Author Topic: How Did You Pick Your Target FIRE Date?  (Read 3415 times)

ReadySetMillionaire

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How Did You Pick Your Target FIRE Date?
« on: May 29, 2020, 09:43:08 AM »
I am somewhat struggling with a fundamental aspect of FIRE -- how do I pick my target date?

Quite frankly, I find myself waffling on this quite a bit. Some days I feel like I could work another 15-20 years. Other days I find myself crunching numbers as to how I could retire in five years (an extremely lofty goal).

Note that my wife earns about $40-45k/year and I have two jobs -- one in the City Law Department ($66k/year) and my own solo practice. My solo practice income is almost whatever I want it to be. It could be as low as $40,000 or as high as $120,000 -- but that high number requires a TON of work. That's what I wrestle with.

After a lot of deliberation -- literally more than a year of journaling my personal finance thoughts -- I think I've settled in on a range of 8-10 years. This would mean retiring at 40 or 42.

The "retire in 8 years" plan requires the household to save approximately $60,000 per year.  It also "requires" the household to earn roughly $172,000 per year, which is enough to:

-Save for kids' college on an accelerated timeline
-Pay off my student loans in that time frame
-Meet the accelerated savings goals

The "retire in 10 years" plan requires less yearly savings and less yearly income. It requires me to save about $48,000 per year and requires the household to earn roughly $147,000 per year.  This is lower mostly because it allows two more years to save for everything and pay off debts.

The income gap of $172,000 and $147,000 might not seem like a lot, but that's about a $2,500 difference at my solo law practice. That's quite a bit of work.

I guess I'm torn. Is the answer to aim for 10 and just save as much as humanly possible, and if earlier, great?

How did you arrive at your target date?

Greystache

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Re: How Did You Pick Your Target FIRE Date?
« Reply #1 on: May 29, 2020, 10:10:44 AM »
It was easier for me to decide on a retirement date. My default date was always age 55 because that was the earliest I could claim my pension.  It was also enough time to get the mortgage paid off and get the kids launched.  Didn't put a lot of thought into it. I had the golden handcuffs until age 55 and that was that.
BTW, I retired 5 years ago at age 55 :)

des999

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Re: How Did You Pick Your Target FIRE Date?
« Reply #2 on: May 29, 2020, 10:47:38 AM »
I also struggle with this decision.  I am fortunate that my latest job is too good to walk away from, so I am now looking at staying for 8+ years.  I had always envisioned my FIRE date to be in about 4 years (age 44). 

I'm sure I could still make it work, but now I like the idea of padding my stash and maybe living it up a little bit more in RE.
The other thing that I keep watching is healthcare.  I was banking on the idea of getting some subsidies, but who knows if ACA will be around when I retire.  So, pushing it out to when my son is 18 (he has a pre existing) might be my only option.
I'll have to figure out if my son can even get approved for insurance at 18 with a pre existing.  haven't researched that, as I have some years to go.

ixtap

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Re: How Did You Pick Your Target FIRE Date?
« Reply #3 on: May 29, 2020, 11:22:30 AM »
We determined our ideal lifestyle and worked from there. In your case, that means weighing what you are giving up against the extra time and stress. Living our best working life means that while we have things we are looking forward to, we aren't desperate to run away from what we have.

We also changed our goals and dates with the changing circumstances. If leaving work were everything to us, we are minimally FI. For various reasons, building our best working life has meant spending a bit more over the last two years than we used to, so we continue to work for now to allow for similar options in the future. Besides, travel sucks right now, and that is the only thing we don't get enough of due to work.

RainyDay

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Re: How Did You Pick Your Target FIRE Date?
« Reply #4 on: May 29, 2020, 11:59:17 AM »
My date is Dec 2022, chosen because I need to be at least 50 years old and have 20 years in, in order to get my pension at age 60. 

It sounds like you don't have anything so cut and dried, which makes the choice harder.  I guess I'd ask how much you enjoy each of your jobs.  Do you want to continue one part-time?  If so, you can partially retire earlier because you'll still be earning money. It sounds like your solo practice could be part-time. 

Eight to ten years is far enough away that you don't have to decide right now, and the market's performance between now and then may impact your decision as well.

