30 and wandering

[pureaboly]

Hi

I'm 30 and coming into an inheritance of the 2 x 10^6 scale. The estate is executing glacially, but steadily. Renting but thinking of buying, single but thinking of proposing to my sweetheart, no dependents (yet), freshly unemployed and mulling a career change away from IT either into heavy math or auto mechanics, either of which means going back to school.

I've been living a lavish and inefficient IT consulting lifestyle, saving all the while to the tune of 2 x 10^5, but in the last year and few months especially had been growing tired of it. Took a vacation and decided to quit my job, and got conveniently laid off with severance while I was away.

Not sure I'm ready for FIRE, given that I'm feeling some risk aversion for the inheritance. I'd like to keep it intact for future generations, and I'd probably consume it in a lifetime of ER. That and I'm a bit of a dreamer, I've got lots of interests that could reasonably turn self-supporting but aren't yet. I wasn't really expecting to make a FIRE decision this early in life, I feel like I don't understand the choices.

Haven't read this forum too long but I was immediately struck by the friendly & supportive atmosphere here. I hope that I can be a part of that.

[plex]

I am reading that you have 2.2M assets and are curious if you can retire at 30. The answer is, probably not, the money will have to last at least 60 years, you will have to cover for your own health-care, you will have very little access to tax-free/tax-deferred accounts and you will have no hope of ever receiving SS, as opposed to little hope. You could do it, but would have to live pretty frugally, since you will need to live on only about 3-3.5% of it per year(since it needs to last so long). After the costs mentioned for your situation, that would involve living on 40-50k a year.

You are close though, get a decent paying job, invest properly and you should be in a much more comfortable position to retire in 4-8 years. It sounds like you were a bit burnt out from your last job, that is common, just switch to something a bit different that uses skills you have, and you should be able to avoid burn out for any remaining working years.

Also, take a long time to plan out how you will properly invest your inheritance, don't make any sudden decisions. You will find lots of threads that talk about the need for extreme caution when handling an inheritance.

[haha]

Quote:

Originally Posted by pureaboly Hi...mulling a career change away from IT either into heavy math or auto mechanics, either of which means going back to school.

Are you sure you have good self-knowledge? I've known some mechanics and some mathematicians. From the outside they don't seem like similar people.

Overall, if you are capable of doing mathematics and you have $2 million, you might enjoy a laid back small college professorship more than abusing your bones lying on some cold floor under an oil dripping car only to come home and have to scrub your hands for 20 minutes before your woman will even let you near her.

Go up market my friend, you can afford it.

Ha

[pureaboly]

Quote:

Originally Posted by plex I am reading that you have 2.2M assets and are curious if you can retire at 30. The answer is, probably not

Agreed, 100%, for the reasons you posted. I'm thinking it is the end of pedal to the metal career pursuits tho. Perspective shift and all that.

[aaronc879]

If that 2.2 million is after taxes then I would think you could retire if wanted. You could do auto repair part-time from home for family, friends, and their families. Seems like something you enjoy that could earn you some extra income while allowing you the freedom of working on your own schedule.

[pureaboly]

Quote:

Originally Posted by aaronc879 If that 2.2 million is after taxes then I would think you could retire if wanted. You could do auto repair part-time from home for family, friends, and their families. Seems like something you enjoy that could earn you some extra income while allowing you the freedom of working on your own schedule.

It's after estimated estate tax but before some taxes -- most of the inheritance is in the form of beneficiary IRAs that I'll have to withdraw over the next 20 years, for better or worse I'll not be able to withdraw over my lifespan due to the nitty gritty, confirmed with accountants & lawyers.

What means retirement? Dropping out of the workforce entirely is not something I think I want. The way I see it at present, the inheritance is my retirement and till then I'll work for subsistence and entertainment.

[CaseInPoint]

One thing that may come as a surprise to single people in their 30s is that they are not as young as they might believe themselves to be. The feeling of being a kid tends to delay some people's settling down and starting the next phase of life.

For example, if you're approx. 30 and single, even if you proposed today to someone your own age, had a fairly quick 6-month engagement, then waited a year to see if the marriage is stable enough to have kids, then stared trying to have kids, then the wife got pregnant after a quick 3 months, and had a child 9 months later, you're now approaching the age of 33. (For the wife, there are definitely some pregnancy issues to keep in mind as she nears the middle 30s). By the time your first kid reaches first grade, you would be nearing 40, give or take.

Of course, 40 is not exactly old, but when you do the math, you can see that being 30 and drifting might be something to ponder, if you have even the slightest desire to be a young father.

Food for thought, dude...

[Raygun99]

Think about Prenuptial Agreement: ... sound crass but it’s your family legacy and could be lost for the wrong reasons.

[pureaboly]

Quote:

Originally Posted by Raygun99 Think about Prenuptial Agreement: ... sound crass but it’s your family legacy and could be lost for the wrong reasons.

The thought has crossed my mind, but from my brief readings on the subject:

assets inherited by a person are not typically considered marital assets, even if the beneficiary was married at the time, unless the bequest was explicitly for the assets to go to the couple, or unless explicitly gifted from the beneficiary to the spouse, etc

income earned on inherited assets would be marital income, I gather, but I'm inclined to think that this is somewhat fair given the time frames under which it would become an issue.

Apart from divorce tho it'd be good advice to prepare a will that spells out how the inheritance would be redistributed. If / when I have kids I'll see to it that the inheritance stays in the family line.

[Texas Proud]

Quote:

Originally Posted by pureaboly The thought has crossed my mind, but from my brief readings on the subject: assets inherited by a person are not typically considered marital assets, even if the beneficiary was married at the time, unless the bequest was explicitly for the assets to go to the couple, or unless explicitly gifted from the beneficiary to the spouse, etc income earned on inherited assets would be marital income, I gather, but I'm inclined to think that this is somewhat fair given the time frames under which it would become an issue. Apart from divorce tho it'd be good advice to prepare a will that spells out how the inheritance would be redistributed. If / when I have kids I'll see to it that the inheritance stays in the family line.

It depends on which state you are in.... some separate property income is still separate...


But here is your big problem... comingling.... you will probably not keep good track of your income.. and might move it out eventually.. but not as soon as it hits... and maybe you will move some money from a joint checking account to your separate account... well, over time.. this means that your separate property can have a claim against it... and maybe will lose it's separate status....

So it is still 'best' to get a prenup... but from what I read, even these can have holes....