2017 – a (special) gap year

My dear dudes,

As I told you in a previous post, I will be taking a year off, starting either from January 1st, April 1st or November 1st, 2017. Most likely, it will be from January 1st onwards. Before I am hit by a lot of you guys, I will be doing this because (1) I am putting my health before everything else, (2) I know that my portfolio will not decrease during the year and (3) I am willing to shift my retirement by one year.

Taken from http://o.aolcdn.com/

Taken from www.aol.com

This post serves to tell you about my plans on what to do during the year, and what my goals are. Right now, I am not sure I will be getting a part-time job. If I do, it has to permit me to work from home.

Regarding my costs during this gap year. I do have one unit RP#3 that I planned on keeping for myself, so paying rent is not in question. I also put some monies on the side, during 2016, to leave off during the gap year. This means that I will not eat a single cent from my portfolio, which also means that I plan on getting richer during the year, as the yields of the portfolio will be entirely put back into the portfolio. In particular, I expect the following gains:

  • RP#1 will either net me €1800, if I continue on renting it out, or €10.000 to €15.000 if I decide to sell it. I am not sure what the market will look like in the future, as the population is decreasing in this market (although the no. of people renting is increasing). If I sell this condo (which I am very inclined towards), for 45k, I will re-invest about 30k on a new condo (which I already have an eye on) and pre-pay the mortgage of RP#2 with the remaining €10/15k. The only reason why I should not sell the condo for a €10/15k profit is not expecting appreciation that surpasses this value (or expecting the appreciation on this condo vs any new condo to be higher, which is not the case).
  • RP#2 will net about €1000-1500. This will be used entirely to pre-pay the mortgage on this property, as I am planning on paring it down significantly (maybe 50% or more) till the end of the year. I want to minimize my liability on this property and increase net cash flow quickly.
  • I will most likely get a part-time job, which enables me to work from home. I expect either to make enough money to enhance my lifestyle during this year, or make enough money to increase my portfolio significantly (my original plan was to get a part-time job so that I could increase my portfolio by at least €10k). Depending on the type of job I get, I will be adding somewhere between 0 and €30.000 to my portfolio.
  • I also expect to make at least €2000 net on the rest of my investments.

So, very conservatively, my portfolio will grow €6000 (up to a maximum of €50000). This is more than 5% of the total net worth I expect to have by the end of 2016 (110-115k). I expect inflation in Portugal to be about 2%. Now, I haven’t talked about RP#3, as I can’t really say how much it will net, right now. Plus, I will be creating other sources of income which I can’t measure as well, as I say below. If I manage to grow my portfolio by 50k, I would be growing it by about 45%, which is actually more than I first estimated to be needed in order to retire by 33-36 years old.

I also mentioned that I intend to pay down my mortgage on RP#2, which may sound odd to some of you. The goal is two-fold: first, I want to pare it down as much as I can because the interest rate is high (4,65%) considering how much money I am making on my other investments right now. Note that I could make at least 10% on my other investments, thus having a reason to not paying down the mortgage, but these would not be liquid investments and I do not want to burn my liquidity as I expect a huge crash in a few markets soon.


  • The biggest reason why I will be taking this year off is because I want to improve my health, which is currently not in the best shape ever. I feel that I need to reduce stress to minimal levels. I will be doing a post on this subject soon.
  • I also want to take this blog to an entire new level. I feel that I can add a lot of value to the blog and attract more users by proper promotion. I will be aiming at 2-3 posts a week, if not more.
  • Improve my financial IQ, as part of improving this blog. I challenged myself to read 100 books in 10 months time, as I posted the other day. While some books will simply be re-read, so I can write summaries and reviews of them, many will be books I never read.
  • Create more sources of income. I love Real Estate, but my portfolio is currently depending too much on Real Estate. I will be writing 2/3 books during the year, and I will most likely do regular consulting.
  • Find more Real Estate deals. Having more free time, I expect to increase my search for Real Estate deals and, as a result, to find really good deals.

Thank you for baring with me,


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