Author Topic: Things to fully understand before FIRE  (Read 7670 times)

The Pigeon

  • Stubble
  • **
  • Posts: 126
  • Location: San Francisco
  • Now *I* drive the bus! *FIREd*!
Things to fully understand before FIRE
« on: April 23, 2015, 07:16:00 PM »
Hi all,

I'm FI but yet to RE. I plan to pull the plug in the next (and no more than) 12 months. I've been reading, reading, reading... Bogleheads guide to retirement, this forum, suggested links and blogs, and discover there are more and more topics I need to be well-versed in by the time I walk out of the office for the last time.

So, I'm asking those of you who have been there already, if there are any other topics I should add to this list. Things that I should FULLY understand by the day I resign...

Please add anything else to the list. I have 9-12 months to get a really good handle on these topics, and need to hop-to!
These are the things I'm currently hardcore researching:

1. Health insurance options
2. Tax planning strategies
3. Enhancing knowledge of investment strategies (and the pros/cons of my current strategy)
4. Yearly spend hard data / investment income projections
5. Plan for utilization of newly-acquired free time
6. ?

What else?

Thanks!
-LaPaloma

Exflyboy

  • Walrus Stache
  • *******
  • Posts: 7317
  • Age: 59
  • Location: Corvallis, Oregon
  • Expat Brit living in the New World..:)
Re: Things to fully understand before FIRE
« Reply #1 on: April 23, 2015, 08:20:25 PM »
Don't be surprised if you find that all you want to do for a while is lounge around, read and take naps.

All I did for the first 7 months of FIRE was..

1) Lounge around
2) figure out the money, taxes, pensions etc.. this took a long time.
3) figure out what your real spending is, plus get the best deals on insurance, cell phones, internet
4) Do a few repairs on the house and rentals.

Its amazing how you can fill the time.. take time to enjoy a few things too.. like a few days fishing or what have you.

You can read my blog below to see what my FIRE looked like.

Dan_at_Home

  • 5 O'Clock Shadow
  • *
  • Posts: 87
Re: Things to fully understand before FIRE
« Reply #2 on: April 23, 2015, 10:44:21 PM »
Hi all,

I'm FI but yet to RE. I plan to pull the plug in the next (and no more than) 12 months. I've been reading, reading, reading... Bogleheads guide to retirement, this forum, suggested links and blogs, and discover there are more and more topics I need to be well-versed in by the time I walk out of the office for the last time.

So, I'm asking those of you who have been there already, if there are any other topics I should add to this list. Things that I should FULLY understand by the day I resign...

Please add anything else to the list. I have 9-12 months to get a really good handle on these topics, and need to hop-to!
These are the things I'm currently hardcore researching:

1. Health insurance options
2. Tax planning strategies
3. Enhancing knowledge of investment strategies (and the pros/cons of my current strategy)
4. Yearly spend hard data / investment income projections
5. Plan for utilization of newly-acquired free time
6. ?

What else?

Thanks!
-LaPaloma

I am not yet in FIRE, however based upon my knowledge, you should have (1) a stash that will support your spending and lifestyle, (2) support from your SO or immediate family living with you and (3) health insurance.  The rest you can figure out once you are retired because you will have a better gauge as to what your needs are then and plus you will have more time to figure it out.  Be careful too much reading on the Internet before early retirement may lead to paralysis by analysis!!

 

Financial.Velociraptor

  • Handlebar Stache
  • *****
  • Posts: 1701
  • Age: 48
  • Location: Houston TX
  • Devour your prey raptors!
    • Financial Velociraptor
Re: Things to fully understand before FIRE
« Reply #3 on: April 24, 2015, 09:08:12 AM »

These are the things I'm currently hardcore researching:

1. Health insurance options
2. Tax planning strategies
3. Enhancing knowledge of investment strategies (and the pros/cons of my current strategy)
4. Yearly spend hard data / investment income projections
5. Plan for utilization of newly-acquired free time
6. ?
-LaPaloma

LaPaloma,

I think that probably covers it.  There aren't any obvious gaps and the fact these are on  your mind indicate these are the areas that are import to you.  In terms of 3/4, have you put any thought into how you will cope with inflation if it creeps up above 5%?  My example is I'm trying hard to rotate my exposure from very stock/options centric to a higher allocation of municipal bonds.  A 100% bond allocation would let me sleep very well at night - short term - but would give me grief if there was inflation (and subsequent interest rate rises).  My solution is to select the municipal bond funds I can find with the shortest durations available while keep large caps to rise with the tide.

