Author Topic: 2018 FIRE cohort  (Read 321856 times)

MaybeBabyMustache

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Re: 2018 FIRE cohort
« Reply #900 on: December 20, 2017, 10:40:19 AM »
For those you planning to work less than a full calendar year, how are you handling your 401k contributions?

Are you contributing more than average for a partial year in order to hit the max before you retire? 

Are you contributing less than average each pay period because your reduced annual income for 2018 means you'll have less tax liability, reducing the value of sheltering income in a 401k?

We're still undecided, so we're letting it ride for now and will make adjustments later as our plans firm up.  I just feel like we should be doing something different since next year's tax return will be so different.

I receive a bonus in late January. By default, my company automatically maxes your 401K with your bonus check. You have to opt out. While it's front loading from an investment perspective, I just use the bonus to max out my 401K, and call it a day. I still get a nice sum in the bonus, & the money is going to my FIRE account, so it works well.

Aegishjalmur

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Re: 2018 FIRE cohort
« Reply #901 on: December 20, 2017, 10:42:09 AM »
Front loading. I have set 401K to take out max allowed from paycheck to get as much as possible. Will not be working long enough to hit max even at that level.

Gimesalot

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Re: 2018 FIRE cohort
« Reply #902 on: December 20, 2017, 12:02:53 PM »
Are you contributing less than average each pay period because your reduced annual income for 2018 means you'll have less tax liability, reducing the value of sheltering income in a 401k?

I am not contributing to a 401k next year since we need to keep our income at around $23k-$25k for the year in order to qualify for subsidies through ACA.  If we go too low or too high on income, we will not have access to subsidies.  We plan on using traditional IRA contributions and selling of investments to hit the right income amount.

I am just realizing that this means that we may need to limit or suspend the Roth conversion ladder for next year.

Vegasgirl

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Re: 2018 FIRE cohort
« Reply #903 on: December 20, 2017, 12:07:48 PM »
I'm front loading to get the max amount in for the year prior to leaving.     Also, just got back from an employer retirement healthcare seminar and am in a very good mood !! Confirmed everything as far as healthcare goes and at least from that aspect all is well.  Ready for the holidays now !!!

DTaggart

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Re: 2018 FIRE cohort
« Reply #904 on: December 20, 2017, 12:20:13 PM »
News of my impending retirement is slowly circulating among my coworkers, which resulted in my getting to have this awesome exchange today:

Coworker: Are you old enough to retire?
Me: Retirement is not an age, it is a dollar amount.
Coworker: Oh. ... Ohhhhhhhh. Congratulations!

Oroadsm

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Re: 2018 FIRE cohort
« Reply #905 on: December 20, 2017, 12:50:52 PM »
I am mostly a lurker here, but will be joining the class of 2018.

I was given a choice of moving to Megacorp's main office to do a job with completely unrealistic expectations or leave the company, so April 30, 2018 will be my last day.  While my stache is more than adequate, it is likely I will be looking for some part time, hopefully easy consulting work to fill the time until my wife moves on in the next 18-24 months so we can travel the country.  I just turned 50, so not extraordinarily earlier (nice job to those 30 year olds) but still young enough to bike and complete in running and triathlon races.

CheapskateWife

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Re: 2018 FIRE cohort
« Reply #906 on: December 20, 2017, 01:06:39 PM »
For those you planning to work less than a full calendar year, how are you handling your 401k contributions?

Are you contributing more than average for a partial year in order to hit the max before you retire? 

Are you contributing less than average each pay period because your reduced annual income for 2018 means you'll have less tax liability, reducing the value of sheltering income in a 401k?

We're still undecided, so we're letting it ride for now and will make adjustments later as our plans firm up.  I just feel like we should be doing something different since next year's tax return will be so different.
This is a question CH and I worked through earlier and settled on contribute to max matching, and then stockpile the cash.  Part of the tipping point was the decreased tax burden for the half year worked, part of it was wanting the flexibility of two years of our Net Worth withdrawals in cash leading into FIRE.  That might sound like excess, but due to pension income, that withdrawal is actually a very modest amount and makes us feel like we have a buffer against heavy market losses.

Oh yeah...I probably need to go ahead and commit to the Cohort.  We're in for 2018!  June 8 if anyone is counting.

CowboyAndIndian

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Re: 2018 FIRE cohort
« Reply #907 on: December 20, 2017, 01:15:55 PM »
Welcome to the cohort, CheapskateWife.

Is it just my imagination or is this cohort one of the biggest till now?


01/01/18  CowboyAndIndian (at 59) CONFIRMED
01/05/18  Gimesalot
01/06/18  Monkey Uncle
01/15/18  PizzaSteve
01/31/18  MomCPA
01/??/18  FIBy30
01/??/18  PrePube
02/01/18  DTaggart
02/28/18  brooklynguy
03/16/18  Cherry Lane
03/30/18  sol
03/31/18  Caoineag (at 36)
03/31/18  homestead neohio
03/31/18  Mrbeardedbigbucks
03/31/18  ZiziPB (at 50)
03/31/18  DavidAnnArbor (at 52) (Won't renew my office lease)
03/??/18  Badblackgirl
03/??/18  Clean Shaven
03/??/18  JLTinVA
03/??/18  Sofa King
03/??/18  MiserlyMiser
03/??/18  Acastus
04/20/18  NinetyFour
04/27/18  poppydog and DW
04/??/18  Aegishjalmur (At 35)
04/??/18  Calvin
04/??/18  FernFree
04/??/18  Gooki
04/??/18  lostformars
~04/??/18 HappyMargo
~04/??/18 Mother Fussbudget
05/01/18  SwordGuy (at 60)
05/08/18  SwordGuy DW (SwordGuy isn't saying.   He wants to live.)
05/04/18  wordnerd and DH (at 30 and 36)
05/04/18  step_away
05/15/18  Markbike528CBX (at 53.5)
05/25/18  Gyosho
05/??/18  Alim Nassor
05/??/18  msilenus
~06/01/18 Honeyfill  (at 60)
06/08/18  CheapskateWife
06/15/18  DavisGang90 (at 49)
06/25/18  MaybeBabyMustache (at 42)
06/29/18  aperture
06/30/18  TartanTallulah
06/??/18  Cheddar Stacker
06/??/18  dbtx
06/??/18  Omalley
06/??/18  randomgiraffe
06/??/18  SwissMiss
~06/??/18 Pylortes
07/??/18  AussieGirl
07/??/18  ChasesFish
07/??/18  Mr Griz
~07/??/18 BackAndForth
~07/??/18 cerat0n1a
~07/??/18 Fresh Bread
~07/??/18 SnidelyWhiplashStache
08/01/18  SugarMountain
08/??/18  Mr Mark
08/??/18  NorCalistache
08/??/18  RunningWithScissors
10/05/18  JumboShrimp
10/??/18  Fire1018
10/??/18  Happy
10/??/18  Irishtache
10/??/18  patches
11/??/18  DeSteeg
11/??/18  Kris
12/01/18  Vegasgirl (at 49)
12/21/18  LateStarter
12/??/18  EnjoyIt
12/??/18  yoda34
??/??/18  Blindsquirrel
??/??/18  Michread
??/??/18  Minnesota_mom
??/??/18  OzBeach -- WIGLO (When I Get Laid Off)
??/??/18  thriftycanadian
??/??/18  pecunia
??/??/18  FLStache

