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Ready to FIRE, but...
Old 07-25-2019, 03:19 PM   #1
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Ready to FIRE, but...

Hi All. I've been lurking here for a couple of months, learning and trying figure out how to cut the w*rk strings.

I'm 53 and DW is 59. We have been saving for FI for the last 20 years, and I think we have finally arrived. We live in SoCal and our house is paid off. DW has a CalPers pension waiting for her, and I've maxed my 401K for 20 years. All the calculators I have tried are giving us the thumbs up.

But...

While my current job is very stressful (mostly due to co-worker drama, and poor management leadership) I still like doing my job and the pay is *very* good (golden handcuffs). There is a chance that MegaCorp will let me go before year end, but they have threatened me with that every 6 months for the last three years without following through with it.

Additionally, I am nervous about the Market being at record highs and using these values in calculators to predict retirement readiness.
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Old 07-25-2019, 03:50 PM   #2
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Additionally, I am nervous about the Market being at record highs and using these values in calculators to predict retirement readiness.
Welcome! If your asset allocation is appropriate, then the current market highs theoretically should not matter. I'm in the same boat as you, roughly, age 53, still working for the remainder of the year. But, ready to bail! Do you have something you'd like to do in retirement that you'd enjoy MORE than your work?
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Old 07-25-2019, 05:55 PM   #3
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Welcome Lagersurfer! If you haven't found them already, we have a helpful list of things to think about as you're deciding whether this is the year or not:

Some Important Questions to Answer

Getting your asset allocation to a place where your withdrawal rate is comfortable for you is the biggest decision to make and as stated above, timing the market shouldn't be an issue if you're at that point (especially with a significant pension).

Have you checked out Ernie Zelinski's books? They have been very helpful to many who are figuring out what the next stage of life looks like when it's not consumed by w*rk.
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Old 07-25-2019, 06:18 PM   #4
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Welcome to our wonderful forum.
The retirement calculators have historical high stock market valuations built in, as part of your 100% success.
Right now could be the healthiest year of your remaining life.....
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Old 07-26-2019, 06:26 AM   #5
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Originally Posted by Lagersuufer View Post
Hi All. I've been lurking here for a couple of months, learning and trying figure out how to cut the w*rk strings.

I'm 53 and DW is 59. We have been saving for FI for the last 20 years, and I think we have finally arrived. We live in SoCal and our house is paid off. DW has a CalPers pension waiting for her, and I've maxed my 401K for 20 years. All the calculators I have tried are giving us the thumbs up.

But...

While my current job is very stressful (mostly due to co-worker drama, and poor management leadership) I still like doing my job
A good reason to keep working. True financial independence is about being able to do what you like.

Quote:
and the pay is *very* good (golden handcuffs).
Not such a good reason to keep working. Unless you want to be motivated to work forever. Once you have enough, you have enough.

Quote:
Additionally, I am nervous about the Market being at record highs
Not such a good reason to keep working. The market is at record highs quite often.

Quote:
and using these values in calculators to predict retirement readiness.
If you aren't confident in assessing your financial readiness for retirement, spend a few hours with an hourly fee-only fiduciary financial planner.
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Old 07-26-2019, 06:52 AM   #6
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I think that I am there financially...I just have to get my security driven impulses to agree. I've always been a great saver and changing to the withdraw mode is going to be tough.

As for things to do in going forward....All the things I don't have time to do now because I am working 55 hrs a week. DW and I like to cook together, so we are planning to explore new cuisines. We recently started learning to cook Indian food and are having a blast with it. We want to take some ballroom dancing classes. Spend time with my sister down by the beach. Take more trips to the various wine countries in CA. Get a dog. The list goes on...
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Old 07-26-2019, 07:00 AM   #7
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Welcome to the forum!!

One thing that can't be purchased is more time. If you have arrived at FI, and have the plans for a great retirement, don't waste time fretting about work. Enjoy your time with your wife and family. It will always pay more dividends than work.

Best to you,

VW
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Old 07-26-2019, 08:11 AM   #8
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I still like doing my job and the pay is *very* good (golden handcuffs).
I feel for you - I also had some pretty significant golden handcuffs (a good chunk of unvested RSUs in a company where the stock had gone absolutely bonkers - as in over 3X the value when I joined). VERY hard to walk away from, but I did so early this year at 55.

I still do have occasional angst about what I left on the table and imagine all the things I could have done with that extra $$, but as someone here on the forum once said - "that's the price of freedom". I thought that was pretty well said, and I took *everything* (health, ability to spend time with the ones I loved doing the things I wanted to, potential number of days left on the planet, etc) into account and did the hardest thing I ever have had to do and walked away.

