Thoughts on Retirement.............. (funds, pay, rent, taxes)

[PACKMAN1]

First time poster here.
Wanted to get your thoughts on our situation, and see what you fine folks think about our ability to retire comfortably.

We are 59 and 54 and ready to retire....
Our assets include:

paid off Rental: $575k generating 2600 a month in rent. 5k in taxes.
Paid off primary custom home. 3 years old: $1.2M
Rental property 2: $260k. $100k mortgage. 1400 monthly rent income.
170k in stocks/iras. no 401k.
175k in cash in the bank.


Our thoughts were to sell the primary. Buy a 500k smaller house. buy 2 additional rentals each generating 2k a month. (conservatively possible in our area)

what are your general thoughts and suggestions?
We are somewhat burnt out and don't want to work until our bodies are broken before we retire. we don't want to work for more than 1 or 2 more years max. we are self employed at about 100k and 125k a year respectively.

We are in Virginia.

[Escort Rider]

You chose to post this in the Personal Finance sub-forum of the Economics Forum, and there's nothing wrong with that. I just want to point out that there is a Retirement Forum on City-Data where such questions as yours are endlessly discussed and debated. Perhaps you would enjoy reading some of the similar threads in that forum in addition to the responses you receive here.

[Petunia 100]

What are your expenses? Impossible to have an opinion without knowing. You need to know the minimum amount you need to live on to cover basic living costs, as well as how much you need to support your current lifestyle.

[ncole1]

Originally Posted by PACKMAN1

First time poster here.
Wanted to get your thoughts on our situation, and see what you fine folks think about our ability to retire comfortably.

We are 59 and 54 and ready to retire....
Our assets include:

paid off Rental: $575k generating 2600 a month in rent. 5k in taxes.
Paid off primary custom home. 3 years old: $1.2M
Rental property 2: $260k. $100k mortgage. 1400 monthly rent income.
170k in stocks/iras. no 401k.
175k in cash in the bank.


Our thoughts were to sell the primary. Buy a 500k smaller house. buy 2 additional rentals each generating 2k a month. (conservatively possible in our area)

what are your general thoughts and suggestions?
We are somewhat burnt out and don't want to work until our bodies are broken before we retire. we don't want to work for more than 1 or 2 more years max. we are self employed at about 100k and 125k a year respectively.

We are in Virginia.

In my opinion (and it is just my opinion), you should not have so much real estate and so little stocks, especially with the Case-Shiller Index at a near-record high again (second ONLY to the Great Housing Bubble)*.

As to exactly what you should do, this will need to depend on what geographic areas you can consider moving to. This is a combination of both financial considerations (prices, property taxes, etc.) and non-financial considerations (proximity to family, climate preference, etc.)

If I were you, I would do this: Sell $1.2 M house, pay off the mortgage on rental #2 in full, buy $500k house to live in with cash, and invest the remaining $600k into mutual funds.

YMMV.

* Unless you enjoy (as a hobby) doing the real estate thing. If that is so, then go ahead and do it. The whole point is to enjoy your retirement.