How to make the jump?

[Accountant]

My calc on different scenarios all end with me dying in my 80s with > 3 mill.  These calls are based on conservative estimate of 4 pct return on my current investments.  Given that it would seem easy to simply make the jump.  How do you do it and silence all the what ifs?  I am 49 and am burned out on working but my conservative nature makes me wonder about what I am not considering.

[deborah]

Do your current investments currently return more than 4%?

[Accountant]

I think historically our 401k have returned 8-9 pct - we started in 1999.  Our fund mix initially was different than it is now which is rebalanced to all S&P index funds.

[Metalcat]

Maybe your conservative nature should start looking at everything you are wasting by not taking the jump now.

Besides, if you really want to be conservative, there are always things you can do to stay employable during retirement.

I actually intend to have a WR less than 0% for the vast majority of my retirement because I'm actually retraining in a whole new career that I can do very part time while covering my entire yearly spend.

You don't have to be that conservative, but my point is that the world of making money is vast and dynamic. And a lot easier to explore and optimize when you're not bogged down in a full time job.

Also, how's your health? If you are burning out, I'm willing to bet that your body could probably use some TLC. Maybe it's time to start being conservative about the resources that money can't buy??

[TreeLeaf]

I assume no return at all and that I can live on my projected social security when I'm older...so I just divide investments by years until social security and view that as what I can spend every year.

If it gets too low I go back to work.

So I don't really view it as a final sort of thing at all. I accept that the investments could fail, or that I may want more money to spend, and either way I'm going back to work or cutting spending.

I take it year by year and don't think of anything as final.

Right now I am still working but my job is a slacker job so...meh? I will think about this more when my current job ends.

[deborah]

I think historically our 401k have returned 8-9 pct - we started in 1999.  Our fund mix initially was different than it is now which is rebalanced to all S&P index funds.

Well the financial side is completely covered, so why won’t you make the jump?

[snic]

"How do you do it and silence all the what ifs?"

I don't have the answer because I haven't made the leap. All the answers above focus on ways to convince yourself you'll have enough money. But you already know you will. So what is stopping you? One of the things that stops me (aside from actually liking my job) is not having a plan for what I'm going to do with myself after quitting. I think if I had a whole list of things I want to do that I'd enjoy more than work, that would go a long way towards convincing me to quit. So maybe the way to approach it is to compare your life now vs what you expect after you quit and decide which one you'll like more.

[yachi]

Not everybody needs to retire early, do you want to?

About 9 years before I FIRED, I figured out that the best financial move was to maximize my 401(k) contributions - it would reduce my taxable income and the fees were nice and low.  I had built up some money in taxable accounts, so I calculated how my I could withhold from my paycheck and still cover health insurance and other deductions.  I had at least 6 paychecks with very low amounts, but we lived on the savings.  That was a very freeing experience.  When we hit our FIRE number, I waited an additional 6-8 months to make sure it wasn't a temporary high, and then took a leap.

Luckily in those 6 to 8 months, our investments actually increased.  Our withdraw rate is somewhere around 3-3.5%, and that's while paying a mortgage, so years later, it'll be lower.  That's all due to growth in the year and half since we first saw our FIRE number.  It seems to me that most people here model their expenses and set a starting withdrawal rate (say 4%) that they adjust for inflation every year after.  That's what I used for modeling, but realistically I like to keep it less than 4% every year, and even then, we withdrawal only what we need while limiting expenses like we did during the accumulation years.

[Smokystache]

Story time: At the age of 89, my grandfather was dying. Had entered hospice and his kidneys were failing. Death was expected in the next few days ... maybe a week at most. Over his life, he had bought two farms in the mid-west and they were now worth ~$2million+. 5 Adult children don't want the farms, and everyone agrees the farm & land will be sold upon inheritance. Grandfather also has one house lot in Arkansas. At one point, he thought he might build a house and retire there, but didn't. Purchased 20 year ago for $3,000.

Grandfather is at death's door. Grandfather + Adult children + family lawyer are all working together to legally reduce probate/inheritance taxes. This means that some adult children are buying some of assets from grandfather (I don't know the specifics). My father talks to grandfather: "Your lawyer says it will be better if I buy the Arkansas lot from you." Here's a check for $2,500 [more than the open market value; this lot is in a proposed planning community that flopped]. Grandfather response, "Well, I've got more than that in it."

