Stuck

[chairman5]

Here is my situation:

Me:54. Spouse 48.

Assets:
Taxable: 1.7M
Retirement accounts: 600k
Home equity: 700k

Debts: 154k mortgage at 3.5%

Income: 300-400k per year depending what n distributions.

Other: I also have 700k worth of company stock that doesn’t Fully vest till I am
65. If I retire earlier I only get 50% if the principal (350k) based on restrictive stock agreement. A significant part of My yearly income is from the company stock distributions.

So I would forfeit about 350k if I retire prior to 65.

What would you do?

[erutio]

What would you do?

Figure out your spending.  If under $105k per year, then retire.

[efree]

11 years is a long time to work for money you don't need. I would say it is not worth it. You already seem very well off financially. And erutio is right, it does depend on how much you want to spend in the retirement.

[Omy]

That's a lot of time to trade for an uncertain amount of money. Stock is very fickle...what happens if there's a major price drop...or if the company is no longer in business in 11 years?

[former player]

11 more years for a total of $350k is just over $31k a year.  Really?  The price of your freedom is only $31k a year?  Aren't you worth more than that?

You've got $3 million in assets.  Go back and read MMM's blog on the 4% rule. Then calculate your annual expenses in retirement.  That will tell you whether you can retire now.

But honestly?  You are already 54 years old.  That's not exactly young.  I retired at 50 and haven't regretted a year of it, and I bet you won't either.

[John Galt incarnate!]

11 years is a long time to work for money you don't need. I would say it is not worth it. You already seem very well off financially.

+1

[mistymoney]

Enron














what I'd worry about if I was staying just to get the stock.

[Linea_Norway]

Golden handcuffs are really not so golden when you compare them to those 11 years you have left in (presumingly) reasonably good health before you can officially retire. Life can be feeble. Grab your chance while you can. You've got plenty as long as you have your spending under control.

[chairman5]

Thanks for the responses.  I'm pretty new to this blog.  Enjoying the reading. 

Our spending is in the 100k range per year.  Book in good health.  We could certainly make it work.    I recently hit the FI area where I can reasonably think about this whole subject.  It seems the input I have here is pretty unanimous, which helps give me some courage.  Have to admit, it is ingrained in me to work and cutting out early when I could add significantly to the assets (at least 1.5 mill if business is just OK) is not in my DNA.  Makes me feel guilty.

Do need to find something to retire to...  Don't hate the job.  Don't love it.  A lot of folks on these boards are looking to retire in their 30s to spend time with the kids.  Mine are in college (which is paid for) so not sure ready to golf and read all day.  Although that doesn't sound horrible :)

[ZMonet]

With a spend of $100k/year, and investable assets of a little over $2.5 million (factoring in the $350k of company stock) you are right at the 4% mark.  You're not terribly far from being able to collect social security so as long as you are confident your spend wouldn't go up (health care?) then you're probably technically there. 

As for what to retire to, I think you're right that you need to think that through. For some of us, the money is actually easier than determining what we would do in retirement.  Once you've identified a few things you might want to do, could you potentially take a 2-3 month break to pursue them?  It might help you put work in better perspective; maybe you appreciate the structure and work you do more, or maybe you realize that it is time for you to jet.   

[BicycleB]

Do need to find something to retire to... 

Ever read any Ernie Zelinski books? Maybe use those to trigger some explorations.

"How to Retire Happy, Wild and Free"
"The Joy of Not Working"

You could explore 10+ hours a week until you find something that makes you say "Why would I work when I could do THIS?" That's when you give notice.

[Linea_Norway]

Our spending is in the 100k range per year. 

As you are reading this blog, you might find that 100K spending per year is pretty high. As someone mentioned above, you can afford to live off that. But to me it sounds like you don't know exactly. If you have no real idea of how much you spend and you are not particularly frugal, you might want to get a bit more control of your expenses, to ensure you won't be spending more than 100K a year.

Why don't you start tracking your expenses into a few categories, and see if you have some expenses that you can replace by cheaper ones, or cut out completely. If you manage to control your expenses and get them down to e.g. 75K a year, this might give you more confidence that your FIRE project would be a success. Then you will have learned the skills to not spend blindly.

