ilovedolphins
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Post by ilovedolphins on May 21, 2019 15:07:58 GMT -5
After my first thread about investment rental property I thought the only other way for additional income streams would be dividend stocks. It's such a tough decision to make when you are close to retirement and hoping to find a way to supplement your money with.
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hoops902
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Post by hoops902 on May 21, 2019 15:16:56 GMT -5
After my first thread about investment rental property I thought the only other way for additional income streams would be dividend stocks. It's such a tough decision to make when you are close to retirement and hoping to find a way to supplement your money with. Or bonds that pay out periodic interest. REITs would do the same.
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Miss Tequila
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Post by Miss Tequila on May 21, 2019 18:08:09 GMT -5
For me, investment property is the no-brainer choice. But I also live in an area with Inexpensive houses and decent rents. I bought my first 2 unit just four years ago. All in, it cost me $70k. Each side rents for $800 and the tenants pay their own utilities. It is getting harder as now there are a lot more people investing. I won’t overpay for a property and if the numbers aren’t fantastic I don’t invest
I also invest in the stock market but not for cash flow. I’m too far away from retirement for that to be my focus.
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Blonde Granny
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Post by Blonde Granny on May 21, 2019 19:34:09 GMT -5
I have used REITS , bonds and CDs for income. CDs allow you the choice of having interest payments going back into it, or taking the month,y interest payments instead.
REITS pay higher interest and dividends and you can also invest in Preferred REITS that pay even higher interest or dividends.
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giramomma
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Post by giramomma on May 21, 2019 19:47:28 GMT -5
We have dividends. But, the income generation is not a whole lot...about 3-4% of our taxable portfolio. We have good amount of utilities in there...nothing real sexy.
When I was much younger and naive, my goal was to get 25% of our retirement income from dividends. Right now we're at about 10%, and we'll be lucky to get it up to 15% before we retire. Depending on your time horizon and how much you have sitting around in cash to put into the market, dividends may not be the way to go, either.
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ilovedolphins
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Post by ilovedolphins on May 21, 2019 20:22:07 GMT -5
I have about $65,000 in the stock market that I can control what I buy and sell. I have made $3100 since the beginning of the year doing short term trading. I only have about $50,000 that is not in retirement accounts. So it is hard to decide where to put my money.
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Deleted
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Post by Deleted on May 21, 2019 21:04:37 GMT -5
I have about $65,000 in the stock market that I can control what I buy and sell. I have made $3100 since the beginning of the year doing short term trading. I only have about $50,000 that is not in retirement accounts. So it is hard to decide where to put my money. Don't mess around with short-term trading, it's a good way to lose your shirt. If you would have just put that 65K in an S&P index fund and just let it sit starting January 1st, you'd be up over 9K.
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Deleted
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Post by Deleted on May 22, 2019 6:24:29 GMT -5
My only experience as a landlord was not a good one. I'd bought a 2-family with a friend and a couple of years later moved out to live with my BF, who would eventually become my first husband. The tenants were always late with the rent, called for trivial problems and took a few things of mine from the attic when they moved out. Someone here (Bonny?) had terrible stories about what a tenant had done to their rental property before being evicted.
I can see that for the people who can handle it, owning rental property is a good road to wealth, but you have to have reserves for repairs and replacement of things that legitimately break down (in the past 3 months I've spent $4,000 to replace a wall oven, water heater, expansion tank and leaky outdoor faucet in my own home) as well as periods when you don't get rent, either due to vacancy or the tenant not paying.
I chose stocks!
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Bluerobin
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Post by Bluerobin on May 22, 2019 8:44:25 GMT -5
I get a nice income from dividend stocks. I stick with "safe" dividend stocks, like utilities etc. It is a lot easier to sell a stock that goes bad than a house that does.
ETA: Even though I am retired, I still have a few stocks where the dividends are reinvested. Watching for future inflation.
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justme
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Post by justme on May 22, 2019 9:38:39 GMT -5
I've thought some about this, and I would probably say not to do it. I bought my condo not even 4 years ago and my place is up at minimum 20%. Housing prices have been on a run-up for a while now and it's definitely a seller's market - most of the other units in my building selling for $40-50k more than I bought still have all the shitatistic finishes and appliances that were installed when this place was built as apartments 14 years ago. Not to mention Orlando's starting to face a housing crisis - the rents are getting ridiculous compared to what a lot of people make. They're still building a lot of new apartment buildings, but they're all luxury ones and the ones open aren't even full. I'm not entirely sure what happens in a market when there's a rental crisis? Maybe those that own are still good?
