Good Evening Mustachians!
I have an interesting story that doesn't quite fit the norm, and an interesting question that I want your help with.
I graduated from college in 2007 in rural New York (the greater, greater, huger Buffalo NY area), with a liberal arts degree. For the first year or so after that, I parlayed my experience as a volunteer EMT into paid EMS work, at the princely sum of $8/hour. Being Mustachian before it was cool, and my dad having lost his job while I was in college, I rode a bicycle to work, in Buffalo, for a year, in the snow. I was in phenomenal shape. I eventually worked my way up to a college security job, and found my way into a Major Metropolitan Police Academy in 2010. Smack dab in the middle of the Great Recession, I was excited to have a job, with a pension...except that the city had slashed the pension, unbeknownst to me, in between my conditional acceptance and the completion of the background check.
Slightly disillusioned with the city, I stumbled upon Mr Money Mustache in 2013, sold my financed car, rode a motorcycle for a year, and saved up enough money to buy a car in cash and relocate to Pennsylvania in 2014 to take advantage of the natural gas rush there, work hard, and stack a fat Stache. This worked well for a year until the bottom dropped out of the oilfield in early 2015. I spent a year in Nepal doing earthquake relief as a volunteer, and discovered how well and simply you can live when you can ride a bicycle (or even better, the outside of a beautifully painted bus blaring Bollywood music) everywhere you want to go, and you're surrounded by fun people. More convinced than ever of the power of early retirement, I came home to visit my parents in Michigan, and got sucked into sales in the mortgage industry.
I'm making money that I never dreamed of making, especially since I lack a serious degree. I'm currently clearing $120,000 per year, but the job is all consuming. I've been here just under three years and I don't have any really solid, non-work relationships, and I'm being forced to chose between hitting goal at work, eating healthy food, eating simply and cheaply, working out, or having a social life. It's sort of a pick one, one and a half if you're lucky, any given month. My minimum work schedule is eleven hours a day, five days a week, with extra days when we're not on pace for goal, and the expectation that we help our clients out on our off days through at-home access and the good old smartphone.
Needless to say, most of the guys at work are Living Their Best Lives -- parties, BMW's with the extra cool badging, there's a guy who shows up at the office every month to do custom tailored suits...
I'm worn out and I don't have enough vacation time to take a decent sabbatical. I requested a leave of absence and was denied (have to have a medical reason). At this point, I could step down to a lower income/lower workload position in the industry, but this would require moving to a different company. In the meantime, part of my dream for early retirement was traveling the world simply, living in places for six months to a year at a time to truly get the flavor for the place, and working part-time as an English teacher or disaster relief worker.
At the moment, I have the opportunity to go teach English in Barcelona, Spain. I'll be able to work 20-30 hours per week and should be able to break even on the cost of living, at a minimum, and gain a CELTA certification in the process. That plus experience will give me the ability to sustain myself comfortably in all the fun places I want to go -- Korea, Japan, Mexico, Ecuador, Morocco, Beirut, etc. It will also give me a skill I can use to feed myself while studying for a master's degree in disaster relief/preparedness, which I would like to do in Beirut, Cairo, Istanbul, or one of several Asian countries.
Life Situation: I am currently single, unattached, with no dependents, no plan or desire for kids. I hate the demanding, hamster wheel nature of my job. I have been working 50-100 hours/week for my entire adult life, and I just want to slow down and ride the bicycle more and work less.
Gross Salary/Wages: $110,000-120,000/ann, commission-based. I maxed out my 401(k) contributions early in the year and have already maxed out the Roth IRA.
Debt Obligations: Mortgage - P and I of $511/month, T and I of $275/month, Mortgage Insurance of $75/month for the next 9 years. If values keep rising I can pay $500 to get the home appraised and get the PMI dropped off early, or I can pay $15,000 to get the principle to 80%. Whenever I run the numbers, it doesn't make sense to refi/pay down/drop the PMI, verses the 7% return on investing.
