Author Topic: Life Advice - Can We Make Mustacianism Work?  (Read 6027 times)

Newtonium

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Life Advice - Can We Make Mustacianism Work?
« on: December 23, 2014, 06:38:01 PM »
We are a family of three, about to be four in the spring. Wife and I are 27 & 28 and about to experience some major life changes. I am currently in the military but will be released in the next 12-24 months due to mental health issues. I've served since high school so this is going to be a major culture shock for me, plus my wife who has followed me for the past six years. I will be out of work, not seeing friends daily, exercise routine will change, income will change (sole income family), and we'll likely move for work and lifestyle.

I just need to lay out my thoughts and ask if you all think I'm crazy.

My income is currently $84 000/yr cdn. I've been reading the blog for two years and have made some serious habit changes towards badassity.

When I learned that I would be leaving the military my wife and I took a hard look at our living expenses. Of that income a fair bit is taxed, $7880 is invested per year (increasing yearly as debt is reduced), $13 500 per year towards LOC ($30k, last debt except mortgage). Turns out our living expenses (mortgage, bills, groceries, etc) plus some family fun is currently $35k per year.

When I leave I will receive a yearly pension (indexed) of ~$18-24k. We expect to have ~$50k invested which we don't plan on touching.

I'm looking for the support of family and friends but having trouble explaining to them what our lives will look like outside.

Well off family can't seem to understand life under $100k, never mind $50k. If we only need $35k to live on, and my pension provides $20k net, then I only need enough to net another $15k right?

 I know, the math feels stupid simple but no one beside my wife seems to get this. There are just questions about how I'll earn a living. We have side gigs we're looking at ramping up to make the difference, plus the military will pay for more education (trade training, whatever) so I've been considering a part time gig. But if we're only talking about netting $15k I don't feel like this is a difficult amount to earn.

When it comes down to it I'm not mentally capable of working 40 hours a week. Time with my family helps me a lot. I really want to be able to work part time to make enough money to live on for the next few years, plus work towards earning more to increase our investments towards FI.

Am I out of it? Will we be unhappy living the luxury of $35k? Will it be impossible to earn $15-$20k from part-time work doing things I enjoy?

Worried about our future, in need of reassurance, and wondering if we're being unrealistic.

Andrew

pzxc

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #1 on: December 23, 2014, 06:47:22 PM »
I'm a smart guy, one of the smartest I know. (Edit: Not trying to be conceited, I just mean my friends ask me for advice a lot).  Your plan sounds fine to me. It would be different if you were sticking your head in the sand and just expecting everything to work out on its own, but I don't hear that in your words. Sounds like you know it will be a little tight, but it's what you need to do to get the recuperation and family time.

I think it's a great strategy. It's not like you have to hold yourself back forever. The idea is that as you ease back into civilian life and get your feet under you and wits about you, then you'll be in a place where you can see things more clearly and decide what you really want to do with the rest of your life.

Go for it man!
« Last Edit: December 23, 2014, 06:54:04 PM by pzxc »

pzxc

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #2 on: December 23, 2014, 06:50:23 PM »
Oh, one another thing that might help. Consider the alternative. What would your extended family have you do? Work yourself to the bone when you're not ready for it, just so you can live with the expected luxuries of modern consumerism?

F that.  Do what you need to do for yourself, your wife, and your kids. You are the only person who TRULY knows what that is.  It's totally fine to coast for a bit if it puts you in a stronger position a year or two down the road.

shuffler

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #3 on: December 23, 2014, 07:23:19 PM »
Turns out our living expenses (mortgage, bills, groceries, etc) plus some family fun is currently $35k per year.
...
If we only need $35k to live on, and my pension provides $20k net, then I only need enough to net another $15k right?
I think you should think about what your future income and expenses will be.
I'd suggest:
  • Adding a new member to your family will increase your expenses.  (Maybe not a large amount, but certainly by some amount.)
  • Eventually you'll want to retire from even part-time work.  When that happens, will you be able to live on $20k/yr from your pension, without the additional income from part-time work?