I'm just glad I bought when I did and have been doing upgrades. My unit will be one of the first sold/rented if I ever need to do that because it has a new a/c, all new kitchen appliances, and new w/d. By the end of the year it should hopefully have all new floors and new kitchen cabinets. That alone will make it better than probably 80% of the units here.
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Rukh O'Rorke
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Post by Rukh O'Rorke on May 22, 2019 10:17:40 GMT -5
For me, investment property is the no-brainer choice. But I also live in an area with Inexpensive houses and decent rents. I bought my first 2 unit just four years ago. All in, it cost me $70k. Each side rents for $800 and the tenants pay their own utilities. It is getting harder as now there are a lot more people investing. I won’t overpay for a property and if the numbers aren’t fantastic I don’t invest I also invest in the stock market but not for cash flow. I’m too far away from retirement for that to be my focus. I think there are parking spaces in Chicago you can get for about 70k!
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Miss Tequila
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Post by Miss Tequila on May 22, 2019 10:25:33 GMT -5
For me, investment property is the no-brainer choice. But I also live in an area with Inexpensive houses and decent rents. I bought my first 2 unit just four years ago. All in, it cost me $70k. Each side rents for $800 and the tenants pay their own utilities. It is getting harder as now there are a lot more people investing. I won’t overpay for a property and if the numbers aren’t fantastic I don’t invest I also invest in the stock market but not for cash flow. I’m too far away from retirement for that to be my focus. I think there are parking spaces in Chicago you can get for about 70k! Lol! It’s crazy to me how expensive some markets are!
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Tiny
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Post by Tiny on May 22, 2019 10:38:07 GMT -5
For me, investment property is the no-brainer choice. But I also live in an area with Inexpensive houses and decent rents. I bought my first 2 unit just four years ago. All in, it cost me $70k. Each side rents for $800 and the tenants pay their own utilities. It is getting harder as now there are a lot more people investing. I won’t overpay for a property and if the numbers aren’t fantastic I don’t invest I also invest in the stock market but not for cash flow. I’m too far away from retirement for that to be my focus. I think there are parking spaces in Chicago you can get for about 70k! LOL! I was just going to suggest that maybe buying a parking space and renting it out would be a better option. I'm sure there's plenty of cities where you can purchase parking spaces and then rent them out.
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MN-Investor
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Post by MN-Investor on May 22, 2019 11:43:29 GMT -5
My husband and I both agreed that we didn't have the proper temperament to invest in rental properties. Fortunately, my DH got us investing in stocks long ago so that we built a portfolio that will provide me (DH passed away last year) with sufficient interest and dividends to continue with my present lifestyle. I don't know that everyone can live off income from their investments. I think that a lot of retirement plans include gradually selling off stocks and bonds as you need more cash, hopefully selling the last stocks to pay for your funeral.
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raeoflyte
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Post by raeoflyte on May 22, 2019 12:46:08 GMT -5
I think there are parking spaces in Chicago you can get for about 70k! Lol! It’s crazy to me how expensive some markets are! Yep, ours aren't as high as Chicago, but 2 units can easily be $500k here. Even if it cash flows well that is just too much money for me to feel comfortable with.
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Deleted
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Post by Deleted on May 22, 2019 16:22:15 GMT -5
One other thought about Orlando- you're in Hurricane Country. Even if you buy a newer building that's better-built to withstand them, your insurance is only going to increase, likely faster than the rate of inflation.
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phil5185
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Post by phil5185 on May 22, 2019 22:37:41 GMT -5
"""After my first thread about investment rental property I thought the only other way for additional income streams would be dividend stocks."""
We've been retired just over 20 years - we use mostly growth stocks. We sell a block about every 6 months and use it to replenish our checking accounts.
