Author Topic: [Case study] Trapped in semi-retirement at 30?  (Read 5596 times)

brice

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[Case study] Trapped in semi-retirement at 30?
« on: February 17, 2018, 04:46:13 AM »
Hi there, I’m a long-time reader (since 2012 I think) but first-time MMM writer, reaching out as I feel I’ve hit a brick wall and want to make use of the hive-mind that I always imagined was lurking on these forums… prove me right!

I live in the UK, by the sea, in a town with zero job prospects (literally zero) but rock-bottom cost of living. I am a freelance book designer, with a wife, small child and three-legged cat, just about to turn 30.

My wife helps me with the freelance business (Ltd company), so I split my salary between us both, resulting in no personal tax liability. I work 3.5 hours a day, 5 days a week, making an average £15k a year. My spreadsheet lists a net monthly income of £1200, which is pretty reliable.

My monthly expenses are:

Rent = £600
Food/misc expenses = £300 (done on a 1% reward credit card)
Council tax = £130 (I forget the US equivalent to this, sorry)
Energy = £75
Car insurance = £20
Water = £35
Internet = £30

This adds up to £1190, which means officially there’s only £10 being stashed each month (plus 2% back on most bills as it's a reward account). We have an EV, so no extra fuel or road tax, and have a large overdraft facility to cover emergencies (health care being free in the UK). However, this lifestyle has left me with just £500 in savings and £300 cash on hand.

What I’ve done, of course, is let myself get carried away with the MMM movement (mixed in with a little Tim Ferris) but taken a shortcut… I've never put in the gruelling hours of high-paid city-based work, pretty much just done this since I graduated, and at the moment am enjoying long mornings with my family.

I have an office (walking distance) and a colleague, both of which I took on last year, but the colleague’s extra output just pays their own salary and the office fees!

Is it simply a case of figuring out how to earn more, should I be trawling business forums instead?

Happy to provide more info. Thanks for reading!

Zamboni

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #1 on: February 17, 2018, 05:03:54 AM »
three-legged cat, just about to turn 30.

Holy moly a 30 year old, 3 legged cat! Surely you can turn this into some sort of youtube or snapchat celebrity cat and profit?

Seriously, though, one answer is to work more hours yourself instead of paying that money for the colleague (unless the colleague is really more of a partner who will just take all the extra business with him or her upon departure.)

If there are no job prospects in your town, then it sounds like you need to get creative with how you and your wife can earn money working from home. Or you can just resign yourself to being one calamity away from being out on the street.

What other skills do you have? My brother and his wife live in a rural town with similarly absolutely no job prospects. None. Their solution was to create jobs for themselves . . . he owns a skilled business where most of his work is in his home shop but them he has to deliver the goods at least a 30 minute drive away; she teaches music lessons at home. It turns out that there are so few options for personal enrichment where they live that lots of people are willing to drive fairly far and pay a good rate for music lessons. I would not have predicted this. Therefore, think about what skills you have.

Villanelle

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #2 on: February 17, 2018, 05:13:14 AM »
I'm not entirely sure what you are looking for.  It sounds like you are willing to work more than 17 hours a week.  So, how are you currently getting business?  Can you simply do a bit more of whatever that is?  Have you considered signing up with some online services.  (I'm not sure exactly what you mean by "freelance book designer", but if that is something like cover art, there are several online services, and you could set up your own simple website as well.) 

Also, what other skills do you have, and what other tasks are needed in your area?  Can you watch some else's kids for a couple hours a day, for example?  Mow lawns?  Cook and sell soup?  (Someone where I live has started this and sells a 1 qt mason jar for $10 and she has more business than she can handle.)   Detail cars?  Clean homes (or vacation rentals if you have those in your area)? 

Forever Wednesday

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #3 on: February 17, 2018, 05:38:41 AM »
It sounds like you either need to expand your business or move to a different location and profession. Your current situation is not sustainable.

The bad news:

- Basically no savings / assets
- Your net income (~£15000) is equivalent to a single full time worker earning slightly less than minimum wage.
- Your child's needs are going to increase as he/she grows.

Here's the good news:

- You guys seem pretty flexible, with no house tying you down to anywhere.
- You are already used to frugal living, which is a big hurdle for many.
- You are educated (you cite a graduate degree) and self-motivated (you run your own business).

