Fean
Dryer sheet aficionado
Greetings! I’ve been lurking here religiously for the past two years and it is liberating to finally make my first post. I can’t express how grateful I am to this community. This forum has literally changed my life
I was raised in a LBYM environment and had the great fortune to marry my incredible DW whose support and LBYM attitude has made ER an attainable goal. Fortune has (quite undeservedly) also smiled on me throughout my career. I was involved with two successful businesses early in my career and proceeds from those businesses gave our family a solid jumpstart toward ER.
DW and I are in our late thirties and plan to pull the ER trigger when I hit forty. I am a firm believer of retiring to something as opposed to simply retiring from something. Although I intend to run some technical side projects for fun (and to keep my skills up-to-date in case of a financial emergency), my primary focus post-retirement will be home schooling our DD. I have always enjoyed teaching and consider it a true privilege to have the financial freedom to spend time teaching my daughter. Hopefully she will feel the same way
I owe a great debt to a former financial advisor who taught me an important lesson of investing: “Financial advisors do not share your agenda and goals even if they work for you.” Roughly ten years ago, I handed my portfolio over to my advisor and assumed that he would have my portfolio’s best interest at heart. Wow, I was naïve. It was a hard lesson to learn (2% fees for the privilege of sub-market performance!?!?) but after a few years I finally came to the conclusion that I needed to learn to handle my own finances. Thinking about all of those wasted fees is easier when I try to think of them as tuition for a financial school of hard knocks…
My investment philosophy is pretty straightforward and will be familiar to many people on the forum. I’m an indexer who rebalances when my AA gets outside of a 5% band. My current portfolio is (roughly) as shown below. I’ll switch out the VMIUX tax exempt bonds for TBM once I retire and drop to a lower tax bracket. Roughly 10% of the portfolio is in tax-deferred accounts with the remaining 90% in taxable accounts.
Other data points:
My main concerns are:
So, that’s me. I welcome any advice or comments on my plan and I look forward to interacting with all of you on the boards!
Fean
I was raised in a LBYM environment and had the great fortune to marry my incredible DW whose support and LBYM attitude has made ER an attainable goal. Fortune has (quite undeservedly) also smiled on me throughout my career. I was involved with two successful businesses early in my career and proceeds from those businesses gave our family a solid jumpstart toward ER.
DW and I are in our late thirties and plan to pull the ER trigger when I hit forty. I am a firm believer of retiring to something as opposed to simply retiring from something. Although I intend to run some technical side projects for fun (and to keep my skills up-to-date in case of a financial emergency), my primary focus post-retirement will be home schooling our DD. I have always enjoyed teaching and consider it a true privilege to have the financial freedom to spend time teaching my daughter. Hopefully she will feel the same way
I owe a great debt to a former financial advisor who taught me an important lesson of investing: “Financial advisors do not share your agenda and goals even if they work for you.” Roughly ten years ago, I handed my portfolio over to my advisor and assumed that he would have my portfolio’s best interest at heart. Wow, I was naïve. It was a hard lesson to learn (2% fees for the privilege of sub-market performance!?!?) but after a few years I finally came to the conclusion that I needed to learn to handle my own finances. Thinking about all of those wasted fees is easier when I try to think of them as tuition for a financial school of hard knocks…
My investment philosophy is pretty straightforward and will be familiar to many people on the forum. I’m an indexer who rebalances when my AA gets outside of a 5% band. My current portfolio is (roughly) as shown below. I’ll switch out the VMIUX tax exempt bonds for TBM once I retire and drop to a lower tax bracket. Roughly 10% of the portfolio is in tax-deferred accounts with the remaining 90% in taxable accounts.
- 55% equities (VTSAX, VTIAX, VGSLX)
- 35% bonds (VWIUX, VFSUX, VAIPX, I-bonds)
- 10% cash (MM, long-term CDs)
Other data points:
- No debt
- No pension
- Emergency fund with 6 months living expenses
- I have tracked every penny in Quicken for over 3 years and know our budget well
- Expected budget will use 2.6% WR (includes moderate budget cushion)
- I'm planning for an indefinite retirement (55+ years, maybe more with medical advances!)
- Plan doesn’t rely on SS, but SS at 70 would be a nice bonus
- DD’s 529 plan is (relatively) well funded and is not included in my portfolio figures
- Plan B: If the market isn’t co-operative, I may ladder small SPIAs to bump up my WR
- Plan C: If the market completely tanks for the first several years of retirement, I may go back to w*rk while my skills and social network are still current
- I survived 2008 without panicking (at least outwardly) and I followed my plan and rebalanced into equities so hopefully I’ll have the fortitude to handle future crashes too. Of course, I’m sure things will feel different once I no longer have a paycheck arriving every two weeks…
My main concerns are:
- Medical: I've run all the online health care cost calculators and it looks like we should be fine. However, there is still a lot of uncertainty around the ACA and I'll feel a lot better (or worse!) once we see actual costs of bronze and silver plans instead of relying on estimates.
- Mental & emotional adjustment: I think that I'm ready to leave the grind and focus on my own interests and DD's schooling. I've always been self-motivated and I don't see that changing in the future. However, I still see this as a risk that I'll need to monitor -- especially once the novelty of leaving work fades. Or does it fade?
- LTC for parents / in-laws: Neither my parents nor my in-laws have long-term care insurance. My plan has a buffer that would allow us to help out with some of that, but we may be in trouble if all four needed care concurrently.
So, that’s me. I welcome any advice or comments on my plan and I look forward to interacting with all of you on the boards!
Fean