Race from $2M to $4M...and Beyond!

[EscapeVelocity2020]

11/1/2022    $2,919,364

Big numbers aren't quite as exciting around these parts, although I congratulate you on having an income over a million a year.  What are your hopes and dreams?  Just having more money, getting to 'and beyond' (which I'm sure you will do within a year or two just by saving)?  Do you plan to ER??

Inquiring minds want to know, since there really isn't any graduating from this thread...  Time to put a little meat on those bones.

[LightTripper]

I finally updated my figures and they don't look too bad.  Pretty flat in sterling terms (my home currency) due to the shitshow currently unfolding at home.  Down in dollars ... but given it's down from "too much money" to still "too much money" and that I'm now retiring at a lower market valuation it's reassuring in a way.

It's amazing how much worse my Developing World and Pacific funds have done compared to the US-dominated global trackers.  The US economy really is something!  I wonder how long it can last?

[Taran Wanderer]

We continue to hover around $3.5. Up a few hundred this year. This is partly due to contributions and partly due to gains as I’ve been buying back in with cash that I had (somewhat stupidly) stashed. It seems crazy. I really need to thing about that hopes and dreams question and consider moving on from work into things if rather be doing.

[ingrownstudentloans]

11/1/2022    $2,919,364

Big numbers aren't quite as exciting around these parts, although I congratulate you on having an income over a million a year.  What are your hopes and dreams?  Just having more money, getting to 'and beyond' (which I'm sure you will do within a year or two just by saving)?  Do you plan to ER??

Inquiring minds want to know, since there really isn't any graduating from this thread...  Time to put a little meat on those bones.

Well I am still excited.  Your lack of excitement doesn't affect mine at all.  Part of my stoic training :)

Good questions.  I am happy with my job and plan on continuing for at least another 4-5 years.  My goal in that time is to build up my cash generating assets (rentals and cash flowing businesses).  I have chance to create real generational wealth (the "beyond" you reference) over the next couple of years and retire at 40ish with a net worth of $10MM in time to coach my kids soccer teams and be an adult leader for the scouting pack.

[Dicey]

11/1/2022    $2,919,364

Big numbers aren't quite as exciting around these parts, although I congratulate you on having an income over a million a year.  What are your hopes and dreams?  Just having more money, getting to 'and beyond' (which I'm sure you will do within a year or two just by saving)?  Do you plan to ER??

Inquiring minds want to know, since there really isn't any graduating from this thread...  Time to put a little meat on those bones.

Wait, are you saying someone called ingrownstudentloans is pulling down $1M a year?

Even if that's true, an increase of $363,339 in five months in the current market is huge, even for this crowd.

[Much Fishing to Do]

I’ve got to brag on my sub 26 year old new co worker (still on her parents health care because I mentioned looking at the HDHP plans during open season).  She is already maxing out TSP while now living in the Bay Area on a salary with a base of less than 80k.  I also had the other new person up their TSP from 5 to 10% to start getting closer to the max.

SO I would guess that means they are making $80k gross and living off of $40k after taxes for a single and maxing out contribution (even assuming no other savings) in the Bay area.  Which means they are saving over half a years spending in a year.  Thats amzing at 26 and similar to the numbers I'm gonna be encouraging my graduating kid to be doing.

[Fomerly known as something]

I’ve got to brag on my sub 26 year old new co worker (still on her parents health care because I mentioned looking at the HDHP plans during open season).  She is already maxing out TSP while now living in the Bay Area on a salary with a base of less than 80k.  I also had the other new person up their TSP from 5 to 10% to start getting closer to the max.

SO I would guess that means they are making $80k gross and living off of $40k after taxes for a single and maxing out contribution (even assuming no other savings) in the Bay area.  Which means they are saving over half a years spending in a year.  Thats amzing at 26 and similar to the numbers I'm gonna be encouraging my graduating kid to be doing.

Yup about right.  Plus their salary goes up rather well for the first five years (government scheduled and so known) and she gets her first raise soon.  With putting that much in that early it allows one to make possibly some big mistakes and still win the game.

In a work sponsored retirement seminar today.  For the first time I heard the presenter sub track out 401k contributions before using the 80% rule.  I’ve always been confused why it wasn’t accounted for.

[ingrownstudentloans]

11/1/2022    $2,919,364

Big numbers aren't quite as exciting around these parts, although I congratulate you on having an income over a million a year.  What are your hopes and dreams?  Just having more money, getting to 'and beyond' (which I'm sure you will do within a year or two just by saving)?  Do you plan to ER??

Inquiring minds want to know, since there really isn't any graduating from this thread...  Time to put a little meat on those bones.

Wait, are you saying someone called ingrownstudentloans is pulling down $1M a year?

Even if that's true, an increase of $363,339 in five months in the current market is huge, even for this crowd.

Don't want to change the name because it reminds me of where I started on this journey and hopefully shows others that it can be done.  Lots of luck and a little hard work.

[EscapeVelocity2020]

11/1/2022    $2,919,364

Big numbers aren't quite as exciting around these parts, although I congratulate you on having an income over a million a year.  What are your hopes and dreams?  Just having more money, getting to 'and beyond' (which I'm sure you will do within a year or two just by saving)?  Do you plan to ER??

Inquiring minds want to know, since there really isn't any graduating from this thread...  Time to put a little meat on those bones.

Well I am still excited.  Your lack of excitement doesn't affect mine at all.  Part of my stoic training :)

Good questions.  I am happy with my job and plan on continuing for at least another 4-5 years.  My goal in that time is to build up my cash generating assets (rentals and cash flowing businesses).  I have chance to create real generational wealth (the "beyond" you reference) over the next couple of years and retire at 40ish with a net worth of $10MM in time to coach my kids soccer teams and be an adult leader for the scouting pack.

Thanks for not being too upset by my grumpiness!  We've had a few 'stache growing superstars (tech salaries, TSLA or crypto early investors, CA real estate, etc.)  shoot through this thread posting eye-popping numbers without any real story or anything interesting to say.  They then realize that they have 'graduated' but not really thought about what comes next.  It's easy to feel unfulfilled and lost at that point.

Glad to hear you are still excited, FI is exciting!  In the 'normal world', many would get here only to increase their lifestyle and continue to live just beyond their means...

Thanks for sharing that the goal is to ER at 40ish with $10MM in order to give back to the next generation and community...  as 'Office Space' once said, you don't need $10MM to do that...  or something along those lines.  I have a feeling these ideas will evolve along the way. 

[jeroly]

It's been a roller coaster year financially for us all, and I once again feel amazingly fortunate to have mostly thrived despite market headwinds.

