You CAN retire : Rooftop Views

Rooftop Views

You CAN retire

We get a weekly e-newsletter from the Motley Fool. For those of you not familiar, this is an organization who advises people on stock and bond investing.

In the last newsletter, they had a question from a couple who want to retire in 10 years - before their retirement plans would begin to pay off. Most of their assets are in real estate - two homes that are paid off plus a 401(k) that needs to be rolled into something and a savings account. Motley Fool advised they should either (a) sell both homes and move into something smaller (b) use one of the homes for rental income and (c) use a reverse mortgage to get income.

Remember the Motley Fool is advising on stocks and bonds - NOT real estate. What they could have advised is to sell one or both homes and invest in income producing real estate. With the amount they would have to invest, they can leverage into some pretty nice income property. Remember you can usually get into income property with 20% or so down. So a $300,000 nest egg can get you into a $1.5M property. That's a nice apartment building or small shopping center.

Then they can roll their 401(k) into a self-directed 401(k) which will let them invest in income producing property as well.

Don't think you need to depend on just stocks or bonds for retirement planning. Real estate has a proven track record returning more than stocks and bonds.

We are working on a new website devoted to just this topic which we hope to have up and running within the next 30 days or so. In the meantime, let us know if you have questions.