« Last Edit: December 20, 2017, 01:18:44 PM by CowboyAndIndian »

msilenus

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Re: 2018 FIRE cohort
« Reply #908 on: December 20, 2017, 01:21:57 PM »
For those you planning to work less than a full calendar year, how are you handling your 401k contributions?

Frontloading should only start to be bad when it starts to push your post-retirement tax position into a worse position than it was in your last employment year.  This should be true when post-retirement marginal rate > 2018 marginal rate.  If you think your post-retirement tax position is going to be extremely favorable, then this becomes a taller and taller order the more you earn in the last working year. 

I've gathered that you're a high-earner, and it says above that you're retiring 3/31.  If high earner is 400k, then you'll earn 100k before April and chop 18.5k off of that for your frontloading, leaving 80k+ in taxable income before dividends and stuff pops in.  Frontloading is very clearly correct here, within the normal range of retirement spending for folks around here.

If you're earning 100k, then you only wind up with about 7k in working income for 2018 when you're frontloading.  Rest goes into post-retirement tax returns.  So it depends on what you think those are going to look like.  Maybe a good rule of thumb for this case would be that if you expect to make > 7k in postretirement disfavored (ordinary) income in retirement, then frontloading starts to become bad.

My intuition here is that even when moving that ordinary income into retirement is bad, it's probably not going to be very bad.  On the other hand: skipping frontloading incorrectly seems like it has much more potential to be bad because earning a living is so disfavored by the tax code relative to unearneding a living.  Especially in future years.  Personally: I'm going to frontload pretax, frontload aftertax, frontload my posttax IRA and spousal IRA, frontload my ESPP.  I'm going to frontload free food and frontload gym access to work it off.  Time to get while the gettin's good.  Now if you'll excuse me, I should get back to work.

sol

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Re: 2018 FIRE cohort
« Reply #909 on: December 20, 2017, 02:01:25 PM »
Our combined income is low enough that working for only three months, with multiple kids, could put us in range of zero tax owed.  In that situation, retirement accounts offer less benefit.

Our 5% match is paid per pay period, so if we max out the 18.5k and then keep working, we would lose the match on any subsequent paychecks.

In our case, the long term problem is finding enough available cash to fund the first five years of the roth pipeline.  This makes it more attractive to pad the cash accounts.

I'm expecting my tax rate in retirement to be mostly zero (24k standard deduction plus roth principal withdrawals plus return of equity on brokerage account with 0% LTCG), with some in the 15% bracket.  If I avoid the 28% marginal rate on potential contributions now, I still come out slightly ahead even if I have to pay the 10% penalty plus 15% on the withdrawals/rollovers as income.  So, my only real concern now is maximizing the employer matching funds by not hitting the max too early.

Caoineag

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Re: 2018 FIRE cohort
« Reply #910 on: December 20, 2017, 02:07:00 PM »
...

Is it just my imagination or is this cohort one of the biggest till now?
...

Not your imagination. I noticed that as well. I suspect part of it is all the people who held off waiting for a recession (OMYers) and eventually gave up waiting. Others probably have benefited greatly from the bull market and so hit their numbers early.

ZiziPB

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Re: 2018 FIRE cohort
« Reply #911 on: December 20, 2017, 02:07:47 PM »
Our combined income is low enough that working for only three months, with multiple kids, could put us in range of zero tax owed.  In that situation, retirement accounts offer less benefit.

Our 5% match is paid per pay period, so if we max out the 18.5k and then keep working, we would lose the match on any subsequent paychecks.

In our case, the long term problem is finding enough available cash to fund the first five years of the roth pipeline.  This makes it more attractive to pad the cash accounts.

I'm expecting my tax rate in retirement to be mostly zero (24k standard deduction plus roth principal withdrawals plus return of equity on brokerage account with 0% LTCG), with some in the 15% bracket.  If I avoid the 28% marginal rate on potential contributions now, I still come out slightly ahead even if I have to pay the 10% penalty plus 15% on the withdrawals/rollovers as income.  So, my only real concern now is maximizing the employer matching funds by not hitting the max too early.
Do they max after tax contributions?  I have the same issue if I for some reason I continue working past my FIRE date, but my employer matches after tax contributions so I can just continue contributing the 6% that's required to get the full match.

