, and depending where you go - your CAD will go many times further. For those who can afford it, it is now also much more common to winter in an Asia while having a hip/joint replaced. 

 

In 2013 an estimated 20M US people lived in mobile homes, and quite a few of those people weren't poor. Some of these mobile homes can go up to 2600 square feet and cost as much as a small house. It is no longer the 'stigma' that it once was, we have a quite a few friends in both California and Texas who have done this, and all have cited it as the down-sizing solution. You would freeze your ass off up here, but if you live in the right climate ... power to you. https://www.bbc.com/news/magazine-24135022   https://www.mhvillage.com/floorplans

 

Small cars do very well in Europe because they fit the streets, are very nimble, easy to park, cheaper to operate, and are reliable high-tech. Most driving is city runabout picking up groceries, dropping the kids off, etc. The US drives big cars because that's the marketing; sell enough of them and a big car costs less than a small one to produce. 

 

I hear you on the tech divide, but this is 2024 and technology is part of our modern life. Your smart phone is your access to services ... and if you refuse to/can't use it, that's on you. If you a have a stroke tomorrow, and are incapacitated, that smart phone could automatically make the right calls; and save both your life, and your mobility.  

 

SD

Edited September 6 by SharperDingaan

[Dinar]

4 hours ago, coc said:

 

Where? My 4BR is ~13k in taxes. >4k sqft. Wouldn't say I live in a low tax jurisdiction at all. 

 

Supposing I could get family healthcare for 1.5k/month, that would be ~2,500 for healthcare and property taxes. Add in 500/wk for food (w/ kids at home, going out etc.), that's $4,750, utils another ~$700-800 (heat, AC, electric, internet), that's $5,550 for the "basics". House maintenance/mowing/pest control adds another ~$200-300. Add in $1k/month for other stuff and basic fun living and that's ~$7,000/month, maybe $10k/month pre-tax (assume all-in 30% tax rate), so roughly $120k/yr gross needed if no mortgage/car payments. At 4% withdrawal that'd be $3 million liquid to be financially independent, plus a free and clear house.

 

Not too easy a bar for most, but not totally out of reach either. Obviously I'm painting an upper-middle class lifestyle. 

New York and New Jersey for instance could easily have 4 bedroom house costing $2MM and have $50k in annual property tax.  As a matter of fact, you would be hard to find a nice suburb within commuting distance of NYC in NJ and CT where property tax on a 4 bedroom house would be under $20k per annum.  I am genuinely curious, where do you get a good health plan as a non-working individual paying $1500 per month for a family?  I am not trying to be argumentative, I would gladly buy the heath plan!

 

By the way, you are assuming no repairs for the house, and that appliances never break, and I do not see car expenses - which exist even if you pay cash.  Also, you are missing insurance, which is several thousand a year at least. 

[73 Reds]

1 hour ago, SharperDingaan said:

 

Retired Ontario/Quebec/Atlantic snowbirds winter in Florida for the climate, and have done so for decades. Back in the day it was cheap, a built-in road trip getting to/from, and your CAD went further than it does today. In 2020, it is much more common to winter in the southern hemisphere (where its summer) vs Florida, and depending where you go - your CAD will go many times further. For those who can afford it, it is now also much more common to winter in an Asia while having a hip/joint replaced. 

 

In 2013 an estimated 20M US people lived in mobile homes, and quite a few of those people weren't poor. Some of these mobile homes can go up to 2600 square feet and cost as much as a small house. It is no longer the 'stigma' that it once was, we have a quite a few friends in both California and Texas who have done this, and all have cited it as the down-sizing solution. You would freeze your ass off up here, but if you live in the right climate ... power to you. https://www.bbc.com/news/magazine-24135022   https://www.mhvillage.com/floorplans

 

Small cars do very well in Europe because they fit the streets, are very nimble, easy to park, cheaper to operate, and are reliable high-tech. Most driving is city runabout picking up groceries, dropping the kids off, etc. The US drives big cars because that's the marketing; sell enough of them and a big car costs less than a small one to produce. 

 

I hear you on the tech divide, but this is 2024 and technology is part of our modern life. Your smart phone is your access to services ... and if you refuse to/can't use it, that's on you. If you a have a stroke tomorrow, and are incapacitated, that smart phone could automatically make the right calls; and save both your life, and your mobility.  

 

SD

No denying that technology is highly useful and here to stay; but that doesn't make the quality of one's life today any more enjoyable.  Personally, there is a lot about the old days that I miss.  

