Author Topic: How much would you need to be FI if you kept working (for fun) and only lived off of that income?  (Read 16054 times)

trollwithamustache

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500k in the bag by age 40 was my number for working until 62 but not needing to save  any more after that point. I kept savings because I would like that number much higher to pull in FI to 55 and with kids the wife and I aren't 100% sure of that number. 

part time/selective contracting employment can be a lot more enjoyable and enjoying life is the point isn't it?  I won't go back to full time salaried ever ever again.

boarder42

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I can retire comfortably on a million.

500 grand invested over a 20 year period should yield returns of about 1.1 million inflation adjusted . . . So, my number would be about 500 k to retire while working fun jobs.

what return are you using b/c over 20 years that should be closer to 2MM inflation adjusted at 7%.  in 10 years you'd hit your 1MM number

arebelspy

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Interesting questions. 

Regarding the initial one "how much do you need saved to supplement fun gigs w/ a 4% WR" (I'm summarizing), I think we could semi-ER with only fun gigs and live just off that, so $0 saved first?

As far as the second question (how much saved to let compound over 20 years so you can work just enough to cover expenses and let the stache compound to full FI in 20 years), hmmm.

Let's say 1MM in today's dollars, 7% inflation adjusted return.  If we had $0 to start out with, side gigs would need to earn us a $24.4k/yr surplus. If side gigs gave us no surplus, we'd need about 258k right now.

So somewhere between those numbers, likely.  Maybe 100k saved first?

Shockingly low numbers either way. Somewhere between $0 and $200k would be plenty to semi-ER.

...yes, we really should have ER'd sooner.  :)
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nereo

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Quote
yes, we really should have ER'd sooner.  :)

A fascinating statement from a couple that ERed in their early 30s...

Also feeling more confident about our own "glide into FI" plan now.

GuitarStv

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I can retire comfortably on a million.

500 grand invested over a 20 year period should yield returns of about 1.1 million inflation adjusted . . . So, my number would be about 500 k to retire while working fun jobs.

what return are you using b/c over 20 years that should be closer to 2MM inflation adjusted at 7%.  in 10 years you'd hit your 1MM number

4%

trollwithamustache

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Regarding the initial one "how much do you need saved to supplement fun gigs w/ a 4% WR" (I'm summarizing), I think we could semi-ER with only fun gigs and live just off that, so $0 saved first?

That would be the dirty secret of a little frugality. You can't share that on the internet!

2Birds1Stone

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I recently made a post about this in my journal here.

My current stash covers about $1100/month, so I would need another $900/month after taxes to maintain current lifestyle.

$207/week after taxes can easily be earned averaging 2-3 days a week at a store like Trader Joe's, where the hours are flexible (first shift is 4AM-Noon, last is 4 PM to midnight)

They also offer a $.60/hr raise every 6 months if you are a good employee.

If I didn't want to tap into my nest egg and let it grow in the background, I would need to earn $2k/month after taxes. Which would require full time low skilled work.

arebelspy

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Regarding the initial one "how much do you need saved to supplement fun gigs w/ a 4% WR" (I'm summarizing), I think we could semi-ER with only fun gigs and live just off that, so $0 saved first?

That would be the dirty secret of a little frugality. You can't share that on the internet!

Haha, totally!
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StarBright

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I've thought about this. Currently I'm 30 and my wife is 28. If my wife and I were to try this approach, and planned to work only at jobs that we enjoyed for a period of 20 years, that take us to 50years old, and our future kids would be 18+.

I'd like to start the adventure with $300k in investments. Such that it has time to compound. In 20 years at 7% interest, our "Stache" would reach 1.2m, and we'd still be much younger than the average retiree.


Our current plan is to do something like this (we are in our mid 30s). DH is a swami that never wants to retire and I am in a great, flexible job but they've burned me out and I want to make a change. We are getting our investments to 300k and then I'll switch to part-time, or SAHM, or make a career change. DH has a mandatory retirement contribution as well so our stache will continue to grow until whenever.