[GuitarStv]

Here is my situation:

Me:54. Spouse 48.

Assets:
Taxable: 1.7M
Retirement accounts: 600k
Home equity: 700k

Debts: 154k mortgage at 3.5%

Income: 300-400k per year depending what n distributions.

Other: I also have 700k worth of company stock that doesn’t Fully vest till I am
65. If I retire earlier I only get 50% if the principal (350k) based on restrictive stock agreement. A significant part of My yearly income is from the company stock distributions.

So I would forfeit about 350k if I retire prior to 65.

What would you do?

Whatever the fuck I wanted to do.  You've got enough saved that you can very comfortably retire, but if you're happy working then keep doing so.

You're loaded.

[chairman5]

<<Why don't you start tracking your expenses into a few categories, and see if you have some expenses that you can replace by cheaper ones, or cut out completely. If you manage to control your expenses and get them down to e.g. 75K a year, this might give you more confidence that your FIRE project would be a success. Then you will have learned the skills to not spend blindly.>>

I do use Mint and Personal Capital to track finances, including spending.  In general, here are finances for last 12 months (realize this is 3 to 4 mouths - and this September my wife and I have empty nest so should find some areas of savings without a ton of trouble):

Per Month:

Recurring Expenses
Mortgage - 833 (P&I only)
Non-health Insurance -500 (personal Umbrella, auto, home, life)
Property tax - 650
Personal Tax - 80 (personal autos taxed in VA)

Cell Phone - 280 (pay for kids as well)
Home connectivity - 240 (FIOS, etc)
Water/Sewer - 100
Power - 150
Gas - 150
Groceries - 900
Clothing - 500
Auto (gas) - 200
Auto (maintenance) - 200
household - 500



Discretionary
DIning - 750
Travel - 1,500
Personal care - 120 (gym, occasional manicure for spouse)

Total - $7,653/month = $91,836/year

As you can see, I live in a high cost of living area, reflected primarily in property tax, utility costs, dining, and groceries.  It is the Wash DC area.  Also, in retirement we would also cut back on dining and groceries naturally since we now are down to just my spouse and I as kids just left nest - these numbers reflect 4 mouths.

I think we could shave it down to $6,400 per month without much effort (just on groceries and dining out) and, if we moved out of HCOL area, down to $5,200 without much effort.  Assume no move and the difference of $1,253/month would be used up in medical costs and medical insurance, which we need to obtain, and we are back to $92k per year.  Leaves still a bit of buffer with the 100k number.

Biggest thing is we would need the 1.7M in taxable investments to stretch 4+ years till I am 59.5 and can tap retirement accounts.  Three years after that we would get approx. $2,700 per month in social security.

[erutio]

...
Biggest thing is we would need the 1.7M in taxable investments to stretch 4+ years till I am 59.5 and can tap retirement accounts. ...

You think you'll have trouble spending less than 1.7M in 4 years?  When the upper limit of your spending now is likely $100k per year?

[erutio]

Mr. Chairman, based on your spending, you are financially independent right now, and can retire right now.

You're spending will go down in Sept, when you have an empty nest, as your groceries and utilities will go down.  Optimize your dining out and travel, and you will really have a nice buffer. 

I realize you may not be ready for such a change right away, but take some time to get used to the idea you can retire now.  But definitely do not work another 11 years. 

[chairman5]

Your insurance costs are ridiculously high.  You do not need life insurance any longer -- your assets mean you are self-insured. 

Cell phone costs also ridiculous, even for four people.  If you want to keep covering the kids, go on a family plan.  Once you are 55 you can put three people on a Tmobile senior plan -- I think the rate is $35/month/person now (we are grandfathered in at 30).

Connectivity costs are also ridiculous. 

Clothing, too.

Are you seriously worried about your 1.7 mill in taxable not lasting 4 years?

LOL no!  It isn't that the 1.7M needs to last 4+ years (I'm not that bad at math!), just that I can only use that in terms of income and drawdown to obtain the 100k per year till 59.5.  That kitty needs to help us last till we are 85+, at least some of it.

