40 doors - should i expand or retire?

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40 doors - should i expand or retire?

Hamad Khan
Member since 2020 · 54 posts · 22 votes

Folks, here is my situation and need your guidance on what should i do.

* age 44

* 40 doors all managed by myself

* net passive income per month approximately 27k

* just achieved my golden number of passive income / month last month after almost 10 yrs of hardwork.

Now i am confused on should i expand further or just chill and enjoy my life. Honestly, i resigned from my corporate job and i have been sitting home for last 3 weeks doing nothing but just collecting passive income and feeling totally different.

All i need to know is from all you experienced folks

* should i expand futher or just ride with what i currently have and chill?

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Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
2y

I was similar to you last year and 'retired'.  Sold 90% on contracts into the sunset of naps and whatever.  

Leisure can be tough on accomplishers, but I'm chill in general and content.

I like learning new stuff, revisiting old hobbies and causes and I wrote a small book/manuscript. 

I'll probably never bother publishing, it was mostly vomiting my tips and experiences through a keyboard but I felt much better when I was done.  

If your markets are like mine right now, finding deals isn't worth the work.   I'd take some time off and discover what I wanted to do.   Nothing's on fire here. Maybe read some books on finding your why.  Simon Sinek is a good start. 

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  • Joe HammelBusiness Member
    Real Estate Agent · Metro Detroit, MI · Member since 2018 · 612 posts · 666 votes
    2y

    @Hamad Khan

    If you’re in the fence at all…give yourself the green light to Retire!

    You can still dabble, do some things you like…if you see a golden property, buy….if in 2 years you get bored, do a couple more things…but I think so many people feel like they “have” to work…and we don’t.

    Congratulations on your success. Now go do all those fun things you’ve been wanting to do…and see how you feel in a couple years.

    [email protected]248-422-1685
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    3Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    2y

    $27K a month is an insane income.  I'd retire and then do whatever I wanted.  If you get bored, take up a hobby, do something to give back to the community, find a volunteer position or a job that you've always wanted to do and do it part time.

    If you find the urge to keep buying, why not go to a local meet up and help newbies or others do what you did, so they can learn from you?  You still get the fun and excitement of finding deals and helping to turn those in to successes without the financial risk.

    3Reply
  • Mary L.
    Rental Property Investor · Member since 2020 · 41 posts · 54 votes
    2y

    @Hamad Khan

    Expand a little bit more, but not more than 75 doors because democrats propose a new Housing Hedge Fund Bill - want to kick out the hedge fund and has penalties for landlords to own 75 or more rental properties - $10k tax fee each property each year.

    Landlord who one 75 doors or more could have $750k tax fee each year due to the Democrat new propose Hedge Fund housing bill.

    Please google the new Hedge Fund housing bill, then you will see the news.

    2Reply
  • Ashish S.
    Wholesaler · Richmond, VA · Member since 2011 · 11 posts · 1 vote
    2y

    Congrats! on reaching that goal....maybe share your story and start a radio channel or JV with folks on their journey of real estate investing!

    1Reply
  • Sean HudginsPro Member
    Real Estate Agent · Chesapeake Va · Member since 2019 · 150 posts · 100 votes
    2y

    @Hamad Khan, The purpose of passive income is to give you the freedom to pursue your life purpose, whatever that is. You can keep investing and grow bigger or pursue a new venture or both, but the upside is you can do something that fulfills you without worrying about your income. That is the whole reason for financial freedom!

    [email protected]757-844-8215
    4Reply
  • Bob S.
    Real Estate Consultant · Cleveland · Member since 2020 · 6k+ posts · 3k+ votes
    2y
    Quote from @Hamad Khan:

    Folks, here is my situation and need your guidance on what should i do.

    * age 44

    * 40 doors all managed by myself

    * net passive income per month approximately 27k

    * just achieved my golden number of passive income / month last month after almost 10 yrs of hardwork.

