Hi All,
been reading for a while, so I thought I'd post and get some feedback on a few things.
Situation:
Age: 39, DW: 34, 2 Kids: 10 months and 2 y/o
Liquid Net Worth:
3.6 Mil:
-about 100k 401k,
-750k Cash in painfully low interest account(I know time in market, not market timing.. I'm irrational),
-250k in dedicated education fund (not 529 yet), planning around 600k for 2 kids in 16 years... yikes
-the rest in about 80/20 stocks and bonds mix.
House: 686k Mortgage (Socal), 1.2ish Million value... not that it matters.
Costs:
-4.2K Mortgage + Tax + insurance
-4K: Everything Else" (kind of embarrassed by this). We travel perhaps more than we should and do lots of family dinners (big extended family ). Tracked via Mint for about 2 years. Scary how close to 4k we are EVERY month .
-No debt except mortgage and hopefully never will.
Work: DW is wonderful caretaker of children. I have full time very well paid job that I mostly enjoy.
From running Firecalc, I can pretty easily get to 95%+ success rate. My wife and I have discussed finances a lot... I'm lucky... we pretty much agree on almost everything when it comes to money. I'm pretty sure we can drop monthly costs by 1k without really much effort (I know, so do it!). In a terrible situation we could sell our house and get something about 50% less closer to extended family. I live in an expensive part of California primarily for work, but we like the area/good schools so aren't really motivated to move.
I ran through turbo tax simulations looking at different tax rates based on income coming from dividends + stock sales vs job income and also looked at impact on insurance costs so I don't see the burn rate going up much...
So... a couple questions:
1) I do like my job for the most part, but there's also lots of other things I want to do so I'm wondering if I should consider ER more seriously... or at least a long sabbatical.
2) Kids: I feel like our situation allows me to spend lots of time with our kids while they are young and that chance won't come back. Flip side is... will I go nuts being at home .
3) DW is a bit nervous about depending on investment returns to fund life. I'm more optimistic in the long run view and I'm a very boring long term investor so swings up and down don't really bother me.
Possible scenarios I've considered:
1) The crazy go for it: Just put a date on a wall, FIRE and forget. If I get bored I can still go back to work. If money becomes a problem we can cut back, move, etc. If I drive my DW crazy I can create a job at home. Done lots of startups in the past anyway. Would like to try again.
2) The more moderate approach: Go to employer and say "I'm cutting down to 2 days a week, cut my pay by 75%." Likely that would be accepted and at 75% cut it still covers our house payment. This makes my DW happy.
3) Temp time. Tell employer "I'm taking a year or two off to spend time on family." This may or may not fly, but it creates a long term unpaid "test" of (1).
4) Wait. Right now we save 150k/yr and if we focused we could increase that. in 3-5 years the situation looks a lot safer. During this time we live from investments and save 100% of income plus the chances of a "market correction" happening right at FIRE go down... in theory . But bulls can run a LONG time sometimes.
Why even consider (1). Well... I'm kind of a 100%er. It's very hard for me to partially do things so I'm thinking that I could TRY to work 2 days a week, but I'd get sucked in and then work for free. Same with "temp time." I could TRY to check out for a year, but if I'm going back I'll feel compelled to "stay in touch." Finally, I've read this board a lot and the one regret I see from people is that they wish they had pulled the trigger earlier. I really worry that if I delay/half ass it for 3-5 years I'll regret missing my kids before school and wish I'd done it sooner.
Thoughts?
been reading for a while, so I thought I'd post and get some feedback on a few things.
Situation:
Age: 39, DW: 34, 2 Kids: 10 months and 2 y/o
Liquid Net Worth:
3.6 Mil:
-about 100k 401k,
-750k Cash in painfully low interest account(I know time in market, not market timing.. I'm irrational),
-250k in dedicated education fund (not 529 yet), planning around 600k for 2 kids in 16 years... yikes
-the rest in about 80/20 stocks and bonds mix.
House: 686k Mortgage (Socal), 1.2ish Million value... not that it matters.
Costs:
-4.2K Mortgage + Tax + insurance
-4K: Everything Else" (kind of embarrassed by this). We travel perhaps more than we should and do lots of family dinners (big extended family ). Tracked via Mint for about 2 years. Scary how close to 4k we are EVERY month .
-No debt except mortgage and hopefully never will.
Work: DW is wonderful caretaker of children. I have full time very well paid job that I mostly enjoy.
From running Firecalc, I can pretty easily get to 95%+ success rate. My wife and I have discussed finances a lot... I'm lucky... we pretty much agree on almost everything when it comes to money. I'm pretty sure we can drop monthly costs by 1k without really much effort (I know, so do it!). In a terrible situation we could sell our house and get something about 50% less closer to extended family. I live in an expensive part of California primarily for work, but we like the area/good schools so aren't really motivated to move.
I ran through turbo tax simulations looking at different tax rates based on income coming from dividends + stock sales vs job income and also looked at impact on insurance costs so I don't see the burn rate going up much...
So... a couple questions:
1) I do like my job for the most part, but there's also lots of other things I want to do so I'm wondering if I should consider ER more seriously... or at least a long sabbatical.
2) Kids: I feel like our situation allows me to spend lots of time with our kids while they are young and that chance won't come back. Flip side is... will I go nuts being at home .
3) DW is a bit nervous about depending on investment returns to fund life. I'm more optimistic in the long run view and I'm a very boring long term investor so swings up and down don't really bother me.
Possible scenarios I've considered:
1) The crazy go for it: Just put a date on a wall, FIRE and forget. If I get bored I can still go back to work. If money becomes a problem we can cut back, move, etc. If I drive my DW crazy I can create a job at home. Done lots of startups in the past anyway. Would like to try again.
2) The more moderate approach: Go to employer and say "I'm cutting down to 2 days a week, cut my pay by 75%." Likely that would be accepted and at 75% cut it still covers our house payment. This makes my DW happy.
3) Temp time. Tell employer "I'm taking a year or two off to spend time on family." This may or may not fly, but it creates a long term unpaid "test" of (1).
4) Wait. Right now we save 150k/yr and if we focused we could increase that. in 3-5 years the situation looks a lot safer. During this time we live from investments and save 100% of income plus the chances of a "market correction" happening right at FIRE go down... in theory . But bulls can run a LONG time sometimes.
Why even consider (1). Well... I'm kind of a 100%er. It's very hard for me to partially do things so I'm thinking that I could TRY to work 2 days a week, but I'd get sucked in and then work for free. Same with "temp time." I could TRY to check out for a year, but if I'm going back I'll feel compelled to "stay in touch." Finally, I've read this board a lot and the one regret I see from people is that they wish they had pulled the trigger earlier. I really worry that if I delay/half ass it for 3-5 years I'll regret missing my kids before school and wish I'd done it sooner.
Thoughts?