I know about cell phone and home connectivity.  It burns me how much we pay.  I think I will look into YouTube TV.  Also, have Iphones with VzW service.  Unlimited data plans.  Family would not be happy if I took that away and could create more stress with them than worth.  What is reasonable for us to pay for smartphone for 3 people?  285 a month is for 3 smartphones, unlimited voice and data.  I get mine through work.

Clothing - 230/month is my wife's stichfix.  What can I say, it is her only real spending extravagancy.  And she looks good in that stuff...

[HovEratoTo]

On the phone bill - that's where you need to ask yourself if it's worth continuing to work (at something you feel "meh" about) to give your family luxuries.

Yes, these are luxuries. They do not need things like cell plans with all the bells and whistles.

My husband and I have two cell phones that we bought off plan for $250 each. We use Ting (which is on the Tmobile network) and pay about $50 a month for both of us. We use WiFi whenever possible to keep our phone costs down.

I have young kids so who knows how I'd feel in 15 years but I'm more of a hardass than you. I would tell them - I will pay up to X amount because that's what will get you reasonable coverage. After that, you can pay your OWN money to have the bells and whistles. I plan to use the same approach with TV, clothes, sports, etc. They need to understand that things cost MONEY and money requires someone's TIME and past a certain point of them being fed/clothed/sheltered/schooled/given opportunities, it is up to them to work hard for life's luxuries.

My 2 cents.

Also, I've seen what happens when kid's abuse their parent's generosity. My own parents had to bail my brother out multiple times in his 20s, and I've seen other parents really struggle to keep up with their children's bad financial decisions. Lay the law now. :)

[HovEratoTo]

Oh and one more thought on the cell phone. I was a little nervous to try Ting. We just went into it with the mindset "This is an experiment. The worst that happens is we try it for a month or two, we hate it, we go back." And it worked for us, we're saving $50+ per month on our bill (we already were on a cheap Tmobile plan). We both have smartphones and we're happy with what we've got.

[chairman5]

Oh and one more thought on the cell phone. I was a little nervous to try Ting. We just went into it with the mindset "This is an experiment. The worst that happens is we try it for a month or two, we hate it, we go back." And it worked for us, we're saving $50+ per month on our bill (we already were on a cheap Tmobile plan). We both have smartphones and we're happy with what we've got.

Well done!  And you are taking an approach I wish I would have been better out with kids and money.  We were much more laisse-faire.  When they graduated from high school though we did give them a several thousand dollar cash gift and basically said, "this is it, we pay for college and this gift. Spend it how you like but you need to work for what lifestyle you want."  Two things we have continued are cell phone and of course medical insurance.

[chairman5]

Your insurance costs are ridiculously high.  You do not need life insurance any longer -- your assets mean you are self-insured. 

Can you expound on this?  I have done some shopping and haven't found much better rates.  These are all with Allstate so we get some bundling discounts too.

Personal Umbrella - 400/year
Auto -  $2,500/year (2 cars, 2012 Toyota Highlander and 2015 Toyota camry (I have myself, my wife, and my two kids - 18 and 20 covered - all good driving records - 20 year old had one minor accident only with our car)
Home - 600/year standard policy - 500 deductible - never really use it.
Life - yes I have waffled on this.  My quasi financial advisor recommended keeping it till I was 60 since the amount isn't that high.  I pay 100 per month and wife pays 44 per month.  both healthy.  250k each term insurance.

[charis]

You should not be paying for your adult children's unlimited data plans - you are not doing them any favors by catering to this.  I have a 25/month plan with 1G and I regularly add another 1G for $5 when I need it.  Family plans are not the great deal that they used to be and wifi is everywhere.  They can get with the program.  My elderly parents are still paying for my 30-something sibling's cell (supposed to pay them each month but never does).  It's embarrassing, don't be those people.

[BicycleB]

You can resign as soon as you're done reading my wonderful message.  :)

I'd drop the life insurance, though. You have enough money, it doesn't fill a need, and it costs more than it's worth.

You pay about $1700/year for it. It only pays $250,000. It's a money loser unless your combined odds of death per year are higher than 1700/250,000 = .68%.

Check the acturial tables per Social Security:

https://www.cdc.gov/nchs/nvss/mortality_tables.htm

You and your wife's combined chance of dying per year is about .16%, therefore the life insurance costs 4 times its expected payout. Dump it.