I'm feeling pretty good about this plan right now.

matchewed

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My GF and I are suddenly very high earners (IMO) within the last year with a three family rental property (2 rents covering all expenses while we live in there). I've been guiding her into the concept of FIRE since I started dating her so that she'd know more about one of my goals.

When we were talking one time about such things I was running her through various scenarios. She'd rattle off variable changes and I'd give her what our success rate was given the variables.

She asked what if we made $30k/yr for the rest of time? I told her we wouldn't have to save a dime at that point. All our savings would be pure excess. This blew her mind. It further blew her mind that all we'd need is to each have a $10k a year job with our current stache and passive income in order to stop.

If I understand the question I guess that answers it for me. We're at that point now where we could work some fun little jobs, my GF already has one on the weekends. So $250k in the bank does it for me.

Maybe I'm looking at it with some particularly rosy glasses but I think I did like those lower responsibility jobs. They lent a greater amount of chatting with coworkers and customers. The stress was a great deal less I believe.

arebelspy

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But is Trader Joe's a "fun job?"

Seriously, while I was mildly happy to work at a gas station in my teens, how would I feel making well under $20/hr now to do something like that, after experiencing the corporate fire hose of cash flow?

Definitely. I can't imagine going into a job like that right now and dealing with customers.  I feel like within a short amount of time I'd be going "I'm FI! I don't need this!" (Though I guess in this scenario I would, which would suck. But picturing it now, in my current situation.. ugh. :P)

But some might enjoy it, and more power to them. We all have different things we enjoy.

More impotantly, are there any hobbies you might explore that would be fun and could earn money.
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (occasionally) blog at AdventuringAlong.com.
You can also read my forum "Journal."

moonpalace

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Definitely. I can't imagine going into a job like that right now and dealing with customers.  I feel like within a short amount of time I'd be going "I'm FI! I don't need this!" (Though I guess in this scenario I would, which would suck. But picturing it now, in my current situation.. ugh. :P)

But some might enjoy it, and more power to them. We all have different things we enjoy.

More impotantly, are there any hobbies you might explore that would be fun and could earn money.

I can't imagine going back to working retail, either, but I can *definitely* imagine just cutting back my existing job to (very) part-time and having that be pretty darn amazing.

Or starting a little climbing gym and maybe clearing $20k/year . . . or something else like that. Or work full-time, but only in odd-numbered years!

To me, the power of this line of thinking is not that you get to go pump gas, but that you have a tremendous array of options once you only have to earn a little bit.

nereo

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Just a thought:  I've found that I enjoy a job far more when I really don't need it.   Several times in my life I've had jobs that I "needed" to make ends meet. It was a huge drag.  But once my situation changed I liked the job a lot more.  For example, I picked up a job in college at a seafood wholesaler to pay my tuition.  It was awful.  But then I got a scholarship but kept the job - within a few weeks my opinion of the job changed dramatically.  I also worked retail when I needed extra money and hated it.  Then I was begged back by my former manager for the holiday season and had a really fun time, in part because I didn't give a damn if I was meeting my 'metrics' or not and everything i earned was going straight to savings.  Ironically - I was a better employee the second time (though whether that's due to experience or attitude I can't say).

trollwithamustache

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But is Trader Joe's a "fun job?"

Seriously, while I was mildly happy to work at a gas station in my teens, how would I feel making well under $20/hr now to do something like that, after experiencing the corporate fire hose of cash flow?

More impotantly, are there any hobbies you might explore that would be fun and could earn money.

Not TJs, but step into any WestMarine store and a very happy semi-retired clerk will chat boating with you for far longer than you probably have time for.

Finances_With_Purpose

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Interesting questions. 

Regarding the initial one "how much do you need saved to supplement fun gigs w/ a 4% WR" (I'm summarizing), I think we could semi-ER with only fun gigs and live just off that, so $0 saved first?

As far as the second question (how much saved to let compound over 20 years so you can work just enough to cover expenses and let the stache compound to full FI in 20 years), hmmm.

