All Forum Posts by: Sarah Ali

@Sarah Ali Just something I’ve been thinking about lately:

I also live in the Bay Area and this is a place where I know people “retiring” in their 40’s after working 10/15 years at the big tech firms. I think it stems from the illusion startup founders project by becoming young billionaires. This is also a location where you never feel rich because you are surrounded by affluence. But when you look at many of the business heroes many folks on bigger pockets read and follow, they made their biggest money between 40-60 and beyond. 

If RE is brand new to you, I would focus on playing defense:

1.) Shortcut your learning curve by learning from experienced players who do what you want to do. 

2.) Focus on making course corrections on your early mistakes fast and moving on or problem solving. 

3.) Utilize unintended advantages that you’ve gained over the years. For example, you may already know people who are crushing real estate and you’ve just never had the conversation with them. You may also know other people who have also been thinking about investment in this stage of their life and have the financial means. 

4.) Only do it if you think it’s going to be fun/interesting or you feel you will be good at it. Why waste the next decade or more otherwise. 

OK, this is what I see here.

 1. I cannot currently work in a traditional sense (ie, desk job). "Cannot" in this sentence as a red flag. There are very few people who pull off real estate investing without doing a LOT of desk jobs. And far less pleasant, safe, and clean jobs as well.

2. Yeah, you're in your late 40s. You're at a disadvantage. But if all your imagination is able to see happening in the next thirty years of real estate investing is that you will pay off your mortgages slowly and steadily, you're already dead in the water. I don't agree with @Bruce Woodruff about many things but he knows what he's talking about here.

3: "I would like to live off income from REI." You and every hopeful investor in America. The goal of getting out of whatever job you work at as quickly as possible to do REI full-time is typically a loser's dream in this business. Forget the promises of education and coaching you hear, it's going to take years and years before you can stand tall with your own, hard-won insights into this business. If you need handholding and spoonfeeding, hire a nanny. Don't come to real estate and expect to be mollycoddled. Anyone who promises you an easy time of anything in this business is without a doubt looking to take advantage of you.

4. Househacking is a great idea for a first investment. I do it, even though I got into it much later than I should have. Househacking in the Bay Area is a difficult proposition from what most people tell me.

5. Clearly, not even for a second are you considering the idea of moving to a place where it's easier to make a start than the Bay Area. You will have to make a lot more significant and burdensome investment decisions than this one.

Conclusion.

You're in your late 40s. You're only going to get older. Time to get the lead out of your butt, one way or another. But don't expect to do what everyone else is doing and be an unqualified success in life. You have to take that leap into the unknown, and keep taking more after it, and you could ruin yourself. These are fears you have to live with in REI, and choices which have consequences that you have to make.

No, you are not too old. I really got started in 2016 at age 46. I now have 33 doors and 135 storage units.

Even if you only bought one house and paid it off in 15 years, you would be age 65 with another $3,000 or more in monthly income. Every little bit helps if you choose/need to retire.

@Sarah Ali having a paid off mortgage is not an appropriate goal. Your goal is to build equity, which can be done through several ways (cash flow, appreciation, principal paydown, tax shielding, etc).

Equity accumulation can be achieved in 10 years, 20 years, or greater. You don’t have to necessarily retire with debt-free assets. You can realistically sell your real estate portfolio after 10 years and have significantly more wealth - and at that point you can spend it all or invest in something less risky or more passive.

The reasons above is why folks will say it’s never really too late to invest in real estate.

When I told my friends how old I would be when I got out of grad school if I went, they asked how old I'd be if I didn't go. Turns out I'd be the same age either way.

What does paying off the mortgages have to do with anything?

The idea is cashflow to live on right? If the deal is a good deal cashflow wise, it's a good deal in the other areas. You just need someone to take you by the hand and walk you through the steps. But you have to reach out, no one is going to do it for you.

You're still young, just do it! You don't just make money when your mortgage is paid off....a lot of people never pay off a mortgage....just keep buying, selling, refi'ing.

Your goal is NOT to just pay off your mortgage.....