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Author: mrparrotfez Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75339  
Subject: Re: Now 20, starting to think about retirment Date: 8/13/2007 2:50 AM
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I don't know jack about real estate, so any suggestions I would make are worthless. But I know jack about rates of return and the principle of compound interest, and if you are twenty and considering this, my hat's off to you. I wish I'd done the same. You'll retire affluent if you have any sense at all and the country doesn't go all to hades. I'll be dead by then, but in spirit I'll be toasting your wisdom and forethought.

I would endorse diversification. If real estate is your primary focus, I'd also touch on the securities markets in some way just to have some money in something else that's likely to be productive. You mentioned some of your money will go into investing; smart of you. Short answer: if you want to manage actively, dare to pick your own funds and stocks. If you want fire-and-forget, buy index funds and take your 11% and be happy. You will obviously be taking advantage of a Roth.

What is more, you will save a lot of money if you can do most of the work yourself. Ever considered taking some community college classes in plumbing/electric/drywall/HVAC/roofing/locksmithing? Those could save you a bundle.

Also, I don't know if your community has it, but my local cops teach a seminar every six months for landlords on how to crime-proof your properties. You can't eliminate crime, but you can make your properties a harder target so that someone else has to deal with the crime. If your local police have such a class, I would suggest it. In my case, the result of the class was that it basically talked me out of owning rental property--but it educated me well. Plus, I got to meet the local police chiefs and be on a friendly basis with them. No small thing.

Good hunting. I hope you retire fricking rich as Croesus and that when you're my age, your biggest headache is how to hit a good middle iron onto the green.
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