Zikoris

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Re: How Did You Pick Your Target FIRE Date?
« Reply #5 on: May 29, 2020, 12:57:52 PM »
We basically just got our lifestyle sorted out so we were both doing everything we wanted to do and also saving a lot, and then ran projections to see when we'd his the FIRE crossover point. Everything pointed to not needing to work anymore somewhere around age 35, and we were happy with that, so we just left everything alone. If we ran projections and got a result we didn't like, we would have made adjustments until we reached an acceptable result.

It looks like our total time from start to finish will be somewhere around 10 years (age 25-35-ish), which we're happy with.

FLBiker

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Re: How Did You Pick Your Target FIRE Date?
« Reply #6 on: May 29, 2020, 01:37:45 PM »
For me, it hasn't remained fixed.  I was living well within my means, saving a lot, from the beginning of my working life.  I was fortunate (for whatever reason) to realize in high school that every dollar I didn't spend was time I didn't have to work.  I never did any math, though, as to when I could retire.  I did choose jobs and a lifestyle that wasn't focused on earning money (taught English overseas) in my 20's, and I still managed to save and invest a bit.  In my 30's I got a regular job, and the savings accelerated.  In my early 40's, we're now approaching lean FIRE -- we'll hit our hypothetical retirement number in 3-5 years.  That being said, we're making a big move (from Florida to Nova Scotia) not for financial reasons but for lifestyle.  This could delay our FIRE (or not, honestly).  We shall see.

The reality is, I'm not a sit around type guy, and in "retirement" I'll undoubtedly be doing things that will earn a little money (or reduce costs, like farming).  Thus, I could already probably quit my job and just kick around doing odd jobs or part-time work, trying to break even for a few years while our investments grew.  If my current job were to go away before I FIRE (which is certainly more possible today than it was 6 months ago), my plan is to take a sabbatical of a year or so before I try to get another job.  I want to figure out what I'd really like to do for the next phase of my working life.

I guess this is all just a long-winded way of saying I don't think choosing a specific date has been my focus as much as reflecting on balancing my work with my lifestyle.  Living well within your means offers a lot of freedom here, beyond just early retirement.

Laura33

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Re: How Did You Pick Your Target FIRE Date?
« Reply #7 on: May 29, 2020, 02:26:51 PM »
It's not a date, it's a process.  You don't decide once and then have to stick with that for time immemorial; instead, you change your plans as your goals and situations change. 

Where you are sitting right now, is it worth busting it that much harder on your family's third job to retire 2 years earlier?  You have a baby and a new job.  Do you really, really want to spend every night and weekend working at yet another job to raise money that you don't actually need right now, just because in 8 years you might decide that you're done?  Do you want to miss that time with your family?  And how would your wife feel about you missing that time with your family and leaving all the parenting work to her? 

And what are you planning to retire TO in 8-10 years?  You know when that "I have to earn another $2500/mo" works?  When you are excited by the opportunity to leave two years earlier, because you can't wait to get started on XYZ, and it's totally worth the extra work to get there faster.  I don't hear that in you -- at all. 

The point of FIRE is to balance your overall lifetime happiness -- basically, to give Future You a seat at the table, so Current You doesn't run around setting all his money on fire because fire is just so much fun.  But that doesn't mean that Future You trumps Current You.  There's no point in being miserable for 8 years just to retire 2 years earlier, if you have another option to enjoy your life for the 10 years you'd need to work.

Finally, consider that you are more than capable of continuing to bring in income after you FIRE if you want or need to.  Even if you quit the day job and your wife quits her job, if you just manage a few cases and clear, say, $10-15K/yr, that decreases the 'stache you need by a LOT.  It doesn't have to be all or nothing.

Tl;dr:  Make the best decision you can now, weighing the lifestyle you want now against your future goals.  Then look at it again next year, and the year after that, and any time something changes and you're not sure you're on the right track any more.  Adjust as needed.  Repeat.

FWIW, our FIRE date is based on when our youngest goes to college.  We could FIRE now.  But DH loves his job, and neither one of us will be in a position to earn anything near our current pay if we quit and find we need to work again.  But really, the big driver is that we want to travel -- and not the "grab a week or two and throw the kids on a plane to go see cool old towns and speak a different language" travel.  We want to stay in places for weeks or months at a time, and we can't do that with kids at home.  Well, we could if we wanted to homeschool, but that's NOT the thing for either of us, and frankly, DS is going to have some great opportunities at the local HS that he wouldn't have with us (he is very into robotics and engineering and such; the HS has classes and teams and such, whereas that's not the kind of stuff we could tote around).  Yadda yadda -- there were of course a million things large and small that played into our analysis.  But the sum total of them all was that it makes sense to keep working until he's out of the house.  And I'm ok with that -- I was the one pushing us to FIRE a couple of years ago, but I compromised on that, and DH compromised by agreeing I could go part-time in the interim, and so far we're both happy with that decision.  But:  if at some point that is no longer true, we'll revisit the decision and make a different one. 

