Poll

What size stash did you RE on.. (Investable assets only.. pls don't include home equity)?

<$500k
25 (9%)
$500k to $1M
76 (27.4%)
$1 to $1.5M
67 (24.2%)
$1.5 to $2M
37 (13.4%)
>$2 Million
72 (26%)

Total Members Voted: 275

Author Topic: How big was your stash when you RE'd?  (Read 35989 times)

BBub

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How big was your stash when you RE'd?
« on: March 20, 2015, 11:49:00 AM »
Just curious to hear from those who RE'd.  How big was your stash when you made the leap?  If you're planning to actually RE within the next year, please feel free to chime in as well.

Financial.Velociraptor

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Re: How big was your stash when you RE'd?
« Reply #1 on: March 20, 2015, 01:04:42 PM »
<500k if we are talking liquid networth.  A little over 500k if you want to include illiquid assets, especially my paid off primary residence.
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DoubleDown

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Re: How big was your stash when you RE'd?
« Reply #2 on: March 20, 2015, 01:30:24 PM »
I included the guesstimated value of a future federal pension since it offsets the amount of a stash that is needed.
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Exflyboy

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Re: How big was your stash when you RE'd?
« Reply #3 on: March 20, 2015, 04:07:12 PM »
Didn't include the value of pension ($42k a year 6.5 years from now)

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Re: How big was your stash when you RE'd?
« Reply #4 on: March 21, 2015, 09:05:12 AM »
I didn't go by how big my stash was.  I went by how much passive income it would throw off.  That was between $25,000 and $30,000 a year.  (My basic living expenses are $15,000 a year... and dropping.)
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arebelspy

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Re: How big was your stash when you RE'd?
« Reply #5 on: March 21, 2015, 11:44:23 AM »
I didn't go by how big my stash was.  I went by how much passive income it would throw off.  That was between $25,000 and $30,000 a year.  (My basic living expenses are $15,000 a year... and dropping.)

I'm doing the same (rental income).  But for people all in paper assets planning a specific WR (even if flexible), it's definitely more important than it is for us.
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iamadummy

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Re: How big was your stash when you RE'd?
« Reply #6 on: March 22, 2015, 12:25:39 PM »
bout 350

Exflyboy

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Re: How big was your stash when you RE'd?
« Reply #7 on: March 23, 2015, 12:00:20 AM »
Its curious to me that we focus on the size of the stash but in reality its the size of the income that stash generates.

Really this is how we should compare the value of a pension vs a stash.

I.e a $40,000 pension is worth a maximum of $1m. Its not perfect of course because in theory a stash should eventually grow in size with a SWR of 4%.. which in turn leads to more income.. But thats not guaranteed so 4% is the best measure we have.

Focusing on the stash makes sense though because when working we want to know when we can RE.. and that question innevitibly becomes "hey I got $xxxk, do I have enough to retire?

deborah

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Re: How big was your stash when you RE'd?
« Reply #8 on: March 23, 2015, 12:10:29 AM »
The problem is that we often haven't really put together the figures of everything we have coming to us (including pensions, old age benefits of various sorts...) and worked out what our income actually is going to be.

This is exacerbated by us not being sure how much risk is associated with these things. For instance, I have heard that some pensions in the US from some companies have become lower than what was promised. In Australia we have superannuation which is equivalent to the US 401k but it cannot be accessed (unless your doctor signs something saying you are less than 6 months from death...) until you are 60 - and there are numerous rumours that the age will go up. The risks must be a real concern to anyone trying to work out what they can actually count on getting.

happy

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Re: How big was your stash when you RE'd?
« Reply #9 on: March 23, 2015, 03:44:12 AM »
OK, I 'fess up. I wanted to see what everyone had voted in the poll so I voted even though I'm not FIRE. I voted for >2 mm since it doesn't hurt to dream:)

So I've buggered the poll, I'm sorry. I thought there was a way to "unvote " but I can't seem to find it now. If there is please "aware" me of how to do this.
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BBub

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Re: How big was your stash when you RE'd?
« Reply #10 on: March 23, 2015, 06:58:41 AM »
DAMMIT HAPPY I can't believe you did that!! haha, jk, no worries... will keep that in mind when viewing results.

