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Do you want to retire from real estate with plenty in savings and some horizontal income streams to keep cash flowing? Anyone can do it, but many people fail to take the steps necessary to actually make it happen.
Even more wait too long to plan for retirement and wind up with far less than they need to live comfortably in their later years.
Don’t let this happen to you.
On a recent podcast with Pat Hiban, retired agent Tim Rhode shared several tips with real estate agents on planning for retirement.
If you take Rhode’s advice to heart, you’ll have no problem living comfortably after leaving the industry. Not only that, you’ll have the financial freedom needed to spend your time doing the things you love with the people you care about.
Read on for Rhode’s top three real estate retirement tips. To hear more information on retiring from real estate, including how to evaluate whether you’re on track, listen to the podcast below.
1. Live within your means
It sure would be nice to drive a fancy new car to work, but is it really necessary? Obviously not, but many agents seem to think so, especially once their commissions start to grow.
As you move up in the real estate world, don’t give into the temptation to spend. Live within your means, and save as much as possible. Instead of wasting money on expensive, unnecessary items, invest in real estate or other assets that will help you generate wealth.
2. Focus on financial defense
During the interview, Rhode shared one of his most powerful wealth-building secrets: he focuses on financial defense.
Most agents focus all of their time and energy playing offensively — trying to earn as much money as possible. Although there’s nothing wrong with earning more money, a higher income won’t do you any good if you can’t keep your expenses in check.
As your annual income increases, do what you can to minimize your expenses. Most agents can bring their expenses far lower than they realize. For instance, when Rhode was earning $500,000 annually as an agent, his combined personal and business spending hovered near $100,000.
3. Plan for retirement now
Rhode had something to say to young agents specifically. “When you’re in your 50s and 60s, you’ll either hug yourself or curse yourself for the financial choices you made in your 20s and 30s,” he said.
Don’t make the mistake of waiting to plan for retirement until you’re in your 40s — it might be too late. Rhode planned for retirement from an early age and managed to retire from real estate at 40. If you plan and take action toward retirement now, you’ll be able to enjoy an earlier, more secure retirement.
Interested in learning more about what it takes to retire from real estate? Listen to the complete podcast with Tim Rhode.
After that, remember to take action on Rhode’s talking points. Although learning what it takes to retire is important, that information won’t do you any good if you fail to put it to use in your day-to-day life.
Pat Hiban sold more than 7,000 homes over the course of his 25-year career in real estate. Now, he dedicates his time to helping others succeed as agents and investors. As host of the Real Estate Rockstars Podcast, Pat interviews real estate experts to explore what works in today’s markets. He also founded Rebus University, an online training platform for real estate agents and sales professionals.