Goldendog777

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Re: How Did You Pick Your Target FIRE Date?
« Reply #8 on: May 29, 2020, 02:36:41 PM »
I couldnít stand my job anymore...literally would wish that I would get hit by a bus so I could go to the hospital instead of work!  It was that bad.  Weíd been keeping track of our budget for years so knew exactly what we spent.  We crunched the numbers over and over and decided that it could be done.  So I quit 2 months before my 49th birthday.  I think hating a job is motivation for many to RE. 

mspym

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Re: How Did You Pick Your Target FIRE Date?
« Reply #9 on: May 29, 2020, 10:49:34 PM »
My husband and I discovered FI when we were 39 and we thought, hey the boys will be finished school when we are 50, that seems like a good target. This was regardless of the fact we didn't know our savings rate and neither of us were investors but we knew we earnt a lot and it seemed like a fun challenge. We are still mostly sticking with that date regardless of withdrawal rate because we've run the numbers across a few scenarios and know we have significant flex in our spending.

Laura33 is on the mark, you can't make today miserable in the hopes of future happiness. It should be a fun adventure for you and your family if you want to sustain your purpose. We're now 4-5 years off our date and it's still fun, because we worked out what was worth our time, money and energy.

So are you and your wife having the conversations?

MayDay

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Re: How Did You Pick Your Target FIRE Date?
« Reply #10 on: May 30, 2020, 07:13:21 AM »
For us we have kids who will graduate at a certain time. We don't feel there is a ton of value to retiring while they are in high school- we want to be able to travel in retirement and we won't do that with kids at home. We also won't move at least until they are launched into college/trade/whatever and probably later.

So for us we figure the soonest that makes sense is when our youngest graduates high school in 8 years. And maybe more like 12 years (possibly part time for those 4 years?).

That is far enough out that we'll definitely have enough saved for a frugal fire, and we'll see how the market does and whether we want to keep working for more luxury.

I'm just not into predicting 10 years out. Too much can change. We'll save on autopilot and spend the rest as makes sense to us.

SwordGuy

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Re: How Did You Pick Your Target FIRE Date?
« Reply #11 on: May 30, 2020, 08:42:53 AM »
Don't miss the time with your kids.   You can't get it back.

Don't take your spouse for granted.    Spend the time with them that they deserve.

So, work extra when you want or need to, but don't burn yourself out and don't mess up your family life.

You may find that alternating periods of "very busy" with "taking it easy" will work much better.

And, of course, if you can cut you expenses, you'll get the advantage of a faster FIRE without the extra work.  An expense level of $112,000 is TWICE what the median family in America earns in GROSS wages, so I expect there's a bit of fat to cut there.

Have you done a case study?

ReadySetMillionaire

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Re: How Did You Pick Your Target FIRE Date?
« Reply #12 on: May 31, 2020, 10:12:43 AM »
Thanks all for the replies. I wanted to respond to a few posts in particular.

And what are you planning to retire TO in 8-10 years?  You know when that "I have to earn another $2500/mo" works?  When you are excited by the opportunity to leave two years earlier, because you can't wait to get started on XYZ, and it's totally worth the extra work to get there faster.  I don't hear that in you -- at all. 

Oh, there's a ton of stuff I want to do. I'd love to coach all my kid's youth sports. I'm currently working on a blog on the side. I'd love get more into hiking and biking. I want to get Indians season tickets and go to a bunch of games.

There's plenty to do.

Finally, consider that you are more than capable of continuing to bring in income after you FIRE if you want or need to.  Even if you quit the day job and your wife quits her job, if you just manage a few cases and clear, say, $10-15K/yr, that decreases the 'stache you need by a LOT.  It doesn't have to be all or nothing.

This is 1,000% the plan, but I struggle with the math of when I can "stop" full time. I have 3-4 clients that I like and, more importantly, they trust me. I would imagine it's an easy $15-20k a year and I could probably do that with close to zero expenses.

