Race from $2M to $4M...and Beyond!

[pecunia]

Healthcare is one of my primary motivators for voting Democrat

Are you sure?  Our President said that the Republican Party Will Become Known As The "Party of Healthcare."

https://www.cnn.com/2019/03/26/politics/trump-obamacare-repeal/index.html

The Republican Party and the major ensurers will be working in lockstep to assure that the Public has access to the very best of American healthcare.  It's a complex issue and I guess they can't expect the rest of us to truly understand all of the intricacies as they are technological as well as having major fiduciary concerns.

[2Birds1Stone]

Healthcare is one of my primary motivators for voting Democrat

Are you sure?  Our President said that the Republican Party Will Become Known As The "Party of Healthcare."

https://www.cnn.com/2019/03/26/politics/trump-obamacare-repeal/index.html

The Republican Party and the major ensurers will be working in lockstep to assure that the Public has access to the very best of American healthcare.  It's a complex issue and I guess they can't expect the rest of us to truly understand all of the intricacies as they are technological as well as having major fiduciary concerns.

Are you trolling? Or just having a hard time with English?

Ensurers are going to assure that we all have the best health care?

Ok.

[FIREstache]

Healthcare is one of my primary motivators for voting Democrat

Are you sure?  Our President said that the Republican Party Will Become Known As The "Party of Healthcare."

https://www.cnn.com/2019/03/26/politics/trump-obamacare-repeal/index.html

The Republican Party and the major ensurers will be working in lockstep to assure that the Public has access to the very best of American healthcare.  It's a complex issue and I guess they can't expect the rest of us to truly understand all of the intricacies as they are technological as well as having major fiduciary concerns.

Are you trolling? Or just having a hard time with English?

Ensurers are going to assure that we all have the best health care?

Ok.

Maybe Pecunia means that insurers along with the Republican party are going to ensure that we all have the best health care, not that he/she really believes that but pointing out the irony vs. what Republicans have actually done.

[2Birds1Stone]

Gotcha, I thought it was a play on words.

Sent from my SAMSUNG-SM-G930A using Tapatalk

[Bateaux]

I was never a Democrat till I had my financial well being saved by the ACA.  You'll commit political suicide if you reinstate preexisting conditions and lifetime limits.  You can fool the voters a lot of the time, but even the greatest fools realize they don't want to give those basics up again.

[pecunia]

I was never a Democrat till I had my financial well being saved by the ACA.  You'll commit political suicide if you reinstate preexisting conditions and lifetime limits.  You can fool the voters a lot of the time, but even the greatest fools realize they don't want to give those basics up again.

Note I said "access" to the very best health care.  You have "access" to a Lamborgini too.  You may not have "access" for sufficient funds for either.

Abe Lincoln quote:

“You can fool all the people some of the time and some of the people all the time, but you cannot fool all the people all the time."

Some of the fools have had good insurance from their employers and really don't understand what others are giving up.

[Exflyboy]

I was never a Democrat till I had my financial well being saved by the ACA.  You'll commit political suicide if you reinstate preexisting conditions and lifetime limits.  You can fool the voters a lot of the time, but even the greatest fools realize they don't want to give those basics up again.

Note I said "access" to the very best health care.  You have "access" to a Lamborgini too.  You may not have "access" for sufficient funds for either.

Abe Lincoln quote:

“You can fool all the people some of the time and some of the people all the time, but you cannot fool all the people all the time."

Some of the fools have had good insurance from their employers and really don't understand what others are giving up.

Precisely why the benefit of free insurance from your employer should be taxed.. So everybody feels the pain!

[Bateaux]

I've been a winey pants lately.   Rode my bicycle 70 miles.  I'm much better now.  Butt is swollen a bit, but, I'm still better.

[DavidAnnArbor]

Wow that's incredible. I take a spinning class and it says I ride 11 miles in 30 minutes.

[pecunia]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse. 

[Exflyboy]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse.

