FIRE’d...miscalculated...getting back into the working world

[NickPotato]

Let’s hear from the folks that FIRE’d early and found themselves needing to work again for one reason or another. Personally, the biggest fear of FIRE is miscalculating and having to work again some day.

How difficult was it to secure a job in your field after significant time off? What was your strategy? What were your learnings?

[markbike528CBX]

Immediate responses are unlikely.
 A) You're asking people to admit a miscalculation.
 B) With the currently "high valuations*", it is unlikely that anyone has felt a pinch in their net worth yet.

* various threads here including The Top is IN.

PTF, really

[terran]

Basically what @markbike528CBX said, but any recent retiree has had a very favorable sequence of return (rising markets after retirement), so you're unlikely to find economic failures unless they FIRE'd WAY too early. You might find people who didn't plan for the non-financial aspect well enough and decided retirement isn't for them.

[undercover]

You're not going to find anyone in this situation. Full on FIRE is a pipe dream.

In reality, people either do not really stop working (IE they're maintaining contacts, keeping their skills sharp, have some side project, etc.)

or

They suffer from one-more-year syndrome and over-save.

I don't think full on theoretical FIRE is actually a reality for anyone. No one really stops working and if you're the type to meticulously plan something like an automatic money making machine to power the rest of your life then you're not going to actually be the type to just do nothing.

Really what FIRE is about is freeing up time so that you can do what you'd rather be doing. It's not about not working.

[CheapScholar]

Look at the S&P by year the past 9 years.  For someone to have messed up their math would have had to been beyond bad.  I suspect some people goofed on the math or shit happened and they withdrew 6% instead of 4% but they’re still FIRE or just picked up some part time work to make up a difference.

[partgypsy]

I would ask this question again in 2, 3 years when we are in a full fledged recession.

[markbike528CBX]

You're not going to find anyone in this situation. Full on FIRE is a pipe dream.

In reality, people either do not really stop working (IE they're maintaining contacts, keeping their skills sharp, have some side project, etc.)

or

They suffer from one-more-year syndrome and over-save.

I don't think full on theoretical FIRE is actually a reality for anyone. No one really stops working and if you're the type to meticulously plan something like an automatic money making machine to power the rest of your life then you're not going to actually be the type to just do nothing.

Really what FIRE is about is freeing up time so that you can do what you'd rather be doing. It's not about not working.

I beg to differ, and so do many of the responders at:
https://forum.mrmoneymustache.com/mustachianism-around-the-web/who-here-is-fired-and-not-monetizing-ittrying-to-earn-additional-income/

Really early, early fire _might_ at least consider some labor income, or have it as a plan B, but not actually activate it at the current conditions.

[Buffaloski Boris]

I would ask this question again in 2, 3 years when we are in a full fledged recession.

Bingo. Or worse in 40 years when they’re out of money.

[Roland of Gilead]

Didn't *exactly* miscalculate but retired from Msft in 2015 when the stock price was $45, giving up some grants and now the stock is $140.

Well, who needs an extra million or so?

[achvfi]

 Gwen at https://www.fierymillennials.com/ has personal story she generously shares.

[BicycleB]

You're not going to find anyone in this situation...

In reality, people either do not really stop working (IE they're maintaining contacts, keeping their skills sharp, have some side project, etc.)

or

They suffer from one-more-year syndrome and over-save.

I don't think full on theoretical FIRE is actually a reality for anyone. No one really stops working and if you're the type to meticulously plan something like an automatic money making machine to power the rest of your life then you're not going to actually be the type to just do nothing.

Hmm.

My first couple years of thin FIRE, I did plan a few alternative jobs, cultivate a contact or two, sharpen a skill.

Then again, I lurched into FIRE prior to having a FIRE plan; I was simply fired from a job at midlife after accumulating modest savings. Gradually I realized that by continuing my habit of renting out rooms, the investments and such would be enough to skate by forever, probably. Six years in, still loafing, finances OK...as others have said, proof of failure won't come until later.

I was going to dispute the point about full-on FIRE not being possible, but maybe I'm just an example of not being the person determined enough to plan it!

[jlcnuke]

You're not going to find anyone in this situation. Full on FIRE is a pipe dream.

In reality, people either do not really stop working (IE they're maintaining contacts, keeping their skills sharp, have some side project, etc.)

or

They suffer from one-more-year syndrome and over-save.

I don't think full on theoretical FIRE is actually a reality for anyone. No one really stops working and if you're the type to meticulously plan something like an automatic money making machine to power the rest of your life then you're not going to actually be the type to just do nothing.

Really what FIRE is about is freeing up time so that you can do what you'd rather be doing. It's not about not working.

LOL

[Padonak]

PTF, will be checking this thread after the market crashes.

[secondcor521]

Let’s hear from the folks that FIRE’d early and found themselves needing to work again for one reason or another. Personally, the biggest fear of FIRE is miscalculating and having to work again some day.

