Hello everyone, I've been reading these forums for awhile but this is my first post. I'm contemplating quitting work in a few months and taking a year off from corporate America. I live a mostly mustachian kind of life, except for a few glaring problems. I bought a house at near the bottom of the market in 2009, which is good, but I have a long commute. The commute is roughly 65 miles one-way, but I only drive or bike to the train station which is 4 miles away and take the train to work. My employer pays almost the entire cost of the train ticket, so the monetary cost of the commute is not much. Having said that, it takes 4 hours and 15 minutes out of my day, every day. When we bought the house, I said I'd do it for 5 years and then re-evaluate. The 5 years are almost up.
The other problem is that I'm not really super happy about the work I do. It is okay, but I have been with the same company for 10 years. I'm dreaming about being self-employed. If I stay at my job for another 10 years, I believe I will be able to retire (at the age of 47).
I started playing with the idea of quitting my job and taking a year off to try self employment. I currently make between $170k - $220k per year depending on bonuses and stock options. My wife makes another $35k per year. We have our costs under pretty good control. Our monthly expenses are roughly $3000 per month. We have no debt other than our mortgage. Assets currently look like this (they should be much higher I know):
House equity: ~$150k
Retirement investments: ~170k
Taxable investments: ~$42k
Savings account: ~$40k
(Cars: ~$25k)
The plan would be to live on her salary + roughly $1500 per month out of savings, which means we need roughly $18,000 per year to maintain current lifestyle. If I stay at work until April 2014 or so, I should have roughly $80k in savings, which is enough money to remain unemployed for 4.5 years, without touching any of my investments. If things go bad and my wife loses her job, it will be enough to last 2 years without touching investments.
I would take one year off, spend 8 hours per day building products (such as iPhone apps and websites), 2 hours per day exercising and 2 hours studying online courses (coursera etc). This means I would spend the same 12 hours per day doing activities, as I do today, except I would be working for myself and I would be taking care of myself rather than sitting on a train. It would also give me a taste of what early "retirement" would feel like. If after one year it turns out that I'm not able to make enough money through self employment or that I hate it, I would start looking for a job again. I hope that I will be able to find a new job within one year. So I would expect to burn through roughly $36,000 in the worst case scenario. If my wife loses her job, I'd start looking for employment right away (if nothing else because health insurance would be a major issue).
The biggest fears I have is that I'll never be able to find a job that pays quite as good again, and that I might end up working somewhere with an even worse commute. It would also set me back a few years to early retirement, I might have to work until 50 or longer if I cant find new job with similar pay. I also fear that being self-employed might be very lonely and that I will sort of lose touch with my network.
On the flip-side, if I do not do this, I will probably always wonder "what if". And I think the timing is about right No kids yet, and I think at age 38 I might have an easier time get re-employed than I would at 50 (at least in my particular field).
Any comments or thoughts? Face punches?