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About to RE! :-)
Old 07-12-2005, 10:09 PM   #1
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About to RE! :-)

Hi...

* * I'm about to RE.* I'm in a good situation as I'm 37, single and no kids. I was living the high life (making $150,000 plus bonuses a year) but paying the price with stress and too much work and decided life is too short. I will have about $1.8 million in liquid assets in a couple of months (in the process of liquifiying some property, etc.) and am looking forward to RE and hearing tips about what to do/not to do.

Always

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Re: About to RE! :-)
Old 07-12-2005, 11:02 PM   #2
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Re: About to RE! :-)

Sounds like you got the financial part figured out for the most part.* You might get some good ideas here to help tweak it.* Financially, you may always have more than I will ever have, even though I am content with what I have.* I would go from semi-retirement to full retirement today if I had $1.8mil.

The part about being single and no kids may work out for you, but this is an area that involves long-term thinking.* If you think you will be content in your 50s, 60s, and 70s alone, then more power to you.* One of the main reasons I want to RE is so I can spend more time with my family.* Just like you don't want to get old and regret not saving for retirement, you want to make sure you also won't regret not having a family later on in life.

I like money, but I don't worship money.* FIRE is a means to get get closer to my family, not an end in itself.* So I guess the question you may want to ask yourself is, "Why do I want to retire early?"
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Re: About to RE! :-)
Old 07-13-2005, 12:42 AM   #3
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Re: About to RE! :-)

With that much money and no family, you are probably good to go. Unless you have been looking for a wife and somehow inexplicably failed to find one over the past 15 years or so, you probably have figured that you don't need one. As you know, no wife doesn't mean alone. Short or long term.

I am in a similar financial situation as you, but older and married. Personally, I would prefer to have more money, but I don't think it is necessary. If I were your age, I would only quit now if I hated my work, or if work was harming me in some way that I couldn't adjust. With a decent job and your stash at age 37, you have a shot at getting "very comfortable" while you are still young.

One of our posters has a bit more money than you and is older and single. He recently decided that for the way he wants to live he would be happier with more money, so he has gone back to work.

Some here interpreted his return to work as a failure of nerve, but to me it made sense, given his attitudes.

Ha
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Re: About to RE! :-)
Old 07-13-2005, 01:04 AM   #4
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Re: About to RE! :-)

You are certainly in good shape - no matter whether you decide to get married or not!

Personally I am 36 and have a girl friend, but marriage is not in our plans - doesn't prove anything for me.

I also lived a busy and stressful life to reach where I am today (FIREd) and I am certainly not going back. Whether I start to dabble with a hobby that earns me money too is up in the air.

Cheers!
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Re: About to RE! :-)
Old 07-13-2005, 06:26 AM   #5
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Re: About to RE! :-)

Always, what do you do for a living? Is it something you could jump back into fairly easily if ER turns out not to work for you? You have many years ahead of you. The world sure looked different to me at 37 than it does at 50.
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Re: About to RE! :-)
Old 07-13-2005, 08:53 AM   #6
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Re: About to RE! :-)

AlwaysLearning,
here are a few things to consider.

1. Detox from the stressful job while still working if possible. Called Retired-In_Place

2. Listen to some of the retirement portfolio's on this board and considering setting it up gradually before you retire.

3. Make a good assesment of what you plan to fill your new 16 hours of freedom each day. 50 retirement years is a long time and will end up being great if you have lots you want to do.

4. Expect a period of adjustment and some anxious days watch a lifetime of savings suddenly in withdrawal phase.

I flunked 2 thru 5. Number 1 was a breeze.
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Re: About to RE! :-)
Old 07-13-2005, 09:03 AM   #7
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Re: About to RE! :-)

I've never been married but I do have a girlfriend.* Neither of us ever wants kids or to get married.

I would like to retire early for a number of reasons.* One is, I guess I never found something to do as work that I really enjoyed.* I've been in management for my adult life and I don't enjoy it.

Also, my worldview has changed in recent years.* I started to make some major money the last few years and I helped a lot of people out financially in addition to living the high life myself.* I learned something about people AND myself.*

About people?* I believe in the saying:* No Good Deed Goes Unpunished.* I used to try and help people who ask for monetary help but I don't think I've ever been repaid except by backstabbing when, at a later time, the person thought I should give them more and I didnít.* So, I guess I've decided to look out for myself and my close family (parents, brother, and girlfriend) from now on.* I may go back to schoolÖstudy lawÖfor fun!* I donít know.

