Author Topic: I just bought a week of my life back  (Read 2462 times)

Rhoon

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I just bought a week of my life back
« on: January 27, 2017, 12:41:15 AM »
So last year was a good year for sales for my team and our commission accelerators and back pay finally caught up with us. I was able to max out my 401K with a single check and still have enough left over to max out both IRAs for my wife and I. I'm pretty sure I'm going to hit the phase out this year on my tIRAs so I'm thinking I'll use the money to pay off $23K of debt, increasing my net worth by $40K in a single paycheck (the rest Uncle Sam got).

I know own 75 days of my own life; still a long way to go.

financialfreedomsloth

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Re: I just bought a week of my life back
« Reply #1 on: January 27, 2017, 02:38:34 AM »
Not really. If you already are at 75 days, and at an average market return of 7% you would be there in about 23 years. That is without any additional savings. Since your bonus and some back pay let you max out your IRA, tIRA and wipe out a debt of 23K I am guessing you could get there much, much faster. If you save for an additional 16 days each year from now on you should be there in 10 years. You’ve got to love compounding!

BrightFIRE

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Re: I just bought a week of my life back
« Reply #2 on: January 27, 2017, 06:22:38 AM »
Not really. If you already are at 75 days, and at an average market return of 7% you would be there in about 23 years. That is without any additional savings. Since your bonus and some back pay let you max out your IRA, tIRA and wipe out a debt of 23K I am guessing you could get there much, much faster. If you save for an additional 16 days each year from now on you should be there in 10 years. You’ve got to love compounding!

I'm not sure where you're getting those numbers. If OP maxed the 401k and both IRAs, that's $29,000 right there with no earnings. For me and my SO, that's almost a year of living expenses.

OP, I like your thinking. I've calculated my savings rate and used it to figure out at what point each day I have earned enough for a future day of no work - 2:12 p.m. It can be pretty motivating on tough days at the office. :-)

financialfreedomsloth

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Re: I just bought a week of my life back
« Reply #3 on: January 27, 2017, 07:00:07 AM »
Not really. If you already are at 75 days, and at an average market return of 7% you would be there in about 23 years. That is without any additional savings. Since your bonus and some back pay let you max out your IRA, tIRA and wipe out a debt of 23K I am guessing you could get there much, much faster. If you save for an additional 16 days each year from now on you should be there in 10 years. You’ve got to love compounding!

I'm not sure where you're getting those numbers. If OP maxed the 401k and both IRAs, that's $29,000 right there with no earnings. For me and my SO, that's almost a year of living expenses.

OP, I like your thinking. I've calculated my savings rate and used it to figure out at what point each day I have earned enough for a future day of no work - 2:12 p.m. It can be pretty motivating on tough days at the office. :-)
I presumed his stash was now large enough to pay for 75days of living expenses (following the 4% SWR). If that stash grows at 7% per year and he adds enough each year to pay for 16 days extra each year, he is FIRE in 10 years.

Rhoon

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Re: I just bought a week of my life back
« Reply #4 on: January 29, 2017, 07:20:28 PM »
Not really. If you already are at 75 days, and at an average market return of 7% you would be there in about 23 years. That is without any additional savings. Since your bonus and some back pay let you max out your IRA, tIRA and wipe out a debt of 23K I am guessing you could get there much, much faster. If you save for an additional 16 days each year from now on you should be there in 10 years. You’ve got to love compounding!

I'm not sure where you're getting those numbers. If OP maxed the 401k and both IRAs, that's $29,000 right there with no earnings. For me and my SO, that's almost a year of living expenses.

OP, I like your thinking. I've calculated my savings rate and used it to figure out at what point each day I have earned enough for a future day of no work - 2:12 p.m. It can be pretty motivating on tough days at the office. :-)
I presumed his stash was now large enough to pay for 75days of living expenses (following the 4% SWR). If that stash grows at 7% per year and he adds enough each year to pay for 16 days extra each year, he is FIRE in 10 years.

See, now you've gone and done it and posed a challenge. Now I have to break out the spreadsheets and figure this out and determine how I can do this.