SwordGuy

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Re: 2018 FIRE cohort
« Reply #912 on: December 20, 2017, 02:31:51 PM »
We'll be padding the cash account unless our old home sells quickly.   Otherwise, we'll make sure we max our our 401Ks by our last paychecks.   We'll have high cash needs the first year to fund a house flipping project.

honeyfill

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Re: 2018 FIRE cohort
« Reply #913 on: December 20, 2017, 02:59:40 PM »
 Good news on the retirement front.  My wife is going to part time , then full retirement in March. Her parents have health issues and she wants to spend more time with them.  I haven't decided whether to stay until June 1 as originally planned, move up my date to March to match the DW or work even later in  the year to make up for the lost income.  The two keys are: do I pay off the kitchen remodel and the DW's car before I retire and if so, how much a month do I take out of the stache .   Or I could take out a lump sum and pay it off all at once. All this then factors into what we do with Health Care. If we have used up our deductible and have a lot of earned income, then it makes sense just to bite the bullet and take cobra through the end of the year. 
We will be 61 and 59 in June.  For now,  I am thinking to put as much into cash and stock in order to keep MAGI income low for the next 4 to 6 years , in order to qualify for subsidies from 2019 to 2024 and just  assume we will use cobra in 2018.  Then work until at least June so we have less cobra to pay for in 2018. 

markbike528CBX

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Re: 2018 FIRE cohort
« Reply #914 on: December 20, 2017, 08:50:43 PM »
per Sol's 401k question

we will contributing less than average each pay period just the match because:
1) your reduced annual income for 2018 means you'll have less tax liability, reducing the value of sheltering income in a 401k?

2) extra cash as a rebalancing move

3) mortgage payoff.

ZiziPB

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Re: 2018 FIRE cohort
« Reply #915 on: December 21, 2017, 03:50:40 AM »
When you all talk about hoarding "cash" to cover expenses for a couple of years of FIRE, what do you actually mean?  Physical cash (I hope not)? Money in a savings account?  CDs?  I Bonds?  Something else?  And is that not part of your portfolio now?  Where do you keep your emergency fund for example?

NinetyFour

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Re: 2018 FIRE cohort
« Reply #916 on: December 21, 2017, 06:58:44 AM »
I can't decide whether to frontload or not.

I have mandatory 401a funds taken out of my paycheck, so that's not an issue.  But I also have access to 403b and 457 accounts.  I will be working through April and paid through June.

If I wanted to, I could max out both the 403b and the 457 accounts ($24K each) with my regular paychecks.  However, I am getting a full year's payout (lump sum of $76K) on June 30, and can take the $48K out of that to fund the 403b and 457 accounts.  It kind of makes me nervous to wait until June 30 to do it, because what if my HR department or TIAA or Voya goofs it up?  So I might compromise and do some sort of half an half approach.

Also, partly in response to @ZiziPB  's question and in response to a post way back from @sol , I have revisited my personal investment strategy, and will be using a particular AA, which involves keeping some funds (<$8K) in cash (savings accounts), a larger chunk in Vanguard's money market account, and then a chunk in a bond fund, and the rest (~85%) in VTSAX.  So, no, I won't be hoarding cash, but will instead be paying attention to my AA.  Thanks for the suggestions for various folks here.

Caoineag

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Re: 2018 FIRE cohort
« Reply #917 on: December 21, 2017, 07:10:48 AM »
When you all talk about hoarding "cash" to cover expenses for a couple of years of FIRE, what do you actually mean?  Physical cash (I hope not)? Money in a savings account?  CDs?  I Bonds?  Something else?  And is that not part of your portfolio now?  Where do you keep your emergency fund for example?

Part of my portfolio now is a house with a ton of equity. When I FIRE I will be selling it so I can travel for awhile and then pick a new place to live. So we aren't super in a hurry to convert all of that equity into investments as we aren't sure of our timeline for needing it for a new much cheaper house (though some equity will indeed be turned into investments). My current emergency fund is a taxable account (stocks) which will pay both for front loading my 401(k) and our expenses prior to the house selling. The cash we keep on hand will be money in a savings account. As we spend down the cash and eventually buy a new place to live, the cash will dwindle until we are back at our original allocation.

Gimesalot

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Re: 2018 FIRE cohort
« Reply #918 on: December 21, 2017, 07:35:21 AM »
When you all talk about hoarding "cash" to cover expenses for a couple of years of FIRE, what do you actually mean?  Physical cash (I hope not)? Money in a savings account?  CDs?  I Bonds?  Something else?  And is that not part of your portfolio now?  Where do you keep your emergency fund for example?

I have always invested pretty aggressively, and I don't plan on changing that after I fire.  Currently, we have 3% of our portfolio in a CD ladder.  The rest, 97%, is in a S&P500 index.  I know that this isn't a typical AA but if we include a low estimate of our rental income in our WR, we are at 2%, so I am comfortable taking the risk.       

MaybeBabyMustache

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Re: 2018 FIRE cohort
« Reply #919 on: December 21, 2017, 08:06:44 AM »
per Sol's 401k question

we will contributing less than average each pay period just the match because:
1) your reduced annual income for 2018 means you'll have less tax liability, reducing the value of sheltering income in a 401k?

2) extra cash as a rebalancing move

3) mortgage payoff.

In our case, my husband will continue to work, & I'll work through June, so we'll still have a significant tax liability for the year.

TartanTallulah

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Re: 2018 FIRE cohort
« Reply #920 on: December 21, 2017, 09:10:17 AM »
When you all talk about hoarding "cash" to cover expenses for a couple of years of FIRE, what do you actually mean?  Physical cash (I hope not)? Money in a savings account?  CDs?  I Bonds?  Something else?  And is that not part of your portfolio now?  Where do you keep your emergency fund for example?

DH and I keep our cash deposit immediately accessible in a savings account linked to our joint checking account. It won't grow much (interest rate currently 1.25%) but it's a short term component of our stash to bridge the period of less than 12 months between my retirement date and my 55th birthday, at which point I plan to access my DB pension, which will include a cash lump sum.

This cash deposit is the critical aspect of our stash in determining how soon I can afford to retire without being obliged to access other investments earlier than planned. At the moment, 15 months away from my 55th birthday, it falls some way short. But each month we save a bit more and the gap becomes one month smaller, and by the end of June 2018 we should be secure.


sol

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Re: 2018 FIRE cohort
« Reply #921 on: December 21, 2017, 10:55:22 AM »
When you all talk about hoarding "cash" to cover expenses for a couple of years of FIRE, what do you actually mean? 