Honestly if I were in your situation and my goal was early retirement, I'd opt for a complete business / career change. You need more security for your family, and book design just doesn't sound very lucrative to me.
« Last Edit: February 17, 2018, 05:43:56 AM by Forever Wednesday »

matchewed

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #4 on: February 17, 2018, 05:51:59 AM »
I don't really see a question.

katekat

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #5 on: February 17, 2018, 06:57:43 AM »
Congrats on your frugal living! You're doing so great on your expenses, £300 to feed 3 people and a cat is pretty amazing and I'm awed by your lack of other personal/luxury spends, it seems like you have great discipline. Being a true spendypants in comparison to yourself, I'm certainly not qualified to lecture you in any length on these. However (as a Northerner), £600 rent/£130 council tax is nothing to criticise but also not what I think of as "rock-bottom cost of living". Do these reflect the cheapest you'd be willing to go in your area, or is there room to make cuts here? It's hard to judge this without knowing your area of the country, but given how tight your cashflow is, saving even £100 here could make things seem less tight over time.

Do you/your partner qualify for any benefits you're not claiming? With a kid it could be possible. Worth checking https://www.entitledto.co.uk/

Are you/your wife accruing NI contributions through your self-employment, or not? The way I see it (and barring big changes to the retirement system in the next 30 or so years), this makes a big difference to whether your situation is dire or not. If you're making NI contributions, you're just-making-it-right-now but also in a position where you're theoretically preparing for retirement. Although you're living very tightly, this might just be a lifestyle choice you make now to not work so hard. If you're not, you're just-making-it-right-now-and-slowly-approaching-a-cliff-edge, which is much worse.

What are your aims? Early retirement? On-time retirement? Or just more money in the budget for emergencies/luxuries?

brice

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #6 on: February 17, 2018, 07:00:03 AM »
Thanks everyone (and thanks for finding the question, those who did!) So far I've got:

  • Consider a career change... are we thinking something I can do remotely in three/four hours a day that will earn more? That will take some thought, but I suppose I do have transferable skills in design.
    The rate for books seems to be stuck at £700ish per project.
  • Look after other people's kids for money - this is potentially genius, especially as we are both qualified teachers of young children (should have mentioned that! but we came to hate the stuff surrounding the job) and I wouldn't have to sacrifice time with my own. Will look into that.

Loved the gag about the cat, must proof read the next one! I actually feel like my work is limited to four hours a day naturally... I find extended creative work beyond that has quickly diminishing returns. (See that book 'Rest', I forget the author.) My wife is doing the admin, and we're turning away work even with another designer on board, hence why I felt a little trapped.

I suppose another question is: what should I be afraid of, besides a devastating illness?

ShoulderThingThatGoesUp

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #7 on: February 17, 2018, 07:11:07 AM »
You’re turning away work? There’s your answer. To be more secure you either need to do more of that work or do some other work too.

Alternately, if you’re turning away work, could you try charging more? Your employee and office should be making you a profit.

brice

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #8 on: February 17, 2018, 07:12:03 AM »
Congrats on your frugal living! You're doing so great on your expenses, £300 to feed 3 people and a cat is pretty amazing and I'm awed by your lack of other personal/luxury spends, it seems like you have great discipline.

Thank you! I've found it difficult to compare our living costs against other examples from the US, but we do grow some veg and mostly cook from scratch. The cat nibbles dry food like it's rationed (but I reckon is scrounging elsewhere.)

Quote
Being a true spendypants in comparison to yourself, I'm certainly not qualified to lecture you in any length on these. However (as a Northerner), £600 rent/£130 council tax is nothing to criticise but also not what I think of as "rock-bottom cost of living". Do these reflect the cheapest you'd be willing to go in your area, or is there room to make cuts here? It's hard to judge this without knowing your area of the country, but given how tight your cashflow is, saving even £100 here could make things seem less tight over time.

