Author Topic: What should I do in a year?  (Read 5954 times)

StetsTerhune

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What should I do in a year?
« on: August 24, 2012, 07:10:27 PM »
So some quick info. The Wife and I make a combined 110K Net. Spend about 40K. Have a combined net worth of about 400K.

We're both relatively happy at our jobs right now, but I doubt we'll last more than another year at our respective jobs before we get too bored and will want to move on.

The question I have is what to do then --
A. take a year off and travel at that point, which we've wanted to do for a while,
or B. find new jobs, push through and try to retire or semi-retire in 3-4 years.

Advantages to each, as I see them:
A. traveling long term together (we've done it separately) is something we really want to do. I'm worried that if we put it off life will somehow intercede in some unanticipated way and prevent that. . You have no idea what will happen. Something to be said for hedging against the world ending.

B. If all goes well we could travel or do whatever we want for... ever. In just a few short years.

Disadvantages
A. Worried that if we come back to work after that we'll be miserable from the contrast.  Also worried we'll have to take significant pay cuts if we come back and look for work after that big a gap.  Certainly in any case, we'd have to work a couple more years total than in scenario B.

B. Worried that I'll be miserable after a few more years of working straight through. Nothing is worth being miserable to me for any period. Also you just don't know what's going to happen, market goes south, asteroid hits the earth, whatever.

Any thoughts or advice?

James

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Re: What should I do in a year?
« Reply #1 on: August 24, 2012, 07:38:36 PM »
I think it depends the most on your physical health and your ability to make working life "enjoyable" for a few more years.  You didn't say how old you are, but I assume you are in good health and not close to the age of expecting a radical decline in health.  In that case I'd suggest hammering it out for a little while longer.  The bigger you can build that nest egg before taking the time off the better, I think taking a year off really has the potential to push FI quite a ways off.  Even just a moderate decline in income has a pretty big effect when you get back, combined with the spending you do during that year off.


Obviously there is absolutely nothing "wrong" with taking the year off to travel, and you should be able to recover from that just fine.  It really becomes a personal decision.  But I'd suggest a lot of caution and planning for that route, coming back after a year off and hitting the grindstone for 10 more years might feel pretty miserable in 4 years when you realize you could have been FI at that point.

StetsTerhune

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Re: What should I do in a year?
« Reply #2 on: August 24, 2012, 07:49:12 PM »
I'm only 32, so certainly expecting to be in good health for quite a while.  Knock on wood.

Thanks for the thoughts James.  I suspect you're right, particularly if we have to take much of a pay cut when we return. Does anyone have any experience with looking for a full-time job after being "retired" for a while?
« Last Edit: August 24, 2012, 08:04:49 PM by StetsTerhune »

mushroom

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Re: What should I do in a year?
« Reply #3 on: August 27, 2012, 11:52:16 PM »
I'm about 9 months in to a year-long trip and loving it (you can check out my travel blog at scottandnina.com if you're interested). We're both in our early 30s. The advantages and disadvantages you've laid out sound spot on. For me, last year I finished my pediatrics residency and my husband was trying his hand at writing, so it was easy enough to have a clear starting point for our trip. We haven't started the job search in earnest yet, but I'm under the (hopefully not mistaken) impression that I shouldn't have too much trouble finding a job as a general pediatrician, especially since I'm flexible on location. My husband has been involved in several different fields and was actually offered a job out of the blue while we were on our trip that combined two of his disparate fields. We considered it for a while, but it would have meant cutting our trip short, and in the end we decided to pass up the tempting paycheck (hopefully not a bad decision!). When we get back, we're planning on working hard for the next few years to reach semi-FI/FI soon and then take another trip.

I've been really happy with my decision to take the trip when we have. I suppose it would have been easier to just take a job out of residency and then fully retire and take a trip, but I was pretty burned out after residency and this trip has brought much-needed clarity of mind and value to my life. I've had some really cool experiences, read a ton of books, become vegetarian, and I'm currently learning Italian. It's been totally worth it to me, and I feel ready to go back to work after this.