In my case, I've been casually using "cash" to refer to all liquid assets outside of tax shelters.  Numerically, it's mostly investments in taxable brokerage accounts.  It's still invested, but it's available for spending on short notice without paying penalties or (much) taxes.

honeyfill

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Re: 2018 FIRE cohort
« Reply #922 on: December 21, 2017, 11:05:38 AM »
Added Mrs. Honeyfill for April 1. Kept Mr. Honeyfill at June 1 for now.  It's starting to look real!!



01/01/18  CowboyAndIndian (at 59) CONFIRMED
01/05/18  Gimesalot
01/06/18  Monkey Uncle
01/15/18  PizzaSteve
01/31/18  MomCPA
01/??/18  FIBy30
01/??/18  PrePube
02/01/18  DTaggart
02/28/18  brooklynguy
03/16/18  Cherry Lane
03/30/18  sol
03/31/18  Caoineag (at 36)
03/31/18  homestead neohio
03/31/18  Mrbeardedbigbucks
03/31/18  ZiziPB (at 50)
03/31/18  DavidAnnArbor (at 52) (Won't renew my office lease)
03/??/18  Badblackgirl
03/??/18  Clean Shaven
03/??/18  JLTinVA
03/??/18  Sofa King
03/??/18  MiserlyMiser
03/??/18  Acastus
04/01/18 Mrs. Honeyfill
04/20/18  NinetyFour
04/27/18  poppydog and DW
04/??/18  Aegishjalmur (At 35)
04/??/18  Calvin
04/??/18  FernFree
04/??/18  Gooki
04/??/18  lostformars
~04/??/18 HappyMargo
~04/??/18 Mother Fussbudget
05/01/18  SwordGuy (at 60)
05/08/18  SwordGuy DW (SwordGuy isn't saying.   He wants to live.)
05/04/18  wordnerd and DH (at 30 and 36)
05/04/18  step_away
05/15/18  Markbike528CBX (at 53.5)
05/25/18  Gyosho
05/??/18  Alim Nassor
05/??/18  msilenus
~06/01/18 Honeyfill  (at 60)
06/08/18  CheapskateWife
06/15/18  DavisGang90 (at 49)
06/25/18  MaybeBabyMustache (at 42)
06/29/18  aperture
06/30/18  TartanTallulah
06/??/18  Cheddar Stacker
06/??/18  dbtx
06/??/18  Omalley
06/??/18  randomgiraffe
06/??/18  SwissMiss
~06/??/18 Pylortes
07/??/18  AussieGirl
07/??/18  ChasesFish
07/??/18  Mr Griz
~07/??/18 BackAndForth
~07/??/18 cerat0n1a
~07/??/18 Fresh Bread
~07/??/18 SnidelyWhiplashStache
08/01/18  SugarMountain
08/??/18  Mr Mark
08/??/18  NorCalistache
08/??/18  RunningWithScissors
10/05/18  JumboShrimp
10/??/18  Fire1018
10/??/18  Happy
10/??/18  Irishtache
10/??/18  patches
11/??/18  DeSteeg
11/??/18  Kris
12/01/18  Vegasgirl (at 49)
12/21/18  LateStarter
12/??/18  EnjoyIt
12/??/18  yoda34
??/??/18  Blindsquirrel
??/??/18  Michread
??/??/18  Minnesota_mom
??/??/18  OzBeach -- WIGLO (When I Get Laid Off)
??/??/18  thriftycanadian
??/??/18  pecunia
??/??/18  FLStache



SugarMountain

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Re: 2018 FIRE cohort
« Reply #923 on: December 21, 2017, 04:19:08 PM »
2017 was my OMY (kind of--my plans have always been flexible/I've always been indecisive).  But looking back, I'm just amazed at how good the market has been and how much my stash has grown.  Does anyone share my anxiety that 2018 will be the peak of market, a.k.a. The Worst time to retire?  And how did you get over that anxiety?

Yes I do.  This also ties into the current thread of why the 2018 cohort is so big, the markets have done really well over the last 8 years, which has boosted a lot of our staches.  I do wonder if this is a bit of a mirage.  Josh Brown, one of my favorite wall street twitter follows thinks 2018 is actually going to be lit for the stock market, and then it will blow up a year or two from now. http://thereformedbroker.com/2017/12/21/trumps-singular-accomplishment/

So who knows.

As for how I get over the anxiety, I'm not sure I do.  I'm also really worried about what 15 years of open market health insurance is going to look like (or 17 or 18 years if medicare ages get raised).  Does OMY become TMY? Maybe.  We'll see how things look in July.

As for the question on 401k, I'm going to try to get a full amount into it by the end of July + the $6k "catch up" bucket since I'm 50.

chasesfish

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Re: 2018 FIRE cohort
« Reply #924 on: December 21, 2017, 06:53:34 PM »
For those you planning to work less than a full calendar year, how are you handling your 401k contributions?

Are you contributing more than average for a partial year in order to hit the max before you retire? 

Are you contributing less than average each pay period because your reduced annual income for 2018 means you'll have less tax liability, reducing the value of sheltering income in a 401k?

We're still undecided, so we're letting it ride for now and will make adjustments later as our plans firm up.  I just feel like we should be doing something different since next year's tax return will be so different.

I've always been a frontloader...I'm blessed to have a deferred comp plan that money spills over into after deferral.  I set a 42% rate for 2018

step_away

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Re: 2018 FIRE cohort
« Reply #925 on: December 22, 2017, 05:03:37 AM »
For those you planning to work less than a full calendar year, how are you handling your 401k contributions?

Are you contributing more than average for a partial year in order to hit the max before you retire? 

I'm maintaining the minimum 4% to get the employer match and will use my bonus to fill in the difference to the max.  The way our 401k is set up I can actually specify the exact $ amount drawn from the bonus as opposed to percentage of salary for regular contributions.