Good call. I'll keep an eye out for similar properties that are cheaper, I'm aware that is a huge portion of our income. [Edit: I would need to save up for moving costs though]

Quote
Do you/your partner qualify for any benefits you're not claiming? With a kid it could be possible. Worth checking https://www.entitledto.co.uk/

Will do that now! This has reminded me that we get £80 a month standard child benefit... how could I have forgotten that?! [Edit: crap, turns out I'd factored that in to the £1200 ages ago]

Quote
Are you/your wife accruing NI contributions through your self-employment, or not? The way I see it (and barring big changes to the retirement system in the next 30 or so years), this makes a big difference to whether your situation is dire or not. If you're making NI contributions, you're just-making-it-right-now but also in a position where you're theoretically preparing for retirement. Although you're living very tightly, this might just be a lifestyle choice you make now to not work so hard. If you're not, you're just-making-it-right-now-and-slowly-approaching-a-cliff-edge, which is much worse.

What are your aims? Early retirement? On-time retirement? Or just more money in the budget for emergencies/luxuries?

I think the NI is taken when my other half does payroll. So, before the £1200. Best check though!

I just wanted to check I'm not heading for disaster, but also want to be moving in the right direction. So all of those aims! This has all been really helpful, thanks.
« Last Edit: February 17, 2018, 07:18:47 AM by brice »

Zamboni

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #9 on: February 17, 2018, 07:13:44 AM »
The second option might be the easiest win right now . . . it would also give your little one a regular playmate, which makes the day smoother sometimes.

I get what you are saying about the mental limitation on creative work. When I'm done, I'm done. Everything after that is a forced death march. Is there anything you can do to provide more efficiency in your work?

Laura33

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #10 on: February 17, 2018, 09:54:48 AM »
There are a bunch of different paths, all of which are fine.  A lot of people here do the “work your ass off for 10-20 years and then kick back to part-time/family time/other pursuits.”  You, OTOH, seem to have jumped right to the “part-time/family time/interesting pursuits” path right from the start.  IOW, you are basically living many people’s versions of a post-FIRE lifestyle now.  So if you are happy doing what you are doing indefinitely, then you are fine.

But it doesn’t sound like you are happy; it sounds like you feel like you are working as hard as you can and living tightly and feeling like you are barely keeping your head above water.  In which case, you should look to make some changes.

The thing is, you’re pretty much in a “have your cake and want to eat it too” spot.  There are very, very few people who can work 4 hours/day in mentally satisfying work and still make buttloads of money and have free cash flying around all the time - and even fewer of them at your age/career phase.  If you want to make more money, something needs to give.  You will need to find a way to work 8 full hours a day, if not more, and/or do less-enjoyable/better-paid work, and/or move to another part of the country where those kinds of jobs are more plentiful.  So the question you need to ask yourself is are those tradeoffs worth it?

One other idea:  since you are turning away work, what about hiring another employee?  If the first one is covering their own salary and your office expenses, the second one should cover their salary and still have cash to spare for you.

Another option:  if you are working part-time on the creative end, and can’t do more creative work than that, and your wife is working part-time on the business end, why don’t you take over her business work so you have the equivalent of of a full-time job, and she can be free to find some other full-time employment of her own?  Obviously local is a problem, but online/remote work should be available everywhere, or she can come up with her own business.  Or if she is good at managing your business, maybe she can expand that work to helping other local small businesses manage their books and whatever?

The key is to start by figuring out what degree and type of tradeoffs you’re willing to make, and then think creatively about how to go about implementing that choice.

brice

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #11 on: February 17, 2018, 04:53:40 PM »
There are a bunch of different paths, all of which are fine.  A lot of people here do the “work your ass off for 10-20 years and then kick back to part-time/family time/other pursuits.”  You, OTOH, seem to have jumped right to the “part-time/family time/interesting pursuits” path right from the start.  IOW, you are basically living many people’s versions of a post-FIRE lifestyle now.  So if you are happy doing what you are doing indefinitely, then you are fine.

But it doesn’t sound like you are happy; it sounds like you feel like you are working as hard as you can and living tightly and feeling like you are barely keeping your head above water.  In which case, you should look to make some changes.