For 1, I do Obamacare.  At first I had a non-insurance 'indemnity plan' because no traditional insurer would take me.  Obamacare fixed that and lowered my premiums at the same time.  If the GOP manages to kill O-C, I'll go back to the indemnity issuers because that is "good enough" but boy will I ever be pissed!

For 4, I have never had a formal budget in my life.  So for FIRE I adopted an 'anti-budget.'  I have a recurring fixed deduction from my brokerage account.  I spend that and no more with no other restrictions.  Works for me.

Recommend not being concerned about free time for about 6 months so you can decompress first.  You likely have no idea what it is that really drives you just yet...

AlwaysBeenASaver

  • Bristles
  • ***
  • Posts: 444
Re: Things to fully understand before FIRE
« Reply #4 on: April 24, 2015, 09:54:18 AM »
I'm almost FIRE and found this board in January when searching for details on how exactly to do the withdraws after FIRE. I don't see that on your list, although maybe that's part of your investment planning, just thought I'd mention it.

Exflyboy

  • Walrus Stache
  • *******
  • Posts: 7317
  • Age: 59
  • Location: Corvallis, Oregon
  • Expat Brit living in the New World..:)
Re: Things to fully understand before FIRE
« Reply #5 on: April 24, 2015, 10:16:30 AM »
Don't be surprised if you find that all you want to do for a while is lounge around, read and take naps.

 
I was the opposite and was off like a shot. Left work forever on a Friday and was 1200 miles away by Monday to climb and hike for a couple of months. Various sundry other adventures happened afterwards :-)! So that's probably highly dependent on how the OP feels. I've settled down a bit since then and have more of a routine (and also a bit more relaxed about everything) but I was burning the candle at both ends and in the middle for awhile there  and left all responsibilities go to the wayside for a long while at first. First flush of freedom I guess. See woman. See woman retire early and run amok :-)!

Haha.. In my case the 60 hour wee combined with the 80 mile one way commute totally burned me out, even though I had only been doing it for 19 months. Plus my Wife was (is) still working so I was sort of "tethered".. I.e I didn't think it was quite fair to go running off to the Bahamas by myself..:)

DragonSlayer

  • Stubble
  • **
  • Posts: 199
Re: Things to fully understand before FIRE
« Reply #6 on: April 24, 2015, 10:32:25 AM »
For me, it was a little like starting a business in that I learned a lot of it on the fly. I did research before I quit but, as they say, "You don't know what you don't know." The first couple of years were just a learning experience in every sense. I had a handle on most of it, but there was always some question about taxes, or saving, or what to do with my time, or "working for fun" that would come up.

I say just relax. Understand the basics like insurance, minimum withdrawal, etc. which you really need to know and which you seem to already have a handle on, and deal with the rest of it as it comes along. You'll never have all of the answers. Even today, 11 years in, I'm still learning stuff. I just correct and improve as I go along.

zinethstache

  • Pencil Stache
  • ****
  • Posts: 829
  • Location: Anywhere USA
  • FIREd 1/27/2017
    • My FIRE Hobby and travel blog
Re: Things to fully understand before FIRE
« Reply #7 on: April 24, 2015, 03:47:36 PM »
If you plan to start slow, or you have a tether, like Exflyboy and my DH have, be sure to have fun! DH is 4 years FIREd now and I swear he works sometimes more than I do. I have to tell him, its going to be a beautiful day tomorrow, grab the camera and go to the mountains to take pictures (we live in PNW and have a fancy camer, so there's NO excuse not to go). I love that our home feels like an "old person's" home, down to the coordinating bird feeders and big garden in the back yard, but that to me is still work! DH does take a nap almost every day, I never bug him about it because heck, he is retired after all and should enjoy some of his day.

