Author Topic: 2022 FIRE cohort  (Read 95216 times)

TempusFugit

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Re: 2022 FIRE cohort
« Reply #450 on: July 01, 2018, 09:03:14 AM »
I'm joining this group and it shouldn't be a problem to make 2022 as I was initially aiming for 2020. I'm still aiming for a 5% WR with hopefully a year or two expenses saved up in cash/paid leave.

Steveo, will you consider those cash reserves in your 5% WR calculation?   

FIreDrill

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Re: 2022 FIRE cohort
« Reply #451 on: July 01, 2018, 10:45:35 AM »
Looks like we will most likely be delaying our FI date.  Changed up our lives a bit and moved to an HCOL area that we absolutely love.  But, our savings is taking a major hit.  Income potential is much better down here so hopefully we get back to a decent savings rate.  I'm thinking our new date may be 2025 but we really won't know until things have settled down and we have been here a year or so.

dsw

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Re: 2022 FIRE cohort
« Reply #452 on: July 02, 2018, 09:35:10 AM »
I'm getting ready to start a new job. It pays about 30% more than my current one, and I think it should be pretty interesting too. If all goes well, this could be my last new job. I have big plans for this position, and it would be very satisfying to have one last good push before walking away from it all. It's hard to describe just how fortunate I've been to get to this point.

I'm not quite close enough to the end that I can visualize it yet, but I feel like I'm not too far away from that point. I think someone on this thread mentioned that getting to 2022 from here is sort of like making it through high school. So, I think that makes this my freshman year coming up. Now I just need to make sure I don't get fired from high school . . .

AccidentalMiser

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Re: 2022 FIRE cohort
« Reply #453 on: July 10, 2018, 06:57:10 AM »
Hi!

Well, DW and I have finally settled on a RE date of 4-1-2022.  We settled on 2022 some time ago since we both turn 55 in late 22.  My work FY starts in October so I値l get half a bonus for FY22 if I work until April 1.  Also, I値l have a bunch of vacation time built up and I want to take the time instead of the money at the end of my working to keep the benefits going while I burn through the rest of the vacay.

We hit 1M today but there are still some risk factors in our financial lives and I知 not quite ready to pull the plug on my job just yet.  If I lost my job tomorrow, however, I doubt I壇 look for another one.  Thanks for all your support!  I really appreciate this community.

couponvan

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Re: 2022 FIRE cohort
« Reply #454 on: July 11, 2018, 09:48:02 AM »
Hi!

Well, DW and I have finally settled on a RE date of 4-1-2022.  We settled on 2022 some time ago since we both turn 55 in late 22.  My work FY starts in October so I値l get half a bonus for FY22 if I work until April 1.  Also, I値l have a bunch of vacation time built up and I want to take the time instead of the money at the end of my working to keep the benefits going while I burn through the rest of the vacay.

We hit 1M today but there are still some risk factors in our financial lives and I知 not quite ready to pull the plug on my job just yet.  If I lost my job tomorrow, however, I doubt I壇 look for another one.  Thanks for all your support!  I really appreciate this community.

Welcome!  4/2/22 was my original date.  Now it's all up in the air - possibly earlier.  Taking the vacation time before ending employment sounds like a solid plan.

Calvawt

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Re: 2022 FIRE cohort
« Reply #455 on: July 19, 2018, 05:13:00 PM »
Looking at 7/5/18 as my last date, would be right before I turn 45.  Our pension vests each year as of 6/30, so that way I get the full year deposit.

Saving about $100k per year, so along with compounding I can retire once my baby girl starts kindergarten.  My wife might actually go back to work at the same time, so we would kind of be swapping except for I make a ridiculous salary.  At least we would barely need to touch principal at that point (and hopefully still get cheap insurance if she goes FT).

middo

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Re: 2022 FIRE cohort
« Reply #456 on: July 19, 2018, 07:14:42 PM »
Job changes, and moving interstate haven't helped our net worth growth lately, but we have an opportunity to increase it with a redevelopment of land we own.  We are planning on losing our inherit conservatism with money and go for it, and maybe retire a bit earlier.  Or at least scale back work before 2022. 

But 22/2/2022 is my end date still one way or another.  I'll be 51, so earlyish, but not really early.

2Birds1Stone

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Re: 2022 FIRE cohort
« Reply #457 on: July 29, 2018, 04:49:37 PM »
2022 is when my projection spreadsheet shows I will have very barebones FI covered. Another 5 years to RE from there. I will be 35 and 40 years old respectively.

Looking forward to to the journey!

Well, I made it all the way down to the 2019 cohort....but things are always shifting.....


There is a strong possibility that I will accept a position which will be a 36 month commitment (golden handcuffs).

This will get us much closer to combined FI. See ya in a few weeks (or not).

ixtap

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Re: 2022 FIRE cohort
« Reply #458 on: August 01, 2018, 09:47:17 AM »
Looks like we will most likely be delaying our FI date.  Changed up our lives a bit and moved to an HCOL area that we absolutely love.  But, our savings is taking a major hit.  Income potential is much better down here so hopefully we get back to a decent savings rate.  I'm thinking our new date may be 2025 but we really won't know until things have settled down and we have been here a year or so.

We moved so that hubby can bike to work, but are keeping the boat. I am having a bit of an identity crisis as I type this sitting on the floor of our empty living room.

We made this move because he needs to reduce stress, as he is experiencing physical pain with any tension. It is actually a spine issue, which may mean that we cannot follow through with any of our current retirement plans. One day of sailing can put him out for the remainder of the week, much less sailing for days on end. He can't sit in a car for a whole hour straight without pain, so RVing is looking less likely...

In short, he probably should have quit work instead of moving here, but he currently doesn't have anything to retire to and the pain causes enough depression without a lack of direction pulled on top.