Let's say 1MM in today's dollars, 7% inflation adjusted return.  If we had $0 to start out with, side gigs would need to earn us a $24.4k/yr surplus. If side gigs gave us no surplus, we'd need about 258k right now.

So somewhere between those numbers, likely.  Maybe 100k saved first?

Shockingly low numbers either way. Somewhere between $0 and $200k would be plenty to semi-ER.

...yes, we really should have ER'd sooner.  :)

You're inspiring me to do it sooner.  Though I really wonder how I could lower housing costs by enough to make that leap.  We, too, could be semi-ER with side biz income that would continue supporting us - and absolutely love life.  I'm constantly debating how much we'd need to have saved in order to pull the trigger. 

But for now, we are doing higher-risk things, like taking lower-paying gigs that are fun, starting our own businesses, and the like - and I'm confident that one of these areas will pan out enough that the problems will probably solve themselves.  Meanwhile, we're finding more ways to make money by doing what we love. 

Plus, this community is amazing: constantly learning more.  (You tipped us off to tradelines, for instance, and I signed up yesterday.)  And constantly adding value to our lives as well as others' lives.  I use a good chunk of what I learn here (where appropriate) in my financial planning meetings. 

tj

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It doesn't take much if your expenses are low. According to my dashboard, I'm there (see "retire on current NW" ; annual expenses of ~19k, NW of ~160k).
https://www.dropbox.com/s/y3v1iwj78d7auiz/dashboard.png?dl=0

That's over a 10% SWR. Is that something you'd actually do?

MaaS

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Cool thread, this is basically my plan as well.  I'm already self-employed as a consultant, so ramping up and down is pretty straight-forward.

A big factor for me is a more favorable take home pay percentage.  It's absolutely a whiny "first world problem," but the reality is that with a strong income, two days of your life each week go towards taxes.  With the wealth creation happening in the background and simply working to pay bills, you suddenly keep almost everything.  Also, health insurance is dirt cheap with an income of under 50k.

It's a very compelling life model if you have the fortune and focus to sock money away early!



BeautifulDay

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I like this idea. A lot!

I like my job, but I don't love it. It pays well enough (by normal standards anyway, not compared to some salaries I see here! But I digress...). My job also often leaves me quite exhausted.
+1

DH is already in his ideal low stress job.  I work for same company and like it a lot but my job can be very stressful at times.  I also make 2x as much as he does.

So if DH were to stay in his job for 10 years I could take a part time job making $1000 or less a month and we would cover expenses.  Or I could bring in a bit more and DH negotiate part time role at work.  Would need $600k to make that work for 10 years. Or $300k for 20 years. It'll take several years to get 300k or 600k. 

Or we can stick to our 13 year plan.  I think this is more appropriate for us.  But it is nice to have other options if we really need a change later.

FIRE_at_45

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Iím not doing this so I am posting to open my mind to other options ;)

Retire-Canada

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I'm working 24hrs/week Mon-Wed at a low[-ish] stress job. While my portfolio keeps growing without major new additions. One thing I'll point out is that you don't necessarily need a different job. If you are working 40-60hrs/week and not loving your work you may well find the same job part-time could be great.

With a 50% savings rate you can work half as many paid hours and still save a little due to lower taxes.

 

sparkytheop

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Along this same line of thinking, does anyone know how to calculate the IRS Life Expectancy payout for 401K/TSPs?

I am a US federal employee, age 36, will have 20 years of service at 43, and currently have $266k in the TSP. At current contribution rates and 7% return, at 43, I will have $636k in my TSP. If I "retire" from the government at 43, I can elect to have a monthly payment according to the IRS LIfe Expectancy tables. I just can't figure out that payment amount.

I realize this is an old question, but go to tsp.gov, to "planning and tools", then "retirement income calculator".  Fill in the info, and the results will show various tabs.  "Overview" and "TSP monthly payments" should show a column for "Life Expectancy", with each annual payment listed through the age you select.

sparkytheop

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For me, I don't want a "fun" job.  I pretty much have the best gig I can imagine right now, and I am well compensated for it (99% stress-free, but that 1% is where we really earn our money).  I could see cutting down to half time if it were allowed, and I'd still get the benefits (health care at retirement age, pension, immediate withdrawal from my TSP, etc), but I can't see quitting something that pays this well, is this "easy", and gives me time to work on my own stuff (I spent a few hours hand quilting tonight while I had to sit in a certain location to push a few buttons, wait, push a few more buttons).

