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Getting Ready to Retire at 47 in NYC
09-18-2011, 06:23 PM
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#1
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Full time employment: Posting here.
Join Date: Sep 2011
Location: Bushnell
Posts: 607
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Getting Ready to Retire at 47 in NYC
Since this is my first post, I want to say a big “THANK YOU” to everyone on this site for sharing their perspectives and knowledge. I have been visiting for over a year and I have learned a ton!
Due to some re-structuring at mega-corp, my position is being eliminated and I only have two weeks left in the office. My employer does not know they are actually doing me a big favor since I have been preparing for early retirement for 10 years and was planning to leave on my own early next year.
I am 47, single, no kids, and I have worked in various marketing related jobs for about 20 years. About 10 years ago I realized I could take control of my life via financial independence by dramatically increasing my savings rate and learning all I could about personal finance. My initial inspirations back then were “Millionaire Next Door” and the “Rich Dad” books, but my primary motivation was the lack of control I felt while working for various big companies. No matter how strong my performance, I couldn’t get ahead fast enough. The harder I w*rked, the more my employers took me for granted.
About a year ago I decided I’d had enough and began preparing a specific escape plan with the assets I had accumulated. I have about $1.8MM in investable assets. Over the last few months, I have shifted my asset allocation to roughly 40% dividend growth stocks, 10% small/mid cap stock funds, 5% Vanguard REIT index fund, 15% Vanguard high yield corp bond fund, 20% I-Bonds, and 10% cash. Based on my assumptions, I should earn about $50k/yr with this approach, which should more than cover my expenses of $40k/yr. The stock market swoon in August provided a chance to scoop up some higher yielding stocks for less money and increase my cash cushion. The I-Bonds and stocks should help me keep up with inflation. I have run my numbers through FIRECalc and the results have been favorable.
It is worth pointing out that I currently live in New York City. It is not easy for most people to live on $40k/yr in Manhattan, but I am living proof that it is possible. I live in a 275 sq ft studio apartment. This is small even by NYC standards. But I own the place with no mortgage, and I pay less than $600/month in maintenance fees which includes property taxes. The most significant lesson I learned from “Millionaire Next Door” was to minimize housing expenses. Still, NYC is pretty expensive, and I am prepared to move to another city if necessary, but for now I will see how it goes.
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09-18-2011, 06:54 PM
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#2
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Recycles dryer sheets
Join Date: Jun 2007
Posts: 413
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Really enjoyed reading your introduction. Your hard work, though not appreciated by Megacorp, has left you sitting pretty and able to FIRE. I love it!
__________________
Retired - Class of 2011
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09-18-2011, 07:12 PM
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#3
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Recycles dryer sheets
Join Date: Jun 2010
Posts: 370
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Congratulations. I'm still trying to envision living in a 275 square foot space. You're proof it can be done and I know that I could get by with a lot less than my current 1450 square feet. I love to think of ways to economize space should I ever decide to really downsize. Similarly I find enjoyment in trying to see see how many boxes I can fit into one. I'm weird, I know.
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09-18-2011, 07:52 PM
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#4
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Thinks s/he gets paid by the post
Join Date: Sep 2010
Location: midwestern city
Posts: 4,061
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Well done, truenorth418. And welcome.
__________________
Very conservative with investments. Not ER'd yet, 48 years old. Please do not take anything I write or imply as legal, financial or medical advice directed to you. Contact your own financial advisor, healthcare provider, or attorney for financial, medical and legal advice.
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09-18-2011, 08:09 PM
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#5
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Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,583
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Hi truenorth418. You are living proof that you can live in NYC and still be frugal. Congratulation on your achievement and welcome to the forum
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09-18-2011, 11:04 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,682
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Congrats, Truenorth418. We are somewhat similar. I am 48, single, no kids, live on Long Island, live in a studio apartment (~625 square feet)I own outright and pay under $600 a month in maintenance charges. This is surely a high-cost area but I can get by with about $20k in annual expenses. I have been ERed for nearly 3 years.
I hope you can reach your ER goal soon.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.
"I want my money working for me instead of me working for my money!"
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09-18-2011, 11:41 PM
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#7
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Thinks s/he gets paid by the post
Join Date: Feb 2011
Location: West Tx
Posts: 1,392
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Congrats to you! The NYC real estate is certainly different than TX. it sounds like you will do well.
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09-19-2011, 01:40 AM
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#8
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Thinks s/he gets paid by the post
Join Date: Apr 2005
Location: Duesseldorf, Germany
Posts: 1,202
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Congratulations and thanks for sharing your story!
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09-19-2011, 05:37 AM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2008
Posts: 12,597
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With all there is to do in NYC every day, you probably don't need to spend that much time in your domicile anyway - so why pay for a big apt.
I could almost live in the museums.
Quite a wonderful story.
Amethyst
__________________
If you understood everything I say, you'd be me ~ Miles Davis
'There is only one success – to be able to spend your life in your own way.’ Christopher Morley.
Even a blind clock finds an acorn twice a day.