Because it seems (just guessing) that you will have some increase in expenses in the future (the new kid) and some decrease of income in the future (stopping part-time work), I'd suggest that you set your aim a bit higher than merely meeting your current expenses of $35k/yr.  IMO, you'll want to exceed that by a bit, in order to save up for those increases-expenses/decreased-income in the future.  How much "padding" you need is up to you, though.

Hope that helps.

Newtonium

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #4 on: December 24, 2014, 04:41:55 AM »
Thanks to you both for getting back to me. As someone that has always planned 5-10 years ahead it has been difficult to imagine civilian work right now. A few years of coasting as pzxc calls it may be just what I need. I've always been ambitious so I can't imagine not wanting to become more efficient in the future, both in earnings and in spending.

I do expect that a new child will raise expenses, but a good deal of this will be offset by government programs. Canada offers a lot to families, more in certain provinces, plus another increase by entering a lower tax bracket. So my income will be reduced by ~$40-$50k, but income tax will drop 10%, and grant money will increase about $10k-$12k per year.

As for part-time work, I want to find things that interest me that earn money so that I enjoy it more. Anything above living expenses is currently saved. Debt will be gone by the time I transition so anything else can be invested. Won't be as fast as my current salary, but I'll also have $20k/yr headstart on investment earnings.


Retired To Win

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #5 on: December 24, 2014, 05:05:42 AM »
One of the decisions that will really make a major difference is going to be WHERE you relocate.  I've learned from my own experience and my conversations with many others that you need to do everything you can to avoid getting sucked into a High Cost of Living area.  Mustachianism is much more easily achieved if you can manage to do that.  So research the costs of living in an area well before you commit to a job or a lease/mortgage.

Good luck!

aneel

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #6 on: December 24, 2014, 07:08:40 AM »
Yes this seems completely reasonable.  An additional 20k could be earned from 2 part time jobs (one for you and one for your wife).  Also consider how you would feel about one of you doing seasonal work.  Depending on where you live, some sort of outdoor work may be more enjoyable than typical retail / indoor work.

Rpesek6904

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #7 on: December 24, 2014, 07:58:02 AM »
You sound like you are thinking correctly. I would note first that having a pension that pays 18-24k for the rest of your life is the equivalent of having approximately $500,000 of investable assets - that is a huge deal. Just to explain, $500,000 * .04 (SWR) = $20,000. Again, that is a big deal and congratulations.

It seems to me that if you can reduce expenses or hold them steady you can supplement your pension with part time work and be doing great. If you and your wife make $10,000 per year in part time/odd jobs (which should be relatively easy, especially if the military will pay for training necessary to gain marketable skills) then you would have family income of $40,000 - $50,000 and lots of time to optimize your life. If you throw in the additional "grants"that you are mentioning and the possibility of making more money as you get a hang of civilian life then it seems you have a safety margin built in as well.

Anyway, continue to follow Mustachian principles. Pay down that debt! A low cost of living place is a good idea. Use your free time to look for more efficient ways to spend money and reduce expenses. Increase your income (without sacrificing your mental health). You will be great.

 

Newtonium

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #8 on: December 24, 2014, 08:30:13 AM »
One of the decisions that will really make a major difference is going to be WHERE you relocate... So research the costs of living in an area well before you commit to a job or a lease/mortgage.

We're looking in to that now. I get a fully paid move on my way out, so we've been looking across the country. Provincial taxes vs benefits, housing/cost of living, jobs, schools, etc. I've got my eye on a few places.

Is there anyone here from Southern Ontario, Niagara Region?

On the seasonal work side, I have a love of brewing and winemaking and actively pursue knowledge as a hobbyist. Working a few harvests at local vineyards could be rewarding personally as well as financially.