I think the best case scenario is I do that and somehow negotiate something to maintain my benefits with the city, if I last that long there.

You may find that alternating periods of "very busy" with "taking it easy" will work much better.

I want to emphasize to all that this is basically how it is now. I have a Brief in Opposition due tomorrow so today is a slammed type of Sunday, but that's rare. My solo practice has peaks and valleys. I have found myself able to do hardly anything there for 1-2 weeks and then there's a crazy week.

Both my wife and I are largely fine with the work-life balance.

And, of course, if you can cut you expenses, you'll get the advantage of a faster FIRE without the extra work.  An expense level of $112,000 is TWICE what the median family in America earns in GROSS wages, so I expect there's a bit of fat to cut there.

Again, my numbers are based on paying off my mortgage ($271k) and student loans ($105k) (really not here to argue about either of these decisions). Those are the biggest expenses the next 10 years. Once those are gone my annual expenses are probably about $40k a year.

secondcor521

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Re: How Did You Pick Your Target FIRE Date?
« Reply #13 on: May 31, 2020, 11:46:06 AM »
Again, my numbers are based on paying off my mortgage ($271k) and student loans ($105k) (really not here to argue about either of these decisions). Those are the biggest expenses the next 10 years. Once those are gone my annual expenses are probably about $40k a year.

You seem like you are pretty with it in terms of calculating things, so you probably are already doing this, but have you run your FIRE projections based on this future reduction in spending?

Some (many?) here may not feel comfortable with assuming a spending reduction, but I think if it is clearly tied to specific items like yours and if you are a disciplined spender like you seem to be it can be reasonable to do so.

I did a similar thing where I knew my mortgage would be paid off, I knew my child support would end, and I knew my taxes would be lower in retirement.  So I was able to plug in those numbers in FIREcalc or cFIREsim.  While the mortgage was paid off before retirement, the other two items were assumptions that turned out exactly as I had calculated.

Again, you've probably already thought about this point, but I mention it because sometimes I had blind spots or lack of understanding about things and when people pointed it out and I had the aha moment it was worth every penny I pay to be on these FIRE forums.

TLDR:  Spending $112K forever requires a much larger nut than spending $112K for 10 years then $40K after that.

Linea_Norway

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Re: How Did You Pick Your Target FIRE Date?
« Reply #14 on: May 31, 2020, 12:31:49 PM »
When I calculated our FIRE date, I made a spreadsheet with lots of variables, like the amount of expenses and extra income. Then I made a projection for each year. To be ablecto FIRE in 2025, we need x amount of stash. That was extrapolated to every year. Then the plan was to live like we normally do, including working parttime for the last year, until we hit a number for a certain year. That turned out to be 2019, but we waited until Jan 2020 to keep my last year's pension. The excel sheet gave the option to play with the variables. Do you expect a 4% profit on investments, or 2%? What if I generate a certain income?

If you are still in the process of paying off you student loans, I would first focus on being debt free. Then making investments and reducing expenses within your comfort level. I would waitbto make a FIRE projection until you actually have made some substancial savings/investments. And in the mean time you try to optimize your life/work situation, so that it fits with the life you want to live.

marty998

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Re: How Did You Pick Your Target FIRE Date?
« Reply #15 on: June 03, 2020, 04:11:56 AM »
Oh god, I hate this question. I have a stash larger than what people here are easily able to FIRE on but I struggle with this so much. Do I have enough? How will it last 60 years? What happens if I have a family in future? How do I draw an income from bricks? Would any potential future partner find me attractive if I don't work? Why should I retire early if I have a job that I'm good at, is relatively stress free and pays me more than any side hustle I could do? Why not make hay while the sun shines?

I could go on and on. I fully expect to be doing the OMY thing for years.

Don't ask me. In fact, I don't know why I'm commenting at all.

When I calculated our FIRE date, I made a spreadsheet with lots of variables, like the amount of expenses and extra income. Then I made a projection for each year. To be ablecto FIRE in 2025, we need x amount of stash. That was extrapolated to every year.

I love spreadsheets. I really do. But I've never been able to accurately predict what my end of year stash total will be.

I'm amazed you can Linea... I guess I should try to build a better spreadsheet :/

reeshau

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Re: How Did You Pick Your Target FIRE Date?
« Reply #16 on: June 03, 2020, 07:12:03 AM »
After a lot of deliberation -- literally more than a year of journaling my personal finance thoughts -- I think I've settled in on a range of 8-10 years. This would mean retiring at 40 or 42.