I've been working since fifth grade, and having a job is just not "fun" to me.  Fishing is fun, quilting is fun, hiking is fun, going to the theater is fun, travel is fun, mindlessly doing nothing is fun.  Work is not fun.  I can have fun at work, and often do, but work is work.  I'm one of those people who enjoys things most when I don't have to do them.  Loved raking leaves as a kid, but the second I was told to do it, or how to do it, I hated it.  I love making quilts, but if someone wanted to pay me to make one for them, I'd lose interest, especially if it wasn't my taste (it took me forever to make a simple quilt for donation that had pink as a main color.  I hate pink and it ended up taking me 10 times as long to finish that quilt, even though it was about a tenth of the work when it came to cutting, sewing, etc.  I just didn't enjoy it.)

So, at least right now, there is no magic number.  I want to do what I do, as long as it stays tolerable (decent boss, and not exposed to too much of the political bs, no one stabbing me in the back to get a promotion, great schedule, etc).  Then I want to retire and not have to try to earn money ever again.

SpareChange

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I'm working 24hrs/week Mon-Wed at a low[-ish] stress job. While my portfolio keeps growing without major new additions. One thing I'll point out is that you don't necessarily need a different job. If you are working 40-60hrs/week and not loving your work you may well find the same job part-time could be great.

How long have you been doing 24hrs? Curious to know if you still have a desire for RE when work has been pared down to pt? I'm planning to do something similar...drop down to two 8s in another year or so. I like my job alright, but I am a bit burned out. I do feel I might like it a lot more if it seemed more like a hobby haha.   

Retire-Canada

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How long have you been doing 24hrs? Curious to know if you still have a desire for RE when work has been pared down to pt? I'm planning to do something similar...drop down to two 8s in another year or so. I like my job alright, but I am a bit burned out. I do feel I might like it a lot more if it seemed more like a hobby haha.   

I started in July so I am at a bit over 6 months. Do I still want to retire? Yes for sure, but definitely the pain of continuing to work has been reduced by a huge amount. I have to leave myself detailed notes because by the time I get back to work after 4 days I have forgotten what the heck I was doing. If I hit 4%WR Monday I would start the process of stopping work. I'd like to travel more and having to be at a desk even 2 or 3 days a week is a drag.

If we were talking 1 day a week of work and it was flexible so I could say leave for 2 weeks and then do 2 weeks of 2 days/wk to make up the time...hmmmm...then I'd probably be okay working longer. However, my own personal definition of FIRE is working 25% FT or less. So I could do 8hrs a week of work on average and still be retired. Like you say at that level it's more like a hobby than a job. ;)


Chairman

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A million bucks. Planning on doing exactly this.

Rubyvroom

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I like hearing others' thoughts on this. As we get closer to FIRE I've been thinking a lot about this too.

At first I set a hard number of $1M for our FIRE goal and tried to project dates based on when we hit that number. The more I've read about withdrawal rates and the sequence of returns risk, the more flexibility I've introduced to that way of thinking and I think we'll be retiring closer to $800K (5% WR).

The tentative plan now is to have DH retire first, in October 2019, at a date triggered by our "free" 3-year auto lease expiring (paid for by his work) before we enter into another lease or need to purchase a second vehicle. We may have between $700K-$750K at that time (liquid, not including home equity). Depending on what the markets look like at that time, he will either be fully retired and start to get our house ready to sell, or he may pick up a small job near our home.

I will probably stay at work until that following spring 2020 when I receive a potential bonus and a raise (the raise impacts my vacation payout upon quitting). We may have between $825K-$875K by then. Now, if for some reason the markets had pushed our stash up into the $800K range by October 2019 and I am not going to get a bonus in the spring, I will absolutely retire at the same time as DH. We'll have to see how things shake out.