Yup all downhill from here.. Wait I thought this was the "top is in" thread..:)

[EscapeVelocity2020]

The nice thing is, like all the other multimillionaires on this planet, we don't need to even think about the market.  All I bother myself with is, when  swipe my credit card at the grocery store, other people are paying :)  Sometimes I pay out of my salary, but that was like 10+ years ago!

[pecunia]

The nice thing is, like all the other multimillionaires on this planet, we don't need to even think about the market.  All I bother myself with is, when  swipe my credit card at the grocery store, other people are paying :)  Sometimes I pay out of my salary, but that was like 10+ years ago!

What a sweet peaceful way to look at it.  I guess I never thought about it before.  Getting FU money lets you say FU to the stock market guys too.

[EscapeVelocity2020]

The nice thing is, like all the other multimillionaires on this planet, we don't need to even think about the market.  All I bother myself with is, when  swipe my credit card at the grocery store, other people are paying :)  Sometimes I pay out of my salary, but that was like 10+ years ago!

What a sweet peaceful way to look at it.  I guess I never thought about it before.  Getting FU money lets you say FU to the stock market guys too.

As long as we're not, say, 100% equities right now, we probably have plenty of money tucked away to ride out whatever turbulence might come as well as enjoy whatever remaining updraft there is.  Just glad I'm not starting my savings and accumulation journey right now though (did that from 1996 - 2000 with tech stocks - ugh!).

[soccerluvof4]

Yea i dont know if I am being honest if I was just starting out and say had 200k to start investing if I would just put it in the market. I would most likely DCA in on the first decline. Just saying.......Glad too I am not at that point.

[Dicey]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse.

Lol, you inspired me to check our biggest account, which is the only one I monitor with any degree of regularity. Wow! Thanks, pecunia!

The nice thing is, like all the other multimillionaires on this planet, we don't need to even think about the market.  All I bother myself with is, when  swipe my credit card at the grocery store, other people are paying :)  Sometimes I pay out of my salary, but that was like 10+ years ago!

.
So much this! It amazes me that after years of crafting my lifestyle to be as inexpensive as possible, despite my HCOLA circumstances, now I literally don't have to pay attention any more. It's all on autopilot and there's plenty more than I ever intend to spend. I was never a high wage earner, so this still amazes me. The primary reason for this working out the way it did was that someone patiently convinced hard-headed me that putting only 20% down and keeping a mortgage (which was counter to my every instinct) was wicked smart.

[Bateaux]

I play a guessing game with myself and Mint about how much daily gains/losses will be.  I missed by over $10,000 yesterday!  So how much I thought I'd gain, PLUS 10,000 DOLLARS!   WHATDAF!  My bicycle is 19 years old.  I'm getting a new one dammit.

[Exflyboy]

I play a guessing game with myself and Mint about how much daily gains/losses will be.  I missed by over $10,000 yesterday!  So how much I thought I'd gain, PLUS 10,000 DOLLARS!   WHATDAF!  My bicycle is 19 years old.  I'm getting a new one dammit.

Hahah.. Beware the hedonistic adaption..:)

I think my mattress got padded with about $13k yesterday. If you told me this would be happening fairly regularly 20 years ago there is no way I could have believed it.

Its like these dump trucks full of money keep backup and dumping into my driveway.. At least for right now.

[wannabe-stache]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse.

Yup all downhill from here.. Wait I thought this was the "top is in" thread..:)

my bonus just came through and went into my investment account so yup - the market will shirley crash.

even though the market statistically spends a lot of time at "all time highs" it still concerns me.

we surpassed $3.6m for the first time but i spend more time on bogleheads than MMM so i am "convinced" we need double what we have...[frowny face]

[Exflyboy]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse.

Yup all downhill from here.. Wait I thought this was the "top is in" thread..:)

my bonus just came through and went into my investment account so yup - the market will shirley crash.

even though the market statistically spends a lot of time at "all time highs" it still concerns me.

we surpassed $3.6m for the first time but i spend more time on bogleheads than MMM so i am "convinced" we need double what we have...[frowny face]

Maybe you should roll your AA a bit more to bonds?

