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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: rich on March 27, 2016, 09:56:30 AM

Title: can i do this?
Post by: rich on March 27, 2016, 09:56:30 AM
hello all.  I'm new here and i'm not sure this is the right place to post this question so please advise if this is not.

Anyway here goes.  I get the feeling many of you have heard this before.  But.

i will be turning 50 this year... no kids, went thru a divorce in 2002 etc... have a SO now, not married.

i've been an engineer since 1994.  Old school mechanical engineer that works at a factory (if you've ever seen one of those that isn't boarded up)

long story short, i've hated my job since day one... my passion was always music (guitar - i know the instrument of my generation i suppose)

i'd like to give this engineering job the old heave ho... can't stand the work, the hours and commute make a 40 hour a week job more like 60 and it's having very negative affects on my health.  I'm drinking more than i ever have, my mood is very negative and at times lately somewhat aggressive combined with depression.

i feel the job is sucking the life out of me.  i'm now trying to disassociate from my job while there to try and lessen the affects it has on me.

i've considered this.

i have 157k cash in 2 bank accounts, plus about another 90k between 2 401k's.  One the company 401 and the other a personal IRA.

i have inherited a home from my parents, no mortgage, just taxes ~ approx 10,000/year

and have a car i bought in 2014 with a monthly payment of $274.00/month.

If someone can please advise, can i take the leap and get the hell off the corporate rat race...

i would like to teach guitar, possible start some kind of small service business

any advice would be welcome

thank you for your time

Title: Re: can i do this?
Post by: GrowingTheGreen on March 27, 2016, 10:10:49 AM
You've got a lot of cash sitting around!  Those checking/savings accounts aren't doing jack for you.  Put that money to work.  What do you need to live on for 6 months?  Whatever that is, that is all the money that should be in a bank (unless you're saving for a house or something).  The rest needs to be invested.  People here prefer index mutual funds and ETFs.  Checkout Vanguard Target Retirement Funds if you're new--they're cheap and hassle free.

Kill the car loan.  With all the cash you have, there is no reason why you should be carrying a car loan.  The preferred method is to sell the car you have and buy a cheaper one with cash.  To some, $2k is cheap,  Others may say $8k.  Either way, you shouldn't be paying interest to drive a vehicle.

Not going to lie, your 401k balance is a little low for your age.  Increase contributions.

There is no reason why you can't change career paths.  Try starting something on the side and seeing if you are able to scale it.  It's a little bit safer than completely dropping out of your current career and starting a business.  Reality check: many business fail.  Yours may not, but it happens.  I don't think you have a strong enough foundation for your age to take a giant leap.  Could you land another full-time gig that doesn't make you want to die?

The next posters will say you need to provide more information.  What are your monthly expenses?  APR on the car loan?  What is your 401k invested in?  Check out the sticky on writing up a case study and come back with some more info :)
Title: Re: can i do this?
Post by: humbleMouse on March 27, 2016, 11:28:51 AM
1) pay off car loan
2) move all cash except for emergency fund into stock market
3) find place to teach guitar out of
4) quit job

Out of curiosity, what kind of house is this that needs 10k/year in taxes?  New York?  Big ass house somewhere else?  Just curious, because 10k in taxes seems nuts.
Title: Re: can i do this?
Post by: FrugalFan on March 27, 2016, 11:42:03 AM
Yes, more info is required. Say you paid off your car and invested the difference, at a 4% SWR, 230k invested would give you 9.2k per year, which would not even cover the property taxes. But since the taxes are so high, is there a chance this is an expensive house that you could sell and move somewhere cheaper? You could buy a much less expensive house with much lower property taxes and invest the difference. So, what are your annual expenses? How much is this house worth? Would you consider moving somewhere cheaper?
Title: Re: can i do this?
Post by: bobechs on March 27, 2016, 11:54:31 AM

Out of curiosity, what kind of house is this that needs 10k/year in taxes?  New York?  Big ass house somewhere else?  Just curious, because 10k in taxes seems nuts.

This hit me too.  Even in states with highest tax rates, (eg. NY, NJ. TX) a $10K tax bill implies a place worth at least $530,000.  It only goes up from there.

I suppose that's not a totally extraordinary value in some places, but for a single person looking for a way out it seems like a lot of sleeping money that could be woken & deployed to good use.

Property tax rates:
Title: Re: can i do this?
Post by: rich on March 27, 2016, 06:09:52 PM
thanks everybody for your replies.

yeah i'm in fairfield county CT, taxes actually are about $9k / year.  it is expensive and selling the house will be something i will do once my folks are no longer with me.  i can't sell before then

the car was bought with no money down and no interest.  i pay an extra $10.00 bucks a month to cover the possibility of wrecking the vehicle and owing more than it is worth.

also no credit card debt...

i do have more cash in the bank than the 401k b/c the market was a little scary this year.  i had been putting in 15% of my pay but cut that in half to 7%.

i've discussed this with my SO, she would be willing to help out.  She doesn't find her job as toxic as i find mine.

but i suppose i'll just have to suck it up and see what happens and stick it out. 

thanks again.
Title: Re: can i do this?
Post by: Nickels Dimes Quarters on March 27, 2016, 06:32:45 PM

Thanks for posting your question. I know how you feel. My last job was killing me. I work in state government. Last year, I found a better position with a different state agency. Night and day. Transferring was easy, since it's the same employer essentially. My health has improved. I now actually sleep at night. Incredible.