So I'm feeling far more comfortable with something around $800K (5% WR) rather than $1M (4% WR), knowing that in our situation, we have quite a bit of flexibility. In my line of work it's quite easy to pick up consulting gigs at a $40-$50/hr. rate, which I may pick up periodically to either push us over the $1M hump, to provide some "fun money," or to mitigate a poor sequence of returns either due to market instability or underestimating the cost of the health insurance debacle. To me, the extra 1.5 years or so of freedom are worth the 1% WR, and part-time consulting will be the perfect way to bridge the gap.

homestead neohio

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I hope my number for this is $600k because that's what I have and I'm making the leap in 2.5 months.  My plan was to work until my FI number, but changes in employment have forced me to look at this much sooner.  Because starting over in my current job at a new employer sounds awful compared to taking a number of jobs for a year at a time which would help me learn skills I value like large scale veggie production, orchard management, and community activism.  If I cover my family expenses for about 7 years, my stash should grow to my full FI number and I my "fun" jobs will be entirely optional, and I'll decide then if I continue or not.  I don't think I need some form of employment outside the home to be happy, as some have indicated.  However, when choosing what to do next, I think I can have a lot more fun at lower paid jobs I'm excited about than continuing to maximize income via the career I've been building for 18 years.  I'm burned out on that.  I probably could have done this sooner, but I'm also glad I'm not working another 3 years in the career job before realizing this is a viable option.  I am taking a year or two off before I start picking up fun jobs, though, to decompress and heal from my burnout.

I entirely agree with others who have said it is a more natural transition to FIRE than going hard 20+ years and FULL STOP, which is what my path would have looked like.

blinx7

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I am conservative and raising a family in a VHCOL city.  So $1.75 million plus paid off house plus enough in 529 that I can expect to reasonably cover state university for each child (assuming investment returns but also tuition rising).  No pensions and would be walking away from a lucrative and stable job so need to make sure it can stick. 

On a per person basis though that is not that much different than some of the numbers others are posting for singles or DINKs.

We are not there yet but it is not so far off as to be unrealistic.   
« Last Edit: January 15, 2018, 07:57:09 AM by blinx7 »

kaetana

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We are doing this. We don't have enough to completely retire right now, but I am definitely one of those people who think that either of the normal options (work hard, save hard OR no work, live off savings) is a horrible prospect. Obviously this will change at some point, but I really think I will always do SOME sort of work. It's just a question of how much I'll earn from it. So we've chosen option 3. Currently my husband has retired and I am still working (a job that I love). Conservatively we will reach our FI figure in 10 years when I'm 42, assuming I keep making enough to cover our expenses. At that point I would be FI even if I never worked again (unlikely).

A few reasons why we've chosen this path:
1. My husband is 28 years older than me. I'm 32, but he is turning 60 this year, which means time with him is my number one priority.
2. We both have backgrounds in tech and have been able to earn incomes high enough to let us do a short burst of saving (about 4 years of slightly less travel than normal and cutting back on stupid expenses to get us to this point).
3. I love my job. I love my industry. I also have a few hobbies I'm extremely passionate about (foreign languages and writing) that I feel comfortable I could leverage to at least meet our expenses for the next 10 years, should I not be able to work in IT for whatever reason. Most importantly, tech and my hobbies are all particularly suited to remote work.
4. We're fortunate enough that we are able to move overseas (we are both multinationals) to further reduce our expenses if we needed to.
5. Right now we both stand to (legally) get pensions from two countries, not to mention other benefits if needed.
6. We love to travel.

Seemed like a no brainer for us. Until this thread I thought that this choice was incompatible with traditional Mustachian philosophy. Whether it is or not, I'm happy to see others are doing this too!

rubybeth

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I am conservative and raising a family in a VHCOL city.  So $1.75 million plus paid off house plus enough in 529 that I can expect to reasonably cover state university for each child (assuming investment returns but also tuition rising).  No pensions and would be walking away from a lucrative and stable job so need to make sure it can stick. 

