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The Real Estate Retirement Plan: An Investment and Lifestyle Solution for Canadians
A Globe and Mail Bestseller!
A guide for Canadians on how to use real estate as an investment and retirement solution.
Leveraging equity in a principal residence and using it wisely to purchase rental property is the solution to a safe, secure retirement for millions of Canadians.
Many Canadians who own their home have never considered buying a second property. And nearly one-third of retirees are worried about running out of money. The Real Estate Retirement Plan shows how homeowners can use the tools already available to them — their mortgages — to access the initial capital to invest and prepare for their retirement. This is a proven, validated antidote to today’s historically low savings rates, poor current rates of return, and pressure on CPP and health care.
With examples and a detailed discussion of the principles and mechanics, Calum Ross and Simon Giannini demystify real-estate investing and make an irrefutable case for borrowing to invest.
A guide for Canadians on how to use real estate as an investment and retirement solution.
Leveraging equity in a principal residence and using it wisely to purchase rental property is the solution to a safe, secure retirement for millions of Canadians.
Many Canadians who own their home have never considered buying a second property. And nearly one-third of retirees are worried about running out of money. The Real Estate Retirement Plan shows how homeowners can use the tools already available to them — their mortgages — to access the initial capital to invest and prepare for their retirement. This is a proven, validated antidote to today’s historically low savings rates, poor current rates of return, and pressure on CPP and health care.
With examples and a detailed discussion of the principles and mechanics, Calum Ross and Simon Giannini demystify real-estate investing and make an irrefutable case for borrowing to invest.
224 pages, ebook
Published February 25, 2017
18 people are currently reading
117 people want to read
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Displaying 1 - 16 of 16 reviews
July 23, 2017
I wish I read this 30 years ago, along with Andrew Hallam's books on personal finance. I would have retired by 40! This should be required reading for all graduating secondary students. Financial literacy is an imperative for all generations. It's very Canadian (for once!), and my knowledge of how other countries' banking systems are limited. However I am sure that many, if not all, of the principles are applicable internationally. If you're Canadian and want to ensure your retirement is underway, read this book. If you're retirement and personal finances are all sorted - give this book as a gift to someone who is not as lucky or learned.
June 23, 2018
10 chapters that could have easily been briefed to 3 or 4. There seems to be a lot of repetitive points in the first 5-6 chapters, all pointing towards the value of borrowing to invest (which bored me out after the first few times he mentioned it). Although I would say that these chapters will help someone new to the field understand the importance of leverage in real estate investment. The real stars are the last 3 chapters - concise, clear and on point.
March 24, 2018
Too often when industry experts write books they are seen as simply trying to pump up the market they operate in. That is an unfortunate way to view things in many cases.
Real Estate was an excellent, if largely unavailable and unstable investment 10,000 years ago, 1,000 years ago, or even 100 years ago depending on which country we look at.
There are 100+ years of rock solid history demonstrating Canadian Real Estate as an excellent long term investment, and in recent decades it has been well within reach of the typical middle income family. Mr. Ross shines yet another light on this fact, and makes a clear case for investing in this specific asset class, an asset class outperforming all others long before he or I were born, let alone involved in the industry, and one that will outperform long after we are gone.
Sadly, at the time of the writing of this review, layers of Government intervention are making it more difficult that ever to enter the housing market, let alone to flourish within it.
The bottom line, engage experts in the industry to help you navigate, and above all else - take action!
Real Estate was an excellent, if largely unavailable and unstable investment 10,000 years ago, 1,000 years ago, or even 100 years ago depending on which country we look at.
There are 100+ years of rock solid history demonstrating Canadian Real Estate as an excellent long term investment, and in recent decades it has been well within reach of the typical middle income family. Mr. Ross shines yet another light on this fact, and makes a clear case for investing in this specific asset class, an asset class outperforming all others long before he or I were born, let alone involved in the industry, and one that will outperform long after we are gone.
Sadly, at the time of the writing of this review, layers of Government intervention are making it more difficult that ever to enter the housing market, let alone to flourish within it.
The bottom line, engage experts in the industry to help you navigate, and above all else - take action!
October 29, 2018
Definitely one of the best real estate books i have read.
February 24, 2021
Makes me want to buy an investment property.
I've heard Calum speak at events, corresponded with him over email and now I've finally read his book. It obviously spells out the value of owning an investment property.
When people think of retirement they often think of:
- nest egg;
- RRSPs;
- TFSAs;
... in that order.
The word "pension" is disintegrating.
I'd estimate that maybe 40% of Canadian workers currently have a pension and in 25-30 years from now, less than 10% will have a pension.
Therefore, build your own pension with Real Estate.
Leverage your dormant equity NOW, pay down the mortgage with your tenant's payments, refinance and further leverage that equity, buy a 2nd property, and so on, and so on, and so on.