One thing that really motivated me is that I saw an increasing number of friends and family in their 50s and early 60s either not make it to their next birthday, or have serious and in some cases life-threatening health issues develop. That put things into perspective..none of us know how much time we or our loved ones have remaining. And once you CAN stop working, does the extra $$ matter that much when you stack it up against those other considerations?

Best of luck whatever you decide..
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Old 07-26-2019, 08:20 AM   #9
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When I'm laying on my deathbed I hope I'm not thinking about how many $ I was paid. I already have forgotten.
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Old 07-26-2019, 08:23 AM   #10
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If you are truly OK to retire, since you like your job and the pay is very good, you can always tell your employer that you're ready to retire...BUT, you are willing to stay on 30-40 hours a week, no evenings or weekends, whatever else it takes to make it less stressful. The worst they can say is no, and then you're free!
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Old 07-26-2019, 08:48 AM   #11
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Quote:
Originally Posted by Lagersuufer View Post
Hi All. I've been lurking here for a couple of months, learning and trying figure out how to cut the w*rk strings.

I'm 53 and DW is 59. We have been saving for FI for the last 20 years, and I think we have finally arrived. We live in SoCal and our house is paid off. DW has a CalPers pension waiting for her, and I've maxed my 401K for 20 years. All the calculators I have tried are giving us the thumbs up.

But...

While my current job is very stressful (mostly due to co-worker drama, and poor management leadership) I still like doing my job and the pay is *very* good (golden handcuffs). There is a chance that MegaCorp will let me go before year end, but they have threatened me with that every 6 months for the last three years without following through with it.

Additionally, I am nervous about the Market being at record highs and using these values in calculators to predict retirement readiness.
Change is hard, particularly when you are making great money... walking away voluntarily and "leaving money on the table" is hard... but at the end of the day if you have enough then you have enough.

The market highs are built into the calculators... SWRs inevitably are based on bad case scenarios and history... but you may want to rethink your AA and go with an AA that you are comfortable with.

I went to part-time for the last 5+ years of my career. It was wonderful. I worked 50% time which was enough to keep health insurance like a FT person, and most other benefits were pro-rata (50% vacation of a FT person, etc.). Also, as a 50% person, I could sidestep some of the bureaucratic crap. I recall that one time they wanted me to do something that I thought was senseless and I called my boss and said "You get 1,000 hours of my time a year... do you really want me to spend time doing this?" and he said "Hell no!". If you're ready to quit anyway, it wouldn't hurt to ask... in my case since they billed my hours out at more than 3 times my cost including benefits they made money for each hour that I worked... they knew that 50% of pb4uski was better for them than 0% of pb4uski.
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Old 07-26-2019, 09:04 AM   #12
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I would want a buffer before retiring into an overpriced market like this. I know people say it is "built in" or "baked in" to the calculators, but those are based on historical data and are not necessarily predictive. Also, if you retire at 95% success, you are more likely to hit the 1 in 20 scenario than retiring with the same odds in a down market. Just my opinion.
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Old 07-26-2019, 09:15 AM   #13
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I second the opinion that you should revisit asset allocation. IMO, true FI would be the ability to fund your lifestyle with passive income- interest, dividends, rents, etc.

Also, retiring from your current position doesn't mean you'll never earn another dollar. Maybe you can think of some ways to supplement retirement with less stressful part time work? There really are thousands of ways smart people can make money without collecting a paycheck.
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Old 07-26-2019, 09:17 AM   #14
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Your post is typical and many of us could have or did post the same thing.

All I can say is that you need to just jump and let it happen. It may take a few months before you feel comfortable, but you are adjusting to a radical change and, of course, it feels different and perhaps not right initially. Take time to figure out what you enjoy doing now. It may well not be what you used to enjoy on weekends.You'll probably have to renegotiate roles with your spouse, but that may end up being more enjoyable for both of you, as you'll have more flexibility with your time.

I retired at 54 and have never regretted a day, nor a dollar left on the table - I'll die with excess, so who cares?

Good luck.
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Old 07-26-2019, 10:51 AM   #15
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I would want a buffer before retiring into an overpriced market like this. I know people say it is "built in" or "baked in" to the calculators, but those are based on historical data and are not necessarily predictive. Also, if you retire at 95% success, you are more likely to hit the 1 in 20 scenario than retiring with the same odds in a down market. Just my opinion.
The OP could mitigate that SORR by starting out retirement with a low equities position and spending from fixed income and letting equities grow. For example, if their withdrawals are 4% and they are comfortable with 60/40 they could start with 30/70 or thereabouts and just spend from fixed income and monitor their AA as it creeps up with equity growth and fixed income spending.
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Old 07-27-2019, 09:15 AM   #16
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I read somewhere that if you can take off 20% of your investment portfolio (too assume a serious correction) and redo the retirement calculator, and still have enough to either generate enough or allow for 4% withdrawal rate then you are really ready. Of course if you are prepared to easily cut your annual expenses in a meaningful way each year you might also be ready.

