Let’s start with a forward-looking question: What does your dream retirement look like?
My dream retirement would be a situation where I’m young and mobile enough to work — let’s say I continue teaching until around 50 — but that I wouldn’t have to. I would love to generate a gross pay of around $40,000 a year through investments while pursuing my own projects to make additional income if I need to. I also want to be able to travel. I have family all over the world, and my ideal would be to visit them whenever I like. It’s about having that financial freedom to live off my passive income, investments, or projects. In a sense, I assume I’ll be working for myself for the rest of my life, but not working for anyone else by the age of 50.
Would you say you’re on track to make that dream come true?
I have three properties — one is rented out, I own the second and am about to rent it out, and I’m closing and plan to live in a third one soon, which will be mortgaged. I also have a 401(k) with my job that I contribute 14% of my income to, a pension plan — which I’m not counting on being much in retirement — a Roth IRA that I try to max out yearly, and a Traditional IRA that I rolled over from my last teaching position. I also have a personal brokerage with a sizable amount in it. I’m doing the investing in that myself, keeping it to conservative options in established companies that pay dividends, which I then reinvest. That’s been paying off. I make about $100 per month on the dividends alone.
Still, I think I’m slightly behind schedule. In some ways I was spoiled because I bought my first couple of properties in 2008 when the market crashed, and I could afford them almost completely with cash. I was young when I bought them, and I didn’t understand how unique that was. I’m confident I’ll be able to pull off my goals, but I just feel slightly behind.
When you think about the steps you’ve taken so far, how much, if at all, did advice from other people factor into your decisions?
I’ve set up appointments with financial companies in the past for consulting and to figure out basic questions, but not for any ongoing financial advice. A lot of my experience with finances was because I’m curious. I pushed to teach personal finance because it’s become such a passion of mine. My dad was also a big saver who showed us how to save money. He was terrible at investing but great at saving. Since then, I’ve looked at ways to become financially secure, no matter what happens to my job.
What smart money moves do you think you’ve made? What would you change if you could?
I didn’t spend much the first decade and a half of my adult life. I was careful about saving as much as possible and reducing my costs. I have never paid more than $35 per month for a cell phone and I never will. I’ve never bought a new car, and I never will. Now, because I was able to achieve a lot of my goals of homeownership and investing early on, I don’t worry quite as much about money. I still don’t spend frivolously, but I have no problem spending on travel or going out to eat.
The thing I would change might be my hyper-focus on real estate so early on. I wasn’t aware of stocks and bonds in the market. If I could go back and change anything, I would have opened a Roth the moment I turned 18.
Research shows that people are living longer. Have you factored that into your plans at all?
I plan on living to 114 years old because I want to see the year 2100. I know that will likely mean that I have to keep working in some way. So, I’m trying to continuously learn new skills. My friend works in electrology, a hair removal method that’s in demand right now. I thought in the future I could go to night classes and get certified. I’ve started selling worksheets that I make to other teachers online. I flip furniture that I sell on Facebook Marketplace. My goal is to retire and keep pursuing fun things like that for extra cash. That’s why I love this country. Because I really do believe that it’s paved in gold.
And if all else fails, I can DoorDash.