MrThatsDifferent

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Re: 2022 FIRE cohort
« Reply #459 on: August 01, 2018, 11:07:16 PM »
Job changes, and moving interstate haven't helped our net worth growth lately, but we have an opportunity to increase it with a redevelopment of land we own.  We are planning on losing our inherit conservatism with money and go for it, and maybe retire a bit earlier.  Or at least scale back work before 2022. 

But 22/2/2022 is my end date still one way or another.  I'll be 51, so earlyish, but not really early.

My hope is to be about 6 months after you at around the same age. I値l take it. Much better than being 65.

2Birds1Stone

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Re: 2022 FIRE cohort
« Reply #460 on: August 09, 2018, 08:22:58 PM »
I'm not happy about it, but I'm in here for the time being.

Starting a new job that has some golden handcuffs which will fully vest 9/1/2022.

Personally, I will be FI before that date. As a couple, the calculators have us 4.2 years out.....so very close to the golden handcuff date.

I'll be 35, and SO 31........we can live with that.


lollylegs

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Re: 2022 FIRE cohort
« Reply #461 on: August 18, 2018, 08:43:24 PM »
Hi, happy to be joining the 2022 thread. 

So far we're on track with our plan but DH has had his hours reduced which will slow us down a bit, but I'm just done with working and I turn 60 at the end of 2022 so I'm sticking to our date.

$400,000 in retirement funds
2 IPs
$160,000 mortgage

our plan is to max out our pre tax savings as long as possible, then when we retire sell up our house, payout the mortgage on one of the IPs and downsize into it, investing the excess funds into savings. That should get us close to $1 Mill if all goes to plan, if not well we'll we'll do some part time work if needed.

can't wait till 2022 rolls around!


dsw

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Re: 2022 FIRE cohort
« Reply #462 on: August 19, 2018, 03:42:44 PM »
Welcome Lolly! Sounds like you have a solid plan. 2022 will be here for we know it!

whywork

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Re: 2022 FIRE cohort
« Reply #463 on: August 25, 2018, 10:49:57 PM »
Can I join the 2022 FIRE cohort?

I have been going all around with my target dates but I think 2022 seems to be the perfect match; here are my details

Current NW: 675K
No Home, Currently renting

Distribution of assets to maximize and speed up my FIRE:

VGT (Vanguard Information Technology ETF): 330K
Amazon, FB, GOOG Stocks: 145K
Vanguard Target Retirement 2050: 135K
VTI: 65K

I am expecting an average return of 10-15% with this aggressive portfolio. Each year I'm planning to add 140K (including 401k) to this in total. I expect my networth to grow as below assuming a 10% overall ROI

End of 2018: 720K
EOY 2019: 930K
EOY 2020: 1.16M
EOY 2021: 1.42M
August 2022: 1.6M+ FIREEEEEE'd

So that's exactly 4 years from now. We are a single income family of 4 in total and 1.6M seems to be the right target to stop. Without working unnecessarily extra or without retiring too soon and going back.

Including rent our expenses will be around 40-45K so technically I'm FIREd by EOY 2020 but the extra 1.8 years will be just to pay kids college and ensure I leave something for them too as inheritance. We plan to continue to rent and move closer to kids colleges when they attend them so that they can go from home. 4 years is a long time and if I get frustrated with work (which I have anyway been since knowing about FIRE 2 years back) I might hangup early and end it at 1.16M

cloudsail

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Re: 2022 FIRE cohort
« Reply #464 on: August 26, 2018, 12:49:42 AM »
Can I join the 2022 FIRE cohort?

I have been going all around with my target dates but I think 2022 seems to be the perfect match; here are my details

Current NW: 675K
No Home, Currently renting

Distribution of assets to maximize and speed up my FIRE:

VGT (Vanguard Information Technology ETF): 330K
Amazon, FB, GOOG Stocks: 145K
Vanguard Target Retirement 2050: 135K
VTI: 65K

I am expecting an average return of 10-15% with this aggressive portfolio. Each year I'm planning to add 140K (including 401k) to this in total. I expect my networth to grow as below assuming a 10% overall ROI

End of 2018: 720K
EOY 2019: 930K
EOY 2020: 1.16M
EOY 2021: 1.42M
August 2022: 1.6M+ FIREEEEEE'd

So that's exactly 4 years from now. We are a single income family of 4 in total and 1.6M seems to be the right target to stop. Without working unnecessarily extra or without retiring too soon and going back.

Including rent our expenses will be around 40-45K so technically I'm FIREd by EOY 2020 but the extra 1.8 years will be just to pay kids college and ensure I leave something for them too as inheritance. We plan to continue to rent and move closer to kids colleges when they attend them so that they can go from home. 4 years is a long time and if I get frustrated with work (which I have anyway been since knowing about FIRE 2 years back) I might hangup early and end it at 1.16M

You seem very heavily weighted in technology stock. Do you plan to redistribute after you FIRE?

We will probably be pretty heavy in tech stock too by the time we FIRE, but that's largely because of our stock options and RSUs from work. It isn't by choice, and after we FIRE I'll probably try hard to diversify more out of tech stock if we can, without taking too big a tax hit.

whywork

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Re: 2022 FIRE cohort
« Reply #465 on: August 26, 2018, 06:23:27 AM »
You seem very heavily weighted in technology stock. Do you plan to redistribute after you FIRE?

We will probably be pretty heavy in tech stock too by the time we FIRE, but that's largely because of our stock options and RSUs from work. It isn't by choice, and after we FIRE I'll probably try hard to diversify more out of tech stock if we can, without taking too big a tax hit.

