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New member, fed up with working and wanting to RE
Old 11-15-2017, 01:59 PM   #1
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New member, fed up with working and wanting to RE

Hello, thought i'd introduce myself. I'm 47, have a 14 year old daughter, divorced. My net worth is around $2.1 M, $600,000 of which is the house (paid off). I have a job that pays well, but the BS-to satisfaction ratio is getting pretty high. I could change jobs, but that would require moving to a different city due to job market/non-compete clause (yes, I know these aren't enforceable), and would result in a significant pay decrease most likely.

I've been pondering the idea of ER for several years now, and I've been moving in that direction as fast as I can - reducing spending, increasing savings, paying off all debt.

The work situation is becoming more uncertain by the week. My company, historically a very strong, local company, was purchased by a national corporation 4 years ago. The corporate policies have crippled us. We are starting to look better and better as an asset to be sold rather than a cash cow that brings in money. But that decision will be made by executives many levels above me, and there's not much I can do about it. And even if the company is sold, I would still have a job - likely at a lower pay scale.

So for now, I'm along for the ride. I've run every financial calculator I can find, and if my company implodes tomorrow, I will be in early retirement and be just fine. However, it would be nice if it could just hold out for 3.5 more years until my daughter graduates high school. By then I have a projected net worth of $3M, and would have some breathing room.

Wish me luck.
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Old 11-15-2017, 02:14 PM   #2
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Good luck and hopefully things will shake out properly for you. That's a fine net worth [particularly for 47 and single]: 1.5 million excluding the very nice house for Tulsa! Breathing room is good to have though--especially when you are talking retirement at 47-50 with no pension or health insurance going forward (assuming that's true for you).

Don't count on the noncompete being unenforceable. That is true of California (and maybe other states), and for certain jobs (lawyer/doctor in many states), but will otherwise vary by jurisdiction.

This forum is great place to learn more.

Edited to add italicized limiter....
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Old 11-15-2017, 02:16 PM   #3
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Originally Posted by rlhendren View Post
Hello, thought i'd introduce myself. I'm 47, have a 14 year old daughter, divorced. My net worth is around $2.1 M, $600,000 of which is the house (paid off). ......
14 seems a bit young for your daughter to be divorced.... when did she get married? Just kidding, of course... welcome.

If you were to be laid off tomorrow and didn't go back to work, how much do you need each year to live on?

As you probably know, the $600k paid off house doesn't count as part of your retirement assets unless you plan to downsize... but it does help the cause in that your expenses don't include rent or mortgage payments.
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Old 11-15-2017, 03:00 PM   #4
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Good luck and hopefully things will shake out properly for you. That's a fine net worth [particularly for 47 and single]: 1.5 million excluding the very nice house for Tulsa! Breathing room is good to have though--especially when you are talking retirement at 47-50 with no pension or health insurance going forward (assuming that's true for you).

Don't count on the noncompete being unenforceable. That is true of California (and maybe other states), and for certain jobs (lawyer/doctor in many states), but will otherwise vary by jurisdiction.

This forum is great place to learn more.

Edited to add italicized limiter....


Oklahoma is the only other state besides California where most provisions of a non-compete are non-enforceable. Google non compete Oklahoma and you'll see the law.
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Old 11-15-2017, 03:11 PM   #5
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Thanks! The non-compete is not enforceable here, but the job market is such that I'd need to move to find a similar job. I have no health insurance or pension going forward.

My current monthly bills are around $7K, but by downsizing the house and cutting out a few luxuries, I think I can get it down to $5k easily.

It's an old house, so not very energy efficient. Gas, electric, sewer cost $500/month. Property taxes and insurance are $500/month each. So it costs me $1,500/month to live in a house that I own outright. Add in maintenance and it's even more. I'd sell the house tomorrow if someone walked up and offered to buy it. But I'll put it on the market the day that I retire.
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Old 11-15-2017, 03:25 PM   #6
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Welcome aboard!