I think about that moment all the time. He died 2 days later. But in that moment, he was worth $2 million+ (and likely had $50k in his checking account), but he wanted his son to pay him at least $500 more for an empty lot ... that if they hadn't done this, the same son would inherit this lot upon his death.

Without question, his frugality and entrepreneur mindset was what allowed him to amass a huge net worth for a kid who chopped wood for 6 days a week during the Great Depression. But he could never escape that mindset. He would never have thought to order the steak instead of the cheapest burger at a restaurant. He would travel, but it would always be bare bones & 3rd class. In fact, another famous story was about him not being able to go on a trip and leave a few eggs behind, so he put them in his carry-on bag (where they promptly cracked).

He's a perfect example of being stuck in a mindset that got him there has now outlived its usefulness. So I push myself to think about when should money be traded for experiences. What is the value of this dollar now compared to what it may have been different 5, 10, or 40 years ago?? What's the point of accumulating resources if we don't use them to enrich our lives instead of some green pieces of paper or a certain number on a bank account screen?

[snic]

Story time: At the age of 89, my grandfather was dying. Had entered hospice and his kidneys were failing. Death was expected in the next few days ... maybe a week at most. Over his life, he had bought two farms in the mid-west and they were now worth ~$2million+. 5 Adult children don't want the farms, and everyone agrees the farm & land will be sold upon inheritance. Grandfather also has one house lot in Arkansas. At one point, he thought he might build a house and retire there, but didn't. Purchased 20 year ago for $3,000.

Grandfather is at death's door. Grandfather + Adult children + family lawyer are all working together to legally reduce probate/inheritance taxes. This means that some adult children are buying some of assets from grandfather (I don't know the specifics). My father talks to grandfather: "Your lawyer says it will be better if I buy the Arkansas lot from you." Here's a check for $2,500 [more than the open market value; this lot is in a proposed planning community that flopped]. Grandfather response, "Well, I've got more than that in it."

I think about that moment all the time. He died 2 days later. But in that moment, he was worth $2 million+ (and likely had $50k in his checking account), but he wanted his son to pay him at least $500 more for an empty lot ... that if they hadn't done this, the same son would inherit this lot upon his death.

Without question, his frugality and entrepreneur mindset was what allowed him to amass a huge net worth for a kid who chopped wood for 6 days a week during the Great Depression. But he could never escape that mindset. He would never have thought to order the steak instead of the cheapest burger at a restaurant. He would travel, but it would always be bare bones & 3rd class. In fact, another famous story was about him not being able to go on a trip and leave a few eggs behind, so he put them in his carry-on bag (where they promptly cracked).

He's a perfect example of being stuck in a mindset that got him there has now outlived its usefulness. So I push myself to think about when should money be traded for experiences. What is the value of this dollar now compared to what it may have been different 5, 10, or 40 years ago?? What's the point of accumulating resources if we don't use them to enrich our lives instead of some green pieces of paper or a certain number on a bank account screen?

I love this story. I see this trait *all the time* in people around me, and maybe in myself a little.

[Accountant]

Story time: At the age of 89, my grandfather was dying. Had entered hospice and his kidneys were failing. Death was expected in the next few days ... maybe a week at most. Over his life, he had bought two farms in the mid-west and they were now worth ~$2million+. 5 Adult children don't want the farms, and everyone agrees the farm & land will be sold upon inheritance. Grandfather also has one house lot in Arkansas. At one point, he thought he might build a house and retire there, but didn't. Purchased 20 year ago for $3,000.

Grandfather is at death's door. Grandfather + Adult children + family lawyer are all working together to legally reduce probate/inheritance taxes. This means that some adult children are buying some of assets from grandfather (I don't know the specifics). My father talks to grandfather: "Your lawyer says it will be better if I buy the Arkansas lot from you." Here's a check for $2,500 [more than the open market value; this lot is in a proposed planning community that flopped]. Grandfather response, "Well, I've got more than that in it."

I think about that moment all the time. He died 2 days later. But in that moment, he was worth $2 million+ (and likely had $50k in his checking account), but he wanted his son to pay him at least $500 more for an empty lot ... that if they hadn't done this, the same son would inherit this lot upon his death.

Without question, his frugality and entrepreneur mindset was what allowed him to amass a huge net worth for a kid who chopped wood for 6 days a week during the Great Depression. But he could never escape that mindset. He would never have thought to order the steak instead of the cheapest burger at a restaurant. He would travel, but it would always be bare bones & 3rd class. In fact, another famous story was about him not being able to go on a trip and leave a few eggs behind, so he put them in his carry-on bag (where they promptly cracked).