There's a 1 in 600 chance one of you is going to die in the next twelve months. Do you want to spend that time at your job?

[chairman5]

You can resign as soon as you're done reading my wonderful message.  :)

I'd drop the life insurance, though. You have enough money, it doesn't fill a need, and it costs more than it's worth.

You pay about $1700/year for it. It only pays $250,000. It's a money loser unless your combined odds of death per year are higher than 1700/250,000 = .68%.

Check the acturial tables per Social Security:

https://www.cdc.gov/nchs/nvss/mortality_tables.htm

You and your wife's combined chance of dying per year is about .16%, therefore the life insurance costs 4 times its expected payout. Dump it.

There's a 1 in 600 chance one of you is going to die in the next twelve months. Do you want to spend that time at your job?

Thanks. Wow that’s some serious calls. I’m done

[BicycleB]

You're welcome.

Re-reading, I posted a hard to read link. Here's the link I meant:
https://www.ssa.gov/oact/STATS/table4c6.html

To be clear, I...um...also miscalculated details. I don't think it should change any decisions, but that's for you to decide. So, full disclosure:

In the table linked above, I read the wrong line. I saw you at 54, wife at 48, and somehow read the "age 58" lines for each of you. Correct odds are based on .071% chance for you in one year, .026% for her. Combined, that's about .1% ... roughly a 1 in 1000 chance, not 1 in 600.

This means the life insurance is even more overpriced compared to current risks, so no change in outcome there. The more important decision is obviously work vs other options. Regarding that - you're free, do as you wish.

Sorry to be picky and macabre at the same time. All this is meant with good intentions. It's your life. Live it to the hilt!

[mistymoney]

Your insurance costs are ridiculously high.  You do not need life insurance any longer -- your assets mean you are self-insured. 

Cell phone costs also ridiculous, even for four people.  If you want to keep covering the kids, go on a family plan.  Once you are 55 you can put three people on a Tmobile senior plan -- I think the rate is $35/month/person now (we are grandfathered in at 30).

Connectivity costs are also ridiculous. 

Clothing, too.

Are you seriously worried about your 1.7 mill in taxable not lasting 4 years?

LOL no!  It isn't that the 1.7M needs to last 4+ years (I'm not that bad at math!), just that I can only use that in terms of income and drawdown to obtain the 100k per year till 59.5.  That kitty needs to help us last till we are 85+, at least some of it.

can you articulate why taking that out of the taxable bucket rather than across or from retirement buckets makes a big difference in your thinking here?

[acepedro45]

@Bicycle_B

I disagree with your term calculations. You dropped a decimal point in your revised post (0.007170 =.717% not .071%), plus conceptually you should be evaluating each term policy separately. For what it's worth, I agree with the decision to drop the policies even though my math shows each to be a "winning" investment.

It's basically a longshot lottery ticket that only pays off if the OP dies. So unless he is keenly interested in maximizing value for his heirs, (OP has indicated this is not a priority above) it makes sense to drop the policy.

Here's the gory details the way I see it:

Husband:
100 premium * 12 = 1200 annually
Chance of collecting at age 58 = .007170 per the table
Expected value of payout = 250,000 * .007170 = 1,793
So the husband is paying 1,200 for an expected payout of 1,793 this year using the SSA's mortality estimates.

Similar math and conclusion applies to the wife's policy.

Term insurance can have a positive EV late in the policy's life. Since term has a level premium but mortality is rising slowly throughout the life of the policy, consumers are generally overpaying for insurance in the early years but end up underpaying in the later years.

Lastly, the general SSA mortality table we used here almost certainly overstates the OP's chances of dying. As an affluent person with a (presumably) white collar job, he probably has better mortality than the general population that the SSA table captures. Better mortality makes the term calculation more and more of a wash and supports dropping the policy.

[SunshineGirl]

[/quote]
I know about cell phone and home connectivity.  It burns me how much we pay.  I think I will look into YouTube TV.  Also, have Iphones with VzW service.  Unlimited data plans.  Family would not be happy if I took that away and could create more stress with them than worth.  What is reasonable for us to pay for smartphone for 3 people?  285 a month is for 3 smartphones, unlimited voice and data.  I get mine through work.