I'm probably down around $200k overall (marking financial assets to market and also taking withdrawals and dividends into account), but since I managed to sell some FL property that I've been carrying on the books at about $150k below market value, my total NW as I calculate it is about level with YE 2021 (I also marked a remaining real property up by $90k to reflect a closer estimate of market value).  My SO's financial assets saw much bigger market losses (maybe about $400k) but she earns and saves a ton and also this year she vested into a defined benefit pension that probably has a present value of about $300k-$500k, so she's actually up a fair bit for the year once we factor the new pension benefit in. Overall we're still comfortably 'beyond.' 

I was able to sell the properties 'as-is' for cash without using a sales agent or staging the properties, just putting up 'for sale by owner' signs linked to a cheap 'VoIP' phone number, so there were virtually no sales costs other than the cost of that trip - total cost for answering / returning the couple hundred phone calls I got was a couple of bucks.  I know that the housing market is slumping overall but my sense of things when I was selling in September was that the bottom end of the market (cheap fixer-uppers / 'handyman's specials') was still very strong, perhaps because folks do really want to buy but are getting priced out of the more expensive market segments so demand at the bottom may even be still growing. Of course that was two months and a couple of interest rate hikes ago, so I wouldn't be surprised if there was a bit more softening even with the recent drop in mortgage rates.

I was finally able to get some foreign travel in this year, restarting my 'bucket list adventures' by doing five weeks in Australia.  I also did some domestic adventuring, hiking in Joshua Tree and Grand Teton NPs, visiting friends in the midwest, and going down to FL twice - once for a quick beach getaway, the other time to deal with the property sale. I'm still working on plans for 2023 but hope to get to Chile's Atacama Desert (perhaps in the fall/Chile's spring), to the Baltic States in the spring, and to Tanzania and Kenya in August in order to watch the wildebeest migration and to climb Kilimanjaro.

The only place that my spending has been dramatically affected by inflation in this year was on the Australian trip.  Despite the good exchange rate, my budget took a beating from high airfares - $1800 to Sydney and then another $1500 on internal flights.  This was certainly my most expensive trip ever, at about $8k for the 5 1/2 weeks. I've generally targeted $1k/week for travel so that's about a 45% increase.

Other inflation observations:

- My biggest expense is my rent, which hasn't been raised since 2017.  So that helps keep the overall inflation adjustment down considerably.
- Next biggest is my ACA coverage, which is going to rise by about 12% next year. When you factor in the extra age-related cost that's probably about in line with overall inflation.  This next year will be my last full year of Obamacare - I will turn 65 and start Medicare in 2024, and I'm figuring my overall healthcare costs will drop from the $15k I budget ($13k premiums plus $2k of uncovered costs) to about half that. Since the end is in sight I haven't been sweating the big current pricetag too much.
- Food in the supermarket is up considerably and we've compensated to a degree by shifting from Safeway to Aldi and even Whole Foods which seems to be offering better value than Safeway these days especially if you take advantage of the Prime deals.
- Food in restaurants is up a fair bit, maybe 20%, but we've cut back our restaurant going a lot since the pandemic and with cold weather incipient here in Washington DC, we'll likely be dining out a lot less in the coming months... by dining out I mean literally outside as my SO still hasn't transitioned to indoor dining (I've only recently restarted this, subsequent to getting my bivalent Covid booster).
- I think that my electricity bill (includes electric heat) has risen but it's been a little hard to assess as my usage patterns have recently shifted.
- Phone bill and main TV service (google's YouTubeTV) are unchanged.  Some streaming service increases (perhaps 15% overall on these).  Reduction in my internet bill of 40% after threatening to cancel service and switch to a competitor.
- Uber costs are much higher and we have offset this by using it much less. This is in my estimation only partly an inflation story and partly an 'Uber is no longer intentionally selling trips below cost' story.
- We use very little petrol so even though gas prices have risen substantially from where they were before the Ukraine War, it hasn't affected our budget much.

I think that overall my spending is up about 10% for the year, but a big chunk of that is because travel was limited last year and I've returned to near my budgeted travel expenditure level of ~$15k.

The main thing we've changed financially besides my selling the property has been for my SO to start diverting income to her company's deferred compensation plan.  It's nonqualified and hence non-guaranteed so it's not without risk (if her company goes under she becomes an unsecured creditor, but typically most if not all of deferred compensation due to employees of bankrupted enterprises is eventually paid).  The plus is that it's paying prime plus some fixed percentage (maybe 2%?) which is both better than we could get from bonds, say, and provides some diversification and ballast.  She's putting 10% of her salary and 70% of her bonus into this, which added up to about 1/3 of her overall income - she also has 401(k) and taxable savings.  If we consider the NQDC balance as part of the FI portion of our financial assets we're probably about 65/35 equities/FI, and equities/FI/RE are about 55/30/15 overall.  We might eventually raise the RE portion if we combine households but that's still down the road.

Since our investment policy statement calls for an annual rebalancing of financial assets, we of course rebalanced our losses in crypto and have bought more BTC, Luna, Terra, FTT, and Solana.  No, just kidding, that was snark, we have a 0% crypto allocation.  However, I did mention this to raise a crypto point - I really wonder how many people who are advocating for x% to be allocated to crypto are going to do an annual portfolio balancing where they realize that the drops in cryptocurrency prices requires them to buy more crypto to maintain those allocations, and then they actually do it?  I think there will be few with the cojones/ovaries to not only HODL but to buy more... and that, my friends, will I believe lead to another leg down in cryptocurrency prices as new demand for the coins falls off the roof  (It would not surprise me if we see BTC at $3,000 or lower by YE 2023.)

[rmorris50]

Heads up that pension lump sums are dropping precipitously Jan 1 due to increases in IRS discount rates. I’m rolling over my old pension before year end to lock in the gain. Otherwise it drops from $334k to $252k. Yes rates could go back down in the future but I don’t want to be at the whim of IRS discount rates.

If your SO is still working at the employer with the pension then maybe there isn’t anything she can do unless she decides to retire.


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[2sk22]

It's been a roller coaster year financially for us all, and I once again feel amazingly fortunate to have mostly thrived despite market headwinds.

...

The only place that my spending has been dramatically affected by inflation in this year was on the Australian trip.  Despite the good exchange rate, my budget took a beating from high airfares - $1800 to Sydney and then another $1500 on internal flights.  This was certainly my most expensive trip ever, at about $8k for the 5 1/2 weeks. I've generally targeted $1k/week for travel so that's about a 45% increase.
...
Since our investment policy statement calls for an annual rebalancing of financial assets, we of course rebalanced our losses in crypto and have bought more BTC, Luna, Terra, FTT, and Solana.  No, just kidding, that was snark, we have a 0% crypto allocation.  However, I did mention this to raise a crypto point - I really wonder how many people who are advocating for x% to be allocated to crypto are going to do an annual portfolio balancing where they realize that the drops in cryptocurrency prices requires them to buy more crypto to maintain those allocations, and then they actually do it?  I think there will be few with the cojones/ovaries to not only HODL but to buy more... and that, my friends, will I believe lead to another leg down in cryptocurrency prices as new demand for the coins falls off the roof  (It would not surprise me if we see BTC at $3,000 or lower by YE 2023.)