On a per person basis though that is not that much different than some of the numbers others are posting for singles or DINKs.

We are not there yet but it is not so far off as to be unrealistic.   

You'd still need to work part-time after having $1.75 million? Wow, I'd suggest moving to a lower cost of living area and working a fun job there instead so you don't need as much in order to only partially retire.

nereo

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I am conservative and raising a family in a VHCOL city.  So $1.75 million plus paid off house plus enough in 529 that I can expect to reasonably cover state university for each child (assuming investment returns but also tuition rising).  No pensions and would be walking away from a lucrative and stable job so need to make sure it can stick. 

On a per person basis though that is not that much different than some of the numbers others are posting for singles or DINKs.

We are not there yet but it is not so far off as to be unrealistic.   

You'd still need to work part-time after having $1.75 million? Wow, I'd suggest moving to a lower cost of living area and working a fun job there instead so you don't need as much in order to only partially retire.
That was $1.75MM plus a paid off house + enough in 529s to pay for college for each kid.
That number floored me, too, assuming we're talking about USD.
If this were their ultimate, walk-away and never work again number I might understand, but for the OP....  yikes.

Samuel

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I think this has been my unconscious plan all along, just never stated this explicitly. I've always been much more focused on the FI than the RE.

I really like the idea of making my primary target be a fail safe point,  the number at which I could downshift to a subsistence job and still coast to FI on a reasonable time frame. The full FIRE number is a secondary target, a best case scenario.

Is there a term  in the early retirement lexicon for this point or do we need to invent one?

never give up

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That sounds like the point of FIRE inevitability. Iím the same. I enjoy the structure of work and being part of a team but FI really appeals just so you know you can leave at the drop of a hat. You never know when a reorg, a horrible boss, internal politics or redundancy is around the corner. None of that matters when FI.

Iím 40 and am likely to be able to take my company pension at 57 (Iím UK) so itís what combo of full time, part time or RE to adopt for this interim period of 17 years. I donít know yet but am working on it. Iím probably 8 years from full FI so full time work needs to exist for at least five of those years.

trollwithamustache

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I think this has been my unconscious plan all along, just never stated this explicitly. I've always been much more focused on the FI than the RE.

I really like the idea of making my primary target be a fail safe point,  the number at which I could downshift to a subsistence job and still coast to FI on a reasonable time frame. The full FIRE number is a secondary target, a best case scenario.

Is there a term  in the early retirement lexicon for this point or do we need to invent one?

We need to invent one. Its about frugality and simplicity but its not the classic program as any of the Gurus, MMM or Extreme Early retirement, ect have laid out.  There is this satisfied advanced mustachian term floating out there, but I don't get the feeling those people have a clear plan other than to keep accumulating. This isn't meant as a criticism.

RichMoose

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Is there a term  in the early retirement lexicon for this point or do we need to invent one?

We need to invent one.
Here's my first poke:
SRIWS - Semi Retired Individual With Savings/Stash

blinx7

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I am conservative and raising a family in a VHCOL city.  So $1.75 million plus paid off house plus enough in 529 that I can expect to reasonably cover state university for each child (assuming investment returns but also tuition rising).  No pensions and would be walking away from a lucrative and stable job so need to make sure it can stick. 

On a per person basis though that is not that much different than some of the numbers others are posting for singles or DINKs.

We are not there yet but it is not so far off as to be unrealistic.   

You'd still need to work part-time after having $1.75 million? Wow, I'd suggest moving to a lower cost of living area and working a fun job there instead so you don't need as much in order to only partially retire.
That was $1.75MM plus a paid off house + enough in 529s to pay for college for each kid.
That number floored me, too, assuming we're talking about USD.
If this were their ultimate, walk-away and never work again number I might understand, but for the OP....  yikes.

I think maybe I didn't fully understand the question the first time around. 