Cassie

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #9 on: December 24, 2014, 01:59:03 PM »
Your plan sounds fine. I would try to earn 20 or 25/year so you can keep saving.  This will help you weather life's challenges. Also once you get to mentally rest as some have suggested you may be more ready for a challenge down the road a few years.  The pension puts you in a great position to never have to work f.t. again.  Both my hubby & I have a 20k pension each & are so grateful for that.

Newtonium

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #10 on: December 24, 2014, 04:54:26 PM »
I would try to earn 20 or 25/year so you can keep saving.

Definitely something I can work towards. Wife and I have been working side businesses for about 4 years so I want to turn those into our part-time income, and then as they grow move from $15k to $20k-$25k.

I'm a big fan of the 50 jobs for $50k articles and my civilian life will likely include some of these ideas.

Thanks all for the feedback. It's been helpful talking to people who can already see past the need for a $100k lifestyle. Merry Christmas,

Andrew

kib

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #11 on: December 24, 2014, 05:14:39 PM »
And some people will never get it.  My parents have been on my ass to get a Real job (as opposed to being a landlord and working part time when I wish to or think I need to boost my stache).   Oh Heaven Help Us She's So Spoiled And Such A Slacker And This Is So Dangerous And Irresponsible!!  for 15 years now.  I have no kids, I was FI at 36, and I'm still FI but for some reason that's totally irrelevant.   "Why" I should have a steady soul sucking office job when I have plenty of money for my individual needs and a great life never seems to enter into the discussion at all, it's just a given, and when I dare to ask why, I'm told to stop being ridiculous.  Er ... someone's certainly being ridiculous, but after 15 years of lower income joyous and abundant living proof, I don't think it's me.

Soooooo .... I agree with everyone else.  Your plan sounds fine, and fuck 'em if they can't see beyond the box.
« Last Edit: December 24, 2014, 05:20:34 PM by frufrau »

Gin1984

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #12 on: December 24, 2014, 06:17:17 PM »
Doesn't the military pay for living expenses for a certain amount of time, once you are out, if you are going to school full time?  Is that possible?

Newtonium

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #13 on: December 25, 2014, 10:52:37 AM »
Doesn't the military pay for living expenses for a certain amount of time, once you are out, if you are going to school full time?  Is that possible?

Yes it does, I will receive a top up on my income up to 70% of my salary (when I leave, ~$86k) for two years. So I will have a cushion while I transition and retrain.

We should have our debt paid by the time I leave so I'm hoping to save as much as we can during the two years of top up.


I'm starting to see that people close to me may never understand. My wife and I will just have to deflect it and do what we need to do. It's just been extra difficult dealing with this while depressed. Feels like a lack of support when really they just can't fathom a different life.

Thanks all, and Merry Christmas!

Gin1984

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #14 on: December 25, 2014, 06:51:10 PM »
Also is there a reason why you are not planning that your wife work in some respect?  If you can't work full time, you could watch the kids and your wife could work full time for a bit.

Rpesek6904

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #15 on: December 26, 2014, 07:01:20 AM »
You are swimming against the current. Most other people won't understand. Family, friends or whoever. You will learn to wear that as a badge of honor. Also, when you find people who do understand, it will be really exciting. Anyway, don't let it get you down.

thedayisbrave

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #16 on: December 26, 2014, 07:26:15 AM »
Just another one jumping here to say "you got this!" Work on trimming the fat out of your expenses, and increasing your income (with two of you that should be slightly easier).  Not many will understand so don't feel like you need to explain yourself.  It definitely gets tough not having that support, but us MMM folk, we're fighters! I have a few friends who understand - not much family - and once you figure out who those are, those friendships will be like gold for you.

Just keep swimming :)

Newtonium

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Re: Life Advice - Can We Make Mustacianism Work?
« Reply #17 on: December 27, 2014, 01:08:45 PM »
Also is there a reason why you are not planning that your wife work in some respect?  If you can't work full time, you could watch the kids and your wife could work full time for a bit.

My wife is considering going back to work, and that will likely play a role in where we move. Plus the hobbies we've been looking to work more on and make more profitable are joint efforts between, which makes them even more interesting to me.