    Now i am confused on should i expand further or just chill and enjoy my life. Honestly, i resigned from my corporate job and i have been sitting home for last 3 weeks doing nothing but just collecting passive income and feeling totally different.

    All i need to know is from all you experienced folks

    * should i expand futher or just ride with what i currently have and chill?


    Y

    Your only 44 what are you going to do ? Sure the 1st 6 months is cool, (been there done that) , then what? RE is not really working 9- 5 and having to sit in traffic to go to work. So why not buy more? HUGE difference wanting to vs having to work

    Keep crushing it 

    1Reply
  • Danny RandazzoPro Member
    Apartment Syndicator · Charleston, SC · Member since 2016 · 973 posts · 728 votes
    2y

    @Hamad Khan congratulations on your awesome success. The question to ask yourself is what is your goal. Do you want to enjoy your free time or use your time to manage your assets? It's always a good exercise to review your ROI and your ROT (return on time). My guess is if you grow your portfolio you'll need to hire help and you'll have more issues to resolve which will increase your time commitment to asset management and or property management.

    2Reply
  • Michael SmytheBusiness Member
    Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
    2y

    @Hamad Khan depends on what motivates you.

    I plan to build up my personal portfolio and have it managed by someone else, so even when I'm financially free, I can focus on building more wealth without the headache of day-to-day issues.

    Logical Property Management4.9454 Reviews
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    2Reply
  • Lane Kawaoka
    Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
    2y

    Sounds like you have hit the Penthouse, you should be conscious of and not trade your time for money. You’ve hit the endgame (15-25K a month passive). You can finally prioritize the things that are really important—like being there for your family with your time, instead of justifying spending your time to afford the life be there for your family.

    2Reply
  • Basit SiddiqiBusiness Member
    Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
    2y

    What will the extra money give you?

    $25,000+ a month is about $300,000 a year which is likely a comfordable living even in a high cost of living market with a wife.
    Especially since not all of it will be considered taxable income.

    I would focus on the next part of your life such based on whatever interests you such as traveling, spending time with friends/family, etc

    Congrats and best of luck!

    [email protected]917-280-8544
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    1Reply
  • Greg M.
    Rental Property Investor · Los Angeles, CA · Member since 2017 · 2k+ posts · 5k+ votes
    2y

    Quite honestly, you've told us nothing about your finances to even begin to allow us to offer an informed decision. $27K a month is a nice, but by no means a mind blowing about of money. Especially if it is pre-tax. And we don't know your location or lifestyle. 

    Does your wife work? How many kids? What ages? Will there be pre-school/private school/college expenses for them?

    As a W2 you likely got medical insurance. Cost of it now? Did it contribute to a 401K? 

    Age of the properties? Upcoming repairs? Appreciation value? Are they clustered together (more risk)? Vacancy rates? Political environment? Equity in them? Insurance rates are rising and we have ugly inflation. Does your location have the ability to raise rates quickly to cover this or will it take years for other landlords to drop out of the market in order to push rents higher? 

    And the most important question everyone on these forums seems to overlook, what percentage of your net worth is in these rentals? Are you diversified so if something goes wrong you can still live comfortably?

    4Reply
  • Olga Daisel
    Member since 2020 · 69 posts · 25 votes
    2y

    @Hamad Khan

    4 doors with 26k passive net here. I'd say redo your investment to minimize number of doors, in case you self manage.

    3Reply
  • Steve K.
    Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    2y

    I did a mini-retirement (2 year rock climbing/ Mt. Biking/ kayaking road trip), then found that life was kind of boring with no purpose other than recreating, and got my RE license and started helping others in order to have something to do. Now I’ve got 3 kids in private school, and they all have the same expensive hobbies that I have so the more money coming in the merrier. I’ve started reducing my number of doors: better locations/ higher returns and less stress. 