Good point. I keep thinking of whether to redistribute as well post FIRE or not. I am clear that the individual stocks will have to go away into an ETF. But I am not sure if I need to move from VGT (technology focus) to VTI (total stock market). VGT has been returning great and there is no reason to believe IT market will get hit.

TempusFugit

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Re: 2022 FIRE cohort
« Reply #466 on: August 26, 2018, 09:38:18 AM »
You seem very heavily weighted in technology stock. Do you plan to redistribute after you FIRE?

We will probably be pretty heavy in tech stock too by the time we FIRE, but that's largely because of our stock options and RSUs from work. It isn't by choice, and after we FIRE I'll probably try hard to diversify more out of tech stock if we can, without taking too big a tax hit.

Good point. I keep thinking of whether to redistribute as well post FIRE or not. I am clear that the individual stocks will have to go away into an ETF. But I am not sure if I need to move from VGT (technology focus) to VTI (total stock market). VGT has been returning great and there is no reason to believe IT market will get hit.

You should really diversify your holdings.  No one can predict how any particular sector will fare in the short term.  You are extrapolating from past performance.  You may indeed get your 10-15% return, or you may get clobbered like tech in 2000.  No one knows. 

You sound a lot like the folks did back in the leadup to that crash. Tech was a sure bet back then, too. 

In any regard, welcome to the cohort and lets all hope for good returns and good times as we prepare for life post employment. 

whywork

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Re: 2022 FIRE cohort
« Reply #467 on: August 26, 2018, 10:19:49 AM »
You should really diversify your holdings.  No one can predict how any particular sector will fare in the short term.  You are extrapolating from past performance.  You may indeed get your 10-15% return, or you may get clobbered like tech in 2000.  No one knows. 

You sound a lot like the folks did back in the leadup to that crash. Tech was a sure bet back then, too. 

In any regard, welcome to the cohort and lets all hope for good returns and good times as we prepare for life post employment.

Thanks for the feedback. I keep thinking that way sometimes too. VGT went down but came back up during the 2008 crash just like VTI. It was not there during 2000 crash so we don't have the data. Individual stocks definitely scare me. But they gave me great returns so far, especially AMZN. Might be a good idea to rebalance and sell some of those and move into VTI.

How does my target FIRE number look? I was all over the place before I decided on this and decided to join 2022 cohort

cloudsail

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Re: 2022 FIRE cohort
« Reply #468 on: August 26, 2018, 12:22:24 PM »
For me, the FIRE date is a very personal decision that involves many factors, of which money is only one of them. We could probably choose to FIRE now, if we really needed to. But my husband has stocks to vest, our son still benefits from expensive therapies, etc. So I chose 2022. I think it's good to have a clear goal in mind, but realistically there's so many unknowns, not just our family situation but the economy in general.

TempusFugit

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Re: 2022 FIRE cohort
« Reply #469 on: August 26, 2018, 01:47:44 PM »
I've only recently discovered this whole subculture of FIRE having stumbled upon MMM via his Tim Ferriss podcast interview.   I've been kind of obsessively running my numbers for a few weeks now to see if I'm potentially able to FIRE in the not-too-distant future and... I think I just might be!

I recently took the time to change my investment mix, moving out of some actively managed funds and into index funds.  I invested some idle cash.  I ramped up funding of a Roth IRA. 

Now 2022 is looking like it could be my year.   My struggle is going to be reducing my spending.  I've done a pretty good job (by normal standards, not by Mustachian standards) in the savings category and so I now have a 'stache of around 800K + ~140K home equity (remaining mortgage of 120K).  I have a savings rate of around 36% (low by Mustachian standards, I know).  My spending is about 50% discretionary (restaurants, mostly) but it will be a hard habit to break. 

I live in a LCOL area (TN) so my expenses could be pretty low.  I'd love to have my home paid off in 5 years to reduce my spending needs. 

I'm single w/no kids so I only have to support one person (so long as my mom's $ lasts for her retirement, which it probably will, fingers crossed).   

My spending goal for post-FIRE is around 47K/yr so I'm hoping to have my 'stache at the 1.2M level by 2022.  That seems to be where things are headed assuming average returns over the next 5 years (7%).  There's also a lot of fluff built into that 47K figure, so plenty of room to adjust if needed. 

If everything falls into place and I pull the trigger in 2022 at 52 years of age, I should have around 260K in taxable accounts to draw from and 950K or so in retirement accounts.  Some reading over at the Mad Fientist site enlightens regarding the access to retirement account funds to bridge the post-FIRE to 59.5yr gap, so I think that would be doable.   

Like so many of us here seem to be, I am a software engineer.  I realize how fortunate I've been in having such a cushy job. I don't even work that hard, to be honest. I'm very effective at my job, don't get me wrong, but for the past couple of years I've been pretty good at keeping it at the 40 hour limit.  But I'm getting burnt out on it after 23 years.  The job has also changed so much in the past 5 years here at my company (Fortune 500 company). The whole culture is now quite different due to all of the outsourced development and support.   It is a constant source of frustration (and a teensy bit of angst). 

My recent research into the world of FIRE has clued me in on the fact that financial freedom is at my fingertips. That makes my job both less frustrating and more frustrating.  Less so because I don't have to think so long term anymore regarding my career. I don't need another promotion.  I don't have to play the political game.  I can be more honest and open about issues.   But also more frustrating because I can see the end, so close... yet not quite here.



So this is my one year post-iversary!*    How has the plan been going over the past year?  Well, let's see...

A couple of things from my initial post can now be revised.   First, my savings rate has improved.  At the time of my first post, I had approx a 36% savings rate.  I ended 2017 with a 49% (post tax) savings rate and so far in 2018 I'm actually at 59% (I include mortgage principle in that calc).   So that's a win and works the needle in the FI sooner direction.  My spending has reduced just a little bit (maybe 8% so far).  I do plan to take a couple of short trips later this year, so that might get me closer to last years spending. 

