Author Topic: 9 months to FI  (Read 3508 times)

DoNorth

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9 months to FI
« on: June 09, 2015, 11:24:04 AM »
I started reading this about 9 months ago after I had retired from the military and started a new job with the federal government.  All the right pieces were pretty much in place and I had to make a variety of tweaks (from small to large), but I'm happy to say we're FI and will semi-retire this month at 36 and 34 years old.

Just to recap, last May, I was medically retired from the military with a generous pension, healthcare, and a variety of other benefits.  I took a few months off and we traveled with our small children throughout Europe and the US.  I felt I should get a job (even though I didn't really need one at the time) and was offered a higher level position with the government.  We made the very poor decision to trade in our paid off Volvo for a new Enclave and I bought a Verano so I could do my 27 mile beltway commute from Alexandria to Bethesda....absolutely horrible.    Anyway, we took the following steps to become FI

1.  Reduced grocery bills to around $400/month
2.  Eliminated cable tv/landline, replaced with ooma, netflix etc.
3.  Paid off cottage in Michigan (about $80K; dropped mandatory insurance policy since I'm going to demolish.  did this by using a 1.9% convenience check and then paying it off in 4 months)
4. Sold DC house for a modest profit
5. Started building new home (where cottage used to be) on the Great Lakes ourselves with contractor assistance while acting as our owngeneral contractor (about 30-35% savings)
6.  Accepted a part time position with a local non-profit making $25K year
7. Opened a solo 401k for my wife to reduce federal income tax to about $2000 total  (contributed about $22K on $27K of 1099 income to 401k)
8. Maxed out my 401k for 2014 and did the same in the first six months of 2015; maxed out both kids' 529s to take max deduction for Virginia, maxed out both Traditional IRAs with the intention of laddering starting next year.
8. Moved in with parents on upper floor (two doors from cottage we're renovating) so we could pay for the new construction with cash instead of mortgage
9.  With few exceptions, made almost all meals at home until the week before we moved; did almost all repairs/staging ourselves, auto maintenance etc.


The vehicles are still a black spot on the overall plan...I want to sell both, but will probably have to sell mine for now and eventually trade the enclave for an older diesel wagon or van. they're not a showstopper by any means.

Final numbers for FI:  $60K/year pension; $25K/year PT work; $30-$35K year spouse freelance PT work:  $115K-$120K/year in semiretired status (15-20 hours/week).  About $500K in retirement accounts (will ladder, but ultimately leave alone until 60 yrs old or later).  new House should appraise around $300K when we're done.  Expenses should be around $30K-$35K/year.  This blog really helped us see the different ways we could get to FI much more quickly

forestbound

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Re: 9 months to FI
« Reply #1 on: June 09, 2015, 12:29:52 PM »
Great job on your FIRE planning. Enjoy Michigan!

DoNorth

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Re: 9 months to FI
« Reply #2 on: June 09, 2015, 12:42:47 PM »
Nice work and congratulations, DoNorth!  Thank you for your service as well!

thanks!

Great job on your FIRE planning. Enjoy Michigan!

we definitely are!

okits

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Re: 9 months to FI
« Reply #3 on: June 09, 2015, 06:35:17 PM »
Totally badass!  Congratulations on achieving a life most only dream about!

StockBeard

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Re: 9 months to FI
« Reply #4 on: June 10, 2015, 11:19:41 AM »
I'm jealous, I'm still a few years away. Congratulations!

DoNorth

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Re: 9 months to FI
« Reply #5 on: June 11, 2015, 05:47:48 AM »
I'm jealous, I'm still a few years away. Congratulations!

It sounds like you're very much on track.    I'm giving notice tomorrow and can't get out of DC soon enough....code orange air quality and was stuck in horrendous traffic jam yesterday....plus the sweltering 95+ degree heat.  They don't call it "Pure Michigan" for nothing.  Best of luck--I'm following your blog now.

Cougar

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Re: 9 months to FI
« Reply #6 on: June 11, 2015, 08:22:44 AM »
Great job on your FIRE planning. Enjoy Michigan!


congrats and third this.

I know Michigan gets a lot of static because of the winters, but march thru November; its awesome if youre an outdoors type, Cheboygan, big bear dunes, traverse city, the UP; lots of great stuff up there.

DoNorth

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Re: 9 months to FI
« Reply #7 on: June 11, 2015, 09:57:29 AM »
Great job on your FIRE planning. Enjoy Michigan!


congrats and third this.

I know Michigan gets a lot of static because of the winters, but march thru November; its awesome if youre an outdoors type, Cheboygan, big bear dunes, traverse city, the UP; lots of great stuff up there.

thanks--I hear it quite a bit.  The outdoor selection of activities is pretty phenomenal (even in the winter)---we have several miles of lit CC ski trails; snowshoeing the North Country trail, icefishing is 500' from our doorstep, ice hockey etc.   It's pretty funny--I had a completely fenced in yard in DC and my 6 and 3 year old never wanted to go outside alone.  We have about an acre lot with 100' x 700' lot with Lake Superior frontage in Michigan and family owns some adjoining lots and they can't get enough of it...telling us we should stay inside so they can explore.