Introduction the Rental Agreement Retirement Plan

Wednesday, 19 August 2009

Introduction the Rental Agreement Retirement Plan

Once upon a time, the American Dream could be summed up something like this: you graduate high school, get a job with your father or father-in-law's company, steadily rise in responsibility and compensation for 40-50 years, and retire with a modest pension. I don't know how that model looks to you, but to me it looks grueling, repetitive, long, and ultimately soul-crushing.

While no concrete data exists on the average number of times Americans change careers in a lifetime (due to the subjective, qualitative nature of the question causing obvious methodological problems), the most commonly-held anecdotal evidence points to an average of 7 career changes for Americans by the time they retire. This is a different dream: I will pursue a career that interests me, and change careers as needed or wanted. This model is more appealing than the original America Dream, as it's more dynamic and personal, but there's still something missing… oh, that's right, the 40-50 years of your life that you spend working.

Which is precisely why so many people hope to retire earlier than 65-70, and save or invest so much of their paychecks each month in a retirement account. But most people still won't manage to retire before 55-60, and those that do succeed tend to burn themselves out working boiler-room type jobs that slowly erode their humanity, leaving them unable to relax when they finally do retire at 38. Guess what they do? You got it, they rush back to work, because it's all they know.

What if you could retire in less than two years? I don't mean as a millionaire, living an absurdly luxurious life for the next 50 years. But what if you could pay your basic bills, on an ongoing basis, by owning a portfolio of rental agreement real estate, freeing up your time to pursue interests, hobbies, and other "night jobs," that don't pay very well but make you happy?

Yes, there are risks. Yes, it requires a lot of work. But if you could accomplish in 20 months what takes most people 40-50 years, is it worth it?

You don't need to own 150 rental properties. You only need a handful, owned free and clear, and that handful is far easier to achieve than you might think, by leveraging your existing rental agreement properties and selling others.

Calculation: Your Retirement Goal

Get out your calculator, it's math class time. In the first column, list your fixed (hard) monthly expenses, and their corresponding dollar figures in the second column (I'll help you get started):

Monthly Expenses	Cost
Mortgage/Rent
Car Payment
Health Insurance






Total

At the bottom, add your estimated variable (soft) expenses: food, entertainment, etc. Now, add them up, to calculate your total monthly costs.

This is your Target Monthly Income, and your goal will be to reach it within 20 months.

How can you possibly reach that goal in 20 months? By buying real estate, signing a rental agreement on much of it, and selling the rest to pay off your mortgages. It's not rocket science, but it's not simple either, so we'll be taking a deeper look into the science of this next time.

Resources:

Rental Agreement Builder for All 50 States