Author Topic: quitting before fi  (Read 6306 times)

sbryant31

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quitting before fi
« on: November 13, 2014, 06:15:59 AM »
Hey all.  Would love to share my situation and get a bit of advice. I'm 24 years old. I'm a typical engineer out of college who has focused for the past two years on saving fervently, my expenses are about 20k and I have 61k after taxes. (Got a big performance raise.) Expenses could be lower but... 8k in medical bills last year. (2 tooth crowns, tonsillectomy, various specialist visits, high deductible plan)

I got really lucky and my company just sold so in 2016 I'll be getting ~150k from stock options (this will be taxed as income). I calculate my net worth will be about 200k after taxes.

I'm not one to complain in this situation but my job is stressful. I have trouble coping, I've developed various "twitches", elevated blood pressure, but I'm doing alright because I focus every day on health and wellness. I feel like most of my spending goes towards negating the stressful effects of my job, which is really annoying. I don't know what I want to do instead, but maybe I'd like to take an early sabattical to figure it out.

So I'm maybe a quarter of the way to true FI and the question is, do I quit my promising and lucrative career as a web engineer to pursue my passions? I feel my future self may kick me for the opportunity cost. I imagine I'll make just enough money to get by without using my savings and hopefully still save a bit. But I feel like these are my most important years to save.
« Last Edit: November 13, 2014, 11:06:55 AM by sbryant31 »

MathNinja

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Re: quitting before fi
« Reply #1 on: November 13, 2014, 06:49:32 AM »
A couple quick clarifications:
Any student or other debt?
If your expenses for the year include 8K in medical (assuming you just had an unlucky year) - you are doing great on keeping costs low.
You mention that you'll get paid for the sale of the company in 2016 - you'll need to stick it out until then to get paid, right?

If you are super-stressed and getting performance based raises, can you possibly gear down a little and merely do an adequate job? If you can do this until 2016, you'll be in such great shape. Assuming you are saving $40K of the $61K post tax money in years 2014 - 2016 + a $150K bonus... you'll have nearly $300K (assuming a small return over the 3 year period). It sounds like you would then be in a position to draw $15K/yr (5%) of your 'stash and pursue your passions then. Alternately, you could probably take any less stressful job and just leave the $300K to compund until you are ready to FIRE.

'Course you'll need to keep expenses down and stay disciplined (don't we all?!).

With your spending so low, you are putting yourself in a great position.
Good luck,
MathNinja

BooksAreNerdy

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Re: quitting before fi
« Reply #2 on: November 13, 2014, 06:59:34 AM »
I just wanted to offer up some support. My DH is a manufacturing engineer and was recently promoted to management. He has stress and anxiety from work.  He developed panic attacks that have mostly resolved with a little talk therapy, a few books, and a low dose of anti anxiety meds.

Another engineer that works under my husband has developed stress related hair loss.

My dad is a psychiatrist in California and he was telling me that the software engineers that work for a big tech company have come to see him with suicidal thoughts due to stress.

Engineering is a very high stress career.

My husband did take a year off between jobs at one point. Be traveled in an rv for a while and tried going back to school. He was not even close to FI.

I understand your position, just consider what it might look like on your resume if you have a big gap since your last job.

I'm sorry you are in such a stressful position.

Murse

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Re: quitting before fi
« Reply #3 on: November 13, 2014, 07:00:26 AM »
Well.. Do you think the stress is from that environment specifically or do you feel you would be stressed in all computer engineer jobs? With a net worth of 200k and yearly expenses of 20k, you are currently at 10x expenses and need 25x, you are almost half way! If it were me I would hold out to see if a different job would be the same and attempt to find something you love to destress your life. If you have already tried these then you only have 3 options. 1) toughing it out till FI, 2) toughing it out meanwhile actively looking for something else or 3) taking a sabbatical. If you can find something you love but it takes you longer to achieve FI, is that okay with you? are you willing to give up your current earning power? To put it in perspective, I think most people your age would love to trade places with you. Great job on your head start, my vote is whatever you do, don't blow it all.

forummm

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Re: quitting before fi
« Reply #4 on: November 13, 2014, 08:04:47 AM »
If the stress is too much, change jobs. There are plenty of places that would love to hire an engineer to work reasonable hours and lower stress. Worst case you make a bit less money, but you'll probably enjoy your life more.