I usually also receive a match for vacation payout, but I don't know whether I'll get one if my employer knows I'm leaving.
« Last Edit: December 22, 2017, 05:09:27 AM by step_away »

MaybeBabyMustache

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Re: 2018 FIRE cohort
« Reply #926 on: December 22, 2017, 07:25:50 AM »
As we're almost to 2018(!), how about a get to know your fellow cohort question? If you're comfortable answering:

1) What do you do for employment currently?
2) What will you miss most about quitting, aside from the $?
3) What are you most looking forward to about quitting your job?

For me:
1) I work in tech, managing a team of marketing managers
2)We get great perks, so there's that. Also, the majority of my team is really great & super smart/fun bunch
3) Not having to do international work travel again. Or, sit through 8 hours of meeting on a Monday.

homestead neohio

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Re: 2018 FIRE cohort
« Reply #927 on: December 22, 2017, 07:41:26 AM »
I'm maxing my tax deferred space early in 2018 because while I'm only working until the end of March, I expect tax liability to be similar to a normal year.  I've increased my 401k contributions to the percent needed to max it, and will do tIRA and spousal tIRA contributions from a severance payout.  This will leave me with remaining cash earned in 2018 >1 years expenses.  When combined with other liquid assets I already have, it will be close to 2 years expenses.  Since I don't plan to have any other income in 2018, I'll be using this cash for all expenses, including travel, 9 months private health insurance and mortgage.   I haven't decided where I will hold each liquid dollar, it will be a combination of accounts, but much of this money will be needed 12-18 months after I receive it, so I'll not invest it in stocks.

I'm not jumping straight into full FIRE.  I'm taking a year or two off, then downshifting to part time, enjoyable work to offset some expenses. Since I don't know how much work I'll take on or how much it will pay (and if there will be benefits), there are quite a few unknowns.  This makes it difficult to plan in detail, but allows for many possible adjustments.

As far as how this all impacts AA, I have an accumulation AA set for my investments and that will remain unchanged.  My overall AA will swing higher on cash, but will settle to my prior AA in about 12 months.  After that I'll have some experience living without an income which should inform my post-career risk tolerance.  I'll revisit my accumulation AA at this time and decide if any changes are needed once I start drawing down (non-liquid) investments.

Patches

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Re: 2018 FIRE cohort
« Reply #928 on: December 22, 2017, 09:09:34 AM »
For those you planning to work less than a full calendar year, how are you handling your 401k contributions?


Well, I had planned on front loading since my RE day was going to be in Oct.  But I got word this week that a succession plan is in place for my job now and my last day will be April 1st!  Haaaappy. 

Some ins/outs to figure out still with taxes next year... but with 3 kids and Marco Rubio's child tax credits... gag/cheer... I think we have some cusion for income.  I don't think I'll be contributing any to my 401k now (no match at my company). However, the lovely missus plans to continue her job (2 days a week) and will sock away all income into her 401k & DCP.

Anyway, you can probably move me to an April 1st FIRE date - I'll be 34.

I love this.  And all you fine people.

Patrick


GettingClose

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Re: 2018 FIRE cohort
« Reply #929 on: December 22, 2017, 10:40:39 AM »
Congratulations!

CowboyAndIndian

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Re: 2018 FIRE cohort
« Reply #930 on: December 22, 2017, 11:45:52 AM »
Patches FIRE'ing earlier on 04/01!


01/01/18  CowboyAndIndian (at 59) CONFIRMED
01/05/18  Gimesalot
01/06/18  Monkey Uncle
01/15/18  PizzaSteve
01/31/18  MomCPA
01/??/18  FIBy30
01/??/18  PrePube
02/01/18  DTaggart
02/28/18  brooklynguy
03/16/18  Cherry Lane
03/30/18  sol
03/31/18  Caoineag (at 36)
03/31/18  homestead neohio
03/31/18  Mrbeardedbigbucks
03/31/18  ZiziPB (at 50)
03/31/18  DavidAnnArbor (at 52) (Won't renew my office lease)
03/??/18  Badblackgirl
03/??/18  Clean Shaven
03/??/18  JLTinVA
03/??/18  Sofa King
03/??/18  MiserlyMiser
03/??/18  Acastus
04/01/18  Mrs. Honeyfill
04/01/18  patches
04/20/18  NinetyFour
04/27/18  poppydog and DW
04/??/18  Aegishjalmur (At 35)
04/??/18  Calvin
04/??/18  FernFree
04/??/18  Gooki
04/??/18  lostformars
~04/??/18 HappyMargo
~04/??/18 Mother Fussbudget
05/01/18  SwordGuy (at 60)
05/08/18  SwordGuy DW (SwordGuy isn't saying.   He wants to live.)
05/04/18  wordnerd and DH (at 30 and 36)
05/04/18  step_away
05/15/18  Markbike528CBX (at 53.5)
05/25/18  Gyosho
05/??/18  Alim Nassor
05/??/18  msilenus
06/01/18  Honeyfill  (at 60)
06/08/18  CheapskateWife
06/15/18  DavisGang90 (at 49)
06/25/18  MaybeBabyMustache (at 42)
06/29/18  aperture
06/30/18  TartanTallulah
06/??/18  Cheddar Stacker
06/??/18  dbtx
06/??/18  Omalley
06/??/18  randomgiraffe
06/??/18  SwissMiss
~06/??/18 Pylortes
07/??/18  AussieGirl
07/??/18  ChasesFish
07/??/18  Mr Griz
~07/??/18 BackAndForth
~07/??/18 cerat0n1a
~07/??/18 Fresh Bread
~07/??/18 SnidelyWhiplashStache
08/01/18  SugarMountain
08/??/18  Mr Mark
08/??/18  NorCalistache
08/??/18  RunningWithScissors
10/05/18  JumboShrimp
10/??/18  Fire1018
10/??/18  Happy
10/??/18  Irishtache
11/??/18  DeSteeg
11/??/18  Kris
12/01/18  Vegasgirl (at 49)
12/21/18  LateStarter
12/??/18  EnjoyIt
12/??/18  yoda34
??/??/18  Blindsquirrel
??/??/18  Michread
??/??/18  Minnesota_mom
??/??/18  OzBeach -- WIGLO (When I Get Laid Off)
??/??/18  thriftycanadian
??/??/18  pecunia
??/??/18  FLStache

« Last Edit: December 22, 2017, 01:08:25 PM by CowboyAndIndian »

Aegishjalmur

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Re: 2018 FIRE cohort
« Reply #931 on: December 22, 2017, 12:56:17 PM »


 But I got word this week that a succession plan is in place for my job now and my last day will be April 1st!  Haaaappy. 