The number I quoted is basically our family's target FI number assuming literally zero lifestyle changes (mostly related to raising 2, and hopefully one day 3, kids in VHCOL-land, which we could easily change by moving to a different city but just would rather not at the present time).  I just intend to keep working in some capacity after FI, to keep active and build an extra margin of safety and that's part of the reason we aren't moving -- this is a good place to find interesting opportunities.  I get that I'll probably die with extra money on the table for grandkids education, charities, etc. but am OK with this.  The figure I cited is just basically my personal current working plan. 

I could probably downshift into either a relatively fun job, at least for me (e.g., 9-5 attorney for city gov't), or a non-fun part time job (e.g., overflow private practice work from friends at $200 per hour) right now and regardless of whether I saved anything and with no lifestyle changes still hit full FI well before normal retirement age from just growing existing assets.   

In terms of starting to live off assets (even at a 2% SWR) while working fun jobs, I get that it is mathematically possible but I am just not comfortable doing that.  I am totally on board with downshifting prior to FI and did so myself (biglaw to boutique) but the downshift was from a 67% savings rate to a 30% one -- not a shift that would involve touching any assets prior to FI.  Maybe if it were just me with no kiddos, but not if this is my family's well being I am responsible for.  I can't speak to other industries, but once you walk away from a lucrative private practice law job it can be hard to get it back so I am going to keep making hay while the sun shines.

Of course, if they kick me to the curb and I can't get anything else, then we are off to a two bedroom apartment near the beach in a LCOL state and I'll take it from there and could hang up my cleats now if need be.   
« Last Edit: January 15, 2018, 06:07:21 PM by blinx7 »

the_fixer

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Thought is was called coast FI?

Our plan is to do something similar as of today my number would be $510k that would result in my somewhat comfortable 60k per year at 62 years old @ 4% SWR


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expatartist

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"Coast FI" sounds like a good description. What a great variety of lifestyle choices on this thread!

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Iíve heard ďGlide pathĒ...

kork

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SWISS

Semi Working Individual with Savings/Stache

tj

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Thought is was called coast FI?

Our plan is to do something similar as of today my number would be $510k that would result in my somewhat comfortable 60k per year at 62 years old @ 4% SWR


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4% of $510k is only $20k. Where's the other $40k coming from?

the_fixer

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Magic pure magic :)

That magic is time in the market compounding.


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nereo

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SWISS

Semi Working Individual with Savings/Stache

Well SWISS is a heck of a lot easier to say than "SRIWS", but we run the risk of people thinking we're from Switzerland....

FI4good

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If i went back to my little house in France i was quite happy living on 100 euro's a week there , healthcare is a reciprocal arrangement with the UK system. So on paper i have enough to fire today with a huge margin in that scenario, Alas my stash is locked away in retirement accounts until I'm 57.

The job i do in the meantime is ok , they give me 14% if i pay 7% into my pension , 40% boost on buying shares (only 5% of my income can be used for this)

The stash i have now will be enough via compounding to live as i do in the UK when i hit 57 but i can't help but add to it because they're throwing free money at me and i want for nothing.

13 years 5 months to go..  i try hard to pretend to care and stay motivated at work , I have a 60-70% SR depending on the mathematics used and its not like I'm depriving myself.     

My plan at 57 is to buy a home in a rich, vibrant and arty area somewhere around the Mediterranean (after exorcising my travel bug) so i can hopefully meet other people who have also solved the money problem and are into more interesting things :)

Addendum, i will probably FIRE earlier but that will depend on the markets and post tax savings , i just keep stashing it away and when it feels right i'll FIRE . paying 20% income tax on the money to invest into a tax free wrapper called and ISA rather than wait 13 years and have it tax free via the pension is a trade off i revisit quite often .
« Last Edit: January 18, 2018, 09:19:30 AM by FI4good »

Apple_Tango

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I love this question! Because once I'm FI I plan on working fun jobs and so it's interesting to theorize what would happen if I just skip the accumulation phase and go straight for fun. I'm not going to do it because I have a loan to pay off in the next 3-4 years.  Also there is a tradeoff for me- If I work just a bit harder at my less fun career to build my FI stache, I won't HAVE to work at all past age 35. All the fun jobs after FI will literally be no stress, all gravy. 

