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Introduction - New Here
Old 07-28-2010, 04:16 PM   #1
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Introduction - New Here

Hi, I am 37 with a 35 year old spouse and two kids Ė 3 and 1 years of age. I plan to achieve FIRE in no more than 13 years. My vital statistics are $300K IRAs/401(k) and $100K Taxable savings. We have about $25K in 529 plans for college and contribute addition amounts to where we anticipate the plans covering no less than 90% of college costs for both kids (if one of the kids pick a very high cost school they will be expected to cover the difference with loans). We currently save approximately $38K a year in tax sheltered and non-tax sheltered accounts. The plan is to eliminate the mortgage before ER. I havenít included much expense information because of our uncertainty around costs for raising children and potential changes to our housing situation, but we are at about $5,500 a month ($2,500 to the mortgage). The plan wonít provide enough $ in 13 years, but I plan to increase savings and hold expenses steady.

My investments are approximately 90% equities 10% bonds. The retirement accounts are in low expense index funds that are rebalanced twice a year between large-cap, small-cap, international and bonds. The non-tax sheltered investment accounts are in various individual stocks that are purchased based partially on a Benjamin Graham type value analysis with a dividend bias.

We currently live in a high cost of living area with an exceptionally horrible public school system. We plan to move to a slightly lower cost of living area with a very good public school system at the cost of a longer commute. We will move to a similarly priced house although it will be larger so there will be a small increase in maintenance costs. I plan to purchase the house with a 30 year mortgage even though I plan to pay it off in 13 years. I will pay less than .25% increased rate for a 30 year vs. 15 year (approx. .15% after tax) for the flexibility of adjusting my payoff schedule (e.g., increasing equity purchases in an under-valued market or increasing mortgage principal payments in an over-valued market). The ability to not have to pay for private school will avoid at least $1,000 a month.

My wife and I had a very aggressive wealth building plan prior to kids (I think it was really a subconscious FIRE plan but I didnít realize it at the time). Once the kids came along we went from about $300K/year in salary to $150K/year because my wife left her job to care for the kids. She may go back part time when the kids are older, but I am not including that in the plan until it actually happens. Needless to say, the drop in income changed our plan. The positive is that we have a better perspective on the choice of time versus income and some mental preparation for a large income drop.

I have been successful in my career my conventional measures (good reputation, financial rewards, etc.). I have a good job where I run a department with little day to day interference from above, but sufficient resources to avoid anything more than an 8 hour day. I know the grass isnít greener in another position. There is absolutely no doubt in my mind that if I had the financial resources I would leave today. I went through a long period trying to figure out what was Ďwrongí with me. I concluded nothing whatsoever Ė I wish I found this site sooner as it would have saved me some of the substantial effort to come to this conclusion.

Iíve spent a ton of time reading the posts on this site and it seems like a very supportive group. Iíve written way more than I intended. My wife would be absolutely shocked Ė Iím an INTJ (hardcore I). I know I havenít given enough expense information as far as my plan is concerned but Iíve mainly written this as an introduction so I donít feel awkward jumping in and providing my two cents or asking for advice. That being said, feel free to comment on problems/issues with the information I did provide.

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Old 07-28-2010, 09:41 PM   #2
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SunsetSail, welcome to the forum! You have clearly invested a lot of thought in your financial plans and seem to me well on your way to FIRE.

You sound fortunate in your job. It sounds like you're reasonably happy in it, and with 13 years of work remaining that's a very good thing. Retiring is wonderful, but it's also important to enjoy the journey getting there.

In sum I think you're doing an admirable job, taking care of a family, saving aggressively in a high cost of living area, and planning for your future. You have my admiration!

I'll look forward to your future posts.


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Old 07-28-2010, 11:41 PM   #3
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Hey SunsetSail, welcome!

You seem to have a good handle on your financial life, and a good attitude as well towards savings. As someone who is younger and has less money, I don't really have any advice. Looks like a solid situation to me.

Keep up the good work, and don't forget to smell the flowers along the way!
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Old 07-29-2010, 05:52 AM   #4
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Welcome to the forum!

You're way ahead of me when I was your age - both in the accumulation of wealth and of financial knowledge.

Please consider reducing your housing costs when you move. Housing will probably be your biggest expense and any savings there will compound nicely over the years. In looking back to my own experience, examine & question all recurring expenses very closely (like mortgages, cell phone, utilities, cable etc.) since you can save a lot of money over time by reducing them even a little.

And resolve to enjoy every day from now till you reach FI.

All the best.
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