Real Estate Professional · Charleston, SC · Member since 2014 · 24 posts · 16 votes
This may seem like an unusual question for this community but I'm sure many of you have or are experiencing a similar situation. I have one parent who has retired and the other a few years away and are quickly finding out the "nest egg" isn't going to be nearly enough during their golden years. They are the perfect example of working hard all their lives, saving what they could, and hoping what they saved will carry them through (philosophy of the 'poor dad' if you will).
I have a few thoughts, but this is a savvy, intelligent forum of investors with a variety of specialty areas so I would love to hear some creative ideas of how they could generate some additional income throughout their retirement years. Not looking to create a real estate empire, just some cash flow to help them feel secure.
The biggest expense will be housing (well maybe not in the US where health care costs). Do they own their house or do they still owe a chunk of money or rent? The nice thing about owning your own home, and having it paid for, when you retire is that expense decreases a lot.
Do they have enough saved that they could take some of that money and invest it in a rental? Better yet, buy a duplex and live in half and rent out the other half? Or find a house with a legal basement suite and rent that out? I know some seniors who rent out part of their home, they still have their own space and are not renting rooms.
I know you know this, but the time to plan is before they get close to retirement age.
@Theresa Harris Thanks for some of the ideas! They actually rent a apt in a small 12 unit apartment building. They are personal friends of the apartment's owner so I even thought about helping them approach him to see if he'd be willing to sell and do seller financing. With a few improvements they could certainly raise the rents to market value and my step-dad could handle most of the maintenance and upgrades.
I like the duplex idea too. Less income but that would be way less work for them than a small apartment.
Totally agree with you about the planning. However I was in my early 40's before I finally woke up and got into RE investing. For them I think they just thought working and saving what they could would get them by. Sadly many people still fall into that line of thinking every day.
@Derek Epperson You are right in that it is a balance between income and work, but if the 12 unit apt has been well maintained, then it shouldn't be a lot of work. Just make sure they save enough for maintenance and repairs. My mom just gets her govt pension (in Canada that's about $1200-1500 a month). She bought a place and rents out the top floor and it works well.