I'm at 25% bonds but when the big crash happens I will roll to about 90% stocks and cash in on the recovery..:)

[wannabe-stache]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse.

Yup all downhill from here.. Wait I thought this was the "top is in" thread..:)

my bonus just came through and went into my investment account so yup - the market will shirley crash.

even though the market statistically spends a lot of time at "all time highs" it still concerns me.

we surpassed $3.6m for the first time but i spend more time on bogleheads than MMM so i am "convinced" we need double what we have...[frowny face]

Maybe you should roll your AA a bit more to bonds?

I'm at 25% bonds but when the big crash happens I will roll to about 90% stocks and cash in on the recovery..:)

I have ~10 years in bonds, or around 30%.  I can sleep but think i should put new money into bonds.

[ysette9]

New Record Highs!

https://www.cnn.com/2019/04/23/investing/stocks-hit-record-highs/index.html

The sky is falling and the correction is coming.

2 million to 3 million and back to 1929 and the poorhouse.

Yup all downhill from here.. Wait I thought this was the "top is in" thread..:)

my bonus just came through and went into my investment account so yup - the market will shirley crash.

even though the market statistically spends a lot of time at "all time highs" it still concerns me.

we surpassed $3.6m for the first time but i spend more time on bogleheads than MMM so i am "convinced" we need double what we have...[frowny face]

Maybe you should roll your AA a bit more to bonds?

I'm at 25% bonds but when the big crash happens I will roll to about 90% stocks and cash in on the recovery..:)

I have ~10 years in bonds, or around 30%.  I can sleep but think i should put new money into bonds.

10 YEARS in bonds and that is 30% of your stash? You definitely need to spend more time cleaning your optimism gun and less time on the Bogleheads forum. There are some smart people there but damn, their pessimism is out of control sometimes.

[markbike528CBX]

Re bonds
Bonds are return- free risk, per Jim Grant
https://www.ft.com/content/bd69356a-c229-11dd-a350-000077b07658

https://www.zerohedge.com/news/2019-04-14/jim-grant-world-wide-suppression-interest-rates-has-been-crime

Disclaimer,
I'm taking 2 months spending from VTSAX.

[wannabe-stache]

I have ~10 years in bonds, or around 30%.  I can sleep but think i should put new money into bonds.

10 YEARS in bonds and that is 30% of your stash? You definitely need to spend more time cleaning your optimism gun and less time on the Bogleheads forum. There are some smart people there but damn, their pessimism is out of control sometimes.

30% in bonds at 40 years old is hardly pessimistic.  also, google "bond tent" or "reverse glidepath".  there is demonstrable efficacy in starting early retirement with an outsized bond allocation to hedge against sequence of returns risk.

[ysette9]

Oh I get it. The bond tent is a key part of our own strategy. My point was that TEN YEARS of spending is only 30% of the overall portfolio. That means the OP is already at 33x yearly spending which is pretty Bogleheads-ish.

[PathtoFIRE]

Regarding reverse glidepath, do you have any links to more in depth discussions about this?  I think it's relatively common knowledge around these parts that the first 10 years of FIRE play an outsized role in whether you fail retirement (and presumably the reverse is true, and relatively good returns in the first 10 years lead to large excess net worth). And I think most of us would trade away the chance of huge outlier ending net worths if it also negated those historical or simulated sequences that resulted in failure around a withdrawal rate of 4%. I'm just wondering if there has been more indepth analysis of this, and if so, whether it might even push safe WRs up closer to 5%, which for someone like me know is planning more of a fatFIRE could mean the difference in several years in a FIRE date.