I enjoyed reading your year end summary and glad that things are going well for you. I agree that the very worst inflation is in the travel sector. Every aspect of travel including airfares, hotels/AirBnB and car rentals are all way more expensive.

Regarding crypto - I have been firmly in the anti-crypto camp ever since I first started reading about it over ten years ago. I lurk a bit on the Reddit FAT Fire group and I have seen a noticeable reduction in the number of crypto bros announcing their retirements :-)

[jeroly]

Heads up that pension lump sums are dropping precipitously Jan 1 due to increases in IRS discount rates. I’m rolling over my old pension before year end to lock in the gain. Otherwise it drops from $334k to $252k. Yes rates could go back down in the future but I don’t want to be at the whim of IRS discount rates.

If your SO is still working at the employer with the pension then maybe there isn’t anything she can do unless she decides to retire.


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I’ll have to check it but I’m not sure she even gets the option of a lump sum- I think she may be limited to choosing a fixed period or not, and a joint-and-survivor payout or not.

The PV is merely something I've done to come up with a way of working it into the NW calculations.
When I met my sweetie she said she wanted to work until about seventy and/or saving $5mm. I'm hoping that she'll quit when we get to a combined $10mm, which at our current rate might happen in four years or so (versus 18 years if she works to 70) if I  include that chunk of change to help get the NV there faster.

[Dicey]

Regarding crypto - I have been firmly in the anti-crypto camp ever since I first started reading about it over ten years ago. I lurk a bit on the Reddit FAT Fire group and I have seen a noticeable reduction in the number of crypto bros announcing their retirements :-)

Lol, I always feel the Crypto Bros are like lottery winners who lose it all. They don't necessarily have the money management skills needed to cope with a windfall.

[Fomerly known as something]

Regarding crypto - I have been firmly in the anti-crypto camp ever since I first started reading about it over ten years ago. I lurk a bit on the Reddit FAT Fire group and I have seen a noticeable reduction in the number of crypto bros announcing their retirements :-)

Lol, I always feel the Crypto Bros are like lottery winners who lose it all. They don't necessarily have the money management skills needed to cope with a windfall.

Well they tend to just roll it into more investments instead of taking profits off the table and walking away, just like at the casino.

My Crypto position has shrunk from $350 to about $135 the last I checked.

[soccerluvof4]

 I know a lot of people that have gone into Crypto and for their sake I hope it comes back but its never been for me.

After reading some of your updates I am down about 18% after yesterdays slight uptick and all I can do is rebalance etc.. I have lived this whole year so far on cash and plan on doing so next year unless we get a much bigger dip then I would add to the market.

[Fomerly known as something]

The market has come back close to when I’m likely to make another contribution to my DAF next year. 

The market this year took my brokerage fund basically down from over funded to just plain funded.  The last few months has brought it back into the slightly overfunded stage.

[LightTripper]

I've just updated my numbers and I'm up about 1% on this time last year (which means I'm actually significantly down given that I've still been earning and there has been significant inflation over the period).  HOWEVER, from that November to the previous one I was up 17%, and the previous 12 month period about 6% - so it's all just part of the natural volatility of how things evolve. 

I need to rebalance a bit - I suspect I am overweight cash and slightly overweight US at the moment - but otherwise no major concerns.  I'm just stepping into retirement now (or at least, what I consider to be retirement: I'll still be technically employed but at a very low salary and a formula that rewards me only for the work I do - so I'll feel no obligation to take on new work unless it is genuinely interesting or rewarding in some other way).

I'm only a few weeks into this new bit of life, and I'm not sure I've really "relaxed" yet as I'm keeping myself busy with many other things (including a massive backlog of lifemin): but so far it's feeling good!  And already I'm seeing the benefits of simple things like always being able to get enough sleep, being less distracted when I'm spending time with the kids, etc. etc.

[arcturus]

I've just updated my numbers and I'm up about 1% on this time last year (which means I'm actually significantly down given that I've still been earning and there has been significant inflation over the period).  HOWEVER, from that November to the previous one I was up 17%, and the previous 12 month period about 6% - so it's all just part of the natural volatility of how things evolve. 

I need to rebalance a bit - I suspect I am overweight cash and slightly overweight US at the moment - but otherwise no major concerns.  I'm just stepping into retirement now (or at least, what I consider to be retirement: I'll still be technically employed but at a very low salary and a formula that rewards me only for the work I do - so I'll feel no obligation to take on new work unless it is genuinely interesting or rewarding in some other way).

I'm only a few weeks into this new bit of life, and I'm not sure I've really "relaxed" yet as I'm keeping myself busy with many other things (including a massive backlog of lifemin): but so far it's feeling good!  And already I'm seeing the benefits of simple things like always being able to get enough sleep, being less distracted when I'm spending time with the kids, etc. etc.

Good for you!  I'm still a couple/few years away from this point, but its good to hear your early experiences, as the next chapter is very elusive to me.   I also enjoyed hearing about your transition to retirement approach....and I can't help but to be curious on how those who have pursued this approach -- which sounds like a transition to retirement with your current employer (maybe I'm wrong) -- have been able to mange that.  My greatest fear is pulling that lever and taking on all the downside of it (lower pay), but still having to keep up with the same expectations, because, after all, its still you!

As for my situation, 2022 has been a punch that landed squarely on the jaw!  Between the market movements, my portfolio allocation (heavy equities), and some extraordinary expenses -- college, health, etc. -- I'm down about 10% from end of 2021, inclusive of contributions I've been able to make in 2022.  I don't regularly / reliably track on a monthly basis, so can't do an accurate "year ago" view.   

Back to the earlier thread, I am thankful that I steered clear of crypto -- was actually looking at it ~12-18 months ago and concluded that I couldn't deal with the uncertainty of it and the seeming ambiguity of the underlying fundamental value driver of it.   That would have been the worst possible time to get in.

Hope all of you in the US have a great Thanksgiving weekend!  The job has been crazy over the past few months and so I am hoping for a chance to unplug from that and focus on things that really matter instead of things that don't matter much yet command a large portion of my time/life/attention!

[LightTripper]

Thanks @arcturus !  I do think it's really hard to imagine - you have to kind of just make a decision to make a change and then see how it fits I think, and be open to changing again if it's not working out (or if you think something else could work out better).

I'm really lucky that I work for a consulting firm where I generate my own work, and for the last few years I've been paid according to a formula (where basically I get a percentage of the revenues I bill personally plus a smaller percentage of what others bill on projects I've sourced).  So it's very scalable as long as I'm prepared to be fully flexible on when I work (i.e. even though for the last year I've been on a 24h/week contract, and paid a salary that reflects that, I may have a 60 hour week followed by several 0 hour weeks - although in general I've been pleased to find I've managed to keep things smoother than that, and my "down times" have largely coincided with school holidays).  Basically the formula gives a total compensation figure, and my salary then gets deducted from that, and whatever the balancing figure is gets paid out as a bonus at year end.  There is no possibility I get underpaid for my work (and my employer only loses out if my salary is higher than the total compensation amount at year end).