    3Reply
  • Basit SiddiqiBusiness Member
    Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
    2y
    Quote from @Olga Daisel:

    @Hamad Khan

    4 doors with 26k passive net here. I'd say redo your investment to minimize number of doors, in case you self manage.

    imo, you can't call it passive if you are self-managing.

    Nice numbers on your investments though!
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    2Reply
  • Becca F.
    Rental Property Investor · San Francisco Bay Area · Member since 2022 · 1k+ posts · 1k+ votes
    2y

    Congratulations @Hamad Khan on your hard work and that portfolio!

    That''s pretty impressive self managing 40 doors and $26k net income.  Like @Basit Siddiqi said, that doesn't sound passive to me. How much time do you spend self managing?

    Like @Greg M. asked, you haven't told us your location, lifestyle, your properties' appreciation, etc? If you have kids and if they're younger, private school, approaching college age etc. If you're single or married (and spouse has an income) with no kids and living in the Midwest that $26k net rental income goes a lot farther than if you've living in an expensive metro area with kids and expenses (day care or private school isn't cheap in California, NYC etc). Also as you get older health care costs go up. If you could fill us in on a few more details we could give more suggestions, but only you know what your individual financial situation and risk tolerance is. 

    2Reply
  • Kai Van Leuven
    Investor · USA · Member since 2015 · 325 posts · 447 votes
    2y

    @Hamad Khan

    I have been in this same boat (having enough and trying to figure out life). I remember reading on here the people who advise to "invest until you die" and thought "I don't want that to be me". There has to be an ends and a bigger purpose in life. I went from 100+hrs a week working to zero. 

    ---This is what I did---

    1. Started connecting with my family- bought an RV and traveled the US. Went on vacations all over the world.

    2. Hired out all of my work- I started to build a team. I make less but I don't have to deal with angry people... really just tenants.

    3. Connected to God- Looked for Him in everything and a higher purpose. Teach kids (my own included) how to connect with Jesus and glorify Him.

    4. Moved- I am in the process of selling the house I just built in Seattle and moving to a warm island in the middle of the Pacific. 

    5. Coaching- I started coaching a middle school wrestling program and was on the board for a NFP wrestling club.

    Ultimately, do what makes you happy and will bring the most joy. I hope that at my funeral no one would talk about my 'financial success' but how I gave freely of my time, took their calls, and wanted to follow Jesus (not trying to be preachy, but it's the truth).

    2Reply
  • Julien J.
    Investor · CO · Member since 2016 · 757 posts · 1k+ votes
    2y

    @Hamad Khan

    First off, congratulations! Massive achievement

    From personal experience, I also retired from from the corporate world thanks to my real estate portfolio. I can sympathize with you, my transition has been unsettling, a growth experience, and just plain strange. I realized, I picked up a ridiculous amount of habit and stress. I'm almost a year in and still feel the pull of the structured life I used to live by. I find that I'm feel like I'm constantly "wasting time" if I'm not on the edge of burning out while grinding out the todo list.

    My best advice for you is to relax (good luck with that) for a while until you get comfortable with your new world, sit down and paint the new dream/ set the new goal post. Learning to enjoy life has been a challenge and requires a complete change of mindset. Its almost like the growth from leveling up a corporate career: individual contributor to manager to manager of managers to director of a department to an executive leader with multiple departments with an ownership stake.

    All in all, not a bad place to be in, but a foreign world.

    Feel free to reach out.

    3Reply
  • Jonah Hartsburg
    Real Estate Agent · Marion, IN · Member since 2019 · 134 posts · 67 votes
    2y
    Quote from @Hamad Khan:

    Folks, here is my situation and need your guidance on what should i do.

    * age 44

    * 40 doors all managed by myself

    * net passive income per month approximately 27k

    * just achieved my golden number of passive income / month last month after almost 10 yrs of hardwork.