We had rental houses for 35 years - whenever one of them got nearly paid-down we refinanced it with a new 30-yr-loan. And invested the money in stocks. The houses made good money over that 35-yr period - and they appreciated very well. But the money that we periodically removed from houses and invested in stocks grew much larger. And it continues to grow. That's an important factor, years after we retired and sold the houses the stocks still grow and provide plenty of extra income. So you might be on the right track with stock - but take a look at growth stocks - such as an SP500 Index fund.
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ilovedolphins
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Post by ilovedolphins on May 24, 2019 0:32:49 GMT -5
"""After my first thread about investment rental property I thought the only other way for additional income streams would be dividend stocks."""
We've been retired just over 20 years - we use mostly growth stocks. We sell a block about every 6 months and use it to replenish our checking accounts.
We had rental houses for 35 years - whenever one of them got nearly paid-down we refinanced it with a new 30-yr-loan. And invested the money in stocks. The houses made good money over that 35-yr period - and they appreciated very well. But the money that we periodically removed from houses and invested in stocks grew much larger. And it continues to grow. That's an important factor, years after we retired and sold the houses the stocks still grow and provide plenty of extra income. So you might be on the right track with stock - but take a look at growth stocks - such as an SP500 Index fund.
The sp500 index funds I have researched are around $285 a share. If I can only save about $700 a month and buy into them each month would my purchase fees be worth it or would I wait until I had more in invest?
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resolution
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Post by resolution on May 24, 2019 6:27:17 GMT -5
You can open a Vanguard brokerage account and buy mutual funds in any fractional increment without fees, but in most cases you need $3000 to initially buy into a fund. So if you wanted VTSAX (total market index) you would need the $3000 to start and then after that you can buy monthly in any amount without commissions or other charges.
If you went with Vanguard's exchange traded fund for the total market index (called VTI) you wouldn't need the $3000 minimum but you would just need the price of one share to start, which are running around $145 per share. You would need to agree to electronic statements to avoid a $20 annual fee. I just do their mutual funds because I set it up before ETFs were available, but the ETFs are now slightly cheaper.
I believe that Fidelity has gotten rid of most of their minimums, and they also have some zero fee funds. So you could open a Fidelity brokerage account and invest there without having to get the $3000 together. However you have to be careful to look at expenses because they have a lot of super cheap or free funds, but they also have a lot of expensive and overpriced ones. But if you are careful they will probably end up cheaper than Vanguard.
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Deleted
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Post by Deleted on May 24, 2019 17:33:39 GMT -5
"""After my first thread about investment rental property I thought the only other way for additional income streams would be dividend stocks."""
We've been retired just over 20 years - we use mostly growth stocks. We sell a block about every 6 months and use it to replenish our checking accounts.
We had rental houses for 35 years - whenever one of them got nearly paid-down we refinanced it with a new 30-yr-loan. And invested the money in stocks. The houses made good money over that 35-yr period - and they appreciated very well. But the money that we periodically removed from houses and invested in stocks grew much larger. And it continues to grow. That's an important factor, years after we retired and sold the houses the stocks still grow and provide plenty of extra income. So you might be on the right track with stock - but take a look at growth stocks - such as an SP500 Index fund.
The sp500 index funds I have researched are around $285 a share. If I can only save about $700 a month and buy into them each month would my purchase fees be worth it or would I wait until I had more in invest? I invest $100/month in an S&P 500 for my youngest. You don't have to buy full shares you just have meet the minimum investment amount for the fund.
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countrygirl2
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Post by countrygirl2 on May 24, 2019 18:03:48 GMT -5
I would love to have dividend earning stocks. I do have a little one, years ago I put $1200 in Walmart stock, reinvested the dividends and its now worth $20k, but would have to have a ton of shares to get enough money off to live on. Yes, I would much prefer having dividends, way easier to deal with then rentals.
Same with I bonds, invested $60k now up to $120k. To get that money out, have to cash them in, but they are earning an average of 5% now and some 6, but that could go way down again too. But just letting them ride. They start maturing in 2030 I think.
We do have money in Vanguard, a good fund, we still have more in it then when we started taking RMD's but this coming year, likely recover 3/4's of withdrawals in the future, also a Principal fund and that one is doing well but not much money in it. The CD's are slowly coming up. But we make more off the rentals then from the others and that's ok too. That will gross $46 a year, forgot about the farm income in the coming years. We are fortunate to live in an area where you can buy a house for $35k, well you could, not seeing any for now. Another downturn and we will. I would have to run figures but I think we are getting 10 to 15% return on our investment in rentals. We are doing ok.