The one thing that is not spoken about enough is qualification.
In order to access $100,000 of dormant equity in a property to buy the 1st $500,000 rental property, one needs to be able to qualify for that "extra" mortgage money.
And the Canadian government has not done us any favours when it comes to qualifying for mortgages.
I've heard Calum speak at events, corresponded with him over email and now I've finally read his book. It obviously spells out the value of owning an investment property.
When people think of retirement they often think of:
- nest egg;
- RRSPs;
- TFSAs;
... in that order.
The word "pension" is disintegrating.
I'd estimate that maybe 40% of Canadian workers currently have a pension and in 25-30 years from now, less than 10% will have a pension.
Therefore, build your own pension with Real Estate.
Leverage your dormant equity NOW, pay down the mortgage with your tenant's payments, refinance and further leverage that equity, buy a 2nd property, and so on, and so on, and so on.
The one thing that is not spoken about enough is qualification.
In order to access $100,000 of dormant equity in a property to buy the 1st $500,000 rental property, one needs to be able to qualify for that "extra" mortgage money.
And the Canadian government has not done us any favours when it comes to qualifying for mortgages.
November 9, 2017
Very good book for someone interesting in learning about real estate investing, especially young people like me who want to get a head start on something most people don't consider until they're much older. Contains a plethora of information regarding Real Estate Investing. As someone who works in Pensions, I agree with Calum's statement about Canadians no longer being able to rely on their CPP and Pension Plans. Defined Benefit pension plans are slowly disappearing, and unless you are someone who works in the government you most likely have a Defined Contribution Pension Plan, which doesn't necessarily guarantee the comfortable retirement you may be expecting. Investing in Real Estate serves as an alternative to this, and may be the difference between lowering your standard of living or maintaining it after you retire.
January 4, 2018
Great book, the author basically discourages you to let equity sit dormant in your principal residence, rather you should re-finance (invest some money from your principal residence) into a rental property. From achieving this, you receive a monthly rent cheque that imitates a CPP cheque. A lot of good advice, although he does reiterate himself ALOT, which does cause him to get his point across.
July 7, 2019
I truly wished I had picked up this book when I was younger -- and I'm 34. I did learn principles in investing that will change my life.
It's a great book that could have been conveyed in half the text, and done without the excessive promoting of author's services. Also, I wish it was better summarized into steps instead of the prose format for what should be practical and methodical advice.
Real Estate Retirement Plan
You can read chapter 2, skip chapters 2 to 5, continue from chapter 6 to the end. The first 6 chapters were belaboured, and self promoting. Yet there's tremendous value if you bear with it.
Here's my summary, in no particular order.
1. Real estate is more than a primary residence. It's a stable profitable investment vehicle that must be part of my general retirement plan. It's also easily available to most Canadians.
2. No use paying off your mortgage. You're only saving the 4% interest rate. A more profitable path is to refinance and buy another property to rent out. Don't leave dormant equity unused; invest.
3. Four ways to make money in real estate:
3.1. value appreciation with time. Estimated at 5% to 15% annually.
3.2 renovations, aka forced appreciations. The cost of renovations is worth it if it pays back 30% more than it cost.
3.3. cash flow from renting out. Rent should pay for monthly expenses plus 15%.
3.4. mortgage pay down. Which is someone else paying your mortgage through rent. Which I have hard time understanding because you wouldn't have this expense if you didn't have real estate in the first place. So I disagree with taking credit with this one.
4. Must have 3 to 5 months worth of expenses in hand as contingency. If a problem happens, and you need to provide temporary residence for your tenants as you fix your property, you will need the cash quick. Build it into your rent price.
5. It is vital to have a competent team around you of: real estate accountant, real estate agent specialized in investing and flipping, mortgage broker, real estate lawyer, contractors, and after 3 properties, a property manager.
6. Build a margin of safety in your risks. Assume interest rates will go up, so don't borrow the maximum allowed by bank.
7. Try to make tenants pay for utilities. It incentivizes them to save. And reduces risk if uncontrolled expenses.
8. Commit to long term. At least 5 years. It should be 10 years per property.
9. Start investing early. Compound interest, baby. Works for you if you're in the market already. Works against every year you delay because prices just keep climbing.
10. Think of cashflow as your retirement pocket money. Assume $300 to $500 cashflow from each property. Ask yourself, how many properties you need to live off your cashflow. Answer, at least three.
11. Diversify your investments. RRSP, TFSA, RESP, and Real Estate.
12. Consider tax implications. You'll pay tax on additional income, but there's also more deductions with investment properties. Get an accountant specialized in real estate.
13. Must select quality tenants. Screen tenants by calling prior landlords, did they miss payments in the past, check credit history, confirm their income, have them fill out rent application.
14. Don't lie to insurance. If you're a serious investor, you'll be doing this for a long time, have multiple properties. The odds of something happening and needing insurance will continue to climb.