On pensions, rentals, side gigs, passive income... everyone's situation is unique.  I'm not so much worried about the details in this particular poll.. Just use whatever figure you feel is right for your situation - some will include PV of pension payments, or whatever.  I just wanted a big picture glimpse of what asset level various folks felt secure with before deciding to make the leap.

deborah

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Re: How big was your stash when you RE'd?
« Reply #11 on: March 23, 2015, 07:09:53 AM »
Well, it looks like you go for more than 2mil if you're going for more than 1.5mil, otherwise everything over 1/2mil is almost even.

Jack

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Re: How big was your stash when you RE'd?
« Reply #12 on: March 23, 2015, 08:03:35 AM »
OK, I 'fess up. I wanted to see what everyone had voted in the poll so I voted even though I'm not FIRE. I voted for >2 mm since it doesn't hurt to dream:)

So I've buggered the poll, I'm sorry. I thought there was a way to "unvote " but I can't seem to find it now. If there is please "aware" me of how to do this.

You can't "unvote," but FYI there is a "view results" link below the poll so that you don't have to vote to see them.

[MOD NOTE:  I edited the poll so you can remove your vote.  But editing this post, not replying in thread, so this doesn't show up in my replies posts. :) ]
« Last Edit: March 23, 2015, 08:34:07 AM by arebelspy »

Exflyboy

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Re: How big was your stash when you RE'd?
« Reply #13 on: March 23, 2015, 11:02:51 AM »
Oh good.. I realised that I wasn't being quite honest because one could argue that my p.t. gig means I am not really retired (and Wife is working f.t.). During the last three months I clipped over the $1.5M threshold (not counting future pensions) and seeing as the 1.5 to 2M category looked a bit sad I moved my vote to there..:)

English people always root for the underdog...:)

soccerluvof4

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Re: How big was your stash when you RE'd?
« Reply #14 on: March 23, 2015, 12:33:54 PM »
Over 2 mil but i will need it with 4 kids! :-) but needing less and less of it as we get better and better about what were doing
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happy

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Re: How big was your stash when you RE'd?
« Reply #15 on: March 23, 2015, 03:05:40 PM »
OK, I 'fess up. I wanted to see what everyone had voted in the poll so I voted even though I'm not FIRE. I voted for >2 mm since it doesn't hurt to dream:)

So I've buggered the poll, I'm sorry. I thought there was a way to "unvote " but I can't seem to find it now. If there is please "aware" me of how to do this.

You can't "unvote," but FYI there is a "view results" link below the poll so that you don't have to vote to see them.

[MOD NOTE:  I edited the poll so you can remove your vote.  But editing this post, not replying in thread, so this doesn't show up in my replies posts. :) ]

Ok, thank you I have removed my vote.
Thanks for pointing out the "view results" link, I will use that in future :)
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MsRichLife

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Re: How big was your stash when you RE'd?
« Reply #16 on: March 27, 2015, 05:56:53 AM »
I selected >$2M, but a a fair chunk of our stash is tied up in superannuation which I can't access until 65. We also have a toddler and a hopefully many decades of retirement so my 'large' stash still doesn't make be feel secure yet.

dude

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Re: How big was your stash when you RE'd?
« Reply #17 on: March 27, 2015, 07:20:19 AM »
I put $500K - $1MM and that included the value of my small pension as well as my paid off house in a HCOL area which will be downsized soon and some (much) of the equity added to the stash. But like other's, I generally go by the amount of passive income I get rather than my stash size or NW.