I think the process you describe going through isn't unusual at all.  I would also not sweat the difference between 8 an 10 years, at this point.  It's a reasonable range, and there are a number of variables you don't control that will impact this, too.  If you busted your butt to get out in 8 years, but it was 2020, so Covid-19 blew up your finances, even if only for a while--would that drive you nuts?  It could happen--it could happen *again*--so as suggested, find a balance between a sustainable, happy today and your goals, and worry about the decimal points in your plan when they get closer.

DadJokes

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Re: How Did You Pick Your Target FIRE Date?
« Reply #17 on: June 03, 2020, 09:22:31 AM »
At this point, my target date is fairly nebulous. My lofty goal is 2030, just because it's a nice round year number. My projected year is 2032. That projection is based on the following:

1. Current expenses, increased by 2% annually
2. Current income, increased by 5% annually, with 75% of those raises going towards savings
3. 9% nominal returns

The latest date that I want to be FI is 2034. Retiring by then would allow me to control my income prior to my child going to college, allowing for him to receive financial aid.

secondcor521

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Re: How Did You Pick Your Target FIRE Date?
« Reply #18 on: June 03, 2020, 01:03:43 PM »
The latest date that I want to be FI is 2034. Retiring by then would allow me to control my income prior to my child going to college, allowing for him to receive financial aid.

Note that FAFSA currently has a two year look back (aka prior prior year), so if your kid is starting college in 2034, they'll look at your 2032 tax return for his freshman year.

Cadman

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Re: How Did You Pick Your Target FIRE Date?
« Reply #19 on: June 03, 2020, 02:40:52 PM »
My target date was fixed 2 or 3 years ago and the countdown started earlier this year, but the date has now come and gone thanks to COVID-19.

For me, it was a matter of optimizing my work projects ahead of new programs for a smooth handoff. Ensuring I met qualification dates for bonuses and cost of living adjustments. Factoring in vacation renewal and the number of days, my work anniversary date, and making sure my last company day meets HSA-contrib qualification for the month.

Then there's the seasonal aspect; retiring in spring had an appeal to me and I don't mind sticking it out in a warm office through the cold, snowy midwest months to get there. Personal goals also play a part..retire before I'm 40. Retire with x-many years at the company.

Now that we're WFH, possibly until this Fall, the workload is more palatable, but I'm afraid I'm looking at OMY.

DadJokes

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Re: How Did You Pick Your Target FIRE Date?
« Reply #20 on: June 03, 2020, 02:53:39 PM »
The latest date that I want to be FI is 2034. Retiring by then would allow me to control my income prior to my child going to college, allowing for him to receive financial aid.

Note that FAFSA currently has a two year look back (aka prior prior year), so if your kid is starting college in 2034, they'll look at your 2032 tax return for his freshman year.

Yes, I have taken that into consideration. My kid turns 18 in 2036.

LightStache

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Re: How Did You Pick Your Target FIRE Date?
« Reply #21 on: June 03, 2020, 09:31:05 PM »
I ran some scenarios to see what was the art of the possible. Looked like 2025 would be a stretch and 2030 would be easily attainable, so I chose the latter for my target. Right now I'm hovering right about the end of 2025 / beginning of 2026 for FI.

But there's a business opportunity on the table that would wrap up in mid-2031. I'm pursuing it and if it's successful, I'll RE after that's over. My stache will be nice and plump at that point and I have some big plans for that money!

Of course, those plans are constantly evolving based on the numbers and my feelings and circumstances.

Chris@TTL

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Re: How Did You Pick Your Target FIRE Date?
« Reply #22 on: June 22, 2020, 09:50:01 PM »
There's some really great back and forth here, especially when considering things like pensions and vestment periods.

FIRE doesn't have to be a direct sprint from deciding to retire early to amassing wealth to quitting. Life meanders.

We decided to retire early after a lot of back and forth, figuring how when we wanted to do it and how much we'd need to do so. I wound up starting a business, she took over a managerial position... our original retirement plans forged in 2013 did not make it to 2020 (we began the transition this year!).

If you're trying to pick a target FIRE date, here's the more detailed advice I'd offer up.