It works well in the sense that I know I will get paid for the work I do (although it's still up to me to say "no" to things or pass things on to colleagues - where the latter obviously often means passing on some of that sourcing credit too - which is fair enough if it's somebody who is going to take all responsibility for the project).  Anyway, I seem to have been fairly successful in saying "no" and reducing my hours so far, and plan to keep going next year (though with a substantially lower salary than this year, so I can really take on minimal work if I choose).  Staying employed means I continue to benefit from health, dental and travel insurance (although health is more "nice-to-have" than essential in the UK) and things like tax and professional liability insurance are all done though my employer which just makes life simple.

It's not really a reversibly flexible model (as once I've handed things over if those projects go well I'd expect that client to call my colleague next time, rather than me) - but that's fine given that I'm looking for a glide-path out.  It does mean if I change my mind I'd have to put considerable work into building up a new client base - but I really think it's very unlikely that I'll want to do that.

[MaybeBabyMustache]

We're down about 10% from our high in April. The two biggest factors: property value drop, & overall stock drop, including company compensation largely tied to stock price. The drop includes the ~$90k or so we added throughout the year, which hurts a little.

[arcturus]

Sounds like a great situation @LightTripper !  Glad you have had the discipline to say "no."   And its great that it can be a continued source of benefits and maybe a little supplemental income, but on your terms.

On real estate values, I don't seem to have been impacted by that so much -- whether that is just based on the fact that we in the midwest don't tend to see swings up or down or whether its because my zillow valuation has always seemed a bit low, I'm not sure.   

In any event I keep my personal residence (which is my ONLY real-estate exposure anyways) out of my calcs, so its a non-factor in my 10% down figure.   Sitting at slightly under $2.1 invested at the moment.

[soccerluvof4]

Sounds like a great situation @LightTripper !  Glad you have had the discipline to say "no."   And its great that it can be a continued source of benefits and maybe a little supplemental income, but on your terms.

On real estate values, I don't seem to have been impacted by that so much -- whether that is just based on the fact that we in the midwest don't tend to see swings up or down or whether its because my zillow valuation has always seemed a bit low, I'm not sure.   

In any event I keep my personal residence (which is my ONLY real-estate exposure anyways) out of my calcs, so its a non-factor in my 10% down figure.   Sitting at slightly under $2.1 invested at the moment.

Like you I don't include my paid for home in my numbers. Also as well mine is still worth quite a bit more than I paid for it and being lake property in a desired area it doesn't drop if there's a drop anywhere near as much as regular real estate. There not building lakes and there is no lots on any of the ones near me so you need to spend a fortune on a tear down if you want to get on a decent lake.  But as I mentioned aside from that on a 60/40 portfolio as I have been fired for 8 years now I am down 18%. But was so far up was expecting it at some point and then some.

[BeanCounter]

YTD we are still down 12% ($400k) which really isn’t bad when you consider the growth we saw 2 during the last two years. We are 80% equities and don’t include home value (gotta live somewhere) so our portfolio tends to follow the market pretty closely. I wonder what next year will bring. The news seems very conflicted. One article states the worst is over and the next says recession is coming in 2023.
I am sort of failing at FIRE though. I started doing some consulting 8 months after I quit. Including for my former employer (which I did not enjoy). I took on a new client in Sept and it was supposed to be a temporary deal, but they would like to make it permanent. So if we can agree on a comp and hours I may become an employee again, part time. Kinda scary. I guess if my husband is going to continue to work and we are tied down by kids school schedules, I don’t mind work some and keeping my brain occupied.
I plan to continue to spend my part time earnings on home improvement, travel (with the kids) and tuition. I will not be saving anything more than what provides tax advantages.

So is there another forum for FIRE failures or a different thread I should be in?

[2sk22]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

[rmorris50]

Sounds like a great situation @LightTripper !  Glad you have had the discipline to say "no."   And its great that it can be a continued source of benefits and maybe a little supplemental income, but on your terms.

On real estate values, I don't seem to have been impacted by that so much -- whether that is just based on the fact that we in the midwest don't tend to see swings up or down or whether its because my zillow valuation has always seemed a bit low, I'm not sure.   

In any event I keep my personal residence (which is my ONLY real-estate exposure anyways) out of my calcs, so its a non-factor in my 10% down figure.   Sitting at slightly under $2.1 invested at the moment.

Like you I don't include my paid for home in my numbers. Also as well mine is still worth quite a bit more than I paid for it and being lake property in a desired area it doesn't drop if there's a drop anywhere near as much as regular real estate. There not building lakes and there is no lots on any of the ones near me so you need to spend a fortune on a tear down if you want to get on a decent lake.  But as I mentioned aside from that on a 60/40 portfolio as I have been fired for 8 years now I am down 18%. But was so far up was expecting it at some point and then some.

I always find this debate over whether to include real estate in one’s “calcs” odd. It should be in your NW, it’s an asset you have to manage. Whether it produces cash flow in a retirement cash flow analysis depends if the real estate is going to be sold, you do a reverse mortgage, or it’s a rental. NW is NW, and cash flow is cash flow.


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[rmorris50]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

I find I have this ingrained “don’t be a quitter” and “your fellow employees need you mentality”. If I resign and retire then I feel like a let down. My whole life I’ve been “groomed” to persevere and don’t quit, keep going, we are all a team, etc. Now if my employer wants to let me go then by, that’s the permission I need. But it’s hard to change that work ethic that was drilled into me and not feel like a quitter.


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[BeanCounter]

Sounds like a great situation @LightTripper !  Glad you have had the discipline to say "no."   And its great that it can be a continued source of benefits and maybe a little supplemental income, but on your terms.

On real estate values, I don't seem to have been impacted by that so much -- whether that is just based on the fact that we in the midwest don't tend to see swings up or down or whether its because my zillow valuation has always seemed a bit low, I'm not sure.   

In any event I keep my personal residence (which is my ONLY real-estate exposure anyways) out of my calcs, so its a non-factor in my 10% down figure.   Sitting at slightly under $2.1 invested at the moment.

Like you I don't include my paid for home in my numbers. Also as well mine is still worth quite a bit more than I paid for it and being lake property in a desired area it doesn't drop if there's a drop anywhere near as much as regular real estate. There not building lakes and there is no lots on any of the ones near me so you need to spend a fortune on a tear down if you want to get on a decent lake.  But as I mentioned aside from that on a 60/40 portfolio as I have been fired for 8 years now I am down 18%. But was so far up was expecting it at some point and then some.

