I don't usually post on Sundays but if I don't get this out, I'll be fine tuning the thing until I give myself a headache.
What I've been working on is a calculation of how much we spend each year. It sounded simple until I got started. You would think that with my spreadsheet, it would be easy but it wasn't quite the walk in the park--considering this is THE number you need as a jump off point for retirement planning!
I have a ballpark figure in my head but have never bothered to actually tally up how much I spend on clothing each yr, the other "smaller" things etc. So that bugged me.
Finally, here is what I came up with.
To Fund our Life as we are currently living -- $ 64868 / Yr
(3 properties, 2 trips skiing, 1 trip to France, 2 cars, work expenses, entertainment, eating out, lessons, utilities, food, extra income tax etc.)
To Fund our Life with no mortgages -- $ 45428 / Yr
(we have accelerated mortgage payments and plan to have the smaller one completed in 4 yrs and the larger one done in max. 6 yrs)
To Fund our Life with no more work -- $ 38866 / Yr
(our work involves paying parking, association and licencing fees as well as liability insurance --all of which will be a non issue at this stage of our life -- we will likely save on clothing as well)
In reality, I'll likely continue working 2 days a week because I enjoy it -- which will mean that we would not be needing to draw on any savings to fund our "retirement".
My current guideline had forecast a retirement "income" of $ 45000 / year. So we are not off by too much. We will likely build in a larger margin.
None of our retirement savings goals (more in future post) requires us to sell any of our properties. I want that to be decided if and when we no longer wish to use them, not because they are part of our money pool.
We have been fortunate that the cottage has almost doubled in market value (even in the current slowdown -- we bought it for a tremendous deal...) and this would be the property that would be chosen first to sell as it will likely be the easiest and quickest to sell.
As you, my readers know, I have a huge love for real estate. My personal philosophy of property purpose is one of life enhancement. I am not in it to flip. Ours are homes that are well used and allows us to live uniquely due to its location and living environment.
That is why they have never been rented out. That is also why I don't worry about how the real estate markets are doing because I do not plan to sell for a long long time. At this point, the only useful info I gather is with respect to where else would be a great place to buy!