Patrick

Are you SURE that's your last day and they aren't just messing with you?

Monkey Uncle

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Re: 2018 FIRE cohort
« Reply #932 on: December 22, 2017, 02:46:12 PM »
As we're almost to 2018(!), how about a get to know your fellow cohort question? If you're comfortable answering:

1) What do you do for employment currently?
2) What will you miss most about quitting, aside from the $?
3) What are you most looking forward to about quitting your job?

1) Group manager for a government natural resource agency.
2) Knowing that my efforts really do leave the world a better place for future generations.
3) Freedom from the stress of constant conflict and competition. 
Freedom from the stress of an impossible workload.  No more "do more with less" bullshit.
No more ridiculous new "initiatives" every time senior leadership changes.
No more pressure from senior leaders to tell them what they want to hear instead of the truth.
Not being prevented from doing the right thing by politically connected corporations who have the agency's senior leadership in their pockets.
Not having to work for a chief executive who is an arrogant, bloviating, ignorant, stupid, lying asshole.
And most of all, not having to sit inside tapping away at my computer and attending meetings and conference calls when it's a beautiful sunny day outside!

TartanTallulah

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Re: 2018 FIRE cohort
« Reply #933 on: December 22, 2017, 04:12:37 PM »
As we're almost to 2018(!), how about a get to know your fellow cohort question? If you're comfortable answering:

1) What do you do for employment currently?
2) What will you miss most about quitting, aside from the $?
3) What are you most looking forward to about quitting your job?

For me:
1) I work in tech, managing a team of marketing managers
2)We get great perks, so there's that. Also, the majority of my team is really great & super smart/fun bunch
3) Not having to do international work travel again. Or, sit through 8 hours of meeting on a Monday.

1) A senior clinical role in primary health care in the UK.

2) Working face to face with patients and immediate colleagues, and the endless variety of brain-stimulating conundrums with which I am presented in the course of a normal working day.
Knowing that if someone in my family gets a trivial medical problem that would benefit from prescription medication, I can sort it out quickly (I do, of course, have an immaculate record of not treating myself or family members for anything more serious than a dose of cystitis).
Using the vast quantity of knowledge that's already in my head, and always being presented with new things to learn.
The way my job defines me as a person. I like to think I won't miss this, but after more than three decades it would be surprising if I was able to slip out of the mantle and walk away without looking back.

3) Getting out of a situation in which I'm fighting to provide a good service in an organisation that's being cut back, while all the other organisations with whom we should share a common goal are also being cut back so work is hot-potatoed around from primary health care to hospitals to the emergency services to social care and back and patients/clients/vulnerable human beings suffer. I realise that by getting out I'll become part of the problem, but there's only one of me and I'll only get one shot at life.
Getting away from the frustrating over-regulation and box-ticking exercises. The systems that have been put in place since I started doing this job might as well have been devised with the purpose of being emotionally abusive to people of my personality type.
Difficult patients and difficult colleagues.
Stopping the long, long working days for which I am too old but for which I can't see an alternative.
Being able to take vacations when it's convenient for me and my husband rather than when it's least inconvenient for my workplace, and being able to go away for more than two weeks at a time. Being able to say yes when a friend texts to say, "I'm in your area, wanna play?"
Being able to go out to play on sunny days instead of sitting at a desk in an office with an opaque window that doesn't open.
Being able to go to concerts and theatre performances on weekday evenings.
Having the time and energy to visit my parents and other family members more often than I do, and being able to provide support when it's needed without having to worry about work.
Freeing up my brain to absorb lots of new knowledge that has nothing to do with providing health care. Maybe even do another degree once I've decompressed.
Having my first-ever experience of being the stay-at-home wife of a man who goes out to work, though I don't expect DH to want to remain at work for very long after I've stopped.

CowboyAndIndian

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Re: 2018 FIRE cohort
« Reply #934 on: December 22, 2017, 04:42:43 PM »
As we're almost to 2018(!), how about a get to know your fellow cohort question? If you're comfortable answering:

1) What do you do for employment currently?
I am a software engineer working for a big Wall St. company. Not an employee, I am a consultant.
Quote
2) What will you miss most about quitting, aside from the $?
Nothing at all: Investment banks are horrible places to work. High stress, very short deadlines and folks who are ready to screw you for $'s

Quote
3) What are you most looking forward to about quitting your job?
A good nights sleep: I need to be on the job at 7:30 am, and I live 50 miles away. So, NJTransit to Newark, then the PATH to the World Trade Center and a walk to Wall St. Means, I have to get up at 5:30 am to get there by 7:30 am. Would love to wake up when my body says I have enough sleep.
« Last Edit: December 22, 2017, 04:44:36 PM by CowboyAndIndian »

FIREin2018?

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Re: 2018 FIRE cohort
« Reply #935 on: December 22, 2017, 07:15:48 PM »
Im 47, single with no kids, and debt free.
the only thing stopping me is Golden Handcuffs and health insurance uncertainty.

Golden Handcuffs:
6figure easy job that i dont particularly enjoy.
i only work like 4hrs/day and literally sleep in an unoccupied room for a couple of hrs.

healthcare uncertainty:
Before Trump, Obamacare was a no-brainer.
if retired, my income will be less than $30k thus maximum subsidies.
now i feel it's too risky

Monkey Uncle

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Re: 2018 FIRE cohort
« Reply #936 on: December 23, 2017, 04:19:17 AM »
Im 47, single with no kids, and debt free.
the only thing stopping me is Golden Handcuffs and health insurance uncertainty.