[wannabe-stache]

Regarding reverse glidepath, do you have any links to more in depth discussions about this?  I think it's relatively common knowledge around these parts that the first 10 years of FIRE play an outsized role in whether you fail retirement (and presumably the reverse is true, and relatively good returns in the first 10 years lead to large excess net worth). And I think most of us would trade away the chance of huge outlier ending net worths if it also negated those historical or simulated sequences that resulted in failure around a withdrawal rate of 4%. I'm just wondering if there has been more indepth analysis of this, and if so, whether it might even push safe WRs up closer to 5%, which for someone like me know is planning more of a fatFIRE could mean the difference in several years in a FIRE date.

this guy's research is a must read for anyone contemplating early retirement.

https://earlyretirementnow.com/2017/09/13/the-ultimate-guide-to-safe-withdrawal-rates-part-19-equity-glidepaths/

[ysette9]

Regarding reverse glidepath, do you have any links to more in depth discussions about this?  I think it's relatively common knowledge around these parts that the first 10 years of FIRE play an outsized role in whether you fail retirement (and presumably the reverse is true, and relatively good returns in the first 10 years lead to large excess net worth). And I think most of us would trade away the chance of huge outlier ending net worths if it also negated those historical or simulated sequences that resulted in failure around a withdrawal rate of 4%. I'm just wondering if there has been more indepth analysis of this, and if so, whether it might even push safe WRs up closer to 5%, which for someone like me know is planning more of a fatFIRE could mean the difference in several years in a FIRE date.

This is our personal recipe for the glidepath along with analysis and discussion:
https://earlyretirementnow.com/2017/09/13/the-ultimate-guide-to-safe-withdrawal-rates-part-19-equity-glidepaths/

I also have this bookmarked, though it has been a while since I have re-read the article:
https://www.kitces.com/blog/managing-portfolio-size-effect-with-bond-tent-in-retirement-red-zone/

[PathtoFIRE]

Thanks, that's exactly what I was looking for to get started. I like Kitces's early graph showing "retirement date risk" and "sequence of returns risk" for the periods right before and after retirement. For many of us, especially high earners who don't absolutely loath their jobs, retirement date risk isn't that much of a risk, so after reading the two links from ERN and Kitces, I'm a little more inclined to maybe increase our equity exposure from the current 75% right now to maybe closer to 85-90%, increasing "retirement date risk" but also giving us a statistically better shot of hitting our number a year or more early, and then immediately dropping to 60% at that point, and gliding up to 90%+. At least, that's the idea that I need to now mull over for a few months. Now to read more and see the arguments against an approach like that.

[ysette9]

I’m really interested what you learn and decide as we are in somewhat of a similar boat. We have been bringing in boatloads of cash these past couple of years, so on one hand it is hard to step away from that. On the other hand, I’m totally over this working-for-a-living thing. :-)

Do you have a mortgage? I haven’t yet processed and made peace with this article that talks about the risks of having a mortgage in retirement as it comes to sequence of returns risk and your asset allocation decisions. We seem to be doing what this article claims is the worst solution: holding the mortgage to its full term and doing the bond tent. https://earlyretirementnow.com/2017/10/11/the-ultimate-guide-to-safe-withdrawal-rates-part-21-mortgage-in-retirement/

[wannabe-stache]

We do not have a mortgage. In all reality my wife isn’t going to stop working. She makes a great salary and has terrific benefits.  Plus we have a 2 yr old and may have another child in the near future.

I may dial it back in 4 or 5 years. We’ll see. I’d like to fire with enough money that I don’t have to worry about one tents wtc. Even though I am sure we still will.
Right now we’re at a 3.2% SWR. I suspect that in 4-5 years we should have at least 40 years expenses. Still so many unknowns wrt health care and cost for kiddos’ activities.

[PathtoFIRE]

I did read that section about mortgages on ERN, and then I went back to the first part and opened a tab for future reading, and plan on rereading about the mortgage. We do have a mortgage, and it's right at $750k, so paying it off is not a minor choice, but up until now we had plan on keeping it, and possibly even recasting/refinancing it back out to 30 years just before FIRE, so that article has given me some more ideas to ruminate on.

One thing, about at least the ERN parts linked above that I read, that is made clear is that you kind of have to decide whether you are in the camp that believes that the CAPE10 continues to mean the same thing that it meant before the 2000s, or if you believe what some say regarding changes in accounting, etc. that translate into "naturally" higher CAPE10 values in recent years that can't necessarily be compared 1:1 with the more distant decades. Because what those charts all screamed at me more than anything was the difference between "all retirement dates" SWRs versus "CAPE>20" SWRs, even more so than which particular glidepath you use (and to make clear, the article stresses that using the glidepath, at least historically, in CAPE<20 retirement years provided NO benefit).