I always find this debate over whether to include real estate in one’s “calcs” odd. It should be in your NW, it’s an asset you have to manage. Whether it produces cash flow in a retirement cash flow analysis depends if the real estate is going to be sold, you do a reverse mortgage, or it’s a rental. NW is NW, and cash flow is cash flow.


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We don’t include it because we have to live somewhere so if we sold our house we would end up using the proceeds to either buy something else or pay rent. And it is such a small portion of our total NW. maybe 10%? Although about 40% of it is mortgaged.

[BeanCounter]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

[Taran Wanderer]

I’m finding that at this stage of our journey, simply having the choice to work or not makes it so much better. I don’t have to work, so I don’t have to take on the stress of work. Totally changes my mindset and approach. I like the work, I like the people I interact with, so I choose to spend part of my time on it. Plus with my recent job change, even though the work is similar, the underlying activities that we support are no longer mine. This allows me to mentally detach more, which again means less stress.

[SwordGuy]

I always find this debate over whether to include real estate in one’s “calcs” odd. It should be in your NW, it’s an asset you have to manage. Whether it produces cash flow in a retirement cash flow analysis depends if the real estate is going to be sold, you do a reverse mortgage, or it’s a rental. NW is NW, and cash flow is cash flow.

Queue the sound of much cheering and clapping!

[rmorris50]

Sounds like a great situation @LightTripper !  Glad you have had the discipline to say "no."   And its great that it can be a continued source of benefits and maybe a little supplemental income, but on your terms.

On real estate values, I don't seem to have been impacted by that so much -- whether that is just based on the fact that we in the midwest don't tend to see swings up or down or whether its because my zillow valuation has always seemed a bit low, I'm not sure.   

In any event I keep my personal residence (which is my ONLY real-estate exposure anyways) out of my calcs, so its a non-factor in my 10% down figure.   Sitting at slightly under $2.1 invested at the moment.

Like you I don't include my paid for home in my numbers. Also as well mine is still worth quite a bit more than I paid for it and being lake property in a desired area it doesn't drop if there's a drop anywhere near as much as regular real estate. There not building lakes and there is no lots on any of the ones near me so you need to spend a fortune on a tear down if you want to get on a decent lake.  But as I mentioned aside from that on a 60/40 portfolio as I have been fired for 8 years now I am down 18%. But was so far up was expecting it at some point and then some.

I always find this debate over whether to include real estate in one’s “calcs” odd. It should be in your NW, it’s an asset you have to manage. Whether it produces cash flow in a retirement cash flow analysis depends if the real estate is going to be sold, you do a reverse mortgage, or it’s a rental. NW is NW, and cash flow is cash flow.


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We don’t include it because we have to live somewhere so if we sold our house we would end up using the proceeds to either buy something else or pay rent. And it is such a small portion of our total NW. maybe 10%? Although about 40% of it is mortgaged.

The distinction I’m making is people should view cash flow analysis and NW as two distinct things. When people say they don’t include their real estate in their net worth it probably means they aren’t doing a CF analysis for retirement preparedness and are just looking at the size of their investment balances to see if they are retirement ready.

When I project retirement cash flows I don’t assume any from my real estate. But it’s definitely included in my NW I track. Also, I include social security in my CF analysis but I of course don’t have that in my NW, it’s not an asset I own.


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[2sk22]

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

I also get a lot of pleasure from solving hard problems. I recently joined a model train club and have been helping them computerize the operations. It has been a fun exercise and I have been putting a lot of my computing experience to use - I have already written a few thousand lines of code.

I worked for thirty years in software research surrounded by experts - I never felt that I was anything special in that crowd. In contrast, I am the only member of this club with any experience in programming and it has been enjoyable explaining how computers work to them. The other club members have been very grateful for my help. I think there are many interesting opportunities to use your problem-solving skills outside of traditional work - you just need to find them.

[EscapeVelocity2020]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

Even when you are long past the point of needing the money, there is still some vestigial part of us that appreciates being paid well for our time.  Ironically I probably cared less about the pay in my 20's when I knew I was good at what I did and had 'college student survival skills' vs. now nearing my 50's wondering just how much longer I can fake keeping up with the young go-getters that seem fluent in every application and software package!  Fortunately my kids are headed out in to the real world soon, so I'm not feeling that pressure to ensure I can provide for them - I would think that a fully FIRE'd couple with young kids and no income would need a sizable stache in these mixed-market times to resist the urge to return to some form of dependable income...

[soccerluvof4]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

Even when you are long past the point of needing the money, there is still some vestigial part of us that appreciates being paid well for our time.  Ironically I probably cared less about the pay in my 20's when I knew I was good at what I did and had 'college student survival skills' vs. now nearing my 50's wondering just how much longer I can fake keeping up with the young go-getters that seem fluent in every application and software package!  Fortunately my kids are headed out in to the real world soon, so I'm not feeling that pressure to ensure I can provide for them - I would think that a fully FIRE'd couple with young kids and no income would need a sizable stache in these mixed-market times to resist the urge to return to some form of dependable income...

Totally agree with you across the board. Fortunately I have one of four left at home and have is College funds in a 529. I never included the 4kids 529s in my NW because basically knew it was spent and to your point and others those are some expensive times. With each one that moves on there own its like a retirement pay raise for the DW and I.

For the people like me that are Fire'd and think its failure to do some work now and again I don't look at it like that. Maybe because if I do anything its a short term side hustle for cash. Next week I have a gut job on a bar there is going to be turned into a house. Guy asked me and I gave him a cash per hour rate for my son and I to do and its just a little extra cash for DW and I. I dont go out and look for things but if people ask and it works out why not make a few bucks especially this time of the year for me when I go away every month for a week on a trip.

[jeroly]

For the people like me that are Fire'd and think its failure to do some work now and again I don't look at it like that. Maybe because if I do anything its a short term side hustle for cash. Next week I have a gut job on a bar there is going to be turned into a house. Guy asked me and I gave him a cash per hour rate for my son and I to do and its just a little extra cash for DW and I. I dont go out and look for things but if people ask and it works out why not make a few bucks especially this time of the year for me when I go away every month for a week on a trip.

I FIREd about 21 years ago and I've worked for a paycheck perhaps five or so of those years, as well as working for my own company for a year and a half or so.  I've never viewed those stints as failures but rather successes; thanks to having 'FU' money, I've been able to choose projects I have been passionate about, without needing to particularly care about the salary or career path or office politics or any of the usual BS. 

[BeanCounter]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

Even when you are long past the point of needing the money, there is still some vestigial part of us that appreciates being paid well for our time.  Ironically I probably cared less about the pay in my 20's when I knew I was good at what I did and had 'college student survival skills' vs. now nearing my 50's wondering just how much longer I can fake keeping up with the young go-getters that seem fluent in every application and software package!  Fortunately my kids are headed out in to the real world soon, so I'm not feeling that pressure to ensure I can provide for them - I would think that a fully FIRE'd couple with young kids and no income would need a sizable stache in these mixed-market times to resist the urge to return to some form of dependable income...