The thing is, you’re pretty much in a “have your cake and want to eat it too” spot.  There are very, very few people who can work 4 hours/day in mentally satisfying work and still make buttloads of money and have free cash flying around all the time - and even fewer of them at your age/career phase.  If you want to make more money, something needs to give.  You will need to find a way to work 8 full hours a day, if not more, and/or do less-enjoyable/better-paid work, and/or move to another part of the country where those kinds of jobs are more plentiful.  So the question you need to ask yourself is are those tradeoffs worth it?

One other idea:  since you are turning away work, what about hiring another employee?  If the first one is covering their own salary and your office expenses, the second one should cover their salary and still have cash to spare for you.

Another option:  if you are working part-time on the creative end, and can’t do more creative work than that, and your wife is working part-time on the business end, why don’t you take over her business work so you have the equivalent of a full-time job, and she can be free to find some other full-time employment of her own?  Obviously local is a problem, but online/remote work should be available everywhere, or she can come up with her own business.  Or if she is good at managing your business, maybe she can expand that work to helping other local small businesses manage their books and whatever?

The key is to start by figuring out what degree and type of tradeoffs you’re willing to make, and then think creatively about how to go about implementing that choice.

Thanks Laura, that's a really insightful summary. The forum has not disappointed! Your first two paragraphs really capture the very heart of the situation... most days I feel grateful (even a little smug), others I feel a bit nervous, and I still have to force myself to work when I'm not in the mood. I will add 'find another employee' to the list of good ideas from the thread.

Llewellyn2006

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #12 on: February 17, 2018, 06:58:57 PM »
To my mind there's no point in having an employee/s if they only cover their costs. They should be adding profit to the business. If there's enough work that you're turning it away that would suggest that there's some scope for increasing your rate, even an extra 5 or 10% would make a difference.

katekat

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #13 on: February 19, 2018, 02:49:35 AM »
Good call. I'll keep an eye out for similar properties that are cheaper, I'm aware that is a huge portion of our income. [Edit: I would need to save up for moving costs though]
It's worth also considering what kind of property (number of bedrooms/space/house or flat/good or bad area) are you living in now and whether it's necessary for your needs or whether you're willing to make do with a less expensive option, as well as just looking for a better deal on maintaining a similar standard to what you have now. Obviously whether this is doable really depends on what kind of place you live in now.

Quote
Are you/your wife accruing NI contributions through your self-employment, or not? The way I see it (and barring big changes to the retirement system in the next 30 or so years), this makes a big difference to whether your situation is dire or not. If you're making NI contributions, you're just-making-it-right-now but also in a position where you're theoretically preparing for retirement. Although you're living very tightly, this might just be a lifestyle choice you make now to not work so hard. If you're not, you're just-making-it-right-now-and-slowly-approaching-a-cliff-edge, which is much worse.

What are your aims? Early retirement? On-time retirement? Or just more money in the budget for emergencies/luxuries?

I think the NI is taken when my other half does payroll. So, before the £1200. Best check though!

I just wanted to check I'm not heading for disaster, but also want to be moving in the right direction. So all of those aims! This has all been really helpful, thanks.
It might be worth both of you checking your national insurance records.

Is it necessary for your business to have an office? I can imagine reasons why it might be necessary, but it's still worth asking -- if you could re-arrange so that your colleague and you both work from home, or both work from your home, presumably that will save the business a lot in rent and create a lot of additional profit.

I suppose another question is: what should I be afraid of, besides a devastating illness?

I don't want to get too grim on this so I'm not going to write the list of things that I, as a risk-averse person, would be afraid of in your position. But to my eyes there's a lot to be afraid of in the general case of 'extremely tight cash flow without any luxuries in the budget', even in the case that you feel happy without those luxuries. You're in a precarious position if, say, rent rises in your area. You don't seem to have room to be saving up to replace assets you already own as they break down -- car, computers and phones if you have them, for example -- so your current lifestyle doesn't seem indefinitely sustainable on your current budget.

I'd be worried about standard-age retirement even if you're happy to keep working as you currently do until then. State pension may be enough for you two if you can keep up your current level of frugality (and again, assuming you have enough NI qualifying years) but we also may see significant changes to the system and it's good to have some kind of safety net of your own.

And this one is maybe coming from my spendypants nature so feel free to disregard but -- I'd be worried that your current budget will become too restrictive to keep up indefinitely -- no room in there for christmas/birthday gifts for kid, or school trips, or clothing for any of you? Don't get me wrong, I'm super impressed that you're managing it for now and apparently have been for several years, but does it really represent something you're willing/able to do forever?