Im about 2 years out, And, boy will I be mad if ACA dies out before then...yikes! Enjoy your FIRE planning:)

soccerluvof4

  • Walrus Stache
  • *******
  • Posts: 6673
  • Location: Artic Midwest
  • Retired at 50
    • My Journal
Re: Things to fully understand before FIRE
« Reply #8 on: April 30, 2015, 08:14:43 AM »
Its good to hear so many people are taking naps! :-) its become regular for me!

Exflyboy

  • Walrus Stache
  • *******
  • Posts: 7317
  • Age: 59
  • Location: Corvallis, Oregon
  • Expat Brit living in the New World..:)
Re: Things to fully understand before FIRE
« Reply #9 on: May 01, 2015, 01:09:43 PM »
Naps are great.. I usually watch the "Nightly Business Report" at 3:30 then doze of for half an hour.. Its great..:)

Well when I'm not doing work for my p.t. job that is..

EscapeVelocity2020

  • Magnum Stache
  • ******
  • Posts: 3460
  • Age: 47
  • Location: Houston
    • EscapeVelocity2020
Re: Things to fully understand before FIRE
« Reply #10 on: May 01, 2015, 06:49:11 PM »
Another FI but not RE here.  Glad to hear about the preponderance of nappers in ER :)  I can't wait!  But I get the sense that this OMY is a limited time trade-off where maybe I should try to live a little large.  In that vein, I have finally asked extended family to watch the kids so that the wife and I can sneak off to Hawaii for a week.  I have no idea how expensive it will be, but still having income above and beyond my 'safety point' (as well as generous investment returns) is a powerful thing.  I have nothing to lose by spending a bit more, other than getting used to spending, which I don't think will happen after one get-away, especially since we'll be back to our parenting right after...

Other than that, your OP covered most of my biggest worries, other than college expenses for my kids...  Good luck, FI is pretty much awesome!

Financial.Velociraptor

  • Handlebar Stache
  • *****
  • Posts: 1701
  • Age: 48
  • Location: Houston TX
  • Devour your prey raptors!
    • Financial Velociraptor
Re: Things to fully understand before FIRE
« Reply #11 on: May 01, 2015, 07:02:37 PM »
I took a trip with my father to Maui a few months into FIRE (2012) because we had both always wanted to go.  I'd like to take a trip with him to Rome so he can see the Pope give a homily.  It would mean a lot to him.  I'd mostly shrug it off and then go enjoy delicious food.  The Colosseum would be fun to see too.

Anyway, point is the travel bug only hits me about every 3 years.  You are probably safe, especially since you can afford to splurge this one time. 

Hawaii: Carry a stack of 1 dollar bills.  You are in perpetual tourist land so there are lots of people to tip.

EscapeVelocity2020

  • Magnum Stache
  • ******
  • Posts: 3460
  • Age: 47
  • Location: Houston
    • EscapeVelocity2020
Re: Things to fully understand before FIRE
« Reply #12 on: May 01, 2015, 08:05:33 PM »
Thanks for the response, I've been to Hawaii as a youngster, so I have a general feel of the 'Waikiki/Diamond Head Tourist Trap' area... 

I've been to Rome and give it two HUGE thumbs up!  We pretty much went crazy there seeing everything in one day (skimming the surface and got great pictures), but the Vatican / Colosseum / museums in depth, or especially 'living like a local' is a whole different level of commitment...

But however you manage to interact, it will most likely always be one of the most amazing cities on the planet! 

Dan_at_Home

  • 5 O'Clock Shadow
  • *
  • Posts: 87
Re: Things to fully understand before FIRE
« Reply #13 on: May 04, 2015, 09:59:32 PM »
Naps are great.. I usually watch the "Nightly Business Report" at 3:30 then doze of for half an hour.. Its great..:)

Well when I'm not doing work for my p.t. job that is..

With a program title like that I am sure watching it would make many people fall asleep and take a nap.