[/quote]

I pay usually less than $100/month for three smartphones (Iphones) on Ting (Sprint network). With Ting, you pay on usage, and we're always in the highest category for data & pretty high for messages, too. In other words, unlimited. No contracts & fantastic customer service, too.

[fuzzy math]

Once your phones are paid off you can switch to Page Plus Wireless (runs off of Verizon towers), and get unlimited everything for $50 per person. Not that you all need that. I use their $30 plan which includes 3 gigs, or you and your spouse could look at the $40 plan with 8 gigs. Additional data is available, it just runs slower.
Your kids do need to learn about data management because when they're off on their own, they may realize how expensive it is, try to go cheap and end up with a giant data overage charge. The biggest killers of data are streaming videos and music when not on wifi. You might find that they're burning all the data simply because they aren't connected to the wifi at school, their job, their friend's apartment etc. Or you might find out that you're paying $$$$ for them to not even use a ridiculous amount of data that Verizon offers.

You are most definitely not stuck. I couldn't tell whether your phone call was to cancel your insurance or quit your job. I hope its both!

[BicycleB]

@Bicycle_B

I disagree with your term calculations. You dropped a decimal point in your revised post (0.007170 =.717% not .071%), plus conceptually you should be evaluating each term policy separately. For what it's worth, I agree with the decision to drop the policies even though my math shows each to be a "winning" investment.

It's basically a longshot lottery ticket that only pays off if the OP dies. So unless he is keenly interested in maximizing value for his heirs, (OP has indicated this is not a priority above) it makes sense to drop the policy.

Here's the gory details the way I see it:

Husband:
100 premium * 12 = 1200 annually
Chance of collecting at age 58 = .007170 per the table
Expected value of payout = 250,000 * .007170 = 1,793
So the husband is paying 1,200 for an expected payout of 1,793 this year using the SSA's mortality estimates.

Similar math and conclusion applies to the wife's policy.

Term insurance can have a positive EV late in the policy's life. Since term has a level premium but mortality is rising slowly throughout the life of the policy, consumers are generally overpaying for insurance in the early years but end up underpaying in the later years.

Lastly, the general SSA mortality table we used here almost certainly overstates the OP's chances of dying. As an affluent person with a (presumably) white collar job, he probably has better mortality than the general population that the SSA table captures. Better mortality makes the term calculation more and more of a wash and supports dropping the policy.

@acepedro45 - You're right, I did. Good catch!!!

So... does that mean his chance of dying per year is also higher than what I said? I don't want to be macabre, just to follow up the math because OP's responded to it. If I re-read correctly, his individual chance is about 1 in 140 (1/.00717=139.4). In response to the question of whether to keep working, even more reason to go live his best life ASAP if I understand correctly now.

Anyway, thanks for the pointer.

[acepedro45]

So... does that mean his chance of dying per year is also higher than what I said?

No I presume his chance of dying is actually less than the SSA estimate we both used in our calculations. He's higher income and presumably has access to better medical care, living environment, probably not in a dangerous job, plus all the other mortality prolonging things that come along with the affluent life.

With lower mortality, the expected value of his insurance lottery ticket gets lower and closer to breakeven with his 1,200 annual premium.

[Nick_Miller]

Maybe I missed it, but I'm shocked that no one focused on $1,650 monthly for food...for two people??

Hell, chop that in half and that's $9600 in yearly savings, and with 4% rule, it reduces your needed Stache by $240,000!!

OP, you are so FI that it's ridiculous. Do what brings you joy, you've earned it, but have you ever considered...

volunteering to a cause need and dear to your heart?
writing a book?
working with some elementary school kids to read?
taking a huge road trip or doing something like walking the Appalachian Trail?
learning/practicing yoga?
running for local office?
starting a charity/scholarship fund?

I mean, your options are ENDLESS.

[Sanitary Stache]

I imagine when I am 55 and retired I will create 3-dimensional models of my Town's buried utilities - like those ants hills that are filled with concrete.
https://www.youtube.com/watch?v=lFg21x2sj-M
And probably work as a back up water operator.  I am also imagining I can create jobs that don't exist because I won't need to be paid for them.
When I get there I wonder if I'll remember these ambitions.