In other words, the analysis and commentary seems to suggest that if you believe the current CAPE>20 environment is going to result in sequence similar to the few scattered years around 1900, 1930, and 1965, then you should be planning an SWR of 3.5 and using a glidepath. But if you think that CAPEs of 20-30 are more equivalent to CAPE of 15-20 in past years, then maybe you don't need a bond tent/reverse glidepath and maybe and SWR of 4 still has a failure rate of around 5%.

[ysette9]

I’m in a similar situation with regards to mortgage amount, so I agree that it is not an insignificant decision to make on how to handle it. I have read some debate about how good CAPE 10 is or is not at predicting future returns as well as whether changes in accounting methods reduce the predictive power of that. I’m not smart enough or learned enough on the subject to have an opinion. I’d be curious to hear where you come down on that debate.

I think I am not really but sort of am counting on a few items to provide margin in the plan: flexibility in spending; the ability to bring in some money in the future, whether it be some consulting by my husband or something as yet unknown; inheritance. I don’t plan on working necessarily in the future, but I keep stumbling on people all over the place online who mention how income-earning opportunities seem to fall I to their laps in FIRE. 

The last one feels almost a bit dirty and doesn’t actually figure into any of our calculations, but I also have in the back of my head that there are two couples in the generation above who have comfortable retirement income, are financially responsible, and have close to $1m invested with intentions to leave to my sister and me.

[bwall]

CAPE 10 is tricky. People only started talking about it in .... 2017/18 (?), which is when the horrible comparisons from the Great Recession were at their (statistical) high point. Now you don't hear so much about it b/c those horrible comparisons have aged out of the CAPE 10, thus making it appear less frightening.

[Exflyboy]

Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,..... New record closing high..:)

[pecunia]

Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,Ding,..... New record closing high..:)

https://www.cnbc.com/2019/04/26/stock-market-gdp-data-and-corporate-earnings-in-focus-on-wall-street.html

Yippee Skippee.  It sure is getting high on this big pile of money.  It was a long hard climb up here.  I think I'll relax in a bit for a while,.........a very long while.

[Exflyboy]

Yeah I'm a little surprised it made gains today after crap earnings from 3M and Intel.

But I'll take it..:)

[soccerluvof4]

Yeah I'm a little surprised it made gains today after crap earnings from 3M and Intel.

But I'll take it..:)

Think I heard yesterday though so far 76% of all earnings have beat estimates. That's still pretty darn solid!

[Exflyboy]

Yeah I'm a little surprised it made gains today after crap earnings from 3M and Intel.

But I'll take it..:)

Think I heard yesterday though so far 76% of all earnings have beat estimates. That's still pretty darn solid!

Yes a cautious sigh of relief after lowered expectations due to a slowing economy. I too have been hearing more and more that the upcoming recession might not happen till after 2020.

[pecunia]

There are definitely political reasons to keep it going until the election of 2020.  It's what the folks got to run on.

[DavidAnnArbor]

We could be like Australia and avoid a recession for 20 years if the economy is managed properly.

[pecunia]

We could be like Australia and avoid a recession for 20 years if the economy is managed properly.

Hmmmmm - That almost sounds like a controlled economy from the top down.  The USSR used to manage their economy and it never really took off.  How could you do it?  How did the Aussies do it?

[itchyfeet]

We could be like Australia and avoid a recession for 20 years if the economy is managed properly.

Hmmmmm - That almost sounds like a controlled economy from the top down.  The USSR used to manage their economy and it never really took off.  How could you do it?  How did the Aussies do it?

A fair bit of luck was involved (China boom consuming so much iron ore) and a few good decisions (floating dollar, removing tariffs etc). Also, keeping immigration fairly high also keeps the economy growing as all the new peeps need to consume too.