For example we travel a lot and well. We also dine out. Could cut expenses by 50k by eating at home and not traveling one year so if the market changes we are prepared to change with it. Until then, let the good times roll.

Another problem with most of those calculators are they don’t deal with changing lifestyle and budgets as we age. I assume for calculators that I will live to 95 (which ain’t gonna happen!) but I am not going to travel as I do now after 80, or perhaps need the golf membership, 2nd home, or a million of the things I budget for now.

Personally I find the best retirement calculator is a detailed expense budget for the next stages of my life and have one calculated for each five year period. Easy to adjust for inflation of course.
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Old 07-27-2019, 09:25 AM   #17
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I read somewhere that if you can take off 20% of your investment portfolio (too assume a serious correction) and redo the retirement calculator, and still have enough to either generate enough or allow for 4% withdrawal rate then you are really ready. Of course if you are prepared to easily cut your annual expenses in a meaningful way each year you might also be ready.

For example we travel a lot and well. We also dine out. Could cut expenses by 50k by eating at home and not traveling one year so if the market changes we are prepared to change with it. Until then, let the good times roll.

Another problem with most of those calculators are they donít deal with changing lifestyle and budgets as we age. I assume for calculators that I will live to 95 (which ainít gonna happen!) but I am not going to travel as I do now after 80, or perhaps need the golf membership, 2nd home, or a million of the things I budget for now.

Personally I find the best retirement calculator is a detailed expense budget for the next stages of my life and have one calculated for each five year period. Easy to adjust for inflation of course.
Firecalc does provide the information as to the least portfolio one can have and still maintain X% of success.
Fidelity calculator provides the opportunity to input changing expenses starting at different ages.
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Old 07-27-2019, 09:28 AM   #18
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All I can say is that you need to just jump and let it happen. It may take a few months before you feel comfortable, but you are adjusting to a radical change and, of course, it feels different and perhaps not right initially.
Amen to that! I ER'd in January, and am only recently (like, this week) starting to get comfortable with the change. The first 6 months were pretty rough mentally.

OP - if you do jump..expect it to take a while to adjust. Although everyone is of course different. It's a HUGE life change..
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Old 07-27-2019, 09:35 AM   #19
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Firecalc does provide the information as to the least portfolio one can have and still maintain X% of success.
Fidelity calculator provides the opportunity to input changing expenses starting at different ages.
I like how Fido also allows for essential and nonessential expenses, which I have used to help me model Retired Expat's scenario below.

Quote:
Originally Posted by Retired Expat View Post
I read somewhere that if you can take off 20% of your investment portfolio (too assume a serious correction) and redo the retirement calculator, and still have enough to either generate enough or allow for 4% withdrawal rate then you are really ready. Of course if you are prepared to easily cut your annual expenses in a meaningful way each year you might also be ready.

For example we travel a lot and well. We also dine out. Could cut expenses by 50k by eating at home and not traveling one year so if the market changes we are prepared to change with it. Until then, let the good times roll.

Another problem with most of those calculators are they don’t deal with changing lifestyle and budgets as we age. I assume for calculators that I will live to 95 (which ain’t gonna happen!) but I am not going to travel as I do now after 80, or perhaps need the golf membership, 2nd home, or a million of the things I budget for now.

Personally I find the best retirement calculator is a detailed expense budget for the next stages of my life and have one calculated for each five year period. Easy to adjust for inflation of course.
Actually, as you become less able to travel or go out, you may spend more on medical expenses and assistance (cleaning, yard care, etc.) than before, so while expenses could decline overall, I wouldn't count on it. In fact, essential expenses could increase, because while those services I mention could be a luxury in your 60s, you might consider them a necessity in your 90s. I think the one thing we can agree upon is that your budget definitely isn't uniform over your retirement, and it's important to try to do some forecasting that tries to account for that. The flexibility you mentioned is a great help with that.
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Old 07-27-2019, 09:52 AM   #20
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Additionally, I am nervous about the Market being at record highs and using these values in calculators to predict retirement readiness.
I think this is a fair concern. For example, calculators may give you a 95% success rate based on historical data, but when you look at the years that started with high valuations only that success rate may drop because those are the starting years for which failures likely occured.

In the end I took the simple approach. I looked at the worst years only (e.g. 1966) and made sure they still worked. That gave me piece of mind.

Good luck and, IMHO, don't let good pay hold you back. I left at the the highest salary of my career with lots of back end payouts from which I walked away (at what were record market highs at the time). I haven't regretted it for a second.

Good luck!
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