Villanelle

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #14 on: February 19, 2018, 04:09:47 AM »
Good call. I'll keep an eye out for similar properties that are cheaper, I'm aware that is a huge portion of our income. [Edit: I would need to save up for moving costs though]
It's worth also considering what kind of property (number of bedrooms/space/house or flat/good or bad area) are you living in now and whether it's necessary for your needs or whether you're willing to make do with a less expensive option, as well as just looking for a better deal on maintaining a similar standard to what you have now. Obviously whether this is doable really depends on what kind of place you live in now.

Quote
Are you/your wife accruing NI contributions through your self-employment, or not? The way I see it (and barring big changes to the retirement system in the next 30 or so years), this makes a big difference to whether your situation is dire or not. If you're making NI contributions, you're just-making-it-right-now but also in a position where you're theoretically preparing for retirement. Although you're living very tightly, this might just be a lifestyle choice you make now to not work so hard. If you're not, you're just-making-it-right-now-and-slowly-approaching-a-cliff-edge, which is much worse.

What are your aims? Early retirement? On-time retirement? Or just more money in the budget for emergencies/luxuries?

I think the NI is taken when my other half does payroll. So, before the £1200. Best check though!

I just wanted to check I'm not heading for disaster, but also want to be moving in the right direction. So all of those aims! This has all been really helpful, thanks.
It might be worth both of you checking your national insurance records.

Is it necessary for your business to have an office? I can imagine reasons why it might be necessary, but it's still worth asking -- if you could re-arrange so that your colleague and you both work from home, or both work from your home, presumably that will save the business a lot in rent and create a lot of additional profit.

I suppose another question is: what should I be afraid of, besides a devastating illness?

I don't want to get too grim on this so I'm not going to write the list of things that I, as a risk-averse person, would be afraid of in your position. But to my eyes there's a lot to be afraid of in the general case of 'extremely tight cash flow without any luxuries in the budget', even in the case that you feel happy without those luxuries. You're in a precarious position if, say, rent rises in your area. You don't seem to have room to be saving up to replace assets you already own as they break down -- car, computers and phones if you have them, for example -- so your current lifestyle doesn't seem indefinitely sustainable on your current budget.

I'd be worried about standard-age retirement even if you're happy to keep working as you currently do until then. State pension may be enough for you two if you can keep up your current level of frugality (and again, assuming you have enough NI qualifying years) but we also may see significant changes to the system and it's good to have some kind of safety net of your own.

And this one is maybe coming from my spendypants nature so feel free to disregard but -- I'd be worried that your current budget will become too restrictive to keep up indefinitely -- no room in there for christmas/birthday gifts for kid, or school trips, or clothing for any of you? Don't get me wrong, I'm super impressed that you're managing it for now and apparently have been for several years, but does it really represent something you're willing/able to do forever?

Also, if you or your partner gets sick, or a kid gets sick, for even a couple weeks and you can't work, because everything is cut so close, you have a problem.  If sales slump slightly for even a few months, you have a problem.  If your car dies or needs a major repair, you have a problem. 

Your exact same situation, but with 5 months expenses in savings, would be very different.

In your shoes, I would bust my butt and work more hours (whether that's at your primary job or adding some child-minding on the side, or both) until I got a large savings account, and then I'd go right back to where you are now (assuming you are going to be happy working 3 hours a day until the day you die).  More likely, I'd do that and then go down to, say... 25 hours  a week once I had the savings built up, so that I might be able to retire someday. 


Forever Wednesday

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #15 on: February 19, 2018, 04:19:31 AM »
Thanks everyone (and thanks for finding the question, those who did!) So far I've got:

  • Consider a career change... are we thinking something I can do remotely in three/four hours a day that will earn more? That will take some thought, but I suppose I do have transferable skills in design.
    The rate for books seems to be stuck at £700ish per project.
  • Look after other people's kids for money - this is potentially genius, especially as we are both qualified teachers of young children (should have mentioned that! but we came to hate the stuff surrounding the job) and I wouldn't have to sacrifice time with my own. Will look into that.