About myself:* I am happier living on less money.* I lived in a cheap two-bedroom condo for 11 years and was very happy.* I just wished I could have a pet.* So when the money started to flow why did I buy a $2 million home?* Turns out I was happier in my condo.* *The home is too big and takes too much effort.* Expenses and time for the pool, landscaping, roof, exterminating, etc.* I was spoiled living in a condo where I could walk into my kitchen and still watch the ballgame on the TV in the living room. Management took care of everything and I just sent a quarterly check.* It was also cheaper.

I also donít need the fancy car (BMW 754 Li) I bought either.* A few years ago I had an Acura NSX which is, in my opinion, the most beautiful car in the world.* Itís only problem is itís a two-seater.* Having had that, and gotten it out of my system, a consumer reports top rated vehicle (Honda Civic or Toyota Camry) is all I need.*

With money, I started to go out to eat more Ė lots more.* And put on lots weight.* *The only luxury Iíd like to see if I can continue to afford is a housekeeper who would do some light HEALTHY cooking since neither I nor my gf like to cook and clean.

I happen to believe we might be on the edge of technology that could extend human lifespan indefinitely.* It sounds crazy but people who thought the earth was round (or that it was a good idea to retire early!) were labeled crazy too.* Technology is snowballing and through things like cloning (for replacement organs), stem cell research (to rejuvenate cells), and nanotechnology (developing mini robots that would repair cells at the molecular level) life spans could increase significantly.

I take a lot of vitamins and would like to focus on getting in the best physical shape of my life and living as long as possible Ė forever?

I know an investment advisor who has averaged about 25% a year in stocks for over 30 years.* He taught me his system.* I set up a dummy portfolio last year and am up over 30% in a year.* I will be using that to manage most of my cash.* However, I will only be drawing < 4% for income because I donít know if I can duplicate it.
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Re: About to RE! :-)
Old 07-13-2005, 10:14 AM   #8
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Re: About to RE! :-)

Quote:
Originally Posted by AlwaysLearning2

I know an investment advisor who has averaged about 25% a year in stocks for over 30 years. He taught me his system. I set up a dummy portfolio last year and am up over 30% in a year. I will be using that to manage most of my cash. However, I will only be drawing < 4% for income because I donít know if I can duplicate it.
Have you seen any evidence of this? Why is he still advising people on investments if he's made 25%/yr on average. I assume he's worth at least ten million now, right? Assuming he put $2,500 per year into the market, that is.

Can you forward me his name, I've got a few million I'd like him to double for me.
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Re: About to RE! :-)
Old 07-13-2005, 10:19 AM   #9
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Re: About to RE! :-)

Wauw we have more in common than most! No kids lanned here either and being dissappointed by people I have helped monetary is also part of my (now distant) past.

I am also much happier living for less - One can only stay in 1 room/wear one shirt/drive one car at a time - and I have been very busy reducing all my "stuff" to the "essentials". I am also an apartment type for the same reasons you mention - let somebody else fight with all that admin/repairs of a huge mcmansion.

One of my biggest FIRE jobs is to get in shape through good work outs/sports and nutrition (and yeah I also gulp a handfull of vitamins/anti-oxidants/oils/herbs every day together with a few cups of green tea).

As to your investment approach I would like to hear more - I suggest you start a thread in the FIRE and money board?

Cheers!


Quote:
Originally Posted by AlwaysLearning2
I've never been married but I do have a girlfriend.* Neither of us ever wants kids or to get married.

I would like to retire early for a number of reasons.* One is, I guess I never found something to do as work that I really enjoyed.* I've been in management for my adult life and I don't enjoy it.

Also, my worldview has changed in recent years.* I started to make some major money the last few years and I helped a lot of people out financially in addition to living the high life myself.* I learned something about people AND myself.*

About people?* I believe in the saying:* No Good Deed Goes Unpunished.* I used to try and help people who ask for monetary help but I don't think I've ever been repaid except by backstabbing when, at a later time, the person thought I should give them more and I didnít.* So, I guess I've decided to look out for myself and my close family (parents, brother, and girlfriend) from now on.* I may go back to schoolÖstudy lawÖfor fun!* I donít know.

About myself:* I am happier living on less money.* I lived in a cheap two-bedroom condo for 11 years and was very happy.* I just wished I could have a pet.* So when the money started to flow why did I buy a $2 million home?* Turns out I was happier in my condo.* *The home is too big and takes too much effort.* Expenses and time for the pool, landscaping, roof, exterminating, etc.* I was spoiled living in a condo where I could walk into my kitchen and still watch the ballgame on the TV in the living room. Management took care of everything and I just sent a quarterly check.* It was also cheaper.