Didn't vote because I'm not there yet, but in the same boat as spartana and DoubleDown -- will have a pension to offset need for a bigger stash.  That being said, conservatively projected to have @$800K in @4.5 years when I RE.  If it were just me, I'd already have enough, but DW is 7 years younger and does not have a pension, so I'll need to subsidize her post-retirement portion of our combined expenses. With a very conservative draw (<2%), if any at all, the stash should grow to exceed a million when she gets around to retiring (probably 6-7 years after I do).

bako_frugal

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Re: How big was your stash when you RE'd?
« Reply #18 on: March 27, 2015, 02:06:51 PM »
Eeek, this makes me realize I am way more conservative than many here; or should that be pessimistic.

~1.1M without equity, and without pension.  My pension won't kick in till 2040, and that's sort of scary to be looking that far away.
I consider myself 2-4 years away from FI though.

Dicey

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Re: How big was your stash when you RE'd?
« Reply #19 on: March 28, 2015, 05:22:39 PM »
1.1M in investments, 1.1M house (paid for, so I'm including but not counting it), 1 rental property (soon to be two), pension at age 60 + SS.
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Retired To Win

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Re: How big was your stash when you RE'd?
« Reply #20 on: March 29, 2015, 04:46:40 PM »
Its curious to me that we focus on the size of the stash but in reality its the size of the income that stash generates... Focusing on the stash makes sense though because when working we want to know when we can RE.. and that question inevitably becomes "hey I got $xxxk, do I have enough to retire?

My mind didn't -- and doesn't -- work that way.  I always asked myself instead "hey, I have $xxx passive income do I have enough to retire?"  And I still gauge the value of my stash to my in-progress earlier retirement that way.
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MustacheExplorer

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Re: How big was your stash when you RE'd?
« Reply #21 on: March 30, 2015, 09:34:09 AM »
I included the guesstimated value of a future federal pension since it offsets the amount of a stash that is needed.


I have the same situation.  How did you calculate the cash equivalent value of your pension?

arebelspy

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Re: How big was your stash when you RE'd?
« Reply #22 on: March 30, 2015, 09:47:22 AM »
I included the guesstimated value of a future federal pension since it offsets the amount of a stash that is needed.


I have the same situation.  How did you calculate the cash equivalent value of your pension?

http://forum.mrmoneymustache.com/investor-alley/accounting-question-pension-as-an-asset/
http://forum.mrmoneymustache.com/welcome-to-the-forum/value-of-a-pension/
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arebelspy

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Re: How big was your stash when you RE'd?
« Reply #24 on: March 30, 2015, 10:01:21 AM »
Sure!
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with a kid.
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My Own Advisor

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Re: How big was your stash when you RE'd?
« Reply #25 on: April 07, 2015, 07:20:35 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.
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arebelspy

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Re: How big was your stash when you RE'd?
« Reply #26 on: April 07, 2015, 07:40:17 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.

Don't visit the ERE forums.

;)
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Financial.Velociraptor

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Re: How big was your stash when you RE'd?
« Reply #27 on: April 08, 2015, 12:16:10 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.

I paid off my house before I started accumulating a stache.  With my expenses cut by about 13,000 a year, I found making it on a stash under 500k was trivial.  I just passed 500k for the first time this week with Tuesday's close.  A raging bull market helps a lot.

I had originally planned to pick up a 10-15 hour a week minimum wage job "to keep busy" but found I needed neither the money nor to be busy.
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Cougar

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Re: How big was your stash when you RE'd?
« Reply #28 on: April 08, 2015, 01:40:15 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.


I had originally planned to pick up a 10-15 hour a week minimum wage job "to keep busy" but found I needed neither the money nor to be busy.
2nd.

i do understand for the few, that continuing their career is what they want to do most; for most; there should be plenty of other things to occupy your time.

benjenn

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Re: How big was your stash when you RE'd?
« Reply #29 on: April 08, 2015, 01:55:50 PM »
We're planning on about $650K in 401Ks, plus a paid off mortgage, plus a $30K annual pension.  We really think we can make it on the pension alone and leave the 401Ks to grow for the next 8 years when we can get to them penalty free.  :)
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Re: How big was your stash when you RE'd?
« Reply #30 on: April 08, 2015, 02:31:55 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.