[Bateaux]

I've been a winey pants lately.   Rode my bicycle 70 miles.  I'm much better now.  Butt is swollen a bit, but, I'm still better.

Rode my bike Friday and Saturday.   I circumnavigated Lake Ponchartrain.   I carried along my camping hammock and sleeping bag.  I finished up yesterday evening, it was 170 miles total, 100 of which was yesterday.  Longest ride of my life and I did it lugging camping gear on a rack.   I did it Mustacian style using my 19 year old mountain bike.  I will be buying a real touring bike, this was a test ride with what I have.  Maybe a more compact and lighter sleeping bag as well.  I have to work Monday, but on those two days of freedom, I was a bicyclist.  I'm sore today but reflecting back on those miles sweetens it some.  FIRE is coming.

[pecunia]

I've been a winey pants lately.   Rode my bicycle 70 miles.  I'm much better now.  Butt is swollen a bit, but, I'm still better.

Rode my bike Friday and Saturday.   I circumnavigated Lake Ponchartrain.   I carried along my camping hammock and sleeping bag.  I finished up yesterday evening, it was 170 miles total, 100 of which was yesterday.  Longest ride of my life and I did it lugging camping gear on a rack.   I did it Mustacian style using my 19 year old mountain bike.  I will be buying a real touring bike, this was a test ride with what I have.  Maybe a more compact and lighter sleeping bag as well.  I have to work Monday, but on those two days of freedom, I was a bicyclist.  I'm sore today but reflecting back on those miles sweetens it some.  FIRE is coming.

Even endorphins aren't free, but they may come with the good bonus of better health.  You are inspiring me to pull my bike out of the shed.

[PhrugalPhan]

Rode my bike Friday and Saturday.   I circumnavigated Lake Ponchartrain.   I carried along my camping hammock and sleeping bag.  I finished up yesterday evening, it was 170 miles total, 100 of which was yesterday.  Longest ride of my life and I did it lugging camping gear on a rack.   I did it Mustacian style using my 19 year old mountain bike.  I will be buying a real touring bike, this was a test ride with what I have.  Maybe a more compact and lighter sleeping bag as well.  I have to work Monday, but on those two days of freedom, I was a bicyclist.  I'm sore today but reflecting back on those miles sweetens it some.  FIRE is coming.

Very impressive.  Even in my 20s the most I ever did in one day was 60 miles.  I assume that was mostly flat terrain.  Not sure I could do that today even with optimal conditions.

[Bateaux]

Pretty flat.  Except New Orleans.   That's below sea level.

[londonbanker]

Joining this thread as I left the 2m milestone behind for good. Our NW hit £2.15m today.
Although technically reporting in GBP and not USD, my FI number is £3.0m of which £2.0m in invested assets - so joint that race is a nice challenge for me.

Took us 8yrs to get to the first £1m, then another 4yrs to get to £2m; so hopefully 2-3yrs to get to £3m :-)

[ysette9]

Joining this thread as I left the 2m milestone behind for good. Our NW hit £2.15m today.
Although technically reporting in GBP and not USD, my FI number is £3.0m of which £2.0m in invested assets - so joint that race is a nice challenge for me.

Took us 8yrs to get to the first £1m, then another 4yrs to get to £2m; so hopefully 2-3yrs to get to £3m :-)

Congrats! It took us similar amounts of time: around 9 years to the first $1m, about another 4 after than to $2m, and now we are working to get to $2.3 which is our newest magical FI number. I have no plans to get to $3M but won’t complain if it happens.

[Exflyboy]

Joining this thread as I left the 2m milestone behind for good. Our NW hit £2.15m today.
Although technically reporting in GBP and not USD, my FI number is £3.0m of which £2.0m in invested assets - so joint that race is a nice challenge for me.

Took us 8yrs to get to the first £1m, then another 4yrs to get to £2m; so hopefully 2-3yrs to get to £3m :-)

So that puts you currently at about $2.8M.. Congratulations!

I was back in London last year (I was born in leyton E15). Knowing how expensive things are back there now I can see why you need 3 million quid!

Welcome aboard..:)