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09-19-2011, 06:02 AM
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#10
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Thinks s/he gets paid by the post
Join Date: Mar 2009
Location: Pittsburgh, PA suburbs
Posts: 1,796
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I, too, enjoyed reading about your successful planning in a bastion of conspicuous consumption. I think NYC would be a great retirement spot and it sounds like you have all your ducks in a row. I have a soft spot for the city, having gone to college in Manhattan in the '70's and started my married life there. No morning is complete for me to this day without a perusal of the NYT.
So many unique, fascinating and low cost things to do in NY. Also excellent transportation options so no need for a money pit of a car. I was watching Househunters International a few weeks ago and a single lady was looking at apartments in Paris that were all just about the size of yours. They were attractive and certainly had everything one needed.
Congrats and welcome!
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09-19-2011, 08:44 AM
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#11
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,202
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Good story, thanks for sharing. Amazing that you live in NYC, I'd love to live there if I could begin to afford it, just for the walkable, cultural aspects.
If I was single, I would live in the smallest place I could manage, not sure about 275sf. DW wants to downsize too fortunately, but not as radically as I'd like. Her idea of small is probably what many here would consider average or slightly above. I see a poll coming...
I couldn't do it, but some people do http://www.tumbleweedhouses.com/plans/
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
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09-19-2011, 09:04 AM
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#12
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Moderator Emeritus
Join Date: Dec 2002
Location: Oahu
Posts: 26,856
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Quote:
Originally Posted by LauAnn
Congratulations. I'm still trying to envision living in a 275 square foot space.
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Speaking as a submariner: yikes.
I think our daughter's college dorm room is bigger than 275 sq ft-- especially including the sink, shower, & toilet. And she doesn't even have a kitchen...
__________________
*
Co-author (with my daughter) of “Raising Your Money-Savvy Family For Next Generation Financial Independence.”
Author of the book written on E-R.org: "The Military Guide to Financial Independence and Retirement."
I don't spend much time here— please send a PM.
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09-19-2011, 10:04 AM
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#13
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2008
Posts: 12,597
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Somewhere between 16x16 and 17x17. Plenty of room for a galley, a head, a bunk, and a table.
So easy to clean, too!
Amethyst
__________________
If you understood everything I say, you'd be me ~ Miles Davis
'There is only one success – to be able to spend your life in your own way.’ Christopher Morley.
Even a blind clock finds an acorn twice a day.
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09-19-2011, 10:23 AM
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#14
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Moderator Emeritus
Join Date: May 2007
Posts: 12,894
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Welcome truenorth!
I used to live in a sub 200 sqft condo apartment. It had everything a single guy would need!
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09-19-2011, 01:14 PM
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#15
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Thinks s/he gets paid by the post
Join Date: Jul 2006
Location: Denver
Posts: 3,504
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Welcome to the board. Thanks for the thoughtful introduction post.
We used to live in high-cost NJ and decided to move to Denver CO for a number of reasons - cost being one of them. Happy to report that there is life after moving out of the NY metro area. We are enjoying Denver. Having a fall back plan to reduce costs is a great idea.
All the best.
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09-19-2011, 01:27 PM
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#16
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
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My apartment is 500 sq ft. It has one very hard to reach, small closet. The bedroom is small, but I can fit a queeen size bed. It is a real job to turn the mattress, and changing sheets must be done from the bed, as I can't get to the far side or the top except by reaching down from above. The kitchen is plenty big for me to store my pans and a moderate size refrigerator, but I do shop for food almost daily. It is most comfortable for one cook, not group or couples' cooking. The LR is actually spacious.
The neighborhood and building are primo, which is why I am here. However, if I buy a condo I really would like at least another 100-200 sq ft, and a balcony. Also, Io have a big storeroom in the basement.
I think I could do a smaller place right on Venice Beach Boardwalk, but otherwise 500ft is about my limit I think.
Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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09-19-2011, 02:32 PM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,067
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Good story. Glad you saved hard as losing your job at 47 with little savings would be no fun. Enjoy your retirement!
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
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09-19-2011, 05:57 PM
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#18
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Recycles dryer sheets
Join Date: Mar 2007
Location: Tampa/St Petersburg, FLA
Posts: 314
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47 yo retiree here as well (no kids) - what do you plan on doing w/ your newly acquired spare time?
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09-19-2011, 06:23 PM
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#19
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Recycles dryer sheets
Join Date: Jan 2011
Location: Desert SW
Posts: 358
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Truenorth, this is your boss. Your position has been un-eliminated - now get back to work .
Congratulations!
__________________
Retired in 2011 at 54
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09-19-2011, 10:32 PM
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#20
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Thinks s/he gets paid by the post
Join Date: Dec 2010
Location: USA
Posts: 1,050
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Congrats!
My first place after starting gainful employment was downtown Chicago. I bought a studio in a condo, about 500 sq ft with a balcony with 150 sq ft. It's one of my rentals now, but would be nice for retirement.... or should I take the 1 br rental.... a few more years to decide.
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