I also donít need the fancy car (BMW 754 Li) I bought either.* A few years ago I had an Acura NSX which is, in my opinion, the most beautiful car in the world.* Itís only problem is itís a two-seater.* Having had that, and gotten it out of my system, a consumer reports top rated vehicle (Honda Civic or Toyota Camry) is all I need.*

With money, I started to go out to eat more Ė lots more.* And put on lots weight.* *The only luxury Iíd like to see if I can continue to afford is a housekeeper who would do some light HEALTHY cooking since neither I nor my gf like to cook and clean.

I happen to believe we might be on the edge of technology that could extend human lifespan indefinitely.* It sounds crazy but people who thought the earth was round (or that it was a good idea to retire early!) were labeled crazy too.* Technology is snowballing and through things like cloning (for replacement organs), stem cell research (to rejuvenate cells), and nanotechnology (developing mini robots that would repair cells at the molecular level) life spans could increase significantly.

I take a lot of vitamins and would like to focus on getting in the best physical shape of my life and living as long as possible Ė forever?

I know an investment advisor who has averaged about 25% a year in stocks for over 30 years.* He taught me his system.* I set up a dummy portfolio last year and am up over 30% in a year.* I will be using that to manage most of my cash.* However, I will only be drawing < 4% for income because I donít know if I can duplicate it.
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Re: About to RE! :-)
Old 07-13-2005, 10:24 AM   #10
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Re: About to RE! :-)

Quote:
Originally Posted by AlwaysLearning2
I know an investment advisor who has averaged about 25% a year in stocks for over 30 years.* He taught me his system.* I set up a dummy portfolio last year and am up over 30% in a year.* I will be using that to manage most of my cash.* However, I will only be drawing < 4% for income because I donít know if I can duplicate it.
Welcome to the board, AL2!

I was nodding my head in agreement right along with you until this paragraph, which is now emitting large warning whoops & big flashing red lights.* You know that Warren Buffett's record has only been about 22% for the last couple decades, right?* If this advisor's doubling money every three years, how come this he's still working for you instead of teaching Warren his system?* But then you're probably getting it for free so it's OK...

"Know how to make a million in the stock market?* Start with two million."* -- Bernard Baruch
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Re: About to RE! :-)
Old 07-13-2005, 10:54 AM   #11
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Re: About to RE! :-)

Quote:
Originally Posted by AlwaysLearning2

I know an investment advisor who has averaged about 25% a year in stocks for over 30 years. He taught me his system. I set up a dummy portfolio last year and am up over 30% in a year. I will be using that to manage most of my cash. However, I will only be drawing < 4% for income because I donít know if I can duplicate it.
I know a number of professional people who worked, made big bucks, and had money to invest. Some lost it all, even to the point of ending up in bankruptcy. I know this because I was either their bankruptcy lawyer or the bankruptcy trustee.

Careful here. Note all the responses waving the red flag.
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Re: About to RE! :-)
Old 07-13-2005, 11:36 AM   #12
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Re: About to RE! :-)

Quote:
Originally Posted by AlwaysLearning2
. . .
I know an investment advisor who has averaged about 25% a year in stocks for over 30 years.* He taught me his system.* I set up a dummy portfolio last year and am up over 30% in a year.* I will be using that to manage most of my cash.* However, I will only be drawing < 4% for income because I donít know if I can duplicate it.
DANGER! DANGER! DANGER!

This doesn't pass the smell test. Investing just $2000 per year at 25% return will result in a portfolio value of almost $9M after 30 years.

The underlying principle of investments is that high reward comes with high risk. There are fundamental reasons why this principle holds true (read Bernstein for a good discussion). If someone claims to have found a way to break this principle, you should be very suspicious.
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Re: About to RE! :-)
Old 07-13-2005, 12:09 PM   #13
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Re: About to RE! :-)

I appreciate the skepticism and advice.* Thatís exactly why I joined this board Ė I want to hear potential problems and things I havenít thought of.* *J

The investment advisor, D, is actually my motherís long-time companion (parents separated several years ago).* Heís mostly retired now (heís in his 60ís) but when he was younger he managed money for the University of Florida and the City of Gainesville, FL.* I have seen his unaudited yearly list of his returns (and they do rival Warren Buffetís) going back to around í73.* Right now he manages a charitable foundationís money and a just a few wealthy clients.* *His minimum accounts are $1,000,000.* He charges 1% or 1.5% on the first million and I think 1% on each after that.

He actually doesn't want more clients -- he would rather try and sell his system as a book or teach it to a financial services company and collect royalties.* He hasn't had luck though.* Outside of himself, he agrees with the premise that just about every financial advisor is a sheister and you can't trust them because they have incentives to give advice that is not in their clients' best interest.* When I first said I wanted to learn about stock investing, he recommended Malkiel's _A Random Walk Down Wall Stree_* He feels very large mutual funds have restrictions and problems that make it difficult for them use his system to beat the market.* I agree and I don't think he will be successful selling his system because of those reasons.