With a 3.5% withdrawal rate, your current portfolio would provide $73.5K annually. Maybe look at any further discretionary spending cuts and targeting for FIRE in 2 years? I jumped out at 60 (this year) because my bullsh!t filter was clogged. The newfound freedom is amazing, so I'm just encouraging you to put the peddle to the metal.

Best wishes on your FIRE journey.
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Old 11-15-2017, 03:45 PM   #7
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Welcome aboard!

With a 3.5% withdrawal rate, your current portfolio would provide $73.5K annually. Maybe look at any further discretionary spending cuts and targeting for FIRE in 2 years? I jumped out at 60 (this year) because my bullsh!t filter was clogged. The newfound freedom is amazing, so I'm just encouraging you to put the peddle to the metal.

Best wishes on your FIRE journey.
Thanks so much! Mentally, it has been challenging. But running all the calculations and realizing that I will be okay regardless of how things go at work is a huge relief. So for now, I will trudge along at my job for as long as I can and get the retirement accounts as full as I can before I pull the plug. Really the deciding factor is my daughter. I don't want to disrupt the routine too much until she graduates high school. But as soon as that is no longer an issue, then there really is no reason to keep working when I really don't want to.
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Old 11-15-2017, 04:50 PM   #8
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....With a 3.5% withdrawal rate, your current portfolio would provide $73.5K annually.....
NO! The $600k paid off house cannot be included so at a 3.5% WR it would be
$52.5k annually [($2.1 million -$600k house)*3.5%].

However, that doesn't consider SS nor any net proceeds from downsizing which could be added to the retirement nestegg.

OTOH, your DD's college needs to be considered too.
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Old 11-15-2017, 05:15 PM   #9
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Your current expenses do not include health insurance, right? HI is in flux now so it will be very hard to estimate future costs.

Do your current expenses ($7k/mo) include income taxes? Unless all your ER needs come from tax deferred accounts, your federal taxes will drop drastically. Model it in tax software.

Do not try to ER on bare minimums ie. $5K a month. You will need flexibility if unexpected expenses crop up or if the market tanks (read about the sequence of return problems early in ER). You're young and who knows what the future will bring in terms of interests, needs and wants.

We ER'd (I was 47) when we felt comfortable that we could safely withdraw our expenses at the time + health insurance + 10% (It may have been 15%). That served us well since we ER'd in 2008 and the market melted down 4 months later.

Whether you ER now or hold off - congratulations on accumulating a nice stash

Good luck.
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Old 11-15-2017, 05:54 PM   #10
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Thanks for the helpful insight! All good things to consider. College is taken care of. No my current expenses don't include health insurance.

There are other variables here that I don't particularly care to share, but I have built in a margin of error for these things. If I retire now, things would be tight. That's why I don't plan to retire tomorrow. Ideally, it will be in 3.5 years, when there should be more than enough margin of error to live comfortably.
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Old 11-16-2017, 04:47 AM   #11
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Congrats on your progress so far.

I think you are a perfect candidate for changing careers, maybe following a passion, for the next few years. Even if there is a huge cut in pay. If health insurance, for example, and continued pension/401-k availability were offered, so much the better.

By making some (even if not enough) money, you will extend your future reserves, even if you need a little financial "boost" every month. We use the word 'reinforcements" a lot here-as in future help is on the way with SS and 401-k/IRA withdrawals.

Something to consider. It might solve the BS/satisfaction dilemma.
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Old 11-16-2017, 04:49 AM   #12
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BTW, with your net worth, you can live like a prince in many areas of the Midwest. Exchange that 600k house for a 250-300k model. Bank the difference.

Many, many of us (here) are retired/semi-retired with much less.
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Old 11-16-2017, 06:10 AM   #13
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I jumped out at 60 (this year) because my bullsh!t filter was clogged.

LOL! I had not checked that yet!
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Old 11-16-2017, 08:54 AM   #14
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14 seems a bit young for your daughter to be divorced
Depends.
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Old 11-16-2017, 10:13 AM   #15
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Congrats on your progress so far.