 

[Way] back, Florida was an uninhabitable swampland.  Like most places, development, combined with desirable natural resources attracted people, including snowbirds from Canada.  It wasn't that long ago when there were as many Quebec licenses plates as Florida plates canvassing the streets of Hallandale and Hollywood during the Winter months.  But Florida did not get any more expensive than most other nice places on a comparative basis.  In fact, until the last 5-10 years, the West Coast of Florida was one of the better Winter-season bargains one could find anywhere and today prices are simply competitive but hardly out of the norm.  Canadian snowbirds, like anyone else of course, are free to choose travel destinations but the tourism and real estate industries in Florida have certainly not suffered so evidently there are still many who find it to be an affordable destination while full-time residents continue to move here from other States and countries.  So I'd ask whether the issue of Canadians going elsewhere, if true, is a bit more complicated than just cost.

 

You're right about small cars and Europe but of course everything in Europe is smaller (just kidding, kind of).  However when you see an RV on the highway here next to you, my guess is the driver is most likely not a 20 or 30 something.  On the flip side, the "tiny-home" craze is surely not being kept alive by retirees and even though there are some fine mobile home parks scattered around they are far from the norm.

[coc]

17 minutes ago, Dinar said:

New York and New Jersey for instance could easily have 4 bedroom house costing $2MM and have $50k in annual property tax.  As a matter of fact, you would be hard to find a nice suburb within commuting distance of NYC in NJ and CT where property tax on a 4 bedroom house would be under $20k per annum.  I am genuinely curious, where do you get a good health plan as a non-working individual paying $1500 per month for a family?  I am not trying to be argumentative, I would gladly buy the heath plan!

 

By the way, you are assuming no repairs for the house, and that appliances never break, and I do not see car expenses - which exist even if you pay cash.  Also, you are missing insurance, which is several thousand a year at least. 

Have lived on the East Coast my whole life and cannot imagine why I'd need a 2MM house for any reasons, there are plenty of <1MM houses w/ 4 br in nice areas of this country. Not sure why you'd need to commute to NYC if you're functionally retired but that's attainable even in the CT suburbs. 

 

One should be able to get a decent ACA plan for $1,500 esp if your income isn't super high. Which in the scenario we are contemplating, it wouldn't be. Try the ACA calculator kff.org. To be fair I'm not currently using an ACA plan so maybe I am overestimating but I don't think I'm far off. $1,500 is a good chunk...

 

I included things like home repairs in the extra 1k/month I chucked in but of course once in awhile you might need to withdraw 4.5% instead of 4% to cover those things (that'd be an extra $15k), or one can borrow on a HELOC and pay it back over time, etc etc I don't think it changes the point. 

[Junior R]

4 hours ago, MMM20 said:

I'm in my mid-30s and "retired" 5 years ago, giving up a $300-500K/year job that wasn't worth it b/c the opportunity cost was still too high. I've had some health scares and am probably more aware of my own mortality than the average mid-30s guy, for better or worse. I also didn't fit in in the corporate world so I knew pretty early on that I was prob on the ~8-10 year plan. I'm 100% convinced that I wouldn't have had the ability or conviction to identify and buy/hold a couple of big winners and compound at ~25-30% (with a lot of luck!) since then if I still had that job. But I have little kids and spend 50%+ of my waking hours with them so I guess that's not "full time investing" anyway. It can be hard but a better kind of hard. Find what works for you and keep it moving.

 

@MMM20 Nice...How do you fund your day to day expenses? Do you use dividends / bonds / sell stocks? What was your compounded rate before when you had a job? Was it less then 25-30%

[Junior R]

3 hours ago, SharperDingaan said:

 

Retired Ontario/Quebec/Atlantic snowbirds winter in Florida for the climate, and have done so for decades. Back in the day it was cheap, a built-in road trip getting to/from, and your CAD went further than it does today. In 2020, it is much more common to winter in the southern hemisphere (where its summer) vs Florida, and depending where you go - your CAD will go many times further. For those who can afford it, it is now also much more common to winter in an Asia while having a hip/joint replaced. 

 

In 2013 an estimated 20M US people lived in mobile homes, and quite a few of those people weren't poor. Some of these mobile homes can go up to 2600 square feet and cost as much as a small house. It is no longer the 'stigma' that it once was, we have a quite a few friends in both California and Texas who have done this, and all have cited it as the down-sizing solution. You would freeze your ass off up here, but if you live in the right climate ... power to you. https://www.bbc.com/news/magazine-24135022   https://www.mhvillage.com/floorplans

 

Small cars do very well in Europe because they fit the streets, are very nimble, easy to park, cheaper to operate, and are reliable high-tech. Most driving is city runabout picking up groceries, dropping the kids off, etc. The US drives big cars because that's the marketing; sell enough of them and a big car costs less than a small one to produce. 

 

I hear you on the tech divide, but this is 2024 and technology is part of our modern life. Your smart phone is your access to services ... and if you refuse to/can't use it, that's on you. If you a have a stroke tomorrow, and are incapacitated, that smart phone could automatically make the right calls; and save both your life, and your mobility.  

 

SD

Who shovels your snow when your gone lol