Is your limit 3-4 hours per day, or are you willing to work more hours for an increased salary? Personally I would be nervous about your current situation as you have no buffer for emergencies. To increase that buffer it seems like you'd need to put more hours in no matter what you do (expand your business, learn new skills, or start something new). I'd first aim for a cash buffer that covers ~3 months of living expenses, which in your case is ~£4000. And then think about investing and prepping for FIRE after this.

A couple of things that spring to mind,

1) Does your business have its own website? How would you feel about transferring your current skills to something like website design? This would allow you to work remotely with flexible hours and could play to your strengths.

2) Totally understand not liking the teaching gig... But it means you have qualifications that you're not tapping into! How about personal tutoring? This will allow you to set your own hours as well.
« Last Edit: February 19, 2018, 04:21:21 AM by Forever Wednesday »

index

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #16 on: February 19, 2018, 06:53:00 AM »
Honestly, you are living paycheck to paycheck and calling it semi-retirement. Semi-retirement implies you are set up financially to a point where you no longer really need to save money and can coast to your retirement date on portfolio appreciation. This free your time to enjoy some fun job to cover your basic expenses in the meantime. You haven't put in the time to financially protect yourself or your family.

The solution to your problem is over simple. You need to be working 2.5x now than you are now.

Bicycle_B

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #17 on: February 19, 2018, 05:17:59 PM »
Yep, find some more work.  At some point, Stoicism requires effort in order to achieve satisfaction.  This will pay emotional as well as financial dividends once you face it.  You're currently coasting on a tightrope instead of getting ahead.

Once you get used to the new job/business/workstyle, it will be tolerable and you are probably capable of getting used to it.  Be it a new employee or doing the business part and having your wife get a job, or whatever other option you choose, you can do it.  In your shoes, I'd honestly try to do 2 or 3 new things: 

1. Raise rates bit by bit, so you start getting ahead financially on the same workload, even if the gain is only £1200 to £2400/year.
2. Start doing more of the business piece, working up to where wife can get separate job.
3. Experiment with the fun / feasible small businesses, such as teaching, tutoring, child care, etc.
4. Explore the housing cost thing.
4. Shoot for a 50% savings rate.  Each step can add up. 

Neal Stephenson works 4 hours a day too and is a successful writer.  But the rest of the day he does engaging physical play such as repairing engines, experimenting with how to do and record sword fights, etc.  You need income from the creative downtime, so you're going to have to find a way to earn income somehow.  Would you rather give up the location and job that you have, or add some side activity to it?

Bear in mind that sooner than you think, things can change for the worse.  You need a prudent reserve in your habits.  Use the luxury you have now - a brief stable period of breaking even - to build your next income source.  Whether by age or health or changing markets or unexpected events, something will interrupt the current pattern.  Get ahead of that incoming wave by doing something now, while you still have the freedom to choose your direction without duress.

TL;DR - You're not trapped.  You have to face an emotional barrier or two and make some decisions.  You can do this.
« Last Edit: February 19, 2018, 05:22:02 PM by Bicycle_B »

boarder42

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #18 on: February 20, 2018, 01:02:40 PM »
i dont get how there is 0 work anywhere - people are always willing to pay someone to do something they dont want to do - do you not have lawns that need mowed or driveways to shovel etc.

reeshau

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Re: [Case study] Trapped in semi-retirement at 30?
« Reply #19 on: February 21, 2018, 07:08:59 AM »
To my mind there's no point in having an employee/s if they only cover their costs. They should be adding profit to the business. If there's enough work that you're turning it away that would suggest that there's some scope for increasing your rate, even an extra 5 or 10% would make a difference.

There are a lot of great points here, but this thought brought up another question for me:  what kind of hours is your employee working, in order to be at this breakeven level?  Are you scheduling them only 4 hours a day, the same as you schedule for yourself?  And, if so, have you actually asked them how much they prefer to work?

I am wondering how aware the employee is about the fact the business is turning work away; as the business owner, you could take advantage of their desire to hustle, without it having to drive yourself to the same level.  Of course, the quality of their output has to be maintained, but I wonder how open this topic of work hours / business opportunities is with your employee.

 

Wow, a phone plan for fifteen bucks!