I think the most important point is to be receptive to change; the curve-balls that life throws. Don't let a target FIRE date and number be blinders to what the world brings you. Thanks for the input in these posts.
« Last Edit: June 23, 2020, 09:31:16 AM by Chris@TTL »

LWYRUP

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Re: How Did You Pick Your Target FIRE Date?
« Reply #23 on: June 23, 2020, 08:28:46 AM »
I don't have a target date.

I have a target number:

Six months emergency fund
House paid off
College funds filled for at least 4 years state flagship + room and board for three kids
Safe withdrawal rate (4% modified by CAPE per madfientist website)
Health insurance figured out

My job is fine (parts I love, parts I hate, parts OK) so I will just truck along until I get there.  If I get fire (FIRE?) in my belly, I may try to juice the end date quicker by making changes, the most notably being a new job or moving.  If I decide some other priority is more important (a few years ago we did a lot of renovation work on our house), then I'll accept that.

This process could take 20 years if we make certain choices or hit certain roadblocks (decide to save for private colleges, huge recession, layoff, etc.) or we could move to a two bedroom condo in Jacksonville and be done tomorrow.  I have a rough estimate of how the accumulation process will continue but it's impossible to predict the future so in the meantime I just live my life. 

MrThatsDifferent

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Re: How Did You Pick Your Target FIRE Date?
« Reply #24 on: June 23, 2020, 12:55:12 PM »
When I calculated our FIRE date, I made a spreadsheet with lots of variables, like the amount of expenses and extra income. Then I made a projection for each year. To be ablecto FIRE in 2025, we need x amount of stash. That was extrapolated to every year. Then the plan was to live like we normally do, including working parttime for the last year, until we hit a number for a certain year. That turned out to be 2019, but we waited until Jan 2020 to keep my last year's pension. The excel sheet gave the option to play with the variables. Do you expect a 4% profit on investments, or 2%? What if I generate a certain income?

If you are still in the process of paying off you student loans, I would first focus on being debt free. Then making investments and reducing expenses within your comfort level. I would waitbto make a FIRE projection until you actually have made some substancial savings/investments. And in the mean time you try to optimize your life/work situation, so that it fits with the life you want to live.

This is kinda what I did but less precise in the beginning. I worked backwards by first identifying what I wanted my FIRE life to be like and what that would cost me? I then did the multiply by 25 to get my target savings needed to cover that. Then I projected each year as best I could to work out when I expect to have that amount of money. I then thought about that year, what would be going on, how it would impact taxes and when I get my bonus and worked out a date. Only problem is some things have changed along the way and now C19 is messing up my projections. I know though that it will be a minimum number plus a possible 2 more years and I just work towards that and see which year gets me closest to what I need (want) to live on.

ChickenStash

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Re: How Did You Pick Your Target FIRE Date?
« Reply #25 on: June 23, 2020, 01:32:44 PM »
I never really set a date, although I have run simulations to see where I might end up. For my accumulation phase, I set a reasonable living expense and savings target and just let the actual FIRE date float to wherever it lands. As I get closer to having my savings and desired withdrawal line up with my then-current expenses, I'll have to reevaluate and see what it is I want to actually do in retirement and where the costs line up in relation where I am then.

In my case, this is at least 10 years out, probably more like 15, so I don't bother trying to predict what my hobbies or interests will be then. I'm not married and have no kids, currently, but could that happen and change my expected expenses... maybe? Will I still like to travel or prefer to just hang around locally? Will I want to live someplace else more or less expensive? Will I ... ?

John Galt incarnate!

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Re: How Did You Pick Your Target FIRE Date?
« Reply #26 on: June 23, 2020, 02:28:20 PM »


I guess I'm torn. Is the answer to aim for 10 and just save as much as humanly possible, and if earlier, great?

How did you arrive at your target date?



In terms of my age I wanted to FIRE as soon as possible.

The lower my age at the time of FIREing the better.

So it was not a preset number with respect to age that was determinative of my FIRE date.

 Instead,  my numerical   criterion for FIREing was accumulating an  amount of money that when  invested in a fixed-income portfolio  ("safe money") would  under all reasonable eventualities  more than provide for everything I needed or wanted for the rest of my life.