I'm surprised there are so many on these boards that waited until they were over $2MM!  That's $80k/year by the 4% rule and $60k at a super safe 3%.

I figured most would be in the $500k to $1.0MM range.  I believe MMM himself was in the $500k to $1MM category so I figured most other fans of his would be similar.

SMCx3

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Re: How big was your stash when you RE'd?
« Reply #31 on: April 08, 2015, 03:14:23 PM »
1.5M that is our magic #.
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Jon_Snow

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Re: How big was your stash when you RE'd?
« Reply #32 on: April 08, 2015, 03:44:21 PM »
1.5M that is our magic #.

Yep, that was mine.

mrshudson

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Re: How big was your stash when you RE'd?
« Reply #33 on: April 08, 2015, 04:59:27 PM »
Not FIRE yet, but the target is something like $700,000 in investments plus a mostly paid-off house.

bruce88

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Re: How big was your stash when you RE'd?
« Reply #34 on: April 09, 2015, 03:10:43 AM »
I like your post.  However, since the largest number of replies are between 500k and 1M, it would be interesting to see that bracket in more detail (500k-750k, example).  My guess is that many hit FIRE with 600k-800k.  Since some people seem discouraged by the continued brain washing of needing multiple millions to retire, that info would be comforting.

I agree with other postings about net worth/investable assets vs. income.  Personally, we only use about half of our investable assets for income-the rest is liquid reserves or non-income producing real estate (held for capital gains).  If you ever revise the post, maybe asking about the amount of investable assets used for income purposes to FIRE instead of total investable assets.  Gold is an investable asset, but not income producing unless liquidated.

soccerluvof4

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Re: How big was your stash when you RE'd?
« Reply #35 on: April 09, 2015, 08:31:12 AM »
I think over the last year and half to two years I have come to realize that people can retire at all different number and be very happy. There are so many variables and really wants, needs , desire are all part of it. Also where you are in your life as well as if you have a family. Knowing what you need , add your must have wants and afford yourself a margin for some unknowns and it will be easier to establish that number.
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Re: How big was your stash when you RE'd?
« Reply #36 on: April 09, 2015, 08:39:30 AM »
Surprised folks can make it on <$500k.  That would be hard long-term.

I'm surprised there are so many on these boards that waited until they were over $2MM!  That's $80k/year by the 4% rule and $60k at a super safe 3%.

I figured most would be in the $500k to $1.0MM range.  I believe MMM himself was in the $500k to $1MM category so I figured most other fans of his would be similar.

+1

Cougar

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Re: How big was your stash when you RE'd?
« Reply #37 on: April 09, 2015, 08:56:38 AM »
I think over the last year and half to two years I have come to realize that people can retire at all different number and be very happy. There are so many variables and really wants, needs , desire are all part of it. Also where you are in your life as well as if you have a family. Knowing what you need , add your must have wants and afford yourself a margin for some unknowns and it will be easier to establish that number.

i agree with that, but i still have a hard time figuring people need more than a million if you can let go of the consumerism that is the usa. if you dont have car payments and just a house payment and living expenses; you can live pretty cheaply depending upon where your house is.

EscapeVelocity2020

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Re: How big was your stash when you RE'd?
« Reply #38 on: April 09, 2015, 09:03:12 AM »
@Bruce - I'm seeing the largest grouping at >2MM myself, would be more interested to see a further >3MM bracket.  I was also surprised by all the relatively HNW ER's, given the younger skew of this crowd, but there is also some confusion on PV of expected benefits, which certainly are valuable too, but throw off things due to assumptions on inflation, etc.