    Now i am confused on should i expand further or just chill and enjoy my life. Honestly, i resigned from my corporate job and i have been sitting home for last 3 weeks doing nothing but just collecting passive income and feeling totally different.

    All i need to know is from all you experienced folks

    * should i expand futher or just ride with what i currently have and chill?


    I'd highly suggest reading through chapters 14 and 15 of The 4-Hour Workweek. I'm sure there are numerous books dedicated to this subject, but Tim Farris discusses "Filling the Void" and some common auto-pilot habits people fall into once they have extra time on their hands after achieving their definition of success. 

    Congrats! What a wonderful position to be in.

    1Reply
  • Anthony Freeman
    Member since 2023 · 327 posts · 63 votes
    2y
    Quote from @Hamad Khan:

    Folks, here is my situation and need your guidance on what should i do.

    * age 44

    * 40 doors all managed by myself

    * net passive income per month approximately 27k

    * just achieved my golden number of passive income / month last month after almost 10 yrs of hardwork.

    Now i am confused on should i expand further or just chill and enjoy my life. Honestly, i resigned from my corporate job and i have been sitting home for last 3 weeks doing nothing but just collecting passive income and feeling totally different.

    All i need to know is from all you experienced folks

    * should i expand futher or just ride with what i currently have and chill?


    Congratulations 

    1Reply
  • Account Closed
    Rental Property Investor · Canton, OH · Member since 2017 · 1k+ posts · 1k+ votes
    2y

    @Hamad Khan

    Out of curiosity, what is your average monthly rent?

    0Reply
  • Hamad Khan
    OP
    Member since 2020 · 54 posts · 22 votes
    2y
    Quote from @Account Closed:

    @Hamad Khan

    Out of curiosity, what is your average monthly rent?

    Around $60k / month
    1Reply
  • Account Closed
    Rental Property Investor · Canton, OH · Member since 2017 · 1k+ posts · 1k+ votes
    2y

    @Hamad Khan

    Nice! 👏

    0Reply
  • Cleon Coleman Sr
    Member since 2018 · 1 post · 1 vote
    2y

    Hamad, congrats on reaching the point of having options on what to do with your time. I reached that point in 2016, when I first walked away from corporate America. Personally, I took a year off to travel and just enjoy working out for hours at the gym. After a year, I took on a part time pharmaceutical sales job. I started the position not because I "had" to but because I "wanted" to. I worked the position for a year and then took another year off. So now, I'll take a medical sales job and work it until the tenure comes to a close and then take at least a year off before being available again to work. When a job is an experience and used as "investing fuel" versus your primary source of income, it is an entirely different feeling. I also have averaged about 3 flips per year over the last 3 years. So, my feedback is do a hybrid of things....flip, hard money lend, be a LP in a syndication deal, travel, play tons of basketball/exercise, work jobs that interest you, and have periods of rest. Do what interest you, that's what I have done over the last seven years. 

    1Reply
  • Hamad Khan
    OP
    Member since 2020 · 54 posts · 22 votes
    2y
    Quote from @Cleon Coleman Sr:

    Hamad, congrats on reaching the point of having options on what to do with your time. I reached that point in 2016, when I first walked away from corporate America. Personally, I took a year off to travel and just enjoy working out for hours at the gym. After a year, I took on a part time pharmaceutical sales job. I started the position not because I "had" to but because I "wanted" to. I worked the position for a year and then took another year off. So now, I'll take a medical sales job and work it until the tenure comes to a close and then take at least a year off before being available again to work. When a job is an experience and used as "investing fuel" versus your primary source of income, it is an entirely different feeling. I also have averaged about 3 flips per year over the last 3 years. So, my feedback is do a hybrid of things....flip, hard money lend, be a LP in a syndication deal, travel, play tons of basketball/exercise, work jobs that interest you, and have periods of rest. Do what interest you, that's what I have done over the last seven years. 

    Thank you so so much for such an incredible detailed feedback. Much appreciated.
    1Reply
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