Start at 45, Retire at 55: The Late Starter's Rental Playbook

**Dave Meyer** (0:00)
If you're in your 40s or even your 50s, thinking it's too late for you to build a comfortable retirement, think again. Today, I'm gonna show you a strategy that could cement you a comfortable retirement in just around 10 years. It's not sexy and it won't get you rich quick, but it works. In this episode, I'll show how the average American can replace a comfortable portion of their income, if not all of their income, with rental properties faster than you probably think. All you have to do is follow the steps and let the system work. If you can do that, you'll not only have passive income to support you in retirement, but you'll have a sizable chunk of equity, somewhere around $2 million in just the next 10 years. That sounds a heck of a lot better than relying on a Social Security check, right? This is how you start at 45 and retire by 55 with rental property.
Welcome to the Bigger Pockets Podcast, I'm Dave Meyer. Today, we're talking about how to get started, even if you're not fresh out of college and willing to hustle at all costs to build your wealth. Because real estate really does work for people at any age. I know that people on social media, the ones that you see talking about rental properties and how much money that they're making are often very young. But that does not mean that you cannot get started a little bit later in life. And as I'm going to show you in this episode, in just the next 10 to 15 years, you can build a financial future to be excited about.
And the good thing is, there are actually some advantages to starting a little bit later in your career. First and foremost, maybe you own a home and you have some equity in it. That means you could be sitting on tens of thousands or even hundreds of thousands of dollars in equity that you can tap and put into your first rental property or maybe even more.
The second advantage of being a little bit older is your retirement accounts. If you've been investing in your retirement accounts through an IRA or 401K, hopefully with a match, you may be well ahead of the average American and you can actually tap some of those funds to buy rental properties.
The third advantage of starting a little bit later is higher income. It is no secret that people a little bit later in their career earn more money. In fact, if you look at some of the data according to Smart Asset, folks who are 25 to 34 years old, their median salary is just under $60,000.
But for people who are 45 to 55, the median salary is almost $72,000.
And this can make a really meaningful difference in building your portfolio. You're going to be able to buy sooner. You'll be able to buy more sooner as well. And that advantage can compound over the next 10 to 15 years.
The fourth advantage of being a little bit later in life when you're starting, no offense to any 20 or 30 year olds, but older folks tend to be a little bit more mature.
Not all 20 year olds do this, but social media is full of people who are taking a lot of risk and who really want to show off all their gains. But at 40 or 50 years old, you have no one to prove success to but yourself. And a lot of what makes you successful in real estate is about that. It's actually really about knowing what you want, being able to be persistent in pursuit of your goals, and not getting distracted by everything else or what other people might think of you. If you're anything like me, the older I get, the more clear I am about what I want and what I don't. And that has really helped me in my real estate investing career, because I've been able to stay laser focused on the types of deals, the types of funding I want, and it makes my portfolio much more efficient. So all of that to say, if you're starting in your 40s or 50s, you're not necessarily at a disadvantage. It is true that you won't have as long to compound, but you can absolutely do this. And I'm going to show you the steps exactly how.
Step one is starting with strategy. Ask yourself, what type of real estate investing best aligns with your personal goals? Because there are a ton of different ways, great ways, that you can make money in real estate, whether it's long-term rentals, short-term rentals, commercial real estate, they all work. But you need to focus on the ones that are best aligned with your personality, your stage of life, and the things that you want. Because if you don't do that, it can be very easy to get distracted by different kinds of deals, to get FOMO based on what you see other people doing. But knowing what's best for you will keep you on track until your retirement. So if you really want to get into this, you can buy my book. It's called Start with Strategy. It's all about aligning your portfolio goals with the types of real estate deals you should do. But I'll give you just a quick summary of things to think about. If your priority is just stable, predictable, long-term returns, go with long-term rentals. I know it's a little boring. I know not everyone gets super excited about owning rental properties, but it just works. It is super stable. It offers great risk-adjusted returns. And I think for the majority of the investors out there, people who just want financial freedom 10, 15 years from now, long-term rentals do the trick. You don't have to overthink it.