I recently decided not to go for a job that would probably have paid 2-3 times my current salary. It would have been a big life change, been stressful, more work hours, less vacation time, etc. I'm saving a lot as it is, and I'm getting close to retiring anyway. Even if it increases my time to retirement by a year or two, the stress wasn't worth it for me.

sbryant31

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Re: quitting before fi
« Reply #5 on: November 13, 2014, 10:59:34 AM »
A couple quick clarifications:
Any student or other debt?
If your expenses for the year include 8K in medical (assuming you just had an unlucky year) - you are doing great on keeping costs low.
You mention that you'll get paid for the sale of the company in 2016 - you'll need to stick it out until then to get paid, right?

If you are super-stressed and getting performance based raises, can you possibly gear down a little and merely do an adequate job? If you can do this until 2016, you'll be in such great shape. Assuming you are saving $40K of the $61K post tax money in years 2014 - 2016 + a $150K bonus... you'll have nearly $300K (assuming a small return over the 3 year period). It sounds like you would then be in a position to draw $15K/yr (5%) of your 'stash and pursue your passions then. Alternately, you could probably take any less stressful job and just leave the $300K to compund until you are ready to FIRE.

'Course you'll need to keep expenses down and stay disciplined (don't we all?!).

With your spending so low, you are putting yourself in a great position.
Good luck,
MathNinja

Hey math ninja.  Thanks for your response.

To clarify: I have no debt.

With regards to your advice:

That sounds like a great idea. I think sticking it out until the big payday makes a lot of sense. But what about the taxes? If I make 150k from the stock options alone in 2016, any more money I make (say 80k) gets taxed very highly, so it may actually be a good idea to make less money in 2016 or go take a vacation/sabbatical.

I'm thinking the takeaway is: keep plugging away through the end of 2015 and then take a vacation year during 2016 to start up a business, see the world, maybe go back to school, or otherwise follow my passions. Does that sound like a good plan?
« Last Edit: November 13, 2014, 11:04:01 AM by sbryant31 »

snshijuptr

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Re: quitting before fi
« Reply #6 on: November 13, 2014, 11:46:10 AM »
Have you thought about getting Contract work? I had a friend a while back who enjoyed working 60-80 hours a week for months at a time then taking the same time to do nothing. It was his best work style. Similarly I have a friend now who works 10 hours a week for $80 an hour but some weeks there is no work. Contract work, when you aren't worried about where your next meal will come from, can be a great way to reduce stress. You just need 1-3 clients who will need you on and off. I know that well connected Web Engineers can always pick up a bit of work.

sbryant31

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Re: quitting before fi
« Reply #7 on: November 13, 2014, 12:08:29 PM »
Have you thought about getting Contract work? I had a friend a while back who enjoyed working 60-80 hours a week for months at a time then taking the same time to do nothing. It was his best work style. Similarly I have a friend now who works 10 hours a week for $80 an hour but some weeks there is no work. Contract work, when you aren't worried about where your next meal will come from, can be a great way to reduce stress. You just need 1-3 clients who will need you on and off. I know that well connected Web Engineers can always pick up a bit of work.

This is a great idea and i think very amenable to my lifestyle. I am always looking for the next big thing. And I work very hard. At my current company, I spent the first year working like a dog and I loved it. But after that I've felt like I need a little bit of a break. Contract work would also allow me to move around a lot which is a big plus.

Thank you for this response!

nereo

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Re: quitting before fi
« Reply #8 on: November 13, 2014, 12:37:00 PM »

To clarify: I have no debt.

... I think sticking it out until the big payday makes a lot of sense. But what about the taxes? If I make 150k from the stock options alone in 2016, any more money I make (say 80k) gets taxed very highly, so it may actually be a good idea to make less money in 2016 or go take a vacation/sabbatical.