[ScreamingHeadGuy]

I imagine when I am 55 and retired I will create 3-dimensional models of my Town's buried utilities - like those ants hills that are filled with concrete.
https://www.youtube.com/watch?v=lFg21x2sj-M
And probably work as a back up water operator.  I am also imagining I can create jobs that don't exist because I won't need to be paid for them.
When I get there I wonder if I'll remember these ambitions.

Holy fuck that is amazing.  But think about how many ants died in that concrete.

OP - you are so FI.  If you use your frugality muscles even a little bit you are more than set (you spend more on clothes than my mortgage payment). 

[chairman5]

Maybe I missed it, but I'm shocked that no one focused on $1,650 monthly for food...for two people??

Hell, chop that in half and that's $9600 in yearly savings, and with 4% rule, it reduces your needed Stache by $240,000!!

OP, you are so FI that it's ridiculous. Do what brings you joy, you've earned it, but have you ever considered...

volunteering to a cause need and dear to your heart?
writing a book?
working with some elementary school kids to read?
taking a huge road trip or doing something like walking the Appalachian Trail?
learning/practicing yoga?
running for local office?
starting a charity/scholarship fund?

I mean, your options are ENDLESS.

Hi Nick - Thanks for the encouragement and great ideas.  The food budget is for my wife and kids.  The last is going to college in September.  The older one is in college but still around a bit for summers and breaks and seems like we tend to eat out a lot when we are all together again. Whats funny is  with college these days, between long summer breaks and in-year breaks, they really are home 5-6 months still a year.   In any case, I do expect the monthly bill for food to drop to the 1,000 per month area this September.

Actually I am starting to practice yoga.  I volunteer a good bit with church, etc.  I read, golf, fish, and play tennis and soccer and enjoy yardwork. I would like to do more cooking and transition to a healthier diet in the process.   Also, we give a good chunk to charity each year, which I want to continue and actually is also part of the reason I am hesitant to quit.  But not a huge factor.

[bbates728]

Hi! Your original post asked what we would do in your situation. I think some of the other posters have provided ample answers on that topic. I think the question is going to be what will YOU do? That is based on what YOU want to spend year over year, month over month.

Your budget line items blow mine out of the water but you haven't seemed like you are wanting to cut down to what the avg MMM user chooses AND THATS OK. It does make me ask what you are hoping to spend? You have the ability to retire today and spend $106,000 a year forever. Is that going to be enough for you? It might mean that when your kids come home you spend time in the kitchen learning new recipes together. It might mean that you push your kids off of your cell plan. It might mean that you reduce from unlimited data to paying per gig (with the added benefit that you and your spouse aren't always staring at a screen!).

You don't have to make all of the changes that MMM and other forum users prescribe but if you make a few changes that you can still get under $106,000.

Ideas provided so far:
Cut life insurance
Reduce coverage on your vehicles and remove your adult children
Increase deductible on home insurance (you said it yourself that you haven't used it)
Reduce food bill/month

You are in an awesome spot but now you have to decide what is important to you. That means asking tough questions such as "Do I value being with my wife more than spending $1600 on food this month?", "Do I want my children to know I love them by paying for XYZ or by being with them and helping them navigate their own financial lives?"

You have already won the $ race. Now you get to have fun. Make sure that if you do decide you want to continue earning to provide for more luxury that you still enjoy the work. There will be no judgement if you decide to earn more instead of retiring; just make sure you make that decision consciously!

Let us know what you decide! It would be great to hear how it goes!

[Villanelle]

Chairman, if you are nervous about pulling the plug now, what about scaling back.  That could be asking your company to let you go part time, starting a small consulting business (if your experiences make that feasible), or just getting a small part time job.  Even working a couple days a week as a barista or at a flower shop, or substitute teaching, could easily bring in $25k/year, covering about 1/4 of your projected expenses.  That might make quitting feel a bit less extreme. 

You can also consider volunteer activities that both give you something to retire to, and maybe help cut expenses.  This could be things like being a theater docent and thus getting to see shows for free, or volunteering at a museum and getting a free annual pass. 