The House! Original Purchase price of the home: $102,000.00, purchased with 1% down and closing costs covered by the seller, 4.625% on a 30 year. Current estimated value, $110,000.00. The home is sturdy but not purdy. I would probably need to redo the kitchen and bath to get higher than bottom barrel rents (and tenants) in my area. Rents in my area go from $900/month to $1300/month for comparable properties, and the home is close to my parent's, who are in their sixties and OG mustachians (dad clocks over 1000 miles/annually on his bicycle and does all my car repairs when I don't have time to do them myself, and has a basement full of appliances he's busy resurrecting and selling on EBay to tickle his old electrical engineering fancy. He also picks up odd jobs doing home renovation and remodeling when he feels like it. Mom has been sewing clothes and canning fruit and cooking hearty home cooked meals for forty five years now).
Expected ER expenses: I really enjoyed living in Nepal, and did that comfortably under $12,000 annually. I imagine I'll need more when I'm older, but plan on having the home paid off by the time I hit 65. I figure I can handle living on $24,000/year, but $40,000 would of course be nice, especially if I find a lady friend. I expect over the next thirty years to find something that I enjoy doing, can get paid to do, and wouldn't mind doing well into my retirement on a part time or freelance basis. Whether it's teaching English, or going back to school for a master's in disaster management and becoming a professional do-gooder/do-goodery consultant. I don't feel comfortable going back to school now because I'm allergic to debt and don't want to spend sixty hours a week working and going to school.
Assets:
$15,000 cash in the bank -
$5,000 in Personal Capital's interest bearing cash account
$6,000 invested a Fidelity Brokerage Account (FZROX zero fee S&P 500 fund)
$24,000 invested in a Vanguard Brokerage Account (Split between VTSAX and VBIAX for a bit more stability for the emergency fund)
$86,000 in Fidelity 401(k) funds through work managed FXIAX / SP500 Index
$34,000 in a Vanguard Rollover IRA brokerage account (split between VIMAX and VSMAX)
$27,000 in a Vanguard Roth IRA VTSAX
Bought with cash 2009 Honda Fit (manual! with no farkles!) with 150k miles
Bought with cash 2002 Honda VFR Interceptor 800, because chicks dig V4's and it got me through the years when I refused to finance a car.
Liabilities: One student loan, $2200 balance with a fixed 5% interest rate and $150/month payment, and the mortgage, taxes, and homeowner's insurance.
Income vs. Savings:
2017: $97,000 vs $33,000
2018: $117,000 vs. $46,000 and bought a house
YTD 2019: $60,000 vs. $34,000.00
QUESTION 1: I am 36 years old. I currently have $175,000.00 in investments. By my back of the envelope calculations, based on a 7% rate of return, even if I never invest another dime, I'll have comfortably over $1,300,000 by the time I turn 65. With a 4% SWR I'll have a comfortable $52,000 annual income, which is more than enough for me to live on by myself currently in America, and will support a very high standard of living abroad. So in my estimation, as long as I can find fulfilling work that pays the bills at a "subsistence" level for the next 29 years, I will be able to comfortably hit FIRE at 65 (or earlier, if I'm happy with surviving on less that $52,000/annually) without ever investing another dime. Am I free to simply spend the next 29 years doing whatever I want as long as I don't dip into my investment accounts? Is this a reasonable use of the 7% rule? Do I need to factor in inflation? Should I use a smaller number than $175k for long term forecasting since I've had such great returns on investment over the past three years of growth? Is there something I'm missing in this calculation, or is it time to tell my boss that I'm simply not coming in on Saturdays anymore, start packing my bags, and get ready for a departure to Barcelona in December?
QUESTION 2: - should I rent or sell the home if I move overseas?
QUESTION 3: - what would you do in my shoes?
QUESTION 4: - how cool is it that, 5 years after leaving a rewarding but not very financially sound public service position, with $20,000 of rollover pension and 401(k) money and $5000 in the bank, I'm now on top of my own pension program and ready to start a working semi-retirement? Thank you America, Mom and Dad who taught me the glories of spreadsheets on a 486 computer in 1995 and who tracked every dollar they've spent over their 45 years of marriage, and you MMM loonies.