15. How will bond yield affect mortgage rates? I forgot the answer already, but in selecting a mortgage professional, they must know how to answer this question.
16. Undercharging for rent of your property, not only is it losing on money you could have, it also devalues the market value of your property.
It's a great book that could have been conveyed in half the text, and done without the excessive promoting of author's services. Also, I wish it was better summarized into steps instead of the prose format for what should be practical and methodical advice.
Real Estate Retirement Plan
You can read chapter 2, skip chapters 2 to 5, continue from chapter 6 to the end. The first 6 chapters were belaboured, and self promoting. Yet there's tremendous value if you bear with it.
Here's my summary, in no particular order.
1. Real estate is more than a primary residence. It's a stable profitable investment vehicle that must be part of my general retirement plan. It's also easily available to most Canadians.
2. No use paying off your mortgage. You're only saving the 4% interest rate. A more profitable path is to refinance and buy another property to rent out. Don't leave dormant equity unused; invest.
3. Four ways to make money in real estate:
3.1. value appreciation with time. Estimated at 5% to 15% annually.
3.2 renovations, aka forced appreciations. The cost of renovations is worth it if it pays back 30% more than it cost.
3.3. cash flow from renting out. Rent should pay for monthly expenses plus 15%.
3.4. mortgage pay down. Which is someone else paying your mortgage through rent. Which I have hard time understanding because you wouldn't have this expense if you didn't have real estate in the first place. So I disagree with taking credit with this one.
4. Must have 3 to 5 months worth of expenses in hand as contingency. If a problem happens, and you need to provide temporary residence for your tenants as you fix your property, you will need the cash quick. Build it into your rent price.
5. It is vital to have a competent team around you of: real estate accountant, real estate agent specialized in investing and flipping, mortgage broker, real estate lawyer, contractors, and after 3 properties, a property manager.
6. Build a margin of safety in your risks. Assume interest rates will go up, so don't borrow the maximum allowed by bank.
7. Try to make tenants pay for utilities. It incentivizes them to save. And reduces risk if uncontrolled expenses.
8. Commit to long term. At least 5 years. It should be 10 years per property.
9. Start investing early. Compound interest, baby. Works for you if you're in the market already. Works against every year you delay because prices just keep climbing.
10. Think of cashflow as your retirement pocket money. Assume $300 to $500 cashflow from each property. Ask yourself, how many properties you need to live off your cashflow. Answer, at least three.
11. Diversify your investments. RRSP, TFSA, RESP, and Real Estate.
12. Consider tax implications. You'll pay tax on additional income, but there's also more deductions with investment properties. Get an accountant specialized in real estate.
13. Must select quality tenants. Screen tenants by calling prior landlords, did they miss payments in the past, check credit history, confirm their income, have them fill out rent application.
14. Don't lie to insurance. If you're a serious investor, you'll be doing this for a long time, have multiple properties. The odds of something happening and needing insurance will continue to climb.
15. How will bond yield affect mortgage rates? I forgot the answer already, but in selecting a mortgage professional, they must know how to answer this question.
16. Undercharging for rent of your property, not only is it losing on money you could have, it also devalues the market value of your property.
January 26, 2020
Disappointed. Tediously repetitive, with frequent suggestions to hire the author and business associates to help you buy real estate. Entire book can be condensed into a few paragraphs. And these paragraphs can be condensed into this: buy real estate with as much cheap debt as possible, and keep refinancing to acquire more real estate.
January 24, 2021
Very insightful. Easy to read but I found myself doubling back because the Author made it so interesting, I wanted to make sure I was understanding everything.
Well done Calum !
Well done Calum !
July 17, 2021
Barring lot of sales pitch by the authors, good material
December 23, 2022
A must read for anyone looking to understand how to use real estate as part of a long term investment and retirement strategy.
August 27, 2017
Overall a good read with good investing principles and advice related to leveraging and its benefits. Good for someone who is slightly beyond the novice investor.
April 23, 2017
Very informative with a great plan for leveraging the equity you have into a revenue stream to boost retirement income.
April 25, 2017
With the vast majority of defined benefit pensions having become a thing of the past, most Canadians are ill prepared to take on their retirement one day. This book offers a sound financial plan to leverage current built up equity in your home to create a positive cash flow / self made pension later in life.
December 20, 2018
Great message, too repetitive
A great introductory book into real estate investing, with a pleasant amount of Canadian focus.
Doesn't go into details on how to determine what property to buy, instead it prepares you with the right mindset to becoming a real estate investor in Canada.
A great introductory book into real estate investing, with a pleasant amount of Canadian focus.
Doesn't go into details on how to determine what property to buy, instead it prepares you with the right mindset to becoming a real estate investor in Canada.
Displaying 1 - 16 of 16 reviews