My net worth has increased by $143K since this first post and I became a millionaire, which is also good.  That also works the FI needle closer to now. 

I no longer intend to pay off my mortgage in any hurry. I've read lots of the posts in these forums about the issue and the math seems to be solidly in the 'keep your mortgage' category.  Since I've got 12 more years on my 3.75%, I think I'll stay the course and just pay it off on the normal schedule.  I may move before then, anyway. 

Now that I am tracking my spending more closely, I have revised my target RE spend upward.  Now, I realize that there are many on the forums who rightly point out that MMM is all about finding sufficiency (nay, bounty) in low cost living.  I get it.  We bigger spenders are dragging up the average on the boards, but we're doing better than we would have without the MMM influence.  So while my 2017 self used 47K as my expected RE spend, I'm now looking for something more around 60K.  Frankly, healthcare costs have me a little freaked out.  Where I live, right now the ACA plan at the Silver level with no subsidies would cost me around 8K/year.  It's only going up.  I'm expecting to need 10-12K/year when I start my RE life.   Trying to predict this is almost pointless, but clearly all signs point to 'more expensive'. 

Increasing my target RE spend obviously moves the RE needle away from now. 

Now that my stash is adequate to provide for me in a 'skinny FIRE' scenario, I do feel somewhat liberated at work.  I find myself being less obliging to early meetings, pointless conference calls, etc.  While my job has never been bad by most standards, I chafe at the fundamental reality of being someone else's servant. I don't want to work their schedule. I don't want to be on call in the middle of the night.  I don't want other people's crappy work to reflect on me.  And I don't want to have to plan my life around being in a cubicle 5 days a week.  Having more financial resources takes a little bit of the edge off of that, since I know that I could walk away at any time.  But I also have to check myself sometimes because I'm not yet where I want to be when I pull that trigger. 

All in all, I see myself still on target for a 2022 RE.  I still extrapolate my stash will be somewhere in the $1.2-1.3M range at that point.  I have a small pension that kicks in at 60, which should reduce my WR by almost 1.5 percentage points. FIRECalc has me at 100% historical success with my current numbers.   

Will I have the guts to really pull the trigger in 2022?  I don't know. It's too far away to be real just yet.  Of course, 20% of my 5 year horizon from first post has now slipped into the past, and it didn't seem to take very long. 

I think my finances are pretty much in snowball mode at this point so the most important thing I need to be doing now to prepare myself for RE is finding new hobbies, interests, and friends that I can spend my time with post-FIRE.  I think this is the most likely stumbling block for me come 2022.  I couldn't retire today if I had the money, because I'm not mentally and socially prepared.  I've got to focus on getting that part in order.

Next year, I will be the same age as my older brother was when he died unexpectedly.  He left behind so much.  He was a wealthy man and I'm sure he thought he had decades ahead of him to spend with his family. He didn't.  He was 49.

This year, a colleague at the office died at 54.  He wasn't wealthy (he was almost a caricature of a spendy-pants), but I'm sure he too thought he had decades ahead of him.  He didn't. 

My father died a few years ago.  He had retired relatively early at 54. He could've worked just a year or two more and made lots more money, but he finally just had to get out.  He and my mom were well off, though the tech bust in 2000 really hurt their retirement stash, but they adjusted and managed. Dad had time to decompress from a high stress job which mellowed him dramatically and he was able to really improve his relationships with the rest of the family.  He was able to spend years cruising with my mom on their boat and then travelling the country in an RV.  They made friends all over the place.  I'm so grateful that he had the chance to retire and enjoy life.  I hope to follow his example and leave the workforce while I'm still young and healthy enough to enjoy the best parts of life.   

Hope everyone else has made good progress on your goals for the past year and I look forward to the final stretch! 


*close enough

cloudsail

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Re: 2022 FIRE cohort
« Reply #470 on: August 26, 2018, 05:13:02 PM »
Good for you Tempus!

My mother in law passed away from lung cancer at 67. My uncle is in his mid fifties and was diagnosed with late stage stomach cancer last year. My brother in law was diagnosed with colon cancer in his early 40s. It's definitely important to keep our own mortality in mind when we get closer to the FIRE date and start dealing with OMY.

dsw

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Re: 2022 FIRE cohort
« Reply #471 on: August 27, 2018, 07:10:27 AM »

So this is my one year post-iversary!*    How has the plan been going over the past year?  Well, let's see...

<snip>

Now that my stash is adequate to provide for me in a 'skinny FIRE' scenario, I do feel somewhat liberated at work.  I find myself being less obliging to early meetings, pointless conference calls, etc.  While my job has never been bad by most standards, I chafe at the fundamental reality of being someone else's servant. I don't want to work their schedule. I don't want to be on call in the middle of the night.  I don't want other people's crappy work to reflect on me.  And I don't want to have to plan my life around being in a cubicle 5 days a week.  Having more financial resources takes a little bit of the edge off of that, since I know that I could walk away at any time.  But I also have to check myself sometimes because I'm not yet where I want to be when I pull that trigger. 

<snip>


I found myself with a similar drift at my last job. I didn't care that much about the work I was doing, and I had enough saved that I didn't really need to. I think it would have worn on me over time though. Fortunately I found a much more interesting position with a different company (rather it found me). My hope is that I'll be able to stay engaged right through the finish and go out on a high note. I'm a little over a month in, and it's looking good so far. I still look forward to not needing to do this, but in the meantime, I don't wake up sighing about the day to come.

couponvan

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Re: 2022 FIRE cohort
« Reply #472 on: August 27, 2018, 07:18:28 AM »
I知 sticking with 2022, although currently out on LOA for medical reasons and moving to another state with our house up for sale. DH got a major promotion that could allow me to FIRE now, but much salary is tied to bonuses, so I may wait and FIRE 2 years earlier after 2 bonuses are 妬n the bag.

