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Retirement home as percentage of networth

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  • #31
    Originally posted by Zaphod View Post

    What risk?
    I mean, if it is one of those houses being held up by a cliff of sand...and the city is charging you to make sure there is no further erosion...but despite this, the house falls into the ocean...and the city charges you to clean it up...and your lot literally doesn't exist any more....


    • #32
      Originally posted by LIFO View Post
      1. You seem to be really good at investing your money. Why dramatically change asset allocation now?
      2. Living next to the beach has other tradeoffs besides expensive real estate. Its crowded and being surrounded by neighbors who are >50% vrbo or seasonal is not that great long term. We moved to a HCOL coastal town a few year ago. First few years we were a block from the beach. It was great for the first couple of years but we stopped going after a while. The party life and crowds weren't our scene. Moved 10 minutes inland. The beach is always there when we want it. But now have peace and quiet and a real neighborhood.

      Unless you know this is your forever home or you feel this is a worthwhile investment (which it may very well be), I'd consider renting a decent place near the beach for a bit and see if you like the lifestyle long term.
      Definitely not an investing genius. We lived well below our means and put money into two index funds. The rest was luck. It helps to have a spouse who is even more frugal than I was even though we traveled and never felt like we had to forgo anything we wanted. We just did not want the mansion, cars, etc.

      We have been renting the last few years in various locations on or near the beach and enjoy it but it is a consideration about whether or not it is worth it.


      • #33
        Originally posted by STATscans View Post
        Reading this post makes you kinda put things into perspective.

        As others have pointed out if you put 5M towards a house and now left with 5M in investment and start taking out 4%, that’s 200k pretax. So maybe 160 to 180k post tax?

        If you have to put 60 to 80k in property tax and up keep for a 5M house, that leaves you with maybe 100k in cash to live on?

        Am I doing this right?

        That’s not a lot of money left over to spend when you consider that you are a ‘decamillionaire ’. That’s like 8K a month. Doesn’t seem like a lot for again a ‘decamillionare’. It is all perspective but we couldn’t live on 8K a month right now, at least without cutting down on many things. And we live in a low cost of living area with no real debt except home.

        I can see why some of my partners are still working in their 60s and taking call.

        That said, if I had your money, I’d retire and not look back. :-)
        We have yet to live on that much yet but I have to admit I enjoy having so much available that we can walk in and buy an expensive car, fly first class or do many other things without even giving it a concern, even if we do not


        • #34
          Originally posted by Zaphod View Post

          What risk?

          As usual this board is highly over weighing theoretical risks and situations that are very very low probabilities and treating them as base case scenarios to advise your course of action with money.

          A mortgage is a house backed by an asset. This sounds like California, there is essentially zero risk. In fact, if the market goes kaboom, you can literally just walk away from a house in cali and deficiency judgements are illegal.
          The risk of a stock market decline, not a property market decline. Inflation is not the only risk out there. We don't have no recourse mortgages where I live so yeah being able to walk away from the property debt and not have to settle the loan with half price stocks would make a difference.


          • #35
            So you did the rentals on and near the beach already. Did you do them during king tide, high season and low seasons to get those looks and feel of the community?

            Here in San Diego the local vibes change dramatically between seasons in some towns vs others that are relatively stable. Makes a huge difference. No way we'd love in del mar proper. Further up in Solana beach...yeah we'd do that. Cliff with view and short 5- 10min walk down to beach would be our sweet spot.