Best month to FIRE?

[rahby1us]

Wondering if there are some opinions out there of the best month to "click the button" and get out. I'm sure there are advantages and disadvantages to all times of year, and personal plans/preferences  that also factor in.

Considerations:

1. Wanting to get out as soon as possible
2. Max'ing 401k for one more year (many companies cap the % you can contribute per paycheck, i'm at 75% and wouldn't be maxed until March-ish)
3. Max'ing HSA one more time (most companies pull the $'s from every paycheck, not sure if this can be adjusted to hit limit earlier in year)
4. Earning enough to Max IRA
4. Various yearly events to plan around (travel plans)
5. Final cash build up, ensuring cash flow won't be a problem

What other considerations might there be for an early retiree?
40 quarters for Soc Sec., tax implications etc? For me personally, i'm weighing the max'ing of the 3 options above vs. being free!

Here is a great pre-fire checklist resource post a while back.http://forum.mrmoneymustache.com/post-fire/pre-fire-checklist/?topicseen

[tonysemail]

an annual bonus is a popular one.
there's also one last ESPP purchase or RSU vest.

I also like the idea of summer vacation, just before the kids get out of school.

[mak1277]

My timing will be influenced by annual bonus and stock compensation vesting. 

[EnjoyIt]

My timing will be mid year to minimize taxes.

[forummm]

I might work into the following year and max my 401k (contributing nearly all my paycheck) and quit when it's maxed.

[Trudie]

There are financial considerations, and then there are psychological ones.  A friend of ours (in education) said he was glad he got out in May.  He could have waited a few more months until the end of the summer.  He likes to bike and he likes the outdoors (we live in the midwest) and he said the timing was good because he got outdoors a lot and he found it easier to detach and decompress when things connected to his old life weren't in full swing.  And also, he didn't have to be cooped up inside thinking all the time.  He said the transition was easier this way.  And, oh yes, he had a few more golf pals and people to run around with.

[dougules]

My vote is for whichever month you find yourself at the Magic Number. 

[AlwaysBeenASaver]

I based my FIRE month on annual bonus (Feb), ESPP (May), and not wanting to work another summer. I FIRED in early June - it was planned for late May but got slightly delayed by boss's vacation.

[jim555]

Fill up your 15% bracket and max out the 401k if possible, then go.

[MVal]

an annual bonus is a popular one.
there's also one last ESPP purchase or RSU vest.

I also like the idea of summer vacation, just before the kids get out of school.

Yes, if/when I ever break out, it will be tough to time it because my company has profit sharing in the summer, but bonuses at the end of the year. There's really never a good time to quit, lol!

[ZiziPB]

For me it's annual bonus and RSUs vesting (both in early to mid March).  So my planned FIRE date is April 1, 2018.  I am planning to max my 401k by then as well.

[MrMoogle]

The downside to some of these is if you plan on doing ACA, you don't want too much income or you'll have to pay more. I'm probably doing it in February or March.

[Villanelle]

Unless there was some sort of *significant* one-time pay (like a very large bonus), I'd quite when I was at The Number.  Otherwise, it's all just OMM, the little brother of OMY.

[Cyaphas]

Where I work you usually see everyone retire right after they've qualified for the enxt year's benefits, including vacation, so may and june are popular. That and the kids are getting out of school if you'd like to go see family their schedules aren't as restricted.

[Cassie]

I waited for a few months after I had obtained another year towards my pension which is common. It also was april which is beautiful around here.

[RedmondStash]

I'm thinking January is the ideal time to FIRE, because of ACA health-insurance subsidies that are based on annual income, which resets on Jan 1. Also gives me time to max out my 401k, though I'm hoping to get that done by early fall.

But there are good arguments & strategies for other times too, such as when you want to start SS benefits, if you are older like spouse & me.

[Goldielocks]

My timing will be influenced by annual bonus and stock compensation vesting.

Don't forget SS credits, if you earn / pay for full credits before the year is up, because of high salary, then pulling the switch after that works in your favour by a few months.

[Primm]

My work anniversary date is 6th December, at which point I become eligible for things like my extra accrued vacation, leave loading payments etc. It's an all-or-nothing scenario, if I leave on 5th December I get nothing, if I leave after 6th December I get an entire years worth of loading. So in whichever year it happens, if I'm at the same employer, my retirement date will be 7th December.

I work shifts, and there's no way I'm staying through the holiday period if I don't have to.

[MandyM]

May for me (incidentally, NEXT May). It has a lot of benefits for me:

1. Start of summer
2. I'll have my 401K maxed
3. I always struggle at work in May, no motivation
4. I'll have just finished a quarterly report that is a bit of work, so they will have 3 months to figure out how to do the next one without me.

[forummm]

My timing will be influenced by annual bonus and stock compensation vesting.

Don't forget SS credits, if you earn / pay for full credits before the year is up, because of high salary, then pulling the switch after that works in your favour by a few months.

I think this only matters if you are trying to get to 40 credits. Once you've hit 40 credits, working more is always better, until you have 35 years of SS-qualifying work in place--and then it's only beneficial if your current income is higher (adjusted for inflation) than the 35th highest income year in your history (the one that will be replaced).

[albireo13]

My company has bonus in April.  My target month will be May.  I clear the bonus and have the whole Summer to enjoy ahead of me.

Rob

[Goldielocks]

My timing will be influenced by annual bonus and stock compensation vesting.

Don't forget SS credits, if you earn / pay for full credits before the year is up, because of high salary, then pulling the switch after that works in your favour by a few months.

I think this only matters if you are trying to get to 40 credits. Once you've hit 40 credits, working more is always better, until you have 35 years of SS-qualifying work in place--and then it's only beneficial if your current income is higher (adjusted for inflation) than the 35th highest income year in your history (the one that will be replaced).

Hey.  I thought we were talking about FIRE. Not 35 years and counting.  Grin.

Here, I need 39 years at over $55k per year before maxing out the credits, and each year I paid up by May for the year, so waiting until June make a bit of difference.

[dreams_and_discoveries]

Still 4 to 5 years away for me, I'm thinking I will work to the number, then as I'm getting close get my FIRE travels planned and start prepping my house to rent out.  I work contracts, so I'll probably see my contract at the time through to the end then not renew, unless I'm really itchy to travel and want to give notice. If I still want to do my current plan, of Russia > Trans Mongolian > China > Tibet > Onwards in Asia, summer is a good time, and I'll need time to research and get visa/tickets arranged and would happily still work when sorting it all out.


Luckily I contract through my own company, so I've got much more flexibility in paying myself across tax years etc. And no bonuses etc that I need to time correctly. As for our state pension, I've already got £100+ per week locked in, and only need 11 years more contributions to get the £155 max...So if I work 5 more years, that will leave me 6 years to buy. (You can buy extra years here). I'll probably wait and see with them, as I might pick up a part time job etc. further down the line, and I'll have 28 years in which to get my last 6 years contributions...