Not to sound too morbid, but as a pediatrician I've seen kids die from cancer, car accidents, and weird freakish things. We have family dealing with chronic illness that keeps them at home. Part of the reason for doing this now was the "you never know what's going to happen later" that will derail you from your current plans. I feel like we're young enough that it's just not a big deal to have FI/semi-FI in flux and go back to work or get side jobs or part-time work if need be. It's too easy to focus on retiring at 35 or whatever, and calculate SWR based on conservative estimates and no income for the rest of your life and decide that you need a huge amount of money before you retire. I think what's worse is to keep putting off a dream, but in the end you have to decide how much that dream is worth to you. I guess you could also argue, though, that if the dream is important enough, you'll definitely make it happen and what's a few years? We wanted to do this while we were still young so we could hike the Annapurna Circuit in Nepal and the Routeburn Track in New Zealand and before we had kids that could make everything a lot more complicated.

I think from the financially "sensible" perspective, you should wait. But it's really up to you whether the financial cost is worth it to you (personally, it was to me). Good luck with your decision and honestly, I think you'll probably end up happy with either choice. Do you think you'll regret going on your trip after the fact? Will you regret going down the other path and being financially independent earlier? I think a lot also depends on what sort of field you're in and what your job market is like and how much you like your job.

happy

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Re: What should I do in a year?
« Reply #4 on: August 28, 2012, 06:34:30 AM »
Its a long time ago now, but I took a year off to travel at age 25. Absolutely worth it.  I found I was very ready to be home and "settle down" after a year being a nomad.  However I did meet quite few people who had been travelling for years and still weren't ready to go back...so it depends.

As a result I didn't initially get the jobs I thought I wanted but did  get a job, easily enough, that ended up in me taking a career direction that I wouldn't have otherwise done. So it was all good.

OP You seem to have summarised the pros and cons well. Have you done the math on how long it would delay FI? Ie what is your budget for the year of travelling? How long will it take to re-save that? And what is the opportunity cost ie how much compound interest/return will you lose over the period by taking that money out of the stache? If you know more accurately what the trade off is in time and $, maybe that will help clarify things further.

By the way, congrats on a nice stache already.


Petruchio

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Re: What should I do in a year?
« Reply #5 on: August 30, 2012, 04:48:36 PM »
Well StetsTerhune, you have to remember that the single greatest, number one determiner of your happiness is genetics. Meaning that your hapiness is mostly determined before you are even born, and your circumstances have a mostly transistory effect on it. So I will not worry about taking the time to travel and worry that you will be miserable afterwards.

With that said, the other major determiners of your happiness is job/work satisfaction, and love/relationship satisfaction. Job satisfaction is not so much due to what you earn, but by being in a state of flow. If you really love your job, and feel that it is a constant challenge to your skills, that is something to consider. Relationship satisfaction, however, is very complicated. But one indictor of relationship success is regularly doing new and novel things with your partner.

Basically, you should take Frodo's advice "Go not to the elves for counsel, for they will say both no and yes."

maizefolk

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Re: What should I do in a year?
« Reply #6 on: August 30, 2012, 05:02:49 PM »
Hey Petruchio I have to disagree, the most recent number I read attributed in only 30-50% of the variance in happiness to genetics. Now that's definitely enough that it might be the single biggest determiner of happiness but I don't think it's enough to justify statements like "your happiness is mostly determined before you are even born." And that 30-50% also includes GxE interactions (basically how your genetic makeup determines the impact different events/life circumstances will have your happiness).

Sorry to go off on a tangent like that. I guess my point is that you can definitely make life decisions that result in being much happier or much less happy. Which I guess is a point you also make in your second paragraph. The idea of predetermined happiness just rubs me the wrong way.