Golden Handcuffs:
6figure easy job that i dont particularly enjoy.
i only work like 4hrs/day and literally sleep in an unoccupied room for a couple of hrs.

healthcare uncertainty:
Before Trump, Obamacare was a no-brainer.
if retired, my income will be less than $30k thus maximum subsidies.
now i feel it's too risky

Have you run your numbers to see if your current stash (and other FIRE income sources if applicable) will cover your annual spend, plus about 15k if you had to buy an unsubsidized individual policy?

As for the golden handcuffs, do you need the continued income your job provides?  Are there particular optional expenses you'd like to cover in FIRE that you can't cover with the stash you have now?  If so, are those optional expenses worth continuing to work a job you don't like?

These are all answerable questions.  For someone who is at or close to FI, which you must be if you are seriously considering FIRE in 2018, there is no such thing as being "stuck."  There are only informed choices to be made.

chasesfish

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Re: 2018 FIRE cohort
« Reply #937 on: December 23, 2017, 07:44:24 AM »
Im 47, single with no kids, and debt free.
the only thing stopping me is Golden Handcuffs and health insurance uncertainty.

Golden Handcuffs:
6figure easy job that i dont particularly enjoy.
i only work like 4hrs/day and literally sleep in an unoccupied room for a couple of hrs.

healthcare uncertainty:
Before Trump, Obamacare was a no-brainer.
if retired, my income will be less than $30k thus maximum subsidies.
now i feel it's too risky

I wouldn't be overly concerned about the health insurance/subsidies.  Giving up a job that you can Peter Gibbons is tougher though

Zoot

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Re: 2018 FIRE cohort
« Reply #938 on: December 23, 2017, 10:29:43 AM »
Giving up a job that you can Peter Gibbons is tougher though

I so, so, so love that you used "Peter Gibbons" as a verb.  I am also so, so, so going to steal it.  :)

FIREin2018?

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Re: 2018 FIRE cohort
« Reply #939 on: December 23, 2017, 11:02:07 AM »
Have you run your numbers to see if your current stash (and other FIRE income sources if applicable) will cover your annual spend, plus about 15k if you had to buy an unsubsidized individual policy?

As for the golden handcuffs, do you need the continued income your job provides?  Are there particular optional expenses you'd like to cover in FIRE that you can't cover with the stash you have now?  If so, are those optional expenses worth continuing to work a job you don't like?

These are all answerable questions.  For someone who is at or close to FI, which you must be if you are seriously considering FIRE in 2018, there is no such thing as being "stuck."  There are only informed choices to be made.

ok, i Ran the #'s (assuming $12k/yr health insurance):
 https://forum.mrmoneymustache.com/welcome-to-the-forum/health-insurance-if-i-fire/msg1822025/#msg1822025

so i can Fire now. :o
(How do you do emoticons?)


I wouldn't be overly concerned about the health insurance/subsidies.  Giving up a job that you can Peter Gibbons is tougher though

yeah.. about those TPS reports...

i guess one scenario is they lay me off to take that decision out of my hands.
and i collect unemployment ($10k)
« Last Edit: December 23, 2017, 11:12:48 AM by FIREin2018? »

honeyfill

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Re: 2018 FIRE cohort
« Reply #940 on: December 23, 2017, 09:57:55 PM »
I love to read all the different scenario's people are considering as we get into the last year of pre retirement.  As for myself, We have paid off all our student loans , credit cards and one of the cars.   the only thing left for 2017 is to take the RMD from an inherited IRA and to donate to a DAF for the tax breaks in our last full year of working.  In the first half of 2018 we plan to pay off our kitchen remodel , our second car and to figure out what the heck we are going to do about HC in the second half of the year, after I retire in June(Mrs HF is retiring on April 1). We are 90% sure we will not pay off the 1st mortgage until we are both 65 and on medicare about 6.5 years from now.  Whoo Hoo , I am super psyched about counting down all the 2018 retiree's. Looks like 7 in January alone!   

davisgang90

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Re: 2018 FIRE cohort
« Reply #941 on: December 24, 2017, 05:14:00 AM »
1) What do you do for employment currently?
Officer in the US Navy, currently faculty at one of the senior War Colleges in Washington D.C.
2) What will you miss most about quitting, aside from the $?
The camaraderie of the Navy.  I've been active duty 28 years and was raised in a Navy family before that.
3) What are you most looking forward to about quitting your job?
Leaving DC, Owning a home again, time for family, work on my photography skills, more exercise, hiking in the area.

Related:  My DW and I are in Roanoke (our FIRE locale) for Christmas and had a realtor show us some houses.  We don't move here until June, but found one we really like and made an offer with a late spring closing date and it was accepted, so we are now under contract!

FIREin2018?

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Re: 2018 FIRE cohort
« Reply #942 on: December 24, 2017, 08:33:51 AM »
1) What do you do for employment currently?
Officer in the US Navy, currently faculty at one of the senior War Colleges in Washington D.C.
2) What will you miss most about quitting, aside from the $?
The camaraderie of the Navy.  I've been active duty 28 years and was raised in a Navy family before that.
3) What are you most looking forward to about quitting your job?
Leaving DC, Owning a home again, time for family, work on my photography skills, more exercise, hiking in the area.

Related:  My DW and I are in Roanoke (our FIRE locale) for Christmas and had a realtor show us some houses.  We don't move here until June, but found one we really like and made an offer with a late spring closing date and it was accepted, so we are now under contract!
i guess you didnt do the usual officer thing where you buy a house at every port you're assigned to?
then after you get re-assigned, hire a property mgr and rent it out to jr officers (ensigns, lieutenants)?
and retire with like 7+ rental properties?
« Last Edit: December 24, 2017, 08:35:46 AM by FIREin2018? »

Monkey Uncle

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Re: 2018 FIRE cohort
« Reply #943 on: December 24, 2017, 09:04:45 AM »
1) What do you do for employment currently?
Officer in the US Navy, currently faculty at one of the senior War Colleges in Washington D.C.
2) What will you miss most about quitting, aside from the $?
The camaraderie of the Navy.  I've been active duty 28 years and was raised in a Navy family before that.
3) What are you most looking forward to about quitting your job?
Leaving DC, Owning a home again, time for family, work on my photography skills, more exercise, hiking in the area.