[2Birds1Stone]

I would have quit yesterday. So much fat in your budget to trim, and you are already able to cover more than your current expenses using a 4% WR. Not getting any younger at this point.

[BicycleB]

Chairman, if you are nervous about pulling the plug now, what about scaling back.  That could be asking your company to let you go part time, starting a small consulting business (if your experiences make that feasible), or just getting a small part time job.  Even working a couple days a week as a barista or at a flower shop, or substitute teaching, could easily bring in $25k/year, covering about 1/4 of your projected expenses.  That might make quitting feel a bit less extreme. 

You can also consider volunteer activities that both give you something to retire to, and maybe help cut expenses.  This could be things like being a theater docent and thus getting to see shows for free, or volunteering at a museum and getting a free annual pass.

Is there a typo in the bolded part? (If a "couple of days" is "two days", that's about $250/day. Quite a coffee shop/ flower shop/school!)

[2Birds1Stone]

Is there a typo in the bolded part? (If a "couple of days" is "two days", that's about $250/day. Quite a coffee shop/ flower shop/school!)

Maybe this is a special coffee or flower shop? Where you can get a $4 cup of coffee or the $104 cup of coffee (w/ a BJ of course)

[Villanelle]

Two 8 hour shifts=16 hours a week, for 52 weeks=832 hours, at $15 $12480.  And there are two people in the family, so...  (Granted that doesn't account for taxes, so it would be quite 1/4 of expenses.)

[fuzzy math]

Is there a typo in the bolded part? (If a "couple of days" is "two days", that's about $250/day. Quite a coffee shop/ flower shop/school!)

Maybe this is a special coffee or flower shop? Where you can get a $4 cup of coffee or the $104 cup of coffee (w/ a BJ of course)

Or a marijuana bar ...

[noplaceliketheroad]

Two 8 hour shifts=16 hours a week, for 52 weeks=832 hours, at $15 $12480.  And there are two people in the family, so...  (Granted that doesn't account for taxes, so it would be quite 1/4 of expenses.)

This... is strange.

Him and his wife, for a total of 32 hours a week, can combined pull $25k a year (generous math on your part, never heard of a barista consistently clearing $15 an hour). Or he can work 40 hours a week and make 300-400k.

I think he can easily retire now, and probably should! But I don't think him and his wife working at a coffee shop is the alternative. Put in one more year and it's more money than both would make barista-ing for over a decade.

Also, as a former child of parents who paid my cell phone and car insurance through college and until I found my first full time job, I didn't turn out spoiled or entitled. I was deeply grateful, was able to graduate college early since it got my full attention, and I've been paying my parent's cell phone bill since I was 22 (now 35). They paid for it from 16-22 so turns out it was a good investment for them to let me concentrate on school! Thanks 'rents!

[Villanelle]

Two 8 hour shifts=16 hours a week, for 52 weeks=832 hours, at $15 $12480.  And there are two people in the family, so...  (Granted that doesn't account for taxes, so it would be quite 1/4 of expenses.)

This... is strange.

Him and his wife, for a total of 32 hours a week, can combined pull $25k a year (generous math on your part, never heard of a barista consistently clearing $15 an hour). Or he can work 40 hours a week and make 300-400k.

I think he can easily retire now, and probably should! But I don't think him and his wife working at a coffee shop is the alternative. Put in one more year and it's more money than both would make barista-ing for over a decade.

Also, as a former child of parents who paid my cell phone and car insurance through college and until I found my first full time job, I didn't turn out spoiled or entitled. I was deeply grateful, was able to graduate college early since it got my full attention, and I've been paying my parent's cell phone bill since I was 22 (now 35). They paid for it from 16-22 so turns out it was a good investment for them to let me concentrate on school! Thanks 'rents!

$15 is minimum wage is some places.  So now, I don't think that's "generous".  I also mentioned substitute teaching, which generally pays more.  You seem weirdly hyper focused on the barista thing.  I used that as one example because of the term "barista FIRE".  There are plenty of chill, part time, low stress jobs to earn a few bucks. And if you'll notice, I also mentioned consulting, which I suspect pays well ore than $15/hr.

