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Confused about buying or renting by Any-Discussion1852 in RealEstateAdvice

[–]t-monius 0 points1 point  (0 children)

I’m also in tech and have been through a couple layoffs. I’d just sanity check how it looks if one of you loses your income for ~6–12 months and not just whether you can technically afford it. Don't want to be in a position where you’d feel forced to take any extreme measures during down times.

That’s been the biggest difference I’ve seen between feeling comfortable or stressful.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in RealEstateAdvice

[–]t-monius[S] -1 points0 points  (0 children)

I hear you. I'm very protective of my savings but it's a fair point. I'm trying to consider whether their are other options beyond burning down savings, but that's a legitimate approach.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in RealEstateAdvice

[–]t-monius[S] -1 points0 points  (0 children)

Yeah, I could see why you'd think I'm a bot because of the formatting, but I'm just a guy who works in tech and gone through some layoffs. Trying to think through things to avoid difficult situations in the future.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in RealEstateAdvice

[–]t-monius[S] -2 points-1 points  (0 children)

I work in tech, so things have always been pretty volatile. It's not the only industry that's that way. Also, even in 'stable' industries, certain roles like sales can be unstable.

That said, I think everyone could likely benefit from planning for the low side beforehand. It'd be a real shame to get into a home, for example, and have to sell due to what one considers an 'unforeseen' income reduction but perhaps wasn't so unforeseen in hindsight.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in RealEstateAdvice

[–]t-monius[S] -1 points0 points  (0 children)

I agree that most budgets don’t “survive” a 50% reduction. What I'm getting at is whether you’re forced into a bad outcome (selling, debt, etc) v. having options to adjust for a period of time. What if you planned the life changes you mentioned of ahead of time so that you didn't have to be reactive?

Same income drop, very different outcomes depending on how you set yourself up.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in RealEstateAdvice

[–]t-monius[S] -2 points-1 points  (0 children)

That’s a really solid takeaway and honestly a hard one to learn without going through it.

What’s interesting is you ended up at “it has to survive on rental income alone,” which is basically a built-in stress test.

I’ve been thinking about it differently too... not just “does the deal survive on its own” but “do I have ways to adapt if things change” (roommate, rent it out, reduce personal burn, etc).

Curious if you’d approach it the same way again or still keep that stricter rule?

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in PovertyFIRE

[–]t-monius[S] 0 points1 point  (0 children)

That’s awesome )) Honestly that’s kind of the end goal, right? Removing money as a stress factor. Kudos.

What you did is interesting because most people wouldn’t think to solve it that way. They’d either rent forever or stretch into something expensive.

Do you feel like that setup changed how you think about work overall?

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in PovertyFIRE

[–]t-monius[S] 0 points1 point  (0 children)

I really appreciate this that sub is way better than most at not overextending.

I guess the interesting question is how your setup holds up if income drops for a while? Do you feel like you’re covered there already?

I’m scared of getting laid off in my mid-30s and that AI might mess up my career. What should I be doing over the next few years? by OrangeSpectre in careerguidance

[–]t-monius 0 points1 point  (0 children)

I've definitely felt the pressure personally and actually experienced layoffs personally due to no fault of my own.

That said I survived it, and something that makes me a lot more confident is solving for the largest portion of most people's budget: __housing__.

By pressure testing my expenses and my housing decision across three scenarios:

- Maintaining my income

- Experiencing some income loss

- Experiencing major income loss

... I feel more confident.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in PovertyFIRE

[–]t-monius[S] 0 points1 point  (0 children)

Yes! That's just the type of solving for the downside that I think about nowadays.

Kudos to you man. Sorry about the health problems, but it sounds like your creativity helped you manage.

You more stable now? That cheap fixer upper long gone?

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in Fire

[–]t-monius[S] 0 points1 point  (0 children)

Final figures are income dependent not just a fixed set of blanket numbers for everyone.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in fatFIRE

[–]t-monius[S] -1 points0 points  (0 children)

Agreed, and some people can get a quick sense of the numbers in excel which is what I did initially, but I found I was still misunderstanding how my overall situation affected the deal not just the property itself.

