47 and near "finish line"

[Lotus]

Hello, everyone!
I’ve lurked for a while, but decided to introduce myself after reading GusLevy’s introduction on 5/15/08. Mine is similar story, though with significantly less dollars!

I’m an immigrant who came to the US for school. Worked for several years after graduation, went back to school for an MBA, and changed careers to financial services. After almost 15 years in this field, I’m close to FIRE. That could be as close as one year away to three years away. I find myself less motivated after a new manager and downsizing have left me with longer days (and less pay) on the trading floor at work.

I’m single and 47 years old, and became a US citizen several years ago. I live way below my means, as I've never bothered to keep up with the Joneses. I should have about $2MM in assets in a year, plus employer stock options well out-of-the-money due to the turmoil in financial services. (MM = million; out-of-the-money = currently worthless)

I struggle with precisely when to pull the trigger on retirement, though it’s probably on the shorter side of the one-to-three year range. While FIRECalc shows me to be fine, escalating healthcare costs and other unknowns encourage me to build a bigger cushion. Also, the thought of being retired for 30-40 years is a little intimidating, though I have plenty of outside interests. At some point, I might choose to return to my former (pre-MBA) career as a hobby, though that may be a pipe dream.

I really appreciate the civil and supportive tone of this board. Retiring early is unusual, and is great to find this sensible group with whom to discuss the prospect. Thank you!

 

[FIREd]

Hello Lotus,

Welcome to the board. It looks like you are in great shape financially. Have you already exercised your stock options? If not, are you willing to wait until they are in the money to quit your job?

 

[Meadbh]

Hello Lotus, and welcome to the Board. You seem to be in great shape. Have you given any thought to returning to your country of origin? It might put you in even better financial shape!

 

[Rich_by_the_Bay]

Two ingredients in your introduction would lead me to FIRE sooner rather than later. First, you seem to be able to live happily with low expenses. Since $2mm would probably support $80K real annual income indefinitely you would see continued growth of your nest egg even in retirement. Second, you are unhappy in your job. In context, there is no reason to stay there.

And of course, the secret weapon of every VER (very early retiree ) is that you can always re-enter the work force at a modest paying by pleasant job. That's not a luxury always available to those over age 55 or so. If you can get the health insurance thing in place, sounds like it's time for the next chapter.

 

[Lotus]

Thanks, everyone, for the welcome.
FIREDreamer, my stock options aren't worth exercising at present (strike price above current stock price). However, they only expire in stages between 2010-2017, so I'll just hope for the best. I conservatively value them at $0; anything more will be great!
Meadbh, I have no interest in returning to the "old" country, though it's true I would be in even better financial shape there. I feel "at home" in the US, and don't feel at home on my infrequent vacations in the old country. I'm always happy to return to the US!
Rich, I'm leaning strongly towards the one-year end of the 1-3 year range to FIRE. My job still pays very well, but has seen better times in years past, particularly in terms of the atmosphere at work. It's strange to think of walking away from it, but I'm getting there.
Again, thanks everyone, for your kind words and advice.

 

[Maurice]

Hi Lotus, curious what you do in the financial services area. I manage a group of IT quant types who do risk and valuation systems for fixed income derivatives. I had a front row seat for the CDO turmoil, a memorable moment in my career to be sure.

There are a handful of Wall Street types here, many who are FI but haven't yet pulled the trigger.

Welcome to the board!

 

[Lotus]

Maurice, thanks for the welcome. I manage a book on a prop trading desk, mostly fixed income, a little equity. No exposure to CDOs directly, but what hurts the firm, also hurts me come bonus time ... you know what I mean! Anyone who had a front row seat for the CDO turmoil has my respect (and sympathy).

 

[Disappointed]

Hello, everyone!
I’ve lurked for a while, but decided to introduce myself after reading GusLevy’s introduction on 5/15/08. Mine is similar story, though with significantly less dollars!

I’m an immigrant who came to the US for school. Worked for several years after graduation, went back to school for an MBA, and changed careers to financial services. After almost 15 years in this field, I’m close to FIRE. That could be as close as one year away to three years away. I find myself less motivated after a new manager and downsizing have left me with longer days (and less pay) on the trading floor at work.

I’m single and 47 years old, and became a US citizen several years ago. I live way below my means, as I've never bothered to keep up with the Joneses. I should have about $2MM in assets in a year, plus employer stock options well out-of-the-money due to the turmoil in financial services. (MM = million; out-of-the-money = currently worthless)

I struggle with precisely when to pull the trigger on retirement, though it’s probably on the shorter side of the one-to-three year range. While FIRECalc shows me to be fine, escalating healthcare costs and other unknowns encourage me to build a bigger cushion. Also, the thought of being retired for 30-40 years is a little intimidating, though I have plenty of outside interests. At some point, I might choose to return to my former (pre-MBA) career as a hobby, though that may be a pipe dream.