The challenge of FIRE with kids is something I don't think is talked about enough on the forum. Many have this "just say no" attitude. DH and I are completely unwilling to not give education and experiences to our kids so that we can not work. I'm not saying that approach is wrong, it's just one we cannot take.
.
Our crazy expenses-
Sports (including private swing coach for golf and club soccer (no travel though)
elementary and pending HS tuition (HS is $15k elementary is $4k)
car insurance for future driver (have you all seen what they charge to add boys to your car insurance?? It's nuts. Or so I hear. We've got a few years still)
He'll need a car- will give him my 12 YO CRV to start. There is no bussing to HS in our area.
And finally family trips. We can blow $8k on a family vacation without thinking about it.

Health insurance if we quit would be a huge blow to our budget. I think we could do it, but it would pinch other areas.

I don't regret any of it. NONE. DH is happy to continue to work to pay for it. And I can stay home and be an Uber for the kids and friends.

Once they go to college they can tap their 529s which are not included in our NW. And they can work to pay living expenses. Or they can live at home. Or they can go to free college at University DH works at. So it's four more years and then one kid should get cheaper and then four more years for the other.

I just feel like there is always the sentiment on the forum that you shouldn't let kids keep you from FIRE and I really don't know how you don't. It's expensive. But short lived really.
just my $0.02.

[Fomerly known as something]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

Even when you are long past the point of needing the money, there is still some vestigial part of us that appreciates being paid well for our time.  Ironically I probably cared less about the pay in my 20's when I knew I was good at what I did and had 'college student survival skills' vs. now nearing my 50's wondering just how much longer I can fake keeping up with the young go-getters that seem fluent in every application and software package!  Fortunately my kids are headed out in to the real world soon, so I'm not feeling that pressure to ensure I can provide for them - I would think that a fully FIRE'd couple with young kids and no income would need a sizable stache in these mixed-market times to resist the urge to return to some form of dependable income...

The challenge of FIRE with kids is something I don't think is talked about enough on the forum. Many have this "just say no" attitude. DH and I are completely unwilling to not give education and experiences to our kids so that we can not work. I'm not saying that approach is wrong, it's just one we cannot take.
.
Our crazy expenses-
Sports (including private swing coach for golf and club soccer (no travel though)
elementary and pending HS tuition (HS is $15k elementary is $4k)
car insurance for future driver (have you all seen what they charge to add boys to your car insurance?? It's nuts. Or so I hear. We've got a few years still)
He'll need a car- will give him my 12 YO CRV to start. There is no bussing to HS in our area.
And finally family trips. We can blow $8k on a family vacation without thinking about it.

Health insurance if we quit would be a huge blow to our budget. I think we could do it, but it would pinch other areas.

I don't regret any of it. NONE. DH is happy to continue to work to pay for it. And I can stay home and be an Uber for the kids and friends.

Once they go to college they can tap their 529s which are not included in our NW. And they can work to pay living expenses. Or they can live at home. Or they can go to free college at University DH works at. So it's four more years and then one kid should get cheaper and then four more years for the other.

I just feel like there is always the sentiment on the forum that you shouldn't let kids keep you from FIRE and I really don't know how you don't. It's expensive. But short lived really.
just my $0.02.

I’ll compare kids to my cat.  (I know not the same thing).  Both the kids and my cat are personal choices.  I don’t have to have either.  But since I chose to have a cat, it’s my responsibility to provide to for the fuzz butt to the best of my ability.  Which would mean if I had kids, reasonable activities and college would have to be paid for because income from my job could do so.

[dividendman]

Kids are like cats... most of the time they ignore you, then they bug you for food, they bite the hand that feeds them, and it seems as though they are always plotting against you.

[BeanCounter]

My cat totally thinks he’s another kid. And he might be just as spoiled!

[secondcor521]

So is there another forum for FIRE failures or a different thread I should be in?

There have been a fair number of posts on these lines in the post-FIRE section agonizing over how much work is ok in retirement :-) But seriously, don't be hard on yourself - just keep reminding yourself that work is entirely optional.

I am about the happiest that a person can possibly be in retirement and yet I get a small twinge when my old boss calls asking if I'd like to come back for a short assignment. Then I look at our NW and politely decline. Thanks to the recent rise in the stock market, we are back above $6M in liquid assets - we have had wild swings this year but nothing so far that would get me back to working :-)

So I think it’s really because I truly find great satisfaction in the problem solving aspect of work.
But there is part of me that must like the money because when I read your post I immediately thought “well, if I had $6M THAT would be different”. Which is of course ridiculous. We have enough. Although because of the kids we are walking into the most expensive phase of life ever. Tuition, cars, insurance etc.
Or maybe it’s because we are only 45? And if I was just a bit older retirement might feel different?
I don’t know. Likely a bit of all of it.
I do completely enjoy the feeling of having the freedom of choice though. And not having to worry.

Even when you are long past the point of needing the money, there is still some vestigial part of us that appreciates being paid well for our time.  Ironically I probably cared less about the pay in my 20's when I knew I was good at what I did and had 'college student survival skills' vs. now nearing my 50's wondering just how much longer I can fake keeping up with the young go-getters that seem fluent in every application and software package!  Fortunately my kids are headed out in to the real world soon, so I'm not feeling that pressure to ensure I can provide for them - I would think that a fully FIRE'd couple with young kids and no income would need a sizable stache in these mixed-market times to resist the urge to return to some form of dependable income...

The challenge of FIRE with kids is something I don't think is talked about enough on the forum. Many have this "just say no" attitude. DH and I are completely unwilling to not give education and experiences to our kids so that we can not work. I'm not saying that approach is wrong, it's just one we cannot take.
.
Our crazy expenses-
Sports (including private swing coach for golf and club soccer (no travel though)
elementary and pending HS tuition (HS is $15k elementary is $4k)
car insurance for future driver (have you all seen what they charge to add boys to your car insurance?? It's nuts. Or so I hear. We've got a few years still)
He'll need a car- will give him my 12 YO CRV to start. There is no bussing to HS in our area.
And finally family trips. We can blow $8k on a family vacation without thinking about it.

Health insurance if we quit would be a huge blow to our budget. I think we could do it, but it would pinch other areas.

I don't regret any of it. NONE. DH is happy to continue to work to pay for it. And I can stay home and be an Uber for the kids and friends.

Once they go to college they can tap their 529s which are not included in our NW. And they can work to pay living expenses. Or they can live at home. Or they can go to free college at University DH works at. So it's four more years and then one kid should get cheaper and then four more years for the other.

