No matter when you started working, it’s never too early — or too late — to think about retirement. Alongside the usual savings from your bank or employer, look into other ways to boost your finances so you’re ready when the time comes. Can real estate investing help you retire sooner? Let’s explore.
Real estate appeals for two main reasons. First, it’s an investment you can control. You set the rent, choose the tenants, and decide when to sell. Second, because it’s a physical asset, it won’t disappear overnight if the stock market falls.
Whether property investing can speed up your retirement depends on how you do it. Here are four tips to help your real estate efforts pay off — and maybe let you leave your job earlier.
This post is from Jennifer Landis of mindfulnessmama.com. Jennifer grew up in northern New Jersey and now lives near Philadelphia with her family. She’s a freelance writer who believes schools should teach kids how to write and manage money. Amen to that!
1. Start with clear goals and realistic finances
Don’t jump in without a plan. Set short- and long-term goals and decide how much you can invest, both financially and emotionally. How much can you afford to spend? How much are you comfortable putting into a property?
Figure out how you’ll run things. Will you manage the property yourself, or hire someone? Know what you can handle financially—from mortgage payments to down payments. Plenty of online calculators can help you see your bottom line. Also learn key metrics like cash-on-cash return so you can evaluate deals more easily.
2. Research markets and think like a renter
Once you have a plan, study the housing or commercial market. Look for areas where demand is strong—you don’t want a rental that sits empty. Cheap properties aren’t always bargains; a fixer-upper could drain more money than it’s worth.
Think about what renters want: neighborhood quality, schools (if renting to families), commute times, and local amenities. Check average rents and property taxes so you can estimate monthly income and expenses.
3. Shop lenders and plan for gaps
When you’re ready to buy, compare mortgage offers. Don’t take the first loan you’re offered—small rate differences add up over time. Pick the lender that saves you the most in the long run.
Once you have a loan, revisit your numbers. Make sure you have enough cash to cover the property until a tenant moves in, plus the mortgage and a little profit. One property may not be enough to retire early, but you can roll profits into more units and grow your income.
4. Be ready for tenant issues and upkeep
As a landlord, expect surprises. Repairs and tenant requests will cost time and money. But with multiple properties, those expenses usually become a small part of overall profits. Eventually you may only need to manage the properties rather than work a full-time job.
Early retirement through real estate is realistic because people always need places to live. The key is making smart choices and building a diverse portfolio. Do that, and you could trade your 9-to-5 for a much more relaxed lifestyle.
Notes from Cubert: Thanks, Jennifer — great post. Real estate has been a big part of our path to FIRE. Finding good deals in a hot market and fixing up places takes work, but once you have tenants and steady rent, it becomes a fairly passive income stream.
Being a landlord also builds useful skills for your day job: customer service, time management, and running a small business. We bought our first condo to use as a short-term rental because single-family homes at the right price weren’t available. Our Airbnb has done well since early 2018, with cash-on-cash around 20%. (There’s always a catch—so keep an eye on rules and associations.)
Bottom line: Can real estate help you retire early? Yes. Be ready to act when opportunities appear: watch mortgage rates, save for a down payment, and learn how to evaluate deals. When the market dips, that’s often the best time to invest.