« Last Edit: June 23, 2020, 02:34:52 PM by John Galt incarnate! »

CharlesBronzee

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Re: How Did You Pick Your Target FIRE Date?
« Reply #27 on: September 08, 2020, 09:50:01 PM »
I will be FI (but not necessarily FIRE) when my passive income from investments > living expenses, which I forecast to happen in 2026. I will likely continue to work as I donít mind what I do for a living (self-employed), DW on the other hand will surely quit her job (she works in IT) as soon as we hit this milestone.

martyconlonontherun

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Re: How Did You Pick Your Target FIRE Date?
« Reply #28 on: September 11, 2020, 02:24:27 PM »
I'm at least 10 years out and variables on salary, returns and savings has it between 10 and 20 years. I figured my son will be 11 spring of when I'm 42 so it would be a good summer to do a 6 week international trip. Will obviously shift but a good date to aim at.

Steeze

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Re: How Did You Pick Your Target FIRE Date?
« Reply #29 on: September 12, 2020, 10:56:04 AM »
Started with retire by 40.

Looked at estimated spending with private health insurance from age 40-67, multiply by 25. That was the number. Consider any social security as saving toward end of life care and increased health costs from 67-100.

Then look at current savings & future savings estimates invested at 6%. (9%-3% inflation). See when I hit FI. Use that date as target FIRE. Join the cohort. (Age 43)

FI with current expenses will happen 5 years sooner, but with 1st child on the way I expect that to get pushed closer to the target FIRE date. If we have two kids like DW wants then itís probably getting pushed back more. (Age 45)

Hopefully though I keep working managing a local real estate portfolio after that and keep building wealth to pass down. Perhaps helping kids / grandchildren with education and first homes.

We do expect at least 1 major change in location during that time which has the potential to really lower the earnings/savings rate. Regardless, by 45 I am going to work for myself part time (only).

Metalcat

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Re: How Did You Pick Your Target FIRE Date?
« Reply #30 on: September 12, 2020, 01:26:11 PM »
Some people have a target date, some people have a target number, most people have a combo of the two.

What's important to note is that you can't actually decide now, that's not how life works. You don't have the power to decide today what your future self is going to do. You don't have the power to control the future.

The only thing you can do is have an idea of what kind of future you might like to have, and then adapt your current behaviours to accommodate that goal being possible.

Meaning, if you could retire in 5 years by continuing to save over 50% of your income, then you may continue to choose to save over 50% of your income this year if you want to maintain that option. It doesn't mean it will happen, but it means that you are contributing to its possibility.

You need a view of what you want your future to look like in order to be able to make responsible decisions in the present, but never forget that it's all about what you do in the present, not some imaginary future that may or may not happen.

Point being?
Don't get too hung up on dates that only exist in your imagination until they actually arrive.

deborah

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Re: How Did You Pick Your Target FIRE Date?
« Reply #31 on: September 12, 2020, 04:24:38 PM »
Itís important to have a good life even while youíre striving for a great life (FIRE). Your life prior to FIRE is adjusting your lifestyle. One part of it is working out what type and level of spending makes you happy and changing your spending patterns to remove the other spending. One part is working out how to spend less on what you enjoy and to ensure you enjoy it as much or more while spending less. One part is to work out what you enjoy without spending, and perhaps doing more of those things.

If you can do all those things before (or even instead of) retiring, you can end up in a better place. I realised I could retire before I was ready for it, so I put it off until it felt right.

Retire-Canada

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Re: How Did You Pick Your Target FIRE Date?
« Reply #32 on: September 14, 2020, 07:47:14 AM »
How did you arrive at your target date?

1. I figured out how I would fund my retirement. [Primarily index fund investing]
2. I figured out how long I would likely have to fund it for. [~100 years old based on parents in their 90's trucking along]
3. I figured out my FIRE spend. [~$46K/yr based on current spending and a few assumptions]
4. I figured out how much I would need invested. [25 x $46K = $1.15M @ 4%WR]
5. I projected forward when that would happen from when I started FIRE planning. [In 2014 I thought I'd be retiring somewhere like 2024-2029]
6. Saved and invested in accordance with my plan or better.
7. Found myself ahead of schedule due to market returns and savings both being higher than planned.
8. FIREd in 2020.

Assuming you don't have enough money already and you are not just waiting on a pension there are a number of elements to FIRE not in your control. So you can put together a plan, but you can't nail down an exact date. Market returns and savings can vary up or down vs. your plan either accelerating your schedule or slowing it down. Once you hit your FIRE $$ Target you can retire anytime. You may not do it right away for any number of personal or professional reasons. In my own case I have never enjoyed working despite being pretty good at it. So pulling the plug on FT work as soon as possible made 100% sense to me.

 

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