# 30 yr old, non-typical situation



## CA14 (Oct 21, 2013)

Hello everyone. I've been a long time lurker and have had this website in the daily rotation for quite some time. First, let me say thank you to all the active forum members who share such valuable information and opinions. I have learned a great deal from the passionate folks on the forums, blogs, websites, and they have helped me stay on track and reach long ago set goals.

Here is my financial/life situation, as well as a few questions regarding the next few years.

I recently turned 30 years old. Originally from a medium size Ontario city, I have lived abroad the last 11 years, 5 of the last have been as a non-resident. I play hockey professionally in Europe and spend my summers (3-4 months) in Canada. 
I have been fortunate to have had a rather high salary ~180K CAD Net the last 5 years. While I definitely enjoy a nice lifestyle, I have been saving at least 60-70% of my salary each year since I graduated. First season, a hard earned $4500, and an increasing amount since. 
I hope to play for another couple years at least, and hopefully at a similar salary. As well, I am getting married next year. We have saved what we budget will be needed (+20%) to pay for the wedding. Surely all being spent within the year, I have not included this 'Wedding Fund' in my assets. We rent overseas, both car and apartment.
My fiancee is an engineer, and prospects of finding a well paid job in Canada are strong.

All figures in CAD
Assets: 
Non-registered account (held abroad)
(Diversified index funds, low cost, predominately USD): $725,000
Savings account : $18,000
CAN Rental Property 1 (1/2 share): $65,000
CAN Rental Property 2 (1/2 Share): $45,000
CAN Rental Property 3 (1/2 share): $125, 000
Vehicles/ Toys: $65,000

Total Assets: $1,043,000

Liabilities:
Rental Prop Mortgage 1 (1/2 share): $40,000
Rental Prop Mortgage 2 (1/2 share): $25,000
Rental Prop Mortgage 3 (1/2 share): $73,000
C.C debt: 0
HELOC: 0
Student debt: 0

Total Liabilities: $138,000

Rental Properties are cash flowing positive, 2 of which on 10yr amortization, larger one with 21 yrs left. Wife-to-be is a diligent saver, more frugal, and rather uninterested in the finer points of personal finance. She has substantial savings, which are equally offset by outstanding student loans. We will both be eligible for this countries equivalent of CPP, and the program is very well funded. Rough estimates are $1600 a month combined from 65 on. I see this as icing on the cake and do not count it in.

A move back to Canada is the general idea in the 3-5 year range. While likely we could move into one of the rentals, we have thoughts of purchasing a 3bd+2bth townhouse or condo, living in it, and renovating while we decide what to do career wise. Once careers are on track, renovations complete, we have talked about building a house for the long haul.

I guess my questions are straight forward. *1) *What portion of our savings should we consider being accessible to use for a new house? Conservatively estimating we would have 1.1 million in Non-registered savings. * 2) * If building, would you mortgage even though savings could pay for it outright? Consider tapping equity in rental properties?
*3) *What portfolio net worth would be a good goal to set, for say 10 years from now. *4)* Owning a house outright, how would you put the remaining investable assets to work?
*5) *Should we consider allocating a large sum towards purchasing 3-4 more rentals? 

I appreciate any and all feedback. 
Cheers for now!
Skål!
CA


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## Charlie (May 20, 2011)

I think there are far too many variables at play for anyone to give you meaningful advice at this point.

Your house budget will depend where you live and the type of home you want. Which will depend on your job prospects, you wife's and personal choice. Maybe consider renting until those things are settled. Your reno and flip plan may work out if you're good at that. Otherwise, maybe not. 

Rental property/investment mix again will depend more on you and opportunities at the time then a general rule from us. Many here are real bears on RE -- others not so much.

Same with the degree of leverage you take (paying outright vs mortgage etc). There'll be a few tricks before you buy to make your interest tax deductible (regardless of the collateral pledged) but whether you want the relative security and flexibility of a mortgage free home, or more investments at work is not something we can answer for you. And likely something you won't know until you figure out your future.

You've done very well so far. I think you should just continue with what you're doing, continue accumulating what you can, and keep your options open for the future. Congrats! Good to see you can have a decent career outside the North American leagues!


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## the-royal-mail (Dec 11, 2009)

Nothing much we can say. Comparing your assets to liabilities indicate you are way ahead of the curve. Don't blow all your money and keep some in cash. I would also say you shouldn't get any more RE but at this point it doesn't look to me like you need any advice. Good luck, congrats, enjoy life and live it up!


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## Four Pillars (Apr 5, 2009)

I've this about other posters before, but you should be giving us advice - not the other way around. Kudos on an incredible savings plan.

What Charlie said makes perfect sense - just keep going and you'll figure it out as you go. Too many unknowns at this point.

$180k is pretty good - I shouldn't have quit organized hockey when I was six!


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## MoreMiles (Apr 20, 2011)

Are you a professional hockey player? Correct me if I am wrong, isn't the career span very short? Most professional athletes retire in their 30's, if they are not lucky enough to switch to other careers later in life. If you put all your savings into your principal residence, some people don't count that as part of the net worth. You will end up with a "house poor" situation.

But if you take out a mortgage, even at 3.5% per year rate, where are you going to find a guaranteed after-tax of return rate? Even the best GIC gives 3% before taxes these days. You have to think about those.

$180k is pretty good, but how many more years do you get to earn that level? You need to sit down and plan for it.


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## Pigzfly (Dec 2, 2010)

I'm curious where you managed to find cash flow positive rentals on 10 year amortizations. (Obviously that's likely a trade secret you're not willing to divulge ;-))

We will be in the same boat as you in a few years, though not with nearly as much free cash, trying to decide what size of a mortgage, if any, to take out for a new house. I was hoping more folks would chime in with some thoughts on that one.

I do not know the answers at all, but I would start talking to some tax folks who can set you up with the best possible asset allocation to minimize your burden for moving back. That may give you some direction regarding your fourth question about additional rentals, or some other investments.

Do you have a career plan for post-hockey yet? I think that will drive your net worth targets and shape how you want that portfolio to look. Such as, do you want to live off of passive income? In which case, your target will be in dividends and property income, etc, instead of capital appreciation to $X Million.

More questions than answers from me, sorry!


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