Petruchio

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Re: What should I do in a year?
« Reply #7 on: August 30, 2012, 05:26:17 PM »
Hey Petruchio I have to disagree, the most recent number I read attributed in only 30-50% of the variance in happiness to genetics. Now that's definitely enough that it might be the single biggest determiner of happiness but I don't think it's enough to justify statements like "your happiness is mostly determined before you are even born." And that 30-50% also includes GxE interactions (basically how your genetic makeup determines the impact different events/life circumstances will have your happiness).

Sorry to go off on a tangent like that. I guess my point is that you can definitely make life decisions that result in being much happier or much less happy. Which I guess is a point you also make in your second paragraph. The idea of predetermined happiness just rubs me the wrong way.

My apologies for my imprecision. Instead of mostly, I should have used "biggest factor".

artimus

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Re: What should I do in a year?
« Reply #8 on: August 31, 2012, 10:18:17 AM »
Does anyone have any experience with looking for a full-time job after being "retired" for a while?

I know someone who graduated with a Finance Degree, worked a few years, then took 2 years off to pursue self-employment.  After 2 years he decided he wanted to go back to work.  He has been searching for a job for 8 months and been interviewed once.  Had to get part-time work just to stay in positive cash flow.  It's tough out there with a "non-standard" gap in the resume.

jawisco

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Re: What should I do in a year?
« Reply #9 on: September 01, 2012, 07:37:40 AM »
I think you should do what you feel like doing and not what you feel you should be doing.  The time to do something is when you want to do it.

You have put yourself in a great place financially - that didn't happen by accident and I have to believe that whether you go travelling now or later, it will work out just fine financially.  There are lots of possibilities of meeting the right people or getting interested in something new that could happen because of travelling that will actually make your future work more rewarding both financially/happiness-wise - you just never know about that stuff.

Trust that you will figure things out just fine and follow your gut...


Sparky

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Re: What should I do in a year?
« Reply #10 on: September 02, 2012, 07:54:08 AM »
With a net value of 400k you can easily retire in most of the world. You find somewhere or something you like, move there.

Travelling is an exceedingly cheap form of entertainment if done properly. And IMO, not a cost but in fact an investment in creating character and maturity.

Your training and skills are transferrable to almost anywhere in the world. I'm jealous.

And I can damn near promise that you will end up having an even better job when you come back to 'home'. Going travelling is a like a reset button on your career, except that this reset gives more than what you started with.


slugsworth

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Re: What should I do in a year?
« Reply #11 on: September 07, 2012, 07:15:59 PM »
Also very jealous! I say go for the trip. . . I plan on doing a smaller trip in the near term myself. I think some time off might rejuvenate you and with the amount of money you have saved, finding work really won't be urgent, and you can always start your own business with that much capital if you want to and you are well on your way to semi-ere anyway.

travelbug

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Re: What should I do in a year?
« Reply #12 on: September 20, 2012, 12:27:07 AM »
Everyone is totally different and DH and I took a year out when we were in our early twenties to travel. It cemented our relationship, we came home and were married, and it made us focus on early FI as we wanted to do it again, longterm.

Having said that, if I were in your position I would have a target goal and just go for it. Once you hit it, in two-three?? years you have the rest of your lives to travel.

In this economic climate I want the security if FI behind me and if it's that close you can taste it I, personally, wouldn't be able to stall my crossing of the finish line.

Good luck with whatever you decide, only you can truly know what weighs what in your world.


StetsTerhune

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Re: What should I do in a year?
« Reply #13 on: September 21, 2012, 05:38:12 PM »
Thanks for all the responses. Some really good input in there.

My wife and I have spent a lot of time talking about it the last few weeks and decided it's better for us to keep working and try to push through to financial independence. We're close enough that it seems worthwhile to just get there. We spent the last couple weeks car camping in europe and decided we can force ourselves to work a few more years if it means we can do things like that full time forever.