Are you saying it would be challenging for 2 people to earn $25k in a year with fairly few hours and low stress?  Surely not. 

I threw it out as an example of a way to step down.  If a high pressure, high hours job is too much, but he can't bring himself to stop earning money, there are ways that he can slow his drawdown in the early years, while still walking away from the stress and time commitment of a full time, high-responsibility job.  Yes, he can work 40 hours a week and make $350k.  BUT HE DOESN'T SEEM TO WANT TO DO THAT.  Yet he is having trouble pulling the trigger.  Brista-FIRE (the concept, not necessarily *literally!*) is one way to get over the psychological hump when quitting work forever and starting to pay all expenses from your stache seems a bit too daunting.  It's a step down, which is what some people need when they aren't ready to jump off a cliff.

[Omy]

Both options work well. When I suggested to my husband that one or both of us get a part time job with health insurance benefits (since this was my biggest emotional obstacle to retiring early), he countered with the suggestion to work one more year at our high income levels and use the additional stash to purchase health insurance over the next decade. We ended up going with his plan and his last day is tomorrow : )

I'm glad we did it his way instead of tethering ourselves to different jobs for the next 9-13 years (when we will be eligible for Medicare). The option to get jobs along the way is still there, but it's nice to know it's an option and not a requirement.

[Linea_Norway]

Just reduce your working hours at your current job and see how you like that. Then you will keep that high income, but some more of your own time.

[mistymoney]

Thanks for the responses.  I'm pretty new to this blog.  Enjoying the reading. 

Our spending is in the 100k range per year.  Book in good health.  We could certainly make it work.    I recently hit the FI area where I can reasonably think about this whole subject.  It seems the input I have here is pretty unanimous, which helps give me some courage.  Have to admit, it is ingrained in me to work and cutting out early when I could add significantly to the assets (at least 1.5 mill if business is just OK) is not in my DNA.  Makes me feel guilty.

Do need to find something to retire to...  Don't hate the job.  Don't love it.  A lot of folks on these boards are looking to retire in their 30s to spend time with the kids.  Mine are in college (which is paid for) so not sure ready to golf and read all day.  Although that doesn't sound horrible :)

given this - use your FI leverage and value to the company to scale back a bit, and focus on developing a PT role in something you would enjoy more.

[MrThatsDifferent]

I read through this cause I can’t sleep and you’re one of the few people who I think should work until retirement at 65. I think your expenses are high and you like a certain lifestyle. It also seems you don’t have a plan and I worry that you might be one of those guys who struggles without work. Might as well keep work, build that nest egg, then sit on boards, or run charities or do something that keeps you engaged, just less pressure. Keep working at something, I think it will help you live longer.

[chairman5]

I read through this cause I can’t sleep and you’re one of the few people who I think should work until retirement at 65. I think your expenses are high and you like a certain lifestyle. It also seems you don’t have a plan and I worry that you might be one of those guys who struggles without work. Might as well keep work, build that nest egg, then sit on boards, or run charities or do something that keeps you engaged, just less pressure. Keep working at something, I think it will help you live longer.

LOL - well hopefully this thread put you to sleep.  This is a fitting final summary.  As you and many others indicate, I have the money to FIRE but something is holding me back.  It is likely purpose.  As of now I mostly like to get up and enjoy my drive to work - not dreading.  Until I find a new purpose, I should probably keep on keepin on.  Perhaps, unlike many on this board I didn't even consider the idea of FIRE until the last 2-3 years.  At 55 years old, if I had been planning it for 10-15 years, perhaps I would be ready now and have had designed a new "vocational" purpose to dive into.

[chairman5]

So... does that mean his chance of dying per year is also higher than what I said?

No I presume his chance of dying is actually less than the SSA estimate we both used in our calculations. He's higher income and presumably has access to better medical care, living environment, probably not in a dangerous job, plus all the other mortality prolonging things that come along with the affluent life.

With lower mortality, the expected value of his insurance lottery ticket gets lower and closer to breakeven with his 1,200 annual premium.

Have we firmed this up?  Is my chance of dying next year 1 in 140 or 1 in 600?  That is not a small difference...