@soccerluv - +1  In fact, I would go even further to say, the more I read about FI and RE, the more individual it becomes.  I would also add, it is not so much the size of the stache at RE as it is the returns in the market post RE.  For example, if I RE'd in 2009 figuring I can live on 3-4% SWR, I'd be in hog heaven with the annual returns since, and even have buffer for extra spending or a downturn.  On the flip side, if you'd retired in 1999, returns (even with dividends, on S&P) were -9.1%, -11.9%, and -22.1%.  That probably would've sucked, especially in Early retirement, without pension or SS. 
(ref - http://en.wikipedia.org/wiki/S%26P_500). 

So the best generalization I can come up with is that there are conservative folks who pad the stash for various reasons (like their job, good work/life balance, golden handcuffs/benefits, have kids and want to pay for college, nervous about a market downturn, etc.) and there are ER at 4% folks (hate their job, don't have kids, got laid off and 'giving it a shot', entrepreneurial endeavors are more rewarding, etc.).
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Re: How big was your stash when you RE'd?
« Reply #39 on: April 09, 2015, 09:11:36 AM »
So the best generalization I can come up with is that there are conservative folks who pad the stash for various reasons (like their job, good work/life balance, golden handcuffs/benefits, have kids and want to pay for college, nervous about a market downturn, etc.) and there are ER at 4% folks (hate their job, don't have kids, got laid off and 'giving it a shot', entrepreneurial endeavors are more rewarding, etc.).

You forgot those of us who love our jobs and are ERing above a 4% WR.  ;)

It certainly is individualized.

(That doesn't make each one necessarily equally admirable.)
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Jon_Snow

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Re: How big was your stash when you RE'd?
« Reply #40 on: April 09, 2015, 11:28:29 AM »
I consider my Stache to be an almost "impossible to screw up" number. And when I say "screw up" I mean any incompetent investing decisions on my part or unexpected global events which may sink my investments resulting in a worst case scenario for me - having to get a job again. *shudders*

I am a big believer in having more than you likely need.

h2ogal

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Re: How big was your stash when you RE'd?
« Reply #41 on: April 09, 2015, 07:10:57 PM »
Are you all voting on size of stache 'per person' or per couple?   I think that makes a big difference.

arebelspy

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Re: How big was your stash when you RE'd?
« Reply #42 on: April 09, 2015, 09:12:53 PM »
Are you all voting on size of stache 'per person' or per couple?   I think that makes a big difference.

Sure, it does matter, but two people doesn't double your expenses, so it wouldn't make sense to cut a stache in half if you're married (or in 4ths if you have a spouse and two kids).

It'd make more sense to do some sort of calculation whereby you calculate how much you spend divided by your stache.  So a single person spending 20k with 500k would get the same number as a couple spending 30k with 750k.

We could call it... hmm.. a withdrawal rate?

;)

(This is obviously tongue-in-cheek.  Any method will be flawed, so whether a single person is voting, or a couple, it doesn't make sense to combine the couple's numbers, but nor does it make sense to cut it in half.  Any method is simplistic and flawed, and that's okay.)
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Exflyboy

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Re: How big was your stash when you RE'd?
« Reply #43 on: April 09, 2015, 11:03:59 PM »
I think over the last year and half to two years I have come to realize that people can retire at all different number and be very happy. There are so many variables and really wants, needs , desire are all part of it. Also where you are in your life as well as if you have a family. Knowing what you need , add your must have wants and afford yourself a margin for some unknowns and it will be easier to establish that number.

i agree with that, but i still have a hard time figuring people need more than a million if you can let go of the consumerism that is the usa. if you dont have car payments and just a house payment and living expenses; you can live pretty cheaply depending upon where your house is.

I don't think so..

Taking Escape Velocity's comments about a market down turn and heck some of us just need that number. In our case we spent $28k last year and thats with NO house payment and no other debt. Thats for a couple and we certainly lived pretty frugally.

Now, that was with employer's health coverage.. when we both retire and Go on the ACA I bet our costs will go up by $5k.. So thats $33k in Western Oregon where costs are not that high.. Try that in California or New York.