I just feel like there is always the sentiment on the forum that you shouldn't let kids keep you from FIRE and I really don't know how you don't. It's expensive. But short lived really.
just my $0.02.

I think it's possible under a reasonable framework.

I FIREd at 46 with 3 kids, at that time aged 21, 16, and 14.  I was pretty sure I had enough money, as at that time I was running at about a 2% withdrawal rate.

My deal with myself was that we would continue to live life the way we had been living and I would not let the lack of income prevent us from doing what we would typically choose to do.  And if that ever ceased to be the case, I would go back to work.

I had some things going for me.  My kids were at least teenagers and I could see the trajectory of their lives and expenses within certain broad ranges.  My WR% was low, and it went even lower as I realized that I wasn't including certain income streams that actually added up to a fair bit, so my net WR% was more like 1%.  2016 turned out to be a good start year with respect to SORR.  My kids didn't do anything weird or drastic or expensive.  I also had saved up what I thought was enough in their college savings.  And my youngest ended up getting a more than full ride to college which obviously helped.  ACA health insurance has been reasonably priced.

Each family gets to decide, at least I think we do, where the line is between providing what is considered a necessity, a nice to have, or spoiling the kid.  Where I draw the line might be different from where you do.  For my kids, that meant everything paid for up through high school except cell phones and cars, plus a college education.  Their mother chose to help with cars.

After I retired, my oldest finished college.  My younger two ended up going to expensive private high schools which I paid for.  None of my kids did sports but my youngest has a $4K viola which I bought.  We've taken trips to England for the Goodwood Festival of Speed, Nevada to drive $500K worth of supercars and climb Boundary Peak, and NYC to see Hamilton on Broadway.

One of the surprises for me in early retirement was being able to drive my younger kids around for a bit before they got their drivers' licenses.  They really opened up to me in those car rides, and I think we have a much deeper and stronger relationship as a result.  Even if the money situation hadn't worked out for us, I would have considered that benefit alone worth a great deal.

My point is that it is not necessarily a tradeoff between FIRE and providing for your kids in the way you see fit - if you have enough money, and plan prudently, and have some average to good luck go your way, you can do both.

[BeanCounter]

My point is that it is not necessarily a tradeoff between FIRE and providing for your kids in the way you see fit - if you have enough money, and plan prudently, and have some average to good luck go your way, you can do both.

I really appreciate your perspective having been through it. I felt comfortable to FIRE in 2020 even though I knew we would be facing some very expensive years. My DH does not. And I understand his feelings because there are still a lot of unknowns in our budget for the next ten years or so. I guess that’s what I feel like isn’t talked about. How you plan for what your kids will want or need in their various stages.
We did recently have a talk about possible University downsizing (birth dearth and all) and we looked at the numbers and reminded ourselves we could do it if he was let go.

[couponvan]

Kids are like cats... most of the time they ignore you, then they bug you for food, they bite the hand that feeds them, and it seems as though they are always plotting against you.

This is so good I am texting it to my 17 year old….

[secondcor521]

My point is that it is not necessarily a tradeoff between FIRE and providing for your kids in the way you see fit - if you have enough money, and plan prudently, and have some average to good luck go your way, you can do both.

I really appreciate your perspective having been through it. I felt comfortable to FIRE in 2020 even though I knew we would be facing some very expensive years. My DH does not. And I understand his feelings because there are still a lot of unknowns in our budget for the next ten years or so. I guess that’s what I feel like isn’t talked about. How you plan for what your kids will want or need in their various stages.
We did recently have a talk about possible University downsizing (birth dearth and all) and we looked at the numbers and reminded ourselves we could do it if he was let go.

Yeah, making predictions is hard, especially about the future (Karl Kristian Steincke).

You can make plans to set aside money for stuff and plans.  The future never ends up exactly as we predict, so you'll either save too much or not enough.  You can have margin, but how much margin is enough and how much is too much?  The answer to that question varies by individual personality and people's circumstances.

In retrospect, I had too much margin.  We know there is bad luck, bad SORR, and stuff that turns out more expensive than we expect, or have expenses we forgot to foresee.  And we plan for worst case scenarios like a repeat of the Great Depression, the stagflation of the 1970s, or the GFC of 2008.  I didn't plan or expect my two younger kids to go to expensive private high schools, for example.

But on the other hand, there is sometimes good luck, good SORR, income we forgot to account for, or side gigs that pop up.  I didn't plan on 2016 being a good year.  I didn't plan on a side gig that covers about a 1/3 of my expenses.  I didn't account for some life insurance proceeds.  I didn't plan on my youngest getting a full ride to college.  These kinds of good things are also not mentioned much - maybe we are afraid of jinxing things, or appearing to be incautious or braggarts, or worried about annoying or offending people who end up with worse luck for whatever reason.

If my retirement timeline had me retiring at the beginning of this year, I probably would be singing a different tune.  You rolls the dice and you takes your chances, they say.

[EscapeVelocity2020]

Counting on good things to happen sounds like a bad plan on the surface, but it does seem like things work out better than expected more often than not.  For example, we have over $100k in a 529 for my son and he is attending a trade school which will run about $40k all said and done!  Still have to pay for our daughter who is going the more traditional 4 year degree route, but we will still spend about $100k less than I expected.  Haven't finished the parenting race yet, but the biggest expenditure is mostly covered at this point.  I feel much more prepared for FIRE, even with the mixed markets, but the FI part was never really the thing holding me back.

[tooqk4u22]

The challenge of FIRE with kids is something I don't think is talked about enough on the forum. Many have this "just say no" attitude. DH and I are completely unwilling to not give education and experiences to our kids so that we can not work. I'm not saying that approach is wrong, it's just one we cannot take.
.
Our crazy expenses-
Sports (including private swing coach for golf and club soccer (no travel though)
elementary and pending HS tuition (HS is $15k elementary is $4k)
car insurance for future driver (have you all seen what they charge to add boys to your car insurance?? It's nuts. Or so I hear. We've got a few years still)
He'll need a car- will give him my 12 YO CRV to start. There is no bussing to HS in our area.
And finally family trips. We can blow $8k on a family vacation without thinking about it.

Health insurance if we quit would be a huge blow to our budget. I think we could do it, but it would pinch other areas.

I don't regret any of it. NONE. DH is happy to continue to work to pay for it. And I can stay home and be an Uber for the kids and friends.

Once they go to college they can tap their 529s which are not included in our NW. And they can work to pay living expenses. Or they can live at home. Or they can go to free college at University DH works at. So it's four more years and then one kid should get cheaper and then four more years for the other.

I just feel like there is always the sentiment on the forum that you shouldn't let kids keep you from FIRE and I really don't know how you don't. It's expensive. But short lived really.
just my $.02.

Your view/experience is pretty consistent with ours.  It's really just math, if you spend more you need more.   We didn't feel it was fair to give up our high paying jobs and tell our three kids your on your own for college so we set aside enough thatbthey each could go to most, all except the most expensive, state schools with out of state tuition.  If they end up going in state or get scholarships/aid then win for us.   Like you we don't count I in our NW.   

