Beginning Investing in 6-7 years; input on my goals?

[Aaron W.]

Hello all!

My wife and I have been discussing Investment property for a couple of years now and we have finally reached an agreement on how to invest/retire (Rental Property).  I would really like some input from you experienced investors out there!

With our current jobs, we aren't rich by any means, but we are doing better than most in our area. Our income is over 2x the median in our area, so we plan to take advantage of that with our aggressive funding goals.

We purchased our first home about 3 years ago and this home is one that we will retire in, so using our home as investment property is not an option.  We looked for years before finding the perfect home as we didn't want to settle.  We plan to have this property completely paid off in 5-6 years.  Once that is done, we will begin aggressively saving in order to fund our first investment property.

The current plan is to fund our investments by our regular jobs and never purchase a property that we can't fund at least 50%.  This way, we can benefit from lower monthly payments which will translate to more funding each month to the next property.

We came up with these numbers simply due to the MLS listings and conditions of homes that are for sale at (or 10% below) twice the amount we can save each year. By this process, we can purchase homes that are in good shape and that don't need major repairs since we are both very busy 40+ hours a week professionals.

We will repeat this process for several years and once we hit a milestone of substituting our income at 70% occupancy rate, we will stop personally funding and retire from the workforce.  If we stay true to our funding, then this would be a significant net-income pay increase for us once we decide to retire.

So, yes; this is an ambitious plan and there is a ton of more info to learn, but we have a couple of years to learn what we need before we go in swinging.

Does my plan reek of inexperience?  Do you see flaws in our planning?  At this point, it just an imaginary numbers game and those plans may change once we begin investing, but this is realized.  That is why I am reaching out for some advice.  We want to learn more so we are better informed.  Neither of us want to go in this blindly or ill-prepared.  We've got our goals and are actively working towards them, so this isn't some dream where we are just sitting around and waiting for it to materialize.