Before you ask, yes I had whittled down our monthly payments as far as we could.. no cellphone data, no cable, RE taxes $1700 a year, best deals on car insurance blah blah.

So 33k is $825k at 4%.. but 4% is not a number I would feel comfortable going forward with.. nearer 3% for an extended period... which means we would need $1.1M..

Remember also that number does not allow for things you never had time for while working.. Some travel for example?


Retired To Win

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Re: How big was your stash when you RE'd?
« Reply #44 on: April 10, 2015, 09:36:31 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.

At 4% SWR, $500K will yield $20,000 a year.  For one person with no house payment, that's not that bad.  I mean, MMM runs a 3-person household with just $24K a year, including lots of travel.
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BBub

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Re: How big was your stash when you RE'd?
« Reply #45 on: April 11, 2015, 06:11:00 PM »
I had expected more of a bell shaped outcome, but it's interesting to see a somewhat even distribution among the categories.  If you combine 1-2 million as a single category, the distribution is +/- 30% each for the 500-1, 1-2, and 2+ respondents.  These results, IMO, speak to the diversity of forum members.  Having so many perspectives is valuable because it causes us to keep challenging our assumptions.  It would get kind of lame around here if we all agreed on the same number!

BPA

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Re: How big was your stash when you RE'd?
« Reply #46 on: April 11, 2015, 06:29:08 PM »
Surprised folks can make it on <$500k.  That would be hard long-term.

I paid off my house before I started accumulating a stache.  With my expenses cut by about 13,000 a year, I found making it on a stash under 500k was trivial.  I just passed 500k for the first time this week with Tuesday's close.  A raging bull market helps a lot.

I had originally planned to pick up a 10-15 hour a week minimum wage job "to keep busy" but found I needed neither the money nor to be busy.

This will be me too later this year, so thanks for the inspiration.  :)  I'm single with my brother as a roommate, so I need less of a stash for one person and his rent keeps expenses down.

Maya

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Re: How big was your stash when you RE'd?
« Reply #47 on: April 11, 2015, 06:50:51 PM »
Well mine is currently a bit under $200 k, but DH doesn't want to stop working any time soon so I figure after the next baby (3) I'll RE ing  and will let DH continue to work till he wants to and we are fully FI as a family. For that we are aiming for about $1.25 M, and paid off house, but could probably make IT work quite well at 750k-1m.

Livewell

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Re: How big was your stash when you RE'd?
« Reply #48 on: April 11, 2015, 10:12:00 PM »
So the best generalization I can come up with is that there are conservative folks who pad the stash for various reasons (like their job, good work/life balance, golden handcuffs/benefits, have kids and want to pay for college, nervous about a market downturn, etc.) and there are ER at 4% folks (hate their job, don't have kids, got laid off and 'giving it a shot', entrepreneurial endeavors are more rewarding, etc.).

You forgot those of us who love our jobs and are ERing above a 4% WR.  ;)

It certainly is individualized.

(That doesn't make each one necessarily equally admirable.)

I think escape nailed it, as one who falls into the more conservative description.


arebelspy

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Re: How big was your stash when you RE'd?
« Reply #49 on: April 11, 2015, 10:17:35 PM »
So the best generalization I can come up with is that there are conservative folks who pad the stash for various reasons (like their job, good work/life balance, golden handcuffs/benefits, have kids and want to pay for college, nervous about a market downturn, etc.) and there are ER at 4% folks (hate their job, don't have kids, got laid off and 'giving it a shot', entrepreneurial endeavors are more rewarding, etc.).

You forgot those of us who love our jobs and are ERing above a 4% WR.  ;)

It certainly is individualized.

(That doesn't make each one necessarily equally admirable.)

I think escape nailed it, as one who falls into the more conservative description.

So even though Escape defined it fairly narrowly and for more conservative positions, since you fit that, he "nailed" the definition?

Got it!  :)

We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with a kid.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (occasionally) blog at AdventuringAlong.com.
You can also read my forum "Journal."