Retiring With Investment Property – How It Is A Good Choice!

iStock_000014064608_SmallWith the volatility of the stock market and other saving avenues requiring you to become a complete miser – both before and after retirement – what other option do you have left to plan an early retirement? It is both understandable and important that you should consider your finances and sit with your financial investor when planning your retirement. However, consider investment property as a means for early retirement!

How Is Investment Property A Good Option To Retire On?

Consider investing in the stock market. If you are good to go with $40,000 as your retirement salary, that would mean having saved $1 million and investing it appropriately. However, that would only work when you find the stock market appreciating at an average of 8%. That does not seem so likely. In a matter of years, the market is seen rising and falling at 50%.

Owning property allows you to profit up to $250,000 from it upon selling, provided you have lived in the house for two of past five years. That means you will pay 0% tax on capital gains. Investing in real estate allows you to nest a constant income stream for yourself in the later years. Not only can you own a property, which can sell at a profit, but you can also rent it and enjoy a monthly income stream from it.

How Can You Buy A Second Home?

HELOC

If you own a property, you can buy another easily through a home equity line of credit. It is a second loan after your mortgage, which you can take out. This second loan, which you take out, can be used as you please. This loan has a fixed interest rate and time period. You can withdraw loan money as you please through a debit or credit card.

401(k)

You can also withdraw money from your 401(k) to purchase a second home. You can borrow up to half of the accounts vested balance or $50,000 – whichever is less to make the down payment on the property you are planning to purchase. Generally, a 401(k) loan has no credit checks and usually features low interest rates.

 

Translate »