I'm thinking the takeaway is: keep plugging away through the end of 2015 and then take a vacation year during 2016 to start up a business, see the world, maybe go back to school, or otherwise follow my passions. Does that sound like a good plan?
If you can plug away through 2015 I think you'll be in a superb position financially - hopefully that wouldn't come at the expense of your health or sanity though.
Once you get into 2016, I'd follow your passions and/or seek out lower-stress employment.  At that point in the 'wealth-accumulation-curve" contributions will start to be less important, and you can just let your investments coast.  All you need to do is earn enough/year to cover your expenses and maybe fund your IRA.  I'm guessing there are lots of places that would fight to hire you for ~$40k/year in a part-time, low stress capacity.  By the time you're in your early 30s you fully declare FI and do whatever you want.

sbryant31

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Re: quitting before fi
« Reply #9 on: November 13, 2014, 12:58:16 PM »

To clarify: I have no debt.

... I think sticking it out until the big payday makes a lot of sense. But what about the taxes? If I make 150k from the stock options alone in 2016, any more money I make (say 80k) gets taxed very highly, so it may actually be a good idea to make less money in 2016 or go take a vacation/sabbatical.

I'm thinking the takeaway is: keep plugging away through the end of 2015 and then take a vacation year during 2016 to start up a business, see the world, maybe go back to school, or otherwise follow my passions. Does that sound like a good plan?
If you can plug away through 2015 I think you'll be in a superb position financially - hopefully that wouldn't come at the expense of your health or sanity though.
Once you get into 2016, I'd follow your passions and/or seek out lower-stress employment.  At that point in the 'wealth-accumulation-curve" contributions will start to be less important, and you can just let your investments coast.  All you need to do is earn enough/year to cover your expenses and maybe fund your IRA.  I'm guessing there are lots of places that would fight to hire you for ~$40k/year in a part-time, low stress capacity.  By the time you're in your early 30s you fully declare FI and do whatever you want.

I'm so excited! Sometimes I feel like it will never end... but I can't imagine how good life will be in just a few short years. Holding strong.

Thanks for the support, everyone.

FOBStash

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Re: quitting before fi
« Reply #10 on: November 13, 2014, 12:58:31 PM »
Health is truly wealth. For someone who's been in a high stress work situation before, it is not worth sticking it out unless you are the type who can let things emotionally slide. But from your medical issues, this is not a sustainable situation.

You have a nice windfall, I'd take at least 2 months of mini-retirement to just decompress and get re-energized. It seems you are burnt out. See if you can cut expenses during this time but this should not be a major setback financially. With your engineering career path, you can find a company that has more work life balance and get your journey back to FIRE.

Pigeon

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Re: quitting before fi
« Reply #11 on: November 13, 2014, 01:09:49 PM »
I would probably look around for another job in your field, maybe after if you think you can hang in there until the big stock deal.  Companies have different working environments.  Is there anything you could do in academia or in a government position?  There are certainly stresses in those positions, but they are different.

I would not quit and stay out of the workforce very long in a tech field if I thought I would need to get back into it.

sbryant31

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Re: quitting before fi
« Reply #12 on: November 14, 2014, 07:27:05 AM »
I would probably look around for another job in your field, maybe after if you think you can hang in there until the big stock deal.  Companies have different working environments.  Is there anything you could do in academia or in a government position?  There are certainly stresses in those positions, but they are different.

I would not quit and stay out of the workforce very long in a tech field if I thought I would need to get back into it.

Yeah, I've been considering going back to school to get a master's degree, which although stressful, has always been something I rather enjoyed... and possibly working for a government agency or doing a Ph.D. afterwards.

waltworks

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Re: quitting before fi
« Reply #13 on: November 14, 2014, 08:31:23 AM »
How certain is the stock option payout (both in terms of it actually happening, and the price of the stock/value of the bonus)? If it's a dead-certain thing, I'd probably stick it out and cash in. If not, I'd consider quitting now and finding something lower stress. Your health is a funny thing... really mess yourself up, and you can be paying for it the rest of your life.