Net worth is around $1.6 now, so still on the FIRE track.

Arbitrage

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Re: 2022 FIRE cohort
« Reply #473 on: August 31, 2018, 07:57:16 AM »
You should really diversify your holdings.  No one can predict how any particular sector will fare in the short term.  You are extrapolating from past performance.  You may indeed get your 10-15% return, or you may get clobbered like tech in 2000.  No one knows. 

You sound a lot like the folks did back in the leadup to that crash. Tech was a sure bet back then, too. 

In any regard, welcome to the cohort and lets all hope for good returns and good times as we prepare for life post employment.

Thanks for the feedback. I keep thinking that way sometimes too. VGT went down but came back up during the 2008 crash just like VTI. It was not there during 2000 crash so we don't have the data. Individual stocks definitely scare me. But they gave me great returns so far, especially AMZN. Might be a good idea to rebalance and sell some of those and move into VTI.

How does my target FIRE number look? I was all over the place before I decided on this and decided to join 2022 cohort

VGT wasn't around in 2000, but other technology funds were, and looking at them can be instructive.  From 8/31/1998 to 8/31/2000, Vanguard total stock market index (VTSAX, or VTI if you prefer) rose almost 60%.  Not too shabby.  The technology sector (per Morningstar charts), however, was killing it, rising 394% over the same period!  Oops, then the crash came.  From 8/31/2000 to 9/31/2002, your money in VTSAX dropped 43.5%.  Painful.  However, your technology money dropped by 80.7%. 

In other words, your $1M in VTSAX became $565k, and your $1M in Information Technology became $193k.  Let that sink in.  To this day, even after the tear that technology stocks have been on lately, VTSAX is ahead by almost 100% if you cherry-pick the dates like this.

I'm not saying we'll have that occurring again, but you need to realize what could happen when you're as sector-concentrated as you are, rather than assuming it's a free lunch for being aggressive. 

Other than that, you're really on a good track with your savings rate, assuming you're flexible enough in your retirement date to accommodate what returns you'll get, rather than extremely optimistic returns.  Also, you'd really need to get out of your sector bet when FIREd.  4% SWR would've failed many times over with that concentration.
« Last Edit: August 31, 2018, 07:59:11 AM by Arbitrage »

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Re: 2022 FIRE cohort
« Reply #474 on: September 02, 2018, 06:02:25 AM »
Hello folks. We are moving from lurking status on this cohort to joining status (moving from the 2024 thread actually). I can't see a scenario where we don't leave in mid-2022 at this point unless either of us loses our jobs between now and then.  I'm using July 15th as our target date, but could leave sooner if there is no bonus worthwhile to stick around for, or our employers don't behave themselves when we give notice.

Here is a basic rundown of our situation in 2022:
AGES: both will be age 49, turning 50 by end of year
HOUSING: Our mortgage will be paid off. But, we will probably sell our current home and invest the funds until we decide where to relocate to (from HCOL to MCOL/LCOL)
FUNDS: We will have enough 'gap year' money to live off for ten years before touching our retirement accounts. Our target RE spending is around $60K to $65K in year 1, adjusted for inflation in remaining years.
RETIREMENT FUNDING SOURCES: Mostly tax deferred 401(k)s and IRAs which we will do some Roth Conversions during our Gap Years to lock in tax-free earnings. Also have a super small pension to collect for one of us that will help pay for a bill or two, plus of course Social Security in our mid 60s to age 70.
HEALTHCARE: Neither eligible for retiree healthcare, so we may COBRA for the remainder of the year we retire in, then look for Exhange coverage for years between FIRE and Medicare at age 65. No significant health issues at this time, so willing to take a high-deductible catastrophic type policy for that 'what if'.
IMMEDIATE FIRE PLANS: To slow travel extensively in and outside the U.S., invest time in 'side hobbies/projects', some of which could be income generating, but not counting on for our planning purposes. Mr. N2S would like to possibly teach at a community college, for example. Would also like flexibility to volunteer more time to charities.
FAMILY: We have two sons. They will be 23 and 24 at this time and should be wrapping up undergrad college and hopefully working FT jobs (or shortly thereafter). College funding should be N/A at this point. If they decide to go to Grad School they will have to mostly secure funding themselves.

nereo

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Re: 2022 FIRE cohort
« Reply #475 on: September 03, 2018, 09:51:38 AM »
Welcome to the thread, Need2Save.

Out of curiosity, how would your retirement plan weather a 30% market downturn?  Because that's basically our 'concern' - if we hit a major recession our FI date will be pushed back until recovery (generally 1-3 years, but could be longer). If we keep oging as is we should be cruising along in 2022.  But of course that would extend the already longest economic expansion ever by a few more years...

TempusFugit

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Re: 2022 FIRE cohort
« Reply #476 on: September 03, 2018, 10:58:08 AM »
Any retirement plan that includes a dependency on stock market returns must necessarily account for the inherent volatility of the market.  Anyone who is using the 4% rule (or the 3.5% or the 3.25%) is already accounting for the possibility of a market downturn.  Otherwise, we would all be talking about our planned 7% withdrawal rates.  Wouldnt that be sweet?

if i retire in 2022 and face an immediate 30% drop in the market, i will probably freak out a little and reduce my spending to somethng closer to a skinny fire number (47k vs 60k) and see how things go. If it looks like a longer term recession, ill reduce further and maybe put out some feelers for more freelance work or even a real job.   But rationally, that would probably not be necessary.  The 4% rule already accounts for this scenario, esp. when one also expects some social security or pension income.