Since you should work a few more years, find a better job. Once you start looking, you will start feeling more positive about life. Make that your priority. Engineering work is everywhere. There must be something closer to home, maybe with better pay and better vibe for you. Also start getting your money socked away in instruments that will earn more. Read every thread here about investing, the index funds, all the tax-free options, etc. Amp up your savings immediately and put everything you can in those funds. Since your SO is onboard, you should both be getting as much money as you can into the best investments you can find. SO may not hate the job now, but we can all come upon circumstances at any time that will prevent us from working.

Like another poster said, start the side hustle. Everything you do outside of the hated day job will lift your spirits and you will feel less trapped. Get a few students signed up and start building that reputation. Figure out what you need to do to advertise and who you need to meet (music teachers at middle/high schools, music store employees, and so on). Figure out what others are charging. Make a teaching video and post it to YouTube with a mini lesson as advertisement. Find a coffee shop where you can perform and hand out business cards.

Test the waters while you keep the job and get a handle on the money. Life will get better. You should start a journal here. I'd read it.

Title: Re: can i do this?
Post by: Sibley on March 28, 2016, 10:16:52 AM
OP, it sounds like you're very nervous about the stock market. Doing some self-education might help. After all, the more you know about something the less you're going to fear the unknown!

Check out the J Collins stock series, and there's others but my brain isn't coming up with the names.

Agree on looking for a different job. It can really make a huge difference. Good luck!
Title: Re: can i do this?
Post by: zolotiyeruki on March 28, 2016, 10:54:13 AM

Out of curiosity, what kind of house is this that needs 10k/year in taxes?  New York?  Big ass house somewhere else?  Just curious, because 10k in taxes seems nuts.

This hit me too.  Even in states with highest tax rates, (eg. NY, NJ. TX) a $10K tax bill implies a place worth at least $530,000.  It only goes up from there.

Here in IL, the effective property tax rates are high as well.  We pay nearly $11k/year in property taxes on our $310,000 house.
Title: Re: can i do this?
Post by: Mother Fussbudget on March 28, 2016, 11:37:17 AM
Side-gig:  Try setting aside one weeknight a week to dedicate to this - example:  Every Thursday Night, work on your guitar side-gig.  Join a band, do the coffee shop suggestion above (great idea!)... do *something* every Thursday.  Add weekends as desired.

The power of compound interest only works IN YOUR FAVOR if you're invested in something that returns a regular return rate.  Savings accounts return interest ~1%.  Bonds return from 3-5%.  Stocks average 7-10% but can vary.  Real estate represents regular income streams, and for those who don't want to fix toilets, REITS (Real Estate Investment Trusts).  (See MMM's  "Become a Lazy Landlord with REIT's" (

In a savings account, money doesn't even keep up with inflation at 2% - savings accounts lose 1.5% annually.  So get those 'worker bee dollars' working for  you.
Title: Re: can i do this?
Post by: rich on March 28, 2016, 05:57:27 PM
thank you everybody for the helpful advice.

i did lose a $30,000 plus 401k account during my divorce in 2002 plus i lost part of a approx %100 percent increase in a house i bought with my ex-wife in 1998 for $150k and sold for $274k in 2004, about the top of the market.

I had a terrible divorce lawyer.  That's water under the bridge as they say.

One other thing i had in mind was renting rooms in the house i inherited from my parents.  I feel like this could one way to help generate income.

there are some issues.  My SO probably isn't really on board although we have really not talked about it in depth.  The other issue is the house is mine and not hers and if she can't own up to the lifestyle i want then maybe a break up is the best.  BTW, she owns her own condo that she rents out.  So it's not like she would be living on the street.  I would never do that to somebody i care about.

Well anyway, i wish i could leave the rat race... still searching and i appreciate the input here.

and i fully admit to being a novice investor.

thx again
Title: Re: can i do this?
Post by: MidWestLove on March 28, 2016, 07:19:55 PM

I think you already heard a lot of advice so it is up to you on whether you will do something about it

- yes, you can do anything you want or set your mind to. it is YOUR life
- start slow if you need you (one day a week as example) but _do_ something as people who act are a lot happier than those who don't
- it does not matter what you do as long as it brings you real joy (teaching and/or playing guitar) and keeps you away from self destructive behavior

Also, please do take depression seriously and actively seek help, this is your highest priority . drinking yourself to death is the dumbest way to waste the time you have left, your potential, and betray your dreams. Please stop with divorce talk, it has been 14 years and it does nothing good for you. wake up and act- you have amazing fortune of living in first world, not facing major prosecution, having food to eat, paid for shelter, job, and savings. wasting it all with attitude you display is plain stupid. sorry for being direct.

signed *one concerned Russian*