I think you are a perfect candidate for changing careers, maybe following a passion, for the next few years. Even if there is a huge cut in pay. If health insurance, for example, and continued pension/401-k availability were offered, so much the better.

By making some (even if not enough) money, you will extend your future reserves, even if you need a little financial "boost" every month. We use the word 'reinforcements" a lot here-as in future help is on the way with SS and 401-k/IRA withdrawals.

Something to consider. It might solve the BS/satisfaction dilemma.
Great advice! That's exactly what I was thinking as well. I could take any job that I find satisfying, regardless of pay, and make ends meet. So that's definitely one of the options in my case.

As for my daughter being divorced, yes she's a bit young. I'll watch my punctuation in the future! hahahaha
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Old 11-17-2017, 05:00 PM   #16
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Tho I do not have anywhere near your net worth, I am a single parent - have a teenager and quit work earlier this year. I do consulting very much part time so far over 20k so with some rental income I have not had to hit the nest egg. It certainly has reduced my stress level to be at home more and Iím having a great time at my new ďjobĒ

Her college is taken care of as well so I donít think this was an irresponsible decision. Be prepared to spend more than you think tho! Suddenly everything will break. Car, house, etc...
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Old 11-17-2017, 08:29 PM   #17
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Tho I do not have anywhere near your net worth, I am a single parent - have a teenager and quit work earlier this year. I do consulting very much part time so far over 20k so with some rental income I have not had to hit the nest egg. It certainly has reduced my stress level to be at home more and Iím having a great time at my new ďjobĒ
That's awesome! Congratulations! it would be great to spend more time with my daughter and not be bothered with work! hahaha

I know it can be done. People survive just fine on less than I have. It's all a matter of how frugal I want to be.
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Old 11-17-2017, 08:41 PM   #18
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People survive just fine on less than I have. It's all a matter of how frugal I want to be.

Fair warning...Iíve not noticed significant decrease in spending despite cooking more at home. I also didnít magically lose the 20lbs I always blamed on my desk job! Lol

Working on the 20lbs...and resolved to hit Lidl and costco more in coming months to see if that helps lower food spending.

I do spend a lot less on gas having given up the commute. That said, just got an email for revisions to a plan and thatís how Iíll spend my Saturday. Itís a welcome tradeoff.
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Old 11-18-2017, 05:07 AM   #19
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I'm sure you'll get the 20 pounds off! I tried Nutrisystem and lost 15 which was my goal to begin with. I'm not a foodie, so I don't really care that the food isn't awesome. I find it to be just fine for my taste buds, and no more expensive than what I was eating before from the grocery store. Some people hate it, but it did actually work. It was nice being able to fit into those pants that had been relegated to the back of the closet. The only exercise I added was walking 30-60 minutes per day.

As for spending, even though I'm still working, I've put myself on a "post-retirement" budget just to see if I can do it and what my life will look like on $X per month. I just started this a few weeks ago so it's still too early to tell what my actual spending needs will be post RE. I use Mint to track everything.
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Old 11-18-2017, 05:20 AM   #20
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Originally Posted by brucethebroker View Post
Congrats on your progress so far.

I think you are a perfect candidate for changing careers, maybe following a passion, for the next few years. Even if there is a huge cut in pay. If health insurance, for example, and continued pension/401-k availability were offered, so much the better.

By making some (even if not enough) money, you will extend your future reserves, even if you need a little financial "boost" every month. We use the word 'reinforcements" a lot here-as in future help is on the way with SS and 401-k/IRA withdrawals.

Something to consider. It might solve the BS/satisfaction dilemma.
This is what I did. For the last few years before FIRE, I took a j*b that paid about 50% of the prior j*b. But, I w@rked from home and only w@rked 4 days per week. It was a nice transition. It allowed our savings to grow without withdrawals.

FN
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