If we have a major drop in the market and a recession before 2022, i think we will all have to adjust our plans based on our numbers.  Being in this 2022 cohort doesn't mean we stop doing the math and valuating our financial positions as conditions dictate. 

I suspect most of us expect a recession sometime in the next few years.  If that happens, hopefully it will be of the more normal type rather than the ugly 2008 type.  We might all benefit from another 2008 type crash (so long as we also get the recovery) but i dont care to see the country (or the world) put through that again.  I'd be more comfortable with a short 12-18 month recession with a commensurate market drop & recovery that gets back on firm footing right before i pull the RE trigger in 2022. 
 

nereo

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Re: 2022 FIRE cohort
« Reply #477 on: September 03, 2018, 11:31:01 AM »
yes, a major recession will cause all of us to review and potentially re-adjust our numbers, but the adjustments will not be the same for everyone.
Many of us have the majority of our income in the market, and so a recession pre-2022 will push us quite a bit away from our FI number, especially if the absolute $ amount we save each year is relatively modest (for this forum).  Those who have very high incomes and correspondingly large annual contributions won't be as strongly impacted as someone who has more modest annual savings.

Then there are those who's retirement income relies less (or not at all) on the markets - for example, those with military pensions, disability or real-estate income. These people will be minimally affected by market drops.
Then of course there's the cash-hoarders among us.  I've seen people here with 7-10x cash & bond ladders which could weather the worst sequence of returns hit we've ever encountered in modern times.

I asked the question (and its a frequent question on these threads) because how 'fixed' we are to a specific date and how vulnerable we are to market fluctuations varies wildly from one member to another.

TempusFugit

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Re: 2022 FIRE cohort
« Reply #478 on: September 03, 2018, 12:44:38 PM »
I hope that everyone in the cohort is really picking the 2022 date based on the expectation of a stash value, not just because the date is nice (though it is nice- 22 has been my fav number since childhood).   

If i havent hit my number, im not going to RE (voluntarily) just because 2022 rolls around. 

My FI state will be mostly due to invested assets, but i mentioned SS and pension as things that many people will have (SS here in the US is certain to exist even if at a reduced amount) and which are not figured into the 4% rule, thus providing some degree of safety even in those failure scenarios from the original study.   

Psychologically, i think I would still adjust my spending and / or retirement date based on the market conditions just because of my conservative mindset.   Here is where having a targeted retirement spend rate that includes a healthy bit of fudge factor and fluff that could be reduced if the situation calls for it can provide more confidence. 

If you havent yet done so, i highly recommend reading @drdoom's drawdown series at
https://livingafi.com/2014/05/09/drawdown-part-1-the-basics/

He does a great job of outlining the strategy and plans he worked through in prep for his retirement.

beer-man

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Re: 2022 FIRE cohort
« Reply #479 on: September 03, 2018, 05:13:17 PM »
I hope that everyone in the cohort is really picking the 2022 date based on the expectation of a stash value, not just because the date is nice (though it is nice- 22 has been my fav number since childhood).   

If i havent hit my number, im not going to RE (voluntarily) just because 2022 rolls around. 

My FI state will be mostly due to invested assets, but i mentioned SS and pension as things that many people will have (SS here in the US is certain to exist even if at a reduced amount) and which are not figured into the 4% rule, thus providing some degree of safety even in those failure scenarios from the original study.   

Psychologically, i think I would still adjust my spending and / or retirement date based on the market conditions just because of my conservative mindset.   Here is where having a targeted retirement spend rate that includes a healthy bit of fudge factor and fluff that could be reduced if the situation calls for it can provide more confidence. 

If you havent yet done so, i highly recommend reading @drdoom's drawdown series at
https://livingafi.com/2014/05/09/drawdown-part-1-the-basics/

He does a great job of outlining the strategy and plans he worked through in prep for his retirement.
Great read thanks for posting. I spent 2hrs reading. Whatever happened to him? Seemed to drop off the radar in 2016?

I think high chances that bear market emerges 2019-2020 which could be great for 2022 cohort as they historically only last for 18months-3yrs.


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beer-man

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Re: 2022 FIRE cohort
« Reply #480 on: September 03, 2018, 06:03:58 PM »
I hope that everyone in the cohort is really picking the 2022 date based on the expectation of a stash value, not just because the date is nice (though it is nice- 22 has been my fav number since childhood).   

If i havent hit my number, im not going to RE (voluntarily) just because 2022 rolls around. 

My FI state will be mostly due to invested assets, but i mentioned SS and pension as things that many people will have (SS here in the US is certain to exist even if at a reduced amount) and which are not figured into the 4% rule, thus providing some degree of safety even in those failure scenarios from the original study.   

Psychologically, i think I would still adjust my spending and / or retirement date based on the market conditions just because of my conservative mindset.   Here is where having a targeted retirement spend rate that includes a healthy bit of fudge factor and fluff that could be reduced if the situation calls for it can provide more confidence. 

If you havent yet done so, i highly recommend reading @drdoom's drawdown series at
https://livingafi.com/2014/05/09/drawdown-part-1-the-basics/

He does a great job of outlining the strategy and plans he worked through in prep for his retirement.
Great read thanks for posting. I spent 2hrs reading. Whatever happened to him? Seemed to drop off the radar in 2016?

I think high chances that bear market emerges 2019-2020 which could be great for 2022 cohort as they historically only last for 18months-3yrs.


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dsw

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Re: 2022 FIRE cohort
« Reply #481 on: September 11, 2018, 08:13:38 AM »
In between meetings, I just calculated that there are only 993 work days (not including holidays or vacation time) until July 1, 2022. Not sure if that will be my actual date, but I've been using it as a place holder until we're closer. I actually do think it's realistic though.