-W

Pigeon

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Re: quitting before fi
« Reply #14 on: November 14, 2014, 08:38:28 AM »
How certain is the stock option payout (both in terms of it actually happening, and the price of the stock/value of the bonus)? If it's a dead-certain thing, I'd probably stick it out and cash in. If not, I'd consider quitting now and finding something lower stress. Your health is a funny thing... really mess yourself up, and you can be paying for it the rest of your life.

-W

I was thinking in terms of working in academia, not suggesting you go back to school, although that's an option of course.  I'm not entirely sure what a web engineer does.  I work at a university that's part of a larger state system and we do hire lots of computer people.  These people generally are paid less than their counterparts in private industry, but the jobs aren't as demanding, either, and the benefits are pretty good.

Icecreamarsenal

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Re: quitting before fi
« Reply #15 on: November 16, 2014, 12:40:55 AM »
Yes, quit. You're young enough to find something you're passionate about, and rebound if it doesn't work out.

You've already determined if it's your particular job or that career path in general.

You only live once.

arebelspy

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Re: quitting before fi
« Reply #16 on: November 16, 2014, 07:16:30 AM »
So I'm a big advocate of "quit if you don't like your job," but your situation of ~200k is merely some FU money, it's not even halfway to true FI.  So make sure you think of it that way.

Given that it's FU money, it provides you a cushion to quit and find something new or just take some time off.  But you will need to make more money.

And that's what I see missing from this thread. I see you saying "follow my passions" 2-3 times, but no indication you know what that means. That's not a magical phrase that will make you happy or make you money. If anything it will add more stress many times. Do you have passions?  What are they?

I see you mention grad school. Okay. That's certainly fun (many of us enjoy being students - no job, you just get to learn about something you like, what a dream life), but what's the long term plan?  Doing grad school with plans for academia will leave you in about 5 years with a degree, probably back to square one in terms of money (I.e. Having burned through most or all of the FU money), and with very tough job prospects that don't pay much (I don't know what field you'll be in, so maybe the actual field will pay more, but I'm specifically talking about academia).

Sounds like a very bad plan if you want early FI.

I think the root cause is being left unaddressed by a lot of people - your stress. That's something you need to solve, regardless of what you do next. How can you reduce that, and make sure it's not affecting your health, whatever job you're in?

By all means, quit if you need to. But come up with some semblance of a plan if you're going to, and address the root problem, don't just think quitting solves it by addressing a symptom that very will can pop up later at your next job(s).

Good luck!  :)
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lpep

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Re: quitting before fi
« Reply #17 on: November 16, 2014, 08:40:36 AM »
Just gonna throw this into the mix:

On $15k passive income, you can easily "slow travel" in SE Asia for a year. Probably South/Central America too. And you'll break even!

Ricky

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Re: quitting before fi
« Reply #18 on: November 16, 2014, 01:42:51 PM »
arebelspy is spot on, but I'll give you my own perspective.

I've been working since 16 basically (not full time until 18-19) and just recently graduated with a BS in MIS this year. I'm 24 now.

For the past 4 years, I went to school full time online, had a full time retail job, installed satellites on the side, and also fixed computers on the side. That's in addition to maintaining a decent social life and a girlfriend. If you want to talk stress and burn out, then look no further than my situation. Four years later in my job, I'm still only making ~$14.5/hr. Granted, I'm in a very rural area and live at home currently, so my options are limited here. I'll be moving to take advantage of my education soon. I'm not necessarily saying your situation is less stressful than mine, just that it could always be worse. And retail is notoriously bad because its so demanding for little pay. Everything has a price, and if you're getting compensated for that stress, then it can be worth it to stick in it. I should have quit forever ago, but I'm glad I didn't.

The point I'm making is, you're in a great situation.  Only 2 years of work and you're making incredible money while maintaining super low expenses. I'm not saying these things won't happen for you in the future, but you're too young to give it up in my opinion. So really, don't quit unless you have a grand plan on how to circle back around. Every time I take a few weeks off or ask for part time, I seem to always end up getting restless and want to get back on the train to FI as quickly as I got off. Again, if you have specific plans, this won't happen to you, I'm just saying to make sure you do indeed have the specifics of the why, how, when, where, etc, worked out.
« Last Edit: November 16, 2014, 01:50:07 PM by Ricky »