Related:  My DW and I are in Roanoke (our FIRE locale) for Christmas and had a realtor show us some houses.  We don't move here until June, but found one we really like and made an offer with a late spring closing date and it was accepted, so we are now under contract!

Congrats on the house purchase.  Sounds like you're committed!

davisgang90

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Re: 2018 FIRE cohort
« Reply #944 on: December 24, 2017, 11:09:06 AM »
1) What do you do for employment currently?
Officer in the US Navy, currently faculty at one of the senior War Colleges in Washington D.C.
2) What will you miss most about quitting, aside from the $?
The camaraderie of the Navy.  I've been active duty 28 years and was raised in a Navy family before that.
3) What are you most looking forward to about quitting your job?
Leaving DC, Owning a home again, time for family, work on my photography skills, more exercise, hiking in the area.

Related:  My DW and I are in Roanoke (our FIRE locale) for Christmas and had a realtor show us some houses.  We don't move here until June, but found one we really like and made an offer with a late spring closing date and it was accepted, so we are now under contract!
i guess you didnt do the usual officer thing where you buy a house at every port you're assigned to?
then after you get re-assigned, hire a property mgr and rent it out to jr officers (ensigns, lieutenants)?
and retire with like 7+ rental properties?
Nope, I did the sell the reasonable first house you bought, buy again at the height of the market, lose big bucks renting it for a year and then short sell the house.  Glad to have the opportunity to participate in the American dream again, instead of just defending it!  ; )

aperture

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Re: 2018 FIRE cohort
« Reply #945 on: December 25, 2017, 07:48:33 AM »
Merry Christmas to all who celebrate.  Happy long weekend to those that don't. 

There are few "things" I want for Christmas, but I am really looking forward to having time with my wife, my home and my kids in 2018.  I have enjoyed working, but I look forward to growing into the other things I can become as a human being.  Today, I relish not knowing what the future may bring.  There is an anticipation of adventure that I have now, and that may be gone this time next year.  I am so grateful to Pete for his blog, to this community, and to live in a time and place where I can explore this new horizon.

Best wishes to you all, aperture. 

NinetyFour

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Re: 2018 FIRE cohort
« Reply #946 on: December 25, 2017, 08:27:21 AM »
Merry Christmas to all who celebrate.  Happy long weekend to those that don't. 

There are few "things" I want for Christmas, but I am really looking forward to having time with my wife, my home and my kids in 2018.  I have enjoyed working, but I look forward to growing into the other things I can become as a human being.  Today, I relish not knowing what the future may bring.  There is an anticipation of adventure that I have now, and that may be gone this time next year.  I am so grateful to Pete for his blog, to this community, and to live in a time and place where I can explore this new horizon.

Best wishes to you all, aperture.

So well said!  The bolded part is totally true for me as well.  Anticipation, excitement, gratefulness, exploration, growth.  Yep.  :)

msilenus

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Re: 2018 FIRE cohort
« Reply #947 on: December 26, 2017, 04:24:55 PM »
PSA:
If you're going to keep donating to charity in 2018 or other post-retirement years then you have just a few days left to frontload those deductions into 2017 by funding a Donor Advised Fund.  The tax cut law is another reason this could make sense.  For many people here, 2017 deductions will be vastly more valuable than deductions in later years.

Another thing that could be desirable is maxing out any charitable match employee benefit you might have for 2017 and/or 2018.

Prepaying property tax and estimated state income tax payments (is: CA) is another trick lots of people are doing for the tax cut law that might make sense for some folks, but that's going to be super situational for folks here.  AMT for 2017 and sliding under SALT limit for 2018 are  ways this could wind up being neutral or bad.

Happy holidays!

SwordGuy

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Re: 2018 FIRE cohort
« Reply #948 on: December 26, 2017, 08:00:41 PM »
Just a bit over 4 months until our FIRE dates!

So far, so good.   

Did some rough calculations this evening.  Between paying off the HELOC, paying down the mortgage, maxing 2 401Ks, employer contributions to same, and market investment gains, less IRA/401K disbursements, our net worth grew approximately:

... drum roll, please ...

 $244,300


Investment gains were about $162,300.   Of course, next week they might be down $500,000.  You never know.

Real estate valuations between our 6 properties varied, some went up, some down, so I'm considering that a wash.

Investment gains this year almost equaled our gross salaries.   That's pretty awesome.

It's amazing what decades of saving and investing can do for you if you set your mind to make it happen.

I didn't realize when we started saving that growth would be compounded instead of just linear in nature.   It's a good thing we saved anyway, even if it's simply because the alternative seemed so damned foolish.

I'm still boggled by the idea that in an average market year, I could buy a house and fix it up to rent out for cash, without having to work to pay for it.   Buy a house a year.  For cash.  Without a job.   Just for putting my dollars to work!   That's so crazy sounding even if I know it's true.   

Here's to all of us in the 2018 FIRE cohort!   Let's have a really Happy New Year and kick One More Year (OMY) Syndrome to the curb!





itchyfeet

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Re: 2018 FIRE cohort
« Reply #949 on: December 27, 2017, 05:18:17 AM »
Congrats SwordGuy!

We had a big year too despite losing $80K AUD in real estate value over the 2nd half of the year. Thankfully the houses did go up in the first 6 months by quite a bit more than $80K and stocks went gangbusters. Like you, we also saved a big chunk of salary.

DW and I are still considering bringing forward FIRE from 2019 to 2018, even though we won’t have hot our number. We will see how our employers treat us through Q1. If we do FIRE before hitting our number we’ll make up the difference by trimming spending for a few years and picking us a little work here or there.