A long way to go still, but getting below three digits is a nice milestone . . .

TempusFugit

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Re: 2022 FIRE cohort
« Reply #482 on: September 16, 2018, 03:14:52 PM »
So, 2022 cohoritans, has anyone begun serious planning or perhaps even begun implementation of you plans for drawdown post RE?

The Roth conversion ladder is a 5 year plan, so since we are <5 years from 2022, anyone serious about pulling the trigger should start reviewing your income needs for those first couple of years.

If I RE in 2022, I'll have about 8 years before I could start pulling from my retirement funds in a traditional manner.

I've got a few years of spending already in taxable accounts, so I won't have an immediate need for the Roth model, but I am starting to do some math to determine whether it's still a good idea to be working the Roth ladder simultaneously in order to minimize taxable income for longer. 

I'm thinking that if I augment my post-tax stash withdrawals with some Roth withdrawals I can perhaps withdraw well below the limit where cap gains and dividends get taxed.   If I just spent through my taxable account funds before beginning to pull from the Roth ladder, I would need to withdraw the full annual spending amount each year from the Roth.   That amount might be high enough to get taxed (it would be close with the deductions reducing AGI).  So if I laddered 30K each year and spent 25-30K from my post tax accounts, my income should be well below the tax threshold. 

I've got to educate myself some more about how I could handle my 401K after retirement.  If I understand correctly, one has to do a conventional rollover to an IRA before converting to a Roth (the necessary step for executing the Roth ladder strategy).  But does one have to roll the entire 401K balance, or can you just move a portion?  I'll have to do more research.  My 401K plan has some really low fees (institutional shares) that I'm not sure I could duplicate in a conventional IRA.  Might be a trivial difference anyway.

Seems weird to be far enough along that I have to consider things like Minimum Required Distributions and such that could lead to tax consequences. 


dsw

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Re: 2022 FIRE cohort
« Reply #483 on: September 17, 2018, 07:13:02 AM »
So, 2022 cohoritans, has anyone begun serious planning or perhaps even begun implementation of you plans for drawdown post RE?

. . .



I've actually been giving a lot of thought to this lately. My plan is to accumulate 5 years of expenses in laddered bond etfs (I currently have just a little more than one year). From there I'm planning on saving enough to buy a house for cash. Between the etfs and what I can get from selling my townhouse (which I would put further up the ladder in a stock index ETF), I should have enough  to get me to a couple of years shy of where I can tap retirement accounts without penalty or worrying with conversions. I think I'll wind up spending less than what I'm budgeting for (I have never spent close to what I'm projecting, but healthcare is still a question), so those last couple of years may work themselves out. If not, I have enough in a post tax brokerage account to more than cover the gap.

I project that I'll have the five year ladder in place in about two years, and the house part (either purchased or able to purchase) in four years. This is a somewhat conservative plan, but I feel pretty good about it. If I make it a couple of years down this path, I will have the option of pulling the trigger early if the job situation turns south. But I'm hoping to do the full four years (or three years and 9.5 months).

zephyr911

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Re: 2022 FIRE cohort
« Reply #484 on: September 19, 2018, 08:58:47 AM »
Hi all! Quasi-FIREd Jan-Aug this year but with some work (mostly for free, LOL) and am now back to the grind in the form of active-duty military orders (voluntarily). A nice step toward kicking the habit completely by 2022: a few days after being activated, I found out I was selected for promotion! I am now set to reach my terminal rank goal in time to get my high-3 there. (for those not familiar with this, in order for your retirement pay to be based on your final rank, you need to have held it for 3 years or they prorate it somewhat based on the time you spent at the previous one)

I don't have the exact date yet, but the estimate is only a couple weeks away, which would mean about $5K in extra pay before I demob, and it's $100+ added to weekend drill pay after that.

Another nice bonus is that I'm in Europe thru Feb with a paid-for hotel and rental car, weekends off, and 2.5 days paid leave monthly, and can check off shitloads of bucket-list items for the cost of gas (personal travel in their car is on the honor system, and I will honor that), which means less spending later if we assume I'd have gone those places someday. DW will also be able to come stay for 90 days and do much of this with me.

One concern at this time: my real estate company has encountered more deferred maintenance on recent acquisitions than projected, and I have shifted an increasing concentration of my assets into it to avoid liquidating anything. It's mostly just us opting to do improvements rather than fix obsolete or failing shit, so it's not all bad, but it's still cash-intensive and I felt it was best to just add my own capital vs. any other options. Our market is strong and our properties stay rented, but I want to avoid going any heavier on that one thing. I'm probably at 40% of NW in the company, and I *think* I can stop there and return to adding all new savings to other stuff and re-diversifying. We'll see.

@TempusFugit , my main implementation goal for the next year is to get out of a house payment by moving into a rental that my company will comp me in lieu of cash compensation. Gotta get DW on board though. This would save us about $800/mo pretax. We also have a car payment to get rid of. I fully expect that dividends alone, between my RE corp. and my stock holdings, will cover all expenses if we get them low enough. The margin of safety consists of casual self-employment for both of us - she will probably work for at least another 20 years whether she needs the income or not, and I will always have a role as a board member of the company I started, as long as I want it.

Finishing 20 with the military will help a lot with health care, but I'm also looking at HDHP plans via my own corp once it has enough employees for a group plan.

Need2Save

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Re: 2022 FIRE cohort
« Reply #485 on: September 21, 2018, 06:57:12 AM »
Welcome to the thread, Need2Save.

Out of curiosity, how would your retirement plan weather a 30% market downturn?  Because that's basically our 'concern' - if we hit a major recession our FI date will be pushed back until recovery (generally 1-3 years, but could be longer). If we keep oging as is we should be cruising along in 2022.  But of course that would extend the already longest economic expansion ever by a few more years...