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Artemis Windsong
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Post by Artemis Windsong on May 24, 2019 18:12:05 GMT -5
My life goal was to have enough investments to cover my living expenses. We made it. There were some serious problems along the way. My H provided the most income for investments. H. had a taste for many expensive vacations (and some other money pits) a year, or we would have a lot more invested.
Right now we have social security income which relieved me of anxiety. We have had investments that provide a quarterly income that is used mostly for large household expenses like insurance and taxes. Insurance is half of our expenses. I was forced to take distributions from an IRA and a former employer retirement plan. I bought a new electric range. Paid for it myself since you know who was waiting for a used one to come up all the while working on the old one. I had an inkling to sell out of some REITS. I should have sold them all as I got a reverse split charge on one I'd had for years. My bad for not paying attention.
The distributions, I invested in some high dividend return stocks, drip. I also bought a marijuana stock. It has no dividend but is buying some vertical businesses. I have some money that I can invest when I see something I'd like to have. Half of the dividend income will go to taxes. We talked about having rentals. A lot of our friends do. They also have some horror stories. My cousin flipped houses in the 90s which worked great for her. A lot of sweat equity.
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dannylion
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Post by dannylion on May 24, 2019 18:16:48 GMT -5
"""After my first thread about investment rental property I thought the only other way for additional income streams would be dividend stocks."""
We've been retired just over 20 years - we use mostly growth stocks. We sell a block about every 6 months and use it to replenish our checking accounts.
We had rental houses for 35 years - whenever one of them got nearly paid-down we refinanced it with a new 30-yr-loan. And invested the money in stocks. The houses made good money over that 35-yr period - and they appreciated very well. But the money that we periodically removed from houses and invested in stocks grew much larger. And it continues to grow. That's an important factor, years after we retired and sold the houses the stocks still grow and provide plenty of extra income. So you might be on the right track with stock - but take a look at growth stocks - such as an SP500 Index fund.
The sp500 index funds I have researched are around $285 a share. If I can only save about $700 a month and buy into them each month would my purchase fees be worth it or would I wait until I had more in invest? If you are buying funds from the fund's brokerage (or through the online brokerage), there are generally no brokerage/purchase fees associated with the purchase, only the fees associated with each individual fund (based on the value of your holdings), which are calculated on an annual basis. For example, I have Vanguard funds and ETFs. If I add to one of my Vanguard mutual funds, I put a specific amount of money into the fund (with no purchase/brokerage fees because I'm investing via the online Vanguard brokerage). If I want to add to one of my Vanguard ETFs, the amount I invest depends on the share price of the fund I'm investing in (again, no purchase fees). If I only buy 1 share, I only pay the cost of 1 share, no other charges. I have some Schwab ETFs, too, which I purchase through the Schwab online brokerage, and there are no fees for purchasing their ETFs.
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countrygirl2
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Post by countrygirl2 on May 24, 2019 18:25:42 GMT -5
I don't know whether I'm that good of a judge of people or its just sheer luck, but 20 years of no disasters in rentals. But I'm sure my day is coming.
We don't mind them and so far we have good ones, they pay early for the most part or on time. We are getting market value or close to it in all of them now. We have one soon as hubs gets done with this one we are putting in a new laminate floor, its not the best, we got her a new w/d and he fixes anything, we have very happy renters. Right now only 1 other needs anything done and the rent on it is to low. It's the only one his dad had, we are getting ready to raise the rent $25 a month, it has not been raised in years and even at that rate its likely $125 a month under market. I'm sure the guy will squeal, but we put in a new furnace and AC couple years ago I was going to raise it then and for some reason we didn't, my bad. But everything keeps raising. If the guy would get mad and move, that's fine, it needs cosmetics and we can rent it for $150 a month more. He was wanting to buy it so we offered it to him last year. Oh he had a bankruptcy he was working through and couldn't, so why say anything??
If we get a downturn we would like to pick up 2 more, 10 is the ideal for additional income, that's what we had in Texas.
Hubs is thinking start selling them off 1 a year when we reach age 80. I figure that depends on our mental and physical condition. That's only 7 more years.
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