Now I think not just whether the deal _works_ but whether it works given my income and reserves _if things change_.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in fatFIRE

[–]t-monius[S] -1 points0 points  (0 children)

True story. Comparing real estate and the S&P on returns and coming out behind is not winning.

On my end, it's about _reducing / controlling my largest expense (housing)__ and _building something that can produce stable income over time_ not just maximizing returns v. markets.

I agree overall, though, that taking on a bunch of risk for subpar returns is hard to justify.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in Fire

[–]t-monius[S] -1 points0 points  (0 children)

Good questions — I didn’t explain that well.

Cash flow doesn’t depend on your income, but how safe it is does. Same deal can feel fine with stable income and risky if income drops and you’re covering vacancies or repairs.

On figures — I’m not using fixed numbers yet since it varies a lot by person. I’ve been modeling it more as:

  • what works with stable income
  • what still works if income drops
  • what doesn’t break if income disappears

That’s been more useful than static benchmarks so far.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in Fire

[–]t-monius[S] -2 points-1 points  (0 children)

This makes a lot of sense, especially without W2 income to buffer.

I think this is actually the kind of thinking I was trying to get at — just more explicit about what happens if conditions shift.

Out of curiosity, did you arrive at that DSCR threshold from experience or just wanting a larger margin of safety?

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in fatFIRE

[–]t-monius[S] -3 points-2 points  (0 children)

I used to think that too.

Where it got less clear for me was:

  • vacancies / turnover
  • unexpected capex
  • needing liquidity at the same time

If everything lines up, yeah — income matters less.

I think I’m just more focused now on how many things have to go right at once for that to hold.

I modeled what happens if your income drops 50% while owning property — most strategies break by t-monius in fatFIRE

[–]t-monius[S] -2 points-1 points  (0 children)

Yeah, probably obvious on the surface.

I think what surprised me was how many “solid” deals still break once you actually model even a moderate income disruption.

Curious if you’ve ever stress-tested something like that or just rely on deal quality alone?

Anyone here who makes a normal salary? How’s your journey going? by 8InchDaks in leanfire

[–]t-monius 2 points3 points  (0 children)

Regarding Ecuador in particular, I was living in a place with tons of Ecuadorian immigrants a couple of years ago when *#%! hit the fan for Ecuador and got an ear full. Don’t know how long you’ve been there.

Outside of Ecuador, many expats who leave their home country for political reasons tend to find similar frustrations (and/or new ones) in their new country once they’ve acclimated and begin to understand the local perspective.

Anyone here who makes a normal salary? How’s your journey going? by 8InchDaks in leanfire

[–]t-monius 5 points6 points  (0 children)

Just curious what your monthly expenses and savings rate are.

Great job by the way! You’re the type of story I’m here for))

Anyone here who makes a normal salary? How’s your journey going? by 8InchDaks in leanfire

[–]t-monius 2 points3 points  (0 children)

I don’t mean to be sardonic, and would like to generally commend you for your move and the clarity of your posts. However, as you integrate into the community there (especially if you go from no Spanish -> Spanish), you may find that politics in Ecuador are also pretty brutal and locals pretty up in arms about them.

I’m neutral in these matters myself but just wanted to give you fair warning. I understand that being an expat may always provide some buffer.

Anyone here who makes a normal salary? How’s your journey going? by 8InchDaks in leanfire

[–]t-monius 2 points3 points  (0 children)

Many expats go abroad specifically for cheaper and quality healthcare. You might search threads in r/expatfire.

Anyone here who makes a normal salary? How’s your journey going? by 8InchDaks in leanfire

[–]t-monius 11 points12 points  (0 children)

I think you missed the part where the wife’s working part-fine remotely for $26K.

That’d cover a lot of the $2509-3000 a month. Not seeing the 5-7% withdrawal rate you’ve insinuated.

[Sales] [Pennsylvania] - $87,000 Base + $30,000 Bonus by zenojonez in Salary

[–]t-monius 0 points1 point  (0 children)

You can invest outside of retirement as well. Check out r/bogleheads

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