Sorry, been a while since I've logged in on my pc to respond.  Not at all worried about a downturn in the first few years of retirement but would rather it come before we pull the trigger just for better planning. We plan to have 2-3 years liquid assets for initial living/travel expenses and another two years in very conservative options (probably bonds). As we get closer to 2022, we will be diversifying our assets more. We deliniate very deliberately between the money we will live off on the first 10 years and the money we will live off after we turn 60 which even if it dipped 30-40% would still be fine after ten years to rebound.

What's fun at the moment is planning a few big vacations that we want to do before we pull the trigger.  Hawaii, Alaska, New Zealand and Australia are currently being batted around either before or shortly following our FIRE date. We also plan to slow travel to many places after retirement (Europe, Asia, South America) but these are a few big-ticket trips we have in mind to lock down right away.

@zephyr911 - that sounds like an awesome detour for your journey!   

dsw

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Re: 2022 FIRE cohort
« Reply #486 on: September 26, 2018, 07:23:48 AM »
From a post in the 2030 cohort, here's a neat way to track your progress . . .

http://engaging-data.com/freedom-calculator/

I'm currently at August 28th for my ideal retirement scenario.

arrintonpalmer

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Re: 2022 FIRE cohort
« Reply #487 on: October 05, 2018, 06:10:13 AM »
It's time I join this Cohort. June 6, 2022 is my Army retirement date and we will be FI then, a month and a half before my 38th birthday(two months before my wife's 39th, our kids will be 6 and 4).

I've waffled on whether it would be my FIRE date or not because the pension won't start until I'm 60(2044). I spent over a decade in the regular Army and when I resigned(FU Money) I figured I was pushing out my real retirement. However, the spreadsheets say we will be FI by then, so here I am.

I'll probably keep earning my grad student stipend for a few years afterwards, because it's lots of fun and feels like a retirement already.

dsw

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Re: 2022 FIRE cohort
« Reply #488 on: October 05, 2018, 10:56:29 AM »
Welcome Arrintonpalmer!

That's impressive that you'll be FI before forty and with two kids. Well done! 2022 is definitely preferable to waiting until 2044.

SheWhoWalksAtLunch

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Re: 2022 FIRE cohort
« Reply #489 on: October 10, 2018, 02:02:22 PM »
We値l be 57 & 60 in 2022. Old I know compared to some of you, but I originally didn稚 expect to Fi/Re until 2025.  Life handed us some challenges in the last few years and thanks to FU money we not only weathered them like Champs, but now that things have settled down to our new normal we realized that 2022 is realistic.  4 years feels both much too long to wait and just around the corner.
« Last Edit: October 11, 2018, 02:18:51 PM by SheWhoWalksAtLunch »

freya

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Re: 2022 FIRE cohort
« Reply #490 on: October 12, 2018, 07:51:08 AM »
With everyone talking about how working past age 70 is the new expectation, retiring at 60 is definitely still early!  That's where I will be in 2022.

I work in academia, where historically many professors stay actively involved well into their 80s, and never really retire but are quietly/unofficially allowed to reduce their work obligations.  Historically, that is.  It seems that regulatory & administrative requirements are getting progressively more onerous and more "corporate".  Productivity requirements increase every year and are also less elastic than they used to be.   Despite the fact that I'm considered very successful, I feel like I'm caught in a giant juggling act, and it's only a matter of time before the eggs all drop.  I am almost at the point where I just can't handle the stress anymore.  Simply being FI would do wonders, even if I choose to keep working - I feel like this is increasingly the way to go, in this era of "throwaway" workers.

Anyway here's where I am on the FI front:

- Estimated annual expenses:  $72,000.  This is based on my current average spending with some add-ins:  average tax rate of 11% (federal + state/local), medical insurance equal to current COBRA figures, and an additional cushion of 20% of non-mortgage spending.  Looks like a lot, but only a small slice of this is discretionary spending.  I live in a cooperative apartment and maintenance is a big chunk of spending, but I don't own or need a car, and all housing costs are covered except internet service and optional home improvements.
- Income in retirement:  I'm planning on Social Security at age 70 with a 26% discount off current figures, plus a small family business that I will take over eventually.  There's also a very small, fixed pension at age 65 that I'm ignoring for FI planning purposes.
- Savings goal: $1.4 million.
- Current liquid savings:  $940K, of which about 70% is tax-deferred.

This is ~3 years away given current savings rate and assuming the market is going to be kinda sluggish the next few years.  I could squeak by on $1.1M if needed, but having that extra cushion will give me a lot more options for traveling, developing new hobbies and revisiting old ones, etc.  Not to mention absorbing potentially deeper cuts to social security and increased Medicare costs.


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Re: 2022 FIRE cohort
« Reply #491 on: October 12, 2018, 08:07:45 AM »
Welcome freya! You should follow NinetyFour's journal - she just FIRE'd from academia this past May.  She owns her home, so her budget is lower than yours overall since she doesn't have rent and has a tenant that covers her mortgage.

Hula Hoop

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Re: 2022 FIRE cohort
« Reply #492 on: October 13, 2018, 06:58:33 AM »
According to my calculations, we should be able to lean FIRE in 2022.  I'll be turning 51 that year and my DH will be 60.  Not exactly early retirement compared to many here but I only discovered MMM recently.

Our plan is not to retire completely but I'll quit my 40 hour a week job and DH will sell his business and we'll freelance doing various things that interest us.  I expect to make enough to pay for day to day expenses but not save anything.  Meanwhile, the stash can grow.  We might be able to do this earlier but it makes both of us a bit nervous particularly as our kids are pretty young and will be in college in the future.