He's a perfect example of being stuck in a mindset that got him there has now outlived its usefulness. So I push myself to think about when should money be traded for experiences. What is the value of this dollar now compared to what it may have been different 5, 10, or 40 years ago?? What's the point of accumulating resources if we don't use them to enrich our lives instead of some green pieces of paper or a certain number on a bank account screen?

What a great story and perspective.  Thank you.  I am 49 now and feel the urgency to live now.  There is a tipping point when the value of the incremental dollar vs the incremental experience turns.  My goal as of now is to exit at 50 which coincides with my only child graduating high school - next year.

[EscapeVelocity2020]

You are asking an early retirement forum if you should retire at 49 (late by some standards around here).  Your user name is accountant and you say you’ll have 3mil in your 80’s (so you’re relatively FatFI).  And you’ve uttered the magic words ‘burned out’…. Is this just a cry for help that you can’t seem to give yourself permission to FIRE?  Unless you aren’t telling us something like you have to spend $150k/yr to just get by, I give you permission to FIRE 👍🏻

[Smokystache]

Story time: At the age of 89, my grandfather was dying. Had entered hospice and his kidneys were failing. Death was expected in the next few days ... maybe a week at most. Over his life, he had bought two farms in the mid-west and they were now worth ~$2million+. 5 Adult children don't want the farms, and everyone agrees the farm & land will be sold upon inheritance. Grandfather also has one house lot in Arkansas. At one point, he thought he might build a house and retire there, but didn't. Purchased 20 year ago for $3,000.

Grandfather is at death's door. Grandfather + Adult children + family lawyer are all working together to legally reduce probate/inheritance taxes. This means that some adult children are buying some of assets from grandfather (I don't know the specifics). My father talks to grandfather: "Your lawyer says it will be better if I buy the Arkansas lot from you." Here's a check for $2,500 [more than the open market value; this lot is in a proposed planning community that flopped]. Grandfather response, "Well, I've got more than that in it."

I think about that moment all the time. He died 2 days later. But in that moment, he was worth $2 million+ (and likely had $50k in his checking account), but he wanted his son to pay him at least $500 more for an empty lot ... that if they hadn't done this, the same son would inherit this lot upon his death.

Without question, his frugality and entrepreneur mindset was what allowed him to amass a huge net worth for a kid who chopped wood for 6 days a week during the Great Depression. But he could never escape that mindset. He would never have thought to order the steak instead of the cheapest burger at a restaurant. He would travel, but it would always be bare bones & 3rd class. In fact, another famous story was about him not being able to go on a trip and leave a few eggs behind, so he put them in his carry-on bag (where they promptly cracked).

He's a perfect example of being stuck in a mindset that got him there has now outlived its usefulness. So I push myself to think about when should money be traded for experiences. What is the value of this dollar now compared to what it may have been different 5, 10, or 40 years ago?? What's the point of accumulating resources if we don't use them to enrich our lives instead of some green pieces of paper or a certain number on a bank account screen?

A Coda to this story. My father (oldest son of grandfather in the story) and mother have always been frugal. At times they have been reluctant to spend their money. to counteract this, I've become more and more vocal about asking them to spend my inheritance on experiences.

One place they are willing to spend some money is travelling. They have been lifelong travelers and filled 2 passports ... and have visited 6 of the 7 continents (always on the cheap, despite having money). Knowing that they wanted to do it, I encouraged them to spend the money to knock off the last one, after all, they are very healthy, but they are both 80 years old. As part of a 21-day excursion, they will get on the ship to Antarctica today.

Old dogs can learn new tricks.

[Loren Ver]

There isn't really enough info to help push in a direction so I'll just drop this off:

https://engaging-data.com/will-money-last-retire-early/

It's a good calculator to gaining perspective that there is another resource that you are spending other than money. 

Loren

[LateStarter]

My calc on different scenarios all end with me dying in my 80s with > 3 mill.  These calls are based on conservative estimate of 4 pct return on my current investments.  Given that it would seem easy to simply make the jump.  How do you do it and silence all the what ifs?  I am 49 and am burned out on working but my conservative nature makes me wonder about what I am not considering.

Maybe what you're not considering sufficiently is that life is short, good health is not guaranteed, and getting to 80+ is by no means certain.

