Is 45 years old too late to be financially free?

58 Replies

I just turned 45 in May and finally bought my first rental property this past March 2019. My wife and I started our own vacation rental business . Although this is the slow season in Big Bear Lake Ca, where our STR is located we've been booking almost every weekend but we still have a lot to learn. I work for the Disney company as a professional designer but I want more for my wife and myself. ESPECIALLY WHEN IT COMES TO MORE TIME WITH MY WIFE.

I make a six figure income and have a 401k I can liquidate to buy more properties but I’m a newbie to real state investing and I’m hoping I’m not to late in life to learn a strategy and retire early.

@Mark Page .

1. I would ask this question in the general forum don't limit yourself to us STR folks.

2. How many rich uncles do you have?

3. The fact that you actually want to spend time with your wife is more amazing than being financially free.

4. Looks like you're trying to be an STR PM? I'd rather work for Disney than manage other people's STRs

5. What is financially free? This is greatly different for everyone. To replace your 6 figure income you need 8333 passive income per month. Let’s say each door cash flows $500 per month you only need 15 doors. I’ve got 15 doors and I’m a moron. If you want Lamborghinis and Prada you’ll need to call the rich uncle and partner up.

6. Set goals! I would start with a goal of 1 non fiction book per week.

One word answer to your question..... No.

Good luck!

*this was typed on an iPhone 

It isn't too late, but I doubt you will be able to replace your income with rentals. STR make more money, but they take more time than long term rentals. Why not look at some multifamily homes such as a duplex? You won't be cash flowing as much, but you will have more time to spend with your wife and depending on the numbers and how quickly you pay off the mortgage, in 15 years you could sell it and pocket the money.

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@Mark Page Great advice from @Lucas Carl, especially #5 & #6. 

You're definitely not too late. It took me a little over two solid years of work to build a solid rental portfolio. Anyone can do it, you just need the motivation and clear goals. 

With your high income you should qualify for some great financing terms too!

Best of luck!

@Mark Page hello mark the short answer is a. If NO man I will be 50 and I just bought my first Rental single home that I’m going to rent out in August and I just got another duplex that I’m working on. I to want to replace my 6 figure income in the next 5 years and I believe I will do it . Good luck to you my friend and keep me updated we can encourage each other. By the way I like your last name Lol

@Mark Page

Age is irrelevant.  People start investing at all different times in their life.  20’s to 60’s it’s your life you do with it as you choose.  Rentals whether short term or long term take time to grow.  I agree with @Theresa Harris if your looking to move quicker multifamily may be the route you want to take. Whether it's 2, 3, 4 units or 100 you can pick. Individuals have created financial freedom in as little as two years. It depends on your situation. How many STR or LTR will it take to meet your goal? I would calculate your cash flow and see what your magic number is to replace your income or just make yourself financially comfortable.

Good Luck.

@Mark Page I agree with others that age is irrelevant. In addition, you are still in your prime income earning years which means you should have a much better shot at accumulating assets quickly than most newer investors. I don't know your financial situation, but if you and your family are serious you probably could look for ways to downsize your lifestyle so that you can deploy more of your income. Most people (me included) allow lifestyle to grow with income, but if you can focus on saving 30, 40 or 50% of your income you will be able to grow your investments that much more quickly. 

The other thing to do is to focus on buying assets that are below market value. I started with a four unit apartment building in 2015, and have snow balled to 58 units in 2019! All of it started with buying under valued assets and leveraging the equity I "created". 

The only time it's too late to be financially free is when you're dead.  The best time to start is today.

As others have said, figure out what "financial freedom" looks like to you and your family.  It's different for everybody.  Once you have a grasp of that, you have a concrete goal to work towards, and that should shape how you invest.  

If you like, you can absolutely reach financial freedom with STRs - that's what I did, and I did it in 18 months with 4 properties. Walked away from my 6-figure job with Netflix. (you want to own the properties, not manage them for others, and they need to be quality investments with big cash flow) But I only have myself to support, so my financial picture is different from yours. Like you, I started with an STR close-ish to LA (though not in Big Bear), then once I felt confident, started buying out of state in a more year-round market.

STRs take more time than LTRs, it's true, but they are far from a full-time job (especially a full-time job in entertainment!).  If you like them and want to stick with them, great!  If you want to get into something a little more hands-off, great!  MFRs have brought many people financial freedom.  So have commercial properties, investing in paper, etc. etc. etc.  Pick what makes sense to you/what you enjoy and learn to master it.

Congratulations on starting the journey!

@Mark Page No way man. Go for it!! Any age you start thinking about financial freedom and spending more time with your family instead of working and buying more stuff puts you so much further ahead in the game! With your job and salary, you could easily be FI in 10 years (if not way less). 55 isn't a bad age to be able to do whatever you want.

@Mark Page first of all, welcome to BiggerPockets! The short answer is, no it is not too late. There are countless stories of people starting at even younger ages and becoming financially independent in a matter of 5-10 years.

It is harder as you get older, only because of mindset limitations. As people get older, they get more cautious and therefore take less risk. Scaling a business quickly requires taking on enormous risk. As you age, you are also more established in success habits. Drive, focus and resourcefulness are important. Would you rather go out to eat with your wife and watch Netflix on a Friday night or work on your business? No wrong answer, but two different paths.

@Mark Page My official day job is a drug screen collector.  It is for the people that are going to enter a refinery to do contract work, contractors.  They have to pass a drug screen in order to enter the facility to do work.  

When I give them the drug screens, I inform them of my 23 STRs with 83 beds.  This is how I rent them out.  

You could leverage your job contacts with Disney and possibly use that inside knowledge to rent out your STRs.  I don't have a specific plan, but Disney is like organized crime.  They have a lot of hands in a lot of pockets.

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@Mark Page

Hell no! I started last year at the age of 40 and will soon have my 22nd door (all SFR's and duplexes). I could leave my day job now, but it would stunt my business growth significantly.

I say good for you for wanting more for you and your wife!

Remember, there are no self-made people. My advice is to continue to put your self out there, join your local REIA, network with other investors, scour the MLS daily, etc., etc. At the end of the day, how bad do you want it?

It's not too late. I became financially independent in 7 years through investing in apartment buildings.  You can do the same if you're willing to hustle.

Thanks so much @Lucas Carl! Man you made my dream sound attainable! I don’t have any rich uncles.

BTW, what type of properties are you talking about to replace my income?  I am absolutely not trying to be a property manager!  I want to hire a property management company.

I bought my first rental at 44. It was a huge mistake. This year I will be 56, I expect to own 18 rentals by the end of this year. My situation is very similar to yours, the wife and I have day jobs that fund our REIs. But these day jobs mean that our REI adventure is a part-time affair. So no, 45 is not too late. :)

Thanks so much @Cameron Tope! Man if I could do that in two years that would be amazing!

What types of properties are you talking about investing in?

@Mark Page

Absolutely not. What is important is that you’re clear that you want more time with your wife. If you just go for acquiring a lot of properties you may just create more time with your tenants and handyman.

There are various strategies to make more money in real estate to be financially free. With your salary, you can put those funds to work so you don’t have to! You can scale large enough to higher a management team to oversee the day to day stuff, but that still requires you to scale it. You can also try passive investments like notes. We actually partner with busy professionals looking to buy apartments.

Lots of strategies and options, it just comes foe to your goals and how active you want to be in the investment.