And you're not kidding about travel....family of five it adds up real quick just starting with 5 airfares, large enough rental to handle 5 plus luggage, and a place to stay that is big enough (thank goodness for AirBNB)....all that is a small fortune and before you do anything fun when your there.  Sure, we have done some car travel and camping trips and crammed into a hotel room for a few nights but we want to do more than that and want to travel a bit more further with the kids.   

I recently went back to work partly bc I was a bit bored and partly to pad the stash for more travel costs (probably the one are I under budgeted) and maybe a little buffer for inflation/turbulent times and unknown college costs (even if we already stashed a ton away).  But really I probably don't need to be working for more money as we have buffers such as $$$$ kids activities thatvwill be going away in the next few years and bigger picture all the kid related costs $$$$$ that will go away when they leave the nest in general.   

But yeah, it was import ant to us and I don't regret it.   Maybe my perspective would be different if I was a lower earner and really had to choose us vs them....fortunately I didn't have to.   

[Car Jack]

I’ve got to brag on my sub 26 year old new co worker (still on her parents health care because I mentioned looking at the HDHP plans during open season).  She is already maxing out TSP while now living in the Bay Area on a salary with a base of less than 80k.  I also had the other new person up their TSP from 5 to 10% to start getting closer to the max.

By now, she's either without insurance or hopefully on the company plan.  When she turned 26, she could stay on her parents' plan only until the end of the month where her birthday was.  This is a qualifying event for her to join the company insurance plan.  The bad thing is that the full deductible will likely mean she pays the premiums and gets nothing back for this year.

My son turned 26 in July, so I know exactly what happens.

[couponvan]

The challenge of FIRE with kids is something I don't think is talked about enough on the forum. Many have this "just say no" attitude. DH and I are completely unwilling to not give education and experiences to our kids so that we can not work. I'm not saying that approach is wrong, it's just one we cannot take.
.
Our crazy expenses-
Sports (including private swing coach for golf and club soccer (no travel though)
elementary and pending HS tuition (HS is $15k elementary is $4k)
car insurance for future driver (have you all seen what they charge to add boys to your car insurance?? It's nuts. Or so I hear. We've got a few years still)
He'll need a car- will give him my 12 YO CRV to start. There is no bussing to HS in our area.
And finally family trips. We can blow $8k on a family vacation without thinking about it.

Health insurance if we quit would be a huge blow to our budget. I think we could do it, but it would pinch other areas.

I don't regret any of it. NONE. DH is happy to continue to work to pay for it. And I can stay home and be an Uber for the kids and friends.

Once they go to college they can tap their 529s which are not included in our NW. And they can work to pay living expenses. Or they can live at home. Or they can go to free college at University DH works at. So it's four more years and then one kid should get cheaper and then four more years for the other.

I just feel like there is always the sentiment on the forum that you shouldn't let kids keep you from FIRE and I really don't know how you don't. It's expensive. But short lived really.
just my $.02.

Your view/experience is pretty consistent with ours.  It's really just math, if you spend more you need more.   We didn't feel it was fair to give up our high paying jobs and tell our three kids your on your own for college so we set aside enough thatbthey each could go to most, all except the most expensive, state schools with out of state tuition.  If they end up going in state or get scholarships/aid then win for us.   Like you we don't count I in our NW.   

And you're not kidding about travel....family of five it adds up real quick just starting with 5 airfares, large enough rental to handle 5 plus luggage, and a place to stay that is big enough (thank goodness for AirBNB)....all that is a small fortune and before you do anything fun when your there.  Sure, we have done some car travel and camping trips and crammed into a hotel room for a few nights but we want to do more than that and want to travel a bit more further with the kids.   

I recently went back to work partly bc I was a bit bored and partly to pad the stash for more travel costs (probably the one are I under budgeted) and maybe a little buffer for inflation/turbulent times and unknown college costs (even if we already stashed a ton away).  But really I probably don't need to be working for more money as we have buffers such as $$$$ kids activities thatvwill be going away in the next few years and bigger picture all the kid related costs $$$$$ that will go away when they leave the nest in general.   

But yeah, it was import ant to us and I don't regret it.   Maybe my perspective would be different if I was a lower earner and really had to choose us vs them....fortunately I didn't have to.

This might be me too come February/March (if I get my act in gear doing CPE to renew my CPA license in active status).  We have the assets at middle of this race, but the expenses of "and beyond" for at least the next 4-5 years.  Three years off and a waver between bored and crabby.  No one else can take the vacations I want to take because they are working full time.  However, the "and beyond" part of the expenses lies solidly on my husband's side of the equation.  Their college expenses are budgeted and saved for, but fancier travel is not in there.  I want to budget for at least 15 years of expensive travel, and likely expensive travel to include my children and their significant others during their "poorer" years.  Yes, I don't have to, but I might like to.  If I'm working, I'm not bored at home - just complaining about work! LOL.   

[ATtiny85]

I always find this debate over whether to include real estate in one’s “calcs” odd. It should be in your NW, it’s an asset you have to manage. Whether it produces cash flow in a retirement cash flow analysis depends if the real estate is going to be sold, you do a reverse mortgage, or it’s a rental. NW is NW, and cash flow is cash flow.

Queue the sound of much cheering and clapping!

My ledger my rules. BUT, it is at least important to specify what your personal GAAP is when trying to have a discussion. Ditto for how DCA has (at least) two different meanings. Same with savings rate, and so on. To each their own, but when questions are asked, it is quite important to make it clear what’s where.

Without clarity, we may as well be politicians.

[rmorris50]

I always find this debate over whether to include real estate in one’s “calcs” odd. It should be in your NW, it’s an asset you have to manage. Whether it produces cash flow in a retirement cash flow analysis depends if the real estate is going to be sold, you do a reverse mortgage, or it’s a rental. NW is NW, and cash flow is cash flow.

Queue the sound of much cheering and clapping!

My ledger my rules. BUT, it is at least important to specify what your personal GAAP is when trying to have a discussion. Ditto for how DCA has (at least) two different meanings. Same with savings rate, and so on. To each their own, but when questions are asked, it is quite important to make it clear what’s where.

Without clarity, we may as well be politicians.

Sure, but real estate should be more cut and dry on a personal level. Kinda weird to cut it out of your NW ledger. But totally understand it not producing cash flow in your house hold cash flow statement and projection . My point is most people skip the cash flow analysis part and just look at their NW and ask “can I retire”? Really need to do a cash flow analysis to see if one is retirement ready, not look at NW. NW does provide the cash flow input into the cash flow analysis.

NW should be straight forward. Cash flow analysis has a billion different assumptions that are different for each household. Yeah, it good to say what you are assuming in that analysis.


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