He also happens to be very bad with customer relations and unbelievably boneheaded at marketing his system.* A year or two ago, D, my mother and I attended a fundraiser for my alma mater.* There I was introduced to a gentleman who is listed on the Forbes 400 Wealthiest Americans list and CEO of the publicly-traded company he founded.* I spoke to him, mentioned D and how well he was managing my mother's money and perhaps he could help the university manage its endowment.* He said he'd be very interested in talking to him so I called D over and made an introduction.* After a few minutes, HE*gave D his card and said call his office to set up an appt.* Less than a week later, D called and (big mistake) sent a fax of a valuation he did of the guy's own company showing it was tremendously OVERVALUED and should be trading at much less.* D never received a return call.* So much for helping D to market his system.

Iíve asked D (in a polite way) why he doesnít have more money (he has enough that he doesn't have to work) and he said it was for a couple of reasons:*

a.* For many years he actually DIDNíT invest in the stockmarket.* He was given advice when he first started out that if he was going to be manage money in the stock market, then he actually shouldnít put his money there.* Similar thinking, I guess to an employee not buying his companyís stock.* He said he did this until realized how much money he was losing by not investing.

b.* He was married and his wife (now ex) spent lots of money.

The irrefutable evidence I have seen is money he has made my mother over the last few years.* I think sheís up over 100% (a $500,000 portfolio now worth over $1 million) since í99 (yes, while the rest of the market was down big-time) plus the dummy portfolio I have been managing since July of last year using his system.* I am planning on managing my own money (I think he would feel awkward charging me and I would feel awkward giving him extra work without compensating him) so I basically just check with him before I make some picks.

His strategy is mostly value investing (buy and hold) with a little technical analysis so you donít buy something that is fundamentally undervalued but happens to be at the top of its historical P/BV ratio.

Iím happy to publish my stock picks if anybody is interested and again, I really appreicate the warnings.

Always
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Re: About to RE! :-)
Old 07-13-2005, 12:17 PM   #14
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Re: About to RE! :-)

Always, I'd like to see a few of you picks.

By the way, I have a couple of friends who also did very well by buying value stocks. While I was buying growth and taking a beating.
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Re: About to RE! :-)
Old 07-13-2005, 12:29 PM   #15
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Re: About to RE! :-)

Interestingly, using the system to value stocks I use, some of the most undervalued stocks ARE growth stocks. I will post a list to whatever is the appropriate board on the forum.

Always
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Re: About to RE! :-)
Old 07-13-2005, 12:34 PM   #16
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Re: About to RE! :-)

Quote:
Originally Posted by OldAgePensioner
AlwaysLearning,
here are a few things to consider.

1. Detox from the stressful job while still working if possible. Called Retired-In_Place
In the military we used to call it ROAD. Retired On Active Duty.
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Re: About to RE! :-)
Old 07-13-2005, 01:52 PM   #17
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Re: About to RE! :-)

By all means list a few of your stock picks.

BUT - I'm more interested in the thought process, screening technique/methodology you used to get down to selecting what you evenually bought - AND how you monitor when to hold 'm and when to fold em.

Bill Miller(fund manager) picks some strange stuff - that most value cats don't consider value. So does Buffett.

Pontificate baby - pontificate. We know it's not a simple as a value screen. And I haven't overwhelmed my balanced index(75% of total) with my 15% individual stocks in the last ten years - so 'my' skill set could use some insight.

Also - tell us what you missed - my losers have been more educational for me(over the last thirty years) than the winners.
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Re: About to RE! :-)
Old 07-13-2005, 09:03 PM   #18
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Re: About to RE! :-)

At to doubling your moms money since 1999 that could also have been done with a well diversifed portfolio of 5-10 funds. SP500 did not do fantastic in that period but other asset classes did great.
Cheers!
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Re: About to RE! :-)
Old 07-14-2005, 09:12 AM   #19
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Re: About to RE! :-)

AlwaysLearning,

Normally, those kind of returns would be met by much skepticism on my part, I still think we're missing something here, but so far what you've posted has left me much more open minded than closed. Please, by all mean, post some picks and why. Everybody here is ready to earnlearn more.
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Re: About to RE! :-)
Old 07-26-2005, 07:53 AM   #20
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Re: About to RE! :-)

That's the kind of return I get on my trading account which NAV is a very tiny percentage of my total net worth. The method & system are described @ http://tradingautomation.blogspot.com/
Last pick by the expert-system this morning (good or bad ?) "Proton Energy System", DESC purchased Mkt Open @ 6.01.
Cheers, Patrice.
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