Wanting to take the plunge in Miami, Florida.

[Darla Powell]

Hello all,

I am a police officer in Miami Florida and I grow weary. I am considering taking an early retirement ( 16 years of service) and rolling over my retirement into a self directed IRA to invest in RE. I have been lurking and reading but have yet to take action.

To be honest, I'm terrified of leaving such a secure job ( which I loathe but make good money ) to pursue something I love and to be my own boss. Bonus though, I have no personal debt and even own my primary residence outright. Double bonus, I have a partner who is on board. Do I take the leap of faith or am I a damn fool?

[DL Martin]

Hi Darla;

Enough of this talk of quitting your job. Not yet.

Your government job provides a steady, dependable paycheck that lenders will love. Combine that with excellent credit and little debt, and the combination is unstoppable.

I "get" that you are "over it." But I would urge you to get your "RE Machine" up and running before you pull the pin.

You haven't mentioned specifically what it is about your job that makes it almost "undoable" anymore. I am curious what assignment you are currently working but for purposes of this conversation, lets assume that you are working patrol...

So why would I say that you should continue to work awhile longer?

Here is why. I would argue that a police officer, working patrol, has the opportunity to meet and engage more people than any other profession/line of work in existence.

With regard to "the good people out there", and making real estate contacts, police officers ALWAYS get the benefit of the doubt and people WANT to help you. It's like some weird cosmic force. True, the bad people hate you. But the good people like you. I mean, REALLY like you.

You find a distressed owner (while on patrol) and through your conversation with him, find out that his loser 40 year old kids moved into his home five years ago, his life is miserable and now he "just wants out." You check title on the house and find that he is the owner and other than the original mortgage, there are not other liens on the house. You re-contact the owner (off duty, in a non-official capacity or have a partner do this for you) and you buy the house.

It needs Stucco/cabinetry/drywall/paint/flooring etc.

You are on patrol and you see a painter walking across the Burger King parking lot. He sees the police car and smiles and waves. You smile and wave back and then drive over to him. You start a friendly conversation, complimenting him on the cleanliness of his truck and contents and also truthfully state that you have very much respect for people who work in the trades, especially modern day craftsmen who take pride in their work. One thing leads to another and before you know it you are telling him about your project. A mutual respect is formed and you make an appointment with him to bid your project. Before you know it, you have a painter. And then a flooring guy. And then a stucco guy. and on and on and on.

Whether you know it or not, after 16 years in LE, you have a tremendous advantage with regard to "reading people." Your 16 years of training and experience in LE will directly positively impact your ability to work in real estate. Here on BP, you will hear again and again that real estate is a people business. Well, LE is also a people business. The ability to obtain voluntary compliance is a skill. The ability to negotiate, to compromise, to LISTEN are all skills. The ability to know exactly when to stop negotiating and draw a hard line is also a skill. Should you enter the "buy and hold" game, these skills will be very valuable with regard to tenant selection/retention/elimination.

In conclusion, I would love for one of the BP financial planners to chime in with regard to the true value of your defined benefit pension and the increase in that pension's value for each added year that you continue to work. Please don't dismiss this important segment of your long term financial plan.

take care,
DL