Living on Equity Spreadsheet

Guys,

Sorry, there was another little mistake in the spreadsheet which I hadn't picked up until now. It considered rental income from all "residential property", even though part of this was your "family home". In fact, you need to exclude the family home from the passive income calculation for residential property, and only include it in the capital growth calculation for residential property.

This error made my numbers look good as I have an $800K PPOR that was nominally making me a 3% rental yield on top of its capital growth. This is just not the case, I can't live off that passive income. Of course, it "offsets" my need to rent, but that's a different part of the equation.

So, I have fixed the spreadsheet and attached it here. I've also added the Commercial Property bit for MJK.

Cheers,
Michael.

Attached Files

Living on Equity v3.2.xls (24.5 KB, 58 views)

Michael,

The "Total passive income" box doesn't add the rental incomes to share income.

Rick

Thanks mate,

Fixed and reloaded here. There was another small mistake in that area too with the capital gains adding in the passive income, so I was double dipping. That's what happens when you start cutting and pasting these things, all your links start to get violated.

I think its all good now. Certainly makes my picture a lot more sombre...

Cheers,
Michael.

Attached Files

Living on Equity v3.3.xls (24.5 KB, 47 views)

Doesn't look like you fixed it... cell B61 should be =SUM(B58:B60)

Doh! Gee I'm a goose...

OK, fixed now.

BTW, shows the importance of version control on files doesn't it. Now if anyone says "mine looks bad", I can ask are you using v3.4?

Cheers,
Michael.

Attached Files

Living on Equity v3.4.xls (24.5 KB, 298 views)

Michael,

Thanks for your additions. I'll have a go with it and see how things look.

MJK

Well I've plugged in my figures and it looks like I could retire on 70K per year now if I wanted to.
Thanks for the spreed sheet. At the moment I have not leveraged off my managed funds so that will be the next step. Setting up a margin loan. Things should look even better then!

MJK

Awesome stuff MJK!

I wonder when we reach the $100k mark (or whatever) if we'll all feel secure enough to live the LOE philosophy. I hope so.

Thanks for that Spreadsheet Michael,

I plugged in my personal figures and found it interesting..

You're welcome mate. Its a very interesting little exercise isn't it. Of course its all predicated on a whole raft of assumptions around ongoing rates of return for yous assets. But if history is to be believed as a robust guide for future performance then the model holds.

Personally, I'll discount the assumptions quite heavily before putting it into place. I personally believe demographic changes will result in quite a different investing environment over the next 50 years than we've seen over the past.

Still, its good to know we're on the right path hey!

Cheers,
Michael.