How difficult was it to secure a job in your field after significant time off? What was your strategy? What were your learnings?

Hasn't happened to me personally.  I was FI in 2014 and REd in 2016 and have been above 90% in the S&P since 1987.  Never say never, but unlikely to happen to me because I miscalculated the wrong way by forgetting about non-portfolio income, so with all those things my net WR at the moment is 1.02%.

I did observe that some people on the early-retirement.org forums who were unsuccessful in remaining FIREd in the 2008/2009 situation fell into the following groups or patterns:

1.  Just plain got nervous watching their portfolio and went back to work out of fear.  This work was typically temporary I think and probably ended after a few years and seeing their portfolio recover.

2.  Went into 2008 with too aggressive of an AA, got nervous, and went to cash or a very conservative portfolio allocation around the bottom.  These people permanently suffered because they missed the strong recovery.  I think most in this group are still working.

Everyone else I think is pretty successful at it.

I will add that I was afraid of miscalculating - just plain getting the math wrong.  So I did two things:  A very simplistic check of "Do I have ~25x my expenses?" and secondly using multiple online calculators and confirming that all of them gave a thumbs up result.

I also have a list of numerous documented contingency plans and a trigger to activate them if necessary.  So far, it has not been necessary.

[undercover]

Honestly the point I was I trying to make more than anything is that people usually overestimate how much they'll need and so either planned accordingly or will continue doing profitable things here and there to make up any perceived difference between what they have and what they need.

So I really meant that the likelihood of a flat out failure would be extremely rare (if it's happened). A lot of that does depend on what you define as "planning" though since of course isolated catastrophes do happen.

Maybe I was a little short-sighted on stating that everyone works even if they're FIRE but what I really meant is that you don't just stop existing as a person. There are things that interest you and you probably do them. You probably won't be the type to just sit around and let your brain melt is my point. I guess that's not really "working" in the strictest sense but even general life requires doing things we don't necessarily want to. I could be wrong there as well depending on who you ask.

[RedmondStash]

You're not going to find anyone in this situation. Full on FIRE is a pipe dream.

In reality, people either do not really stop working (IE they're maintaining contacts, keeping their skills sharp, have some side project, etc.)

or

They suffer from one-more-year syndrome and over-save.

I don't think full on theoretical FIRE is actually a reality for anyone. No one really stops working and if you're the type to meticulously plan something like an automatic money making machine to power the rest of your life then you're not going to actually be the type to just do nothing.

Really what FIRE is about is freeing up time so that you can do what you'd rather be doing. It's not about not working.

LOL

Ditto ;-). I full FIREd shortly before the great recession, lost half my NW, tightened my belt a bit but didn't go back to work. Doubt anything short of full financial worldwide collapse could make me go back. Even that probably wouldn't. So no, I haven't worked at all or have done anything that earned money since.

Ditto here too. Of course real FIRE is possible. It's just math, passive income > spending.

What I will say is a state of semi-FIRE exists for some people, like semi-retirement, where you're not committed to FIRE, but are dipping toes in that pond to see how you like it. I consider myself more semi-retired than absolutely retired. But saying everyone is like that is short-sighted and demonstrably incorrect.

I am working on side projects, but I'd do them whether or not I wanted to reenter the workplace, because I enjoy them and they're good for my brain. And they don't pay, though there is a slim chance they might someday, in small amounts. They're also related to the paid work I used to do, because I worked in an industry I enjoyed.

So if I want to go back to work -- or if I have to because of unexpected financial strife -- my skills are up to date. Honestly it's a coin-flip as to whether I'll go back. The more time I spend away from work, the more I realize how much I hated work environments, no matter how much I enjoyed the actual work itself. So I may be permanently FIREd.

[stuckinmn]

Not a financial miscalculation per se, but I retired in 2015, got divorced and went back to old job in 2018. Cutting the nest egg in half tends to hurt the plans a bit.

Probably could retire again right now but I'll stick it out until the youngest graduates high school in 4 years.  They basically gave me the same salary but allow me extremely flexible hours so I can do single dad stuff.

Just don't burn any bridges because you never know and if you're valuable and they know you have no problem walking they'll often make special arrangements.

[A Fella from Stella]

Not a financial miscalculation per se, but I retired in 2015, got divorced and went back to old job in 2018. Cutting the nest egg in half tends to hurt the plans a bit.

Probably could retire again right now but I'll stick it out until the youngest graduates high school in 4 years.  They basically gave me the same salary but allow me extremely flexible hours so I can do single dad stuff.

Just don't burn any bridges because you never know and if you're valuable and they know you have no problem walking they'll often make special arrangements.

This must have been very hard on everyone. Sorry you went through this. My wife knows a few people who started new careers at 60 or so because they got divorced after retiring.

[SwordGuy]

There was a guy in the retirement neighborhood my mom moved to that was in his late 60s.   He acted as a handyman for people in the neighborhood.   When he retired in his 60s he took his entire nest egg and invested it in some business he wanted to start up and, naturally, the business when broke.   So now he was scraping by, the moron.