As Loren Ver posted above . . . Rich, Broke or Dead is a great chart.

[Smokystache]

My calc on different scenarios all end with me dying in my 80s with > 3 mill.  These calls are based on conservative estimate of 4 pct return on my current investments.  Given that it would seem easy to simply make the jump.  How do you do it and silence all the what ifs?  I am 49 and am burned out on working but my conservative nature makes me wonder about what I am not considering.

One last thought. In addition to my grandfather bartering on his death bed, I think about the message from this post from Tim Urban's "Wait, But Why" blog on a regular basis. He has an interesting way of breaking down time and remaining experiences based on life expectancy in a concrete, visual way. He used this line of thinking to realize that despite being 34 (when he wrote it), that he has relatively little time left with his parents and so he schedules in an annual vacation with them. But he also looks at how many more books he will likely read, how many more trips he has to the beach, etc. It's worth a read.

https://waitbutwhy.com/2015/12/the-tail-end.html

[eyesonthehorizon]

Will you have more or less time & geographic overlap with the high schooler after graduation?

[BeanCounter]

This was very hard for me too. I was very afraid to leave my well paying finance position, even though I was miserable, when I knew we had to school aged kids and very uncertain expenses.
I think you have to ask yourself what are more afraid of, the slight possibility of running out of money and having to do some paid work or the more certain possibility of dying with too much money (and not enough time spent with family and friends or doing the things you love)
Accountants are in such high demand right now. It is highly likely you could find a bit of part time work or seasonal tax work to help pad the budget a bit. Go ahead and pull the trigger and give yourself time to decompress and then see what sounds good to you.

[stoaX]

The way I made the jump was to hem and haw about it for about 3 years after I felt I could retire early.  The "tail end" concept mentioned in an earlier post plus knowing that I had spent years checking and re-checking the numbers and looking at the decision from multiple angles was what pushed me over the edge.  Even then I was nervous. It's worked out great so far (it's been almost 4 years).

C'mon in, the water's fine!

[JupiterGreen]

Story time: At the age of 89, my grandfather was dying. Had entered hospice and his kidneys were failing. Death was expected in the next few days ... maybe a week at most. Over his life, he had bought two farms in the mid-west and they were now worth ~$2million+. 5 Adult children don't want the farms, and everyone agrees the farm & land will be sold upon inheritance. Grandfather also has one house lot in Arkansas. At one point, he thought he might build a house and retire there, but didn't. Purchased 20 year ago for $3,000.

Grandfather is at death's door. Grandfather + Adult children + family lawyer are all working together to legally reduce probate/inheritance taxes. This means that some adult children are buying some of assets from grandfather (I don't know the specifics). My father talks to grandfather: "Your lawyer says it will be better if I buy the Arkansas lot from you." Here's a check for $2,500 [more than the open market value; this lot is in a proposed planning community that flopped]. Grandfather response, "Well, I've got more than that in it."

I think about that moment all the time. He died 2 days later. But in that moment, he was worth $2 million+ (and likely had $50k in his checking account), but he wanted his son to pay him at least $500 more for an empty lot ... that if they hadn't done this, the same son would inherit this lot upon his death.

Without question, his frugality and entrepreneur mindset was what allowed him to amass a huge net worth for a kid who chopped wood for 6 days a week during the Great Depression. But he could never escape that mindset. He would never have thought to order the steak instead of the cheapest burger at a restaurant. He would travel, but it would always be bare bones & 3rd class. In fact, another famous story was about him not being able to go on a trip and leave a few eggs behind, so he put them in his carry-on bag (where they promptly cracked).

He's a perfect example of being stuck in a mindset that got him there has now outlived its usefulness. So I push myself to think about when should money be traded for experiences. What is the value of this dollar now compared to what it may have been different 5, 10, or 40 years ago?? What's the point of accumulating resources if we don't use them to enrich our lives instead of some green pieces of paper or a certain number on a bank account screen?

Thanks for sharing this story. It reminds me of how one of my relatives was dying of cancer (literally in hospice), asked for low fat yogurt. I was like well you can have the full fat. She looked at me and I saw realization cross her face, but she still ate the fat free yogurt. She was well under 100 lbs when she passed. This experience was sad in a number of ways, but also a good reminder to me how we adopt rigid thinking patterns and it is good to revisit these thoughts/ideas/philosophies/ways of interfacing with ourselves and the world. This particular relative died the year she retired too. Enjoy your days, no more than this moment is promised to us.