I really appreciate the civil and supportive tone of this board. Retiring early is unusual, and is great to find this sensible group with whom to discuss the prospect. Thank you!

Lotus: My story is pretty similar to yours except that I am not working in the Finanical area. I am 54 years old with about 3.8MM investable assets, a house with no mortgage that is worth about $700,000. Husband and wife, no kids. Making great money but do not like the people that I work with. Want to RE but afraid of 30 years of retirement as I still do not know what I will do to occupy my time. I have read "How to retire happy, free and wild", it helps a bit but not much. I guess, work has sucked the life out of me for 34 years.

I am glad to find people in the same situation I am (unsure of retirement but want to retire).

This board is a great community, you will enjoy it, and welcome.

Hope you continue to post.

mP

 

[FIREd]

FIREDreamer, my stock options aren't worth exercising at present (strike price above current stock price). However, they only expire in stages between 2010-2017, so I'll just hope for the best. I conservatively value them at $0; anything more will be great!

Lotus, I realize that your stock options are not worth anything right now but I was wondering if you exercised them when they were still worth something and then got caught by the slump in financial stocks before you could sell them.

I ask because, in my case, I have three months to exercise my stock options (no matter what their expiration dates) if I leave the company or get laid off. After that period of time I must forfeit them. So if I wanted to quit my job but still profit from my options, I would have to wait until they are in the money before quitting (and do a sale to cover), or exercise them immediately upon quitting and sell them later. If the options have already been exercised then I can quit whenever I want with my stock.

I was wondering if your stock option agreement had any time-limit clauses like mine...

 

[Lotus]

FIREDreamer, my stock options have a similar clause about "exercise or forfeit" if I leave the company.

However, if I formally take early retirement (must meet certain tenure/age conditions ... I qualify) and don't go to work for a competitor, I retain the original 2010-2017 expiration schedule. You may want to check whether your company has a similar waiver for early retirees.

 

[Rambler]

FIREDreamer, my stock options have a similar clause about "exercise or forfeit" if I leave the company.

However, if I formally take early retirement (must meet certain tenure/age conditions ... I qualify) and don't go to work for a competitor, I retain the original 2010-2017 expiration schedule. You may want to check whether your company has a similar waiver for early retirees.

Mine are exercise or forfeit, no early retirement clause...this is the first one I have heard of. In case of death of an employee, the beneficiaries have three months to exercise or forfeit.

Disappointed:

May I suggest you find something you like to do? If you asked me, I would say your situation sounds pretty serious...want to retire but can't because of not knowing what you would do. Eventually the day will come, so it would be good to begin figuring it out. Finding this board, having outside stimulus as to the possibilities, and some serious reflection have helped DW and me to figure out what we want to do, and how to begin planning for it. Good luck to you! I hope you find something interesting and fulfilling.

R

 

[Milton]

Anyone who had a front row seat for the CDO turmoil has my respect (and sympathy).

They don't have mine!

However, if I formally take early retirement (must meet certain tenure/age conditions ... I qualify) and don't go to work for a competitor, I retain the original 2010-2017 expiration schedule. You may want to check whether your company has a similar waiver for early retirees.

Wow. That's very generous. I've never heard of such an ER waiver.

 

[Texas Proud]

I got laid off from a mega bank.... my (small number of) options continue with their original due date... since they were the ones who severed ties they do not expire when employment is severed...


Are you sure they expire IF they lay you off? Sounds fishy to me... I mean, with them having so much problems and their stock price being so low now and planning on laying off many 1,000s.... just doesn't seem right you also lose your options....

 

[clifp]

Don't know about financial industry, but Silicon Valley the tech industry generally you had between 30 to 90 days after leaving the employment of the company (whether volunteer or involuntary) to exercise any vested stock options. In Intel's case much of this was spelled out in the stock option plan, which was voted on by the board and shareholders, hence not easily changed.

Generally leave of absence freeze all of the benefits, (as does being called to military duty), so taking a leave may give you an additional year for the financial industry to recover. (I hope it does bought way to many financial companies these last 6 months)

 

[Lotus]

Possible reasons for the generous ER clause are that 1) options are not widely awarded at my firm (probably < 10% of employees), 2) the qualifications for ER are not easy to meet, 3) the definition of "competitor" is fairly broad.

If you have substantial options, the generous ER clause encourages you to leave on good terms and ensures that you don't go to a competitor.