[jojoguy]

I`m not an expert(of course). This is one of those situations where it is good to always have something(hopefully not stressful) on the side to bring in a little bit of money even when things are great with portfolio returns.

[Metalcat]

It's really not a matter of "miscalculating" since all of the numbers are rough estimates anyway.

It's just a matter of being more or less conservative, and those who are less conservative have to have some flexibility incorporated into their plan: either flexible spending, or the ability to generate more income when needed. It's not a failure of the plan, it's part of the plan.

As for going back to work, well, it's a lot easier if you purposely keep your options open, nurture your network, and maintain your skills, which should be a major priority for those with less conservative savings goals.

If you quit, haven't saved enough to weather some uncertainty, have no flexibility in your spending, and do absolutely nothing to sustain your employability...that's not a miscalculation error, that's a lack of common sense error.

Divorce is definitely a big factor, and if your retirement finances absolutely depend on staying together, then it's probably a good idea to sustain some level of employability, just so that you can always be self sufficient.

This is all basic risk analysis stuff, and should be part of any retirement plan, whether retiring early or not.

[Mr. Green]

You could count me as a FIRE failure the first time around, if your definition of failure isn't strictly based on portfolio failure. Part of our FIRE plan was that I would be building us a new house. I quit my six-figure a year job when we had just enough to FIRE on 4% plus the amount needed for the house. However, being fresh from the mentality of five figure paychecks, the thought of spending tens of thousands of dollars in a few short months with no income coming in was a lot scarier than I anticipated. That and several other major life changes we were planning at the same time created such stress that I went back to work after just 3 months of FIRE, rationalizing that 3 months of work would pay for the whole house. After 48 hours back at the job I knew it was a huge mistake. I stuck it out 9 months because people were pissed that I wanted to quit again after the effort it took to bring me back. I FIREd the second time a year to the day from my first attempt. I had worked out my anxiety issues by then and many of the happiest days of my life have occured in the 2+ years since then.

[FiveSigmas]

This thread has a few examples of FIRE failures:

https://forum.mrmoneymustache.com/welcome-to-the-forum/any-early-retirement-fails-out-there/

Like many others have said, though, FIRE failure (in the sense of running out of money) has and will be mostly tied to broader economic failure. We haven’t had that in a while, so the best accounts of FIRE failure (true and fictional) are probably on the bookshelf, not in an internet forum.

[Padonak]

Begpackers in South East Asia can be examples of FIRE/geo arbitrage failure. Other examples of people who failed at FIRE in places like Thailand include honorable members of exclusive clubs such as the Smith and Wesson retirement club and High Fliers from Condo Balconies club.

[fierymillennials]

Let’s hear from the folks that FIRE’d early and found themselves needing to work again for one reason or another. Personally, the biggest fear of FIRE is miscalculating and having to work again some day.

How difficult was it to secure a job in your field after significant time off? What was your strategy? What were your learnings?

I don't quite meet your criteria but it's probably as close as you're going to get right now. I saved up $200k by 28 and decided that was enough to "CoastFI". I had a ton of things going on hustle wise and figured I'd be fine. However, half of my cash reserves got wiped out in the first month by an unexpected repair to my rental property. I think I made about $1500 over the course of 9 months. My personal life was in shambles. Combined with my failures online I was in this vortex spiraling down and it wasn't good.

So, I went back to work. It honestly took me longer to get back into the working world than I thought. No one really cared about the gap on my resume because I filled it with "business owner". Most people thought it was pretty cool I took the chance. But, my skills atrophied hard over the 9 months. I'm in a fairly technical field and forgot a lot of things I once knew. But, I found a company that didn't really care about that as I had a clearance and the base skills they needed. One company to take you on is really all you need to get your foot back in the door.  I'm doing ok now. I live in a great area with a decent job. I was honestly probably better off staying where I was, but hindsight it 20/20. I'm just grateful I did save so aggressively at the beginning as the compounding is really starting to carry me and my lackluster current savings rate.

[Much Fishing to Do]

Immediate responses are unlikely.
 A) You're asking people to admit a miscalculation.
 B) With the currently "high valuations*", it is unlikely that anyone has felt a pinch in their net worth yet.

* various threads here including The Top is IN.

PTF, really

Its not so long ago really to reach back in time.....someone who say retired in 2000 @ the age of 40 with a very normal 80/20 portfolio & withdrawing 4%, then in Spring 2009 (at still a very young 49) looking at a balance worth only one-third real of the initial may have started contemplating that they had failed and the remaining balnace would pretty quickly evaporate.  With the great recovery they are still hanging in there now at age 59 (but are still young, and only with half real initial balance because of all the withdrawals during down initial down-times).

I'm all for pulling the plug when you're at 25x, but do think thru what you'll do if you hit the same stretch that early in your retirement, that was not that long ago and with what we all consider pretty safe variables...