First, the 4% rule applies to all invested assets; the type of account they are in doesn't matter. So I would count the IRA, but not the cash you intend to hold to cover current expenses. The 4% rule itself is pretty conservative, so 3% is really conservative. I don't know that that is out of line in your situation, because you are still young and have so many unknowns, and because this is a new concept to you and you might feel better with a bigger buffer -- but using 3% AND excluding $600K of your 'stache from that calculation is pretty ridiculously conservative.
So, yes, I think you are FI now, even if you stay put, and likely would be even moreso if you follow your plan and move somewhere that is even cheaper. Here's what I would do in your situation:
1. Cash in the life insurance. You have no dependents, so you don't need it. Even if you want to make sure to your mom has enough if something happens to you, you already have a giant 'stache to leave to her. You will do much better investing that $175K-ish on your own.
2. Begin tracking your expenses with YNAB or some other. My biggest caveat about your plan is that you
think you are spending
@$3700/mo. But I'm not sure that includes everything -- for example, I'm sure that doesn't include your $12K in charity last year, right? Do you want to be able to continue to make good-sized charitable contributions? If so, then you need to plan for it in your budget. IME the best way to figure out what your real lifestyle is is to look at everything you are actually spending money on -- and don't kid yourself that XYZ is just a "one-time" expense, because life has a way of throwing other XYZs at us on a pretty frequent basis. So since you are not actively miserable in your job, I would take a few months to really dig into the numbers and do some planning so you feel more prepared and confident when you leave.
3. Once you leave, I would strongly suggest starting a Roth ladder, beginning the year after you FIRE -- if you are unfamiliar with it, it means converting a portion of your IRA to a Roth every year. The big caveat here is that the amount you convert each year is considered taxable income, so you do pay taxes on it -- but the magic here is that once you FIRE and your salary goes away, the amount you convert is probably your
only taxable income.* And that allows you to decide how much you want to convert in a way that minimizes your tax liability -- for example, with the new $12K standard deduction, if the conversion is your only taxable income, you can convert $12K each year and pay no taxes on that money, ever. This is basically free permanent tax avoidance on the amounts you convert, so it would be stupid not to take advantage of that to the maximum extent possible. Whether you want to convert more to take advantage of the 10% tax bracket is up to you.
The Roth ladder is a longer-term plan: you need to have it established for 5 years before you can begin drawing from it. So for your first 5 years, you'd be relying on your cash and sales of your stocks/bonds to pay your way; after that, you could choose to draw from the Roth or continue to use the stocks/bonds to allow the maximum tax-free growth from the Roth (personally, I would avoid drawing from the Roth for as long as possible, but that is something you should figure out with an expert given the various tax consequences involved, as per the * below -- there may be years you need to take a little from the Roth to meet your living expenses while still staying in the 0% bracket, for ex.).
In any event, you seem to be in a great position to do whatever it is you decide you want to do -- congrats and good luck!
*Note that any interest from your bonds or bank accounts/MMs would also count as income (unless they are federal tax-free bonds) -- I am just doing basic math here as an illustration. Note also that your CGs from selling your stocks do not count toward this $12K, because those are taxed under the separate CG rates. AND the new CG rate is
also 0% as long as your reported income + CGs is below $38,600K (2018 numbers). So assuming you had no other income/CGs, you could roll over $12K from the IRA to a Roth and then sell enough stock to generate $26,600 in CGs and absolutely no federal tax on any of it! Of course, the reality is going to be more complex, so definitely talk to a CPA or tax specialist to make sure you are considering all of the income sources that will count on your tax return, and to help you develop a strategy of how much to convert/sell/withdraw and from what source to meet your income needs while taking maximum advantage of those 0% brackets.