On the other hand, if I stop the career train right now and coast along and work only doing fun jobs (seasonal jobs at yellowstone,  working at a ski resort and getting free mountain time, working at a winery doing tastings, etc) then I will HAVE to work until I'm in my mid 60s. And i'm nervous about the future of US health care and potential future babies :) So like I said...i'm just going to work through until age 35 and consider that good enough :)

But enough jabbering, let's get to the numbers! Let's say all I did from today on was fun jobs, making fun money.  If I managed to make a net $25,000 and spend it all on living costs, I'd still be at 1.2 million by age 67. So that's a damn good feeling.  If I netted $25,000, spent $19,500 per year, and just contributed $5500 into a Roth IRA every year without fail until age 67.....I'd have just under $2.5 million waiting for me in the bank.

On the other hand if I go with my FI plan and save/invest until age 35, and THEN go on my whimsical fun job spree so I'm not even touching my stache and saving NO more money, I'll be at $6.5 million. If I keep investing $5,500 into a Roth from age 35-67, I'll be at $7.1 million. So maybe my FI number is a little larger than it needs to be since I plan on working after, but I'm kind of trying to plan for worst case scenario like become disabled to a point where I can't work. I want my FI number to be able to support me even if I don't have fun money coming in after age 35.

the_fixer

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Perfect example of how saving in your early years really makes a huge difference


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MrThatsDifferent

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$650k

Need $35k/yr in retirement

Downshift at 50.  Need $200k in retirement account, $250k in investments, $200k cash

Have 2 years sabbatical traveling the world, no work at all, use $70k cash
Spend 8 years at fixed locations drawing $16k a year and SO & I working for $19k a year doing fun stuff

Fully retire at 60 with $900k, providing $35k @4% drawdown for life

kork

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Someone else posted about perception and how jobs seems to become more fun when you donít rely on them.

So true!

Iím 39 and have investments of 730k. Thereís a huge allure of just working to pay the bills from this point on while the nest egg grows.  Very much ďAmerican BeautyĒ working at the burger joint attitude.

I currently work for a company and need to be in the office 2 days of the week.  The other days I work remotely. Honestly, it feels like I work 2 days of the week.  Just yesterday there was some politics and some mud slinging and I thought to myself ďIím going to look for a job thatíll pay for my bills, but isnít full-time.Ē

Instead of feeling trapped in my job, I felt completely empowered to be able to make a choice for me and it wasnít financially driven. While ďBig cheeseĒ wife is going off, Iím thinking... ďI can just walk away and be no further behind than I was yesterdayĒ

The moment passed but if itís was 10 years ago, I would have been stressing over it.  For the most part, the job is enjoyable because I have most of the control over my own schedule.

Bird In Hand

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I've known this concept for a while with a different name and a slightly broader meaning: early semi-retirement -- ESR.

The particular flavor of ESR being discussed in this thread seems to be more about quitting one's existing full-time job and finding something more fun to do to cover expenses while the portfolio grows.  In this case I propose something like:

F--- It! Semi Early Retirement! (FISER, rhymes with 'miser').  It makes a good noun for an occupation, as in "Look at that lazy FISER bagging groceries at TJ's while her stash does all the hard work!"

For the more risk averse among us, this approach threads the needle between RE and full-on OMY syndrome. 

In our case, my wife and I completed the heavy lifting of accumulation fairly early -- $1M by age 40.  We like our jobs, but we would also like to free up some time to do other things while we're still youngish.  If we stop saving now and just work to cover our expenses, our nest egg should grow to be bigger than we'll ever need in 10-15 years.  And if an historically long/severe downturn in the markets makes this otherwise, then we'd just keep working part-time in the jobs we (hopefully) would still have.  With any luck we'd still enjoy it too!

trollwithamustache

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SWISS

Semi Working Individual with Savings/Stache

Well SWISS is a heck of a lot easier to say than "SRIWS", but we run the risk of people thinking we're from Switzerland....

does that mean we will all have to pass a test with a K31 rifle  and keep more chocolates on hand?