Schizo saver

[dallas27]

Hi All,

Turning 36 this month, lovely wife of 44 and no kids. I've been a decent saver since my 20's. Recently got propelled into a well compensated (but unsteady) position with a startup. For the first time in my life retirement seems within my calculators grasp.

House worth about $280k, owe $180k, 12 years left at 2 7/8 % (I'll never pre-pay at that rate)

Savings, $425k, mostly in 401k.

I have never had credit card debt, only ever made payments on a vehicle 1 year of my life. I save first then buy, unless there is a 0% finance deal, then I have a debate with my intellect.

My wife and I work from home, have an LLC S-corp that we bill our time through. With my new gig that started this year, together we will pull in $250k in revenue give or take 30k, then play tax games to recognize as little as possible of it. 25% of total salary 401k match, 100% health care reimbursement, education reimbursement, etc. About 200k of the revenue is from my hours.

So far this year, we have been putting more than 10k a month into savings through one account or another. 11k really. I have never been more worried about money in my life now that I have so much and and losing the high income stream could so severely affect my future. It's literally distracting me from work. I started working in the late 90's and literally during each of the financial disasters, while everyone got broke, my salary doubled over night because of hard work, willingness to relocate, and some luck. Although I'm a bright dude, it's starting to feel like I have a good run on the casino (my job, no the market), but can't win forever.

One day I run the retirement numbers and I can drop the full time work in a year or two and live a modest life working just some part time gigs while my nest egg compounds. The next day I run the numbers and I need to work 20 more years because I want to be "comfortable". For the record, I'm not a schizo, I just play one during retirement planning. Or wait, maybe I am a schizo.

FWIW - I'm invested 100% in vanguard stock indexes evenly split among these 5. I'm quite confident Bond is a four-letter word.

VIG - US Large Div Increasers
VOE -US Mid Val
VBR - US Small Val
VEU - Ex US Large (includes emerging)
VSS - Ex us Small (includes emerging)

And about 10K in VWO (Emerging only) to pump up that exposure some.


Also, I've read WAY to much about markets and planning, and I've come to the conclusion that past performance does in fact predict future results (over reasonable time frames). How else to explain everyone repeating that tag line, then acting and investing directly based on the past performance of asset classes. Everyone trying to prove new algorithms and "this time it's different" arguments are, in fact, delusional and only half as bright as they think they are. Well, possibly less.

And you may find yourself in another part of the world
And you may find yourself behind the wheel of a large automobile
And you may find yourself in a beautiful house with a beautiful wife
And you may ask yourself, "Well, how did I get here?"

1 year update - couldn't reply to old thread due to age
http://www.early-retirement.org/forums/f26/hi-schizo-saver-from-it-72421.html

about to turn 37 now....

525k total


100k in each of below:

VIG - US Large Div Increasers
VOE - US Mid Val
VBR - US Small Val
VEU - Ex US Large (includes emerging)
VSS - Ex us Small (includes emerging)

And 20K in VWO (Emerging only) to pump up that exposure some. (only after tax account). Another 30K in cash for emergency and/or operating expenses.

Should be approaching 600k by year end, market gods allowing. Owe 169 on the house.

Big journey for me mentally over the last year, reading these forums, took a economics and a finance course at Harvard to study some fundamentals. A little less Schizo now and a lot more confident in my future. Job has been steady and money has been great.

Lately the thought has been to get the savings up to 600-750, then kill the mortgage through downsizing (or saving equivalent in after-tax) and wife and I will downshift for the next 10-20 years. Start focusing on relationships and experiences and let time do the retirement savings for us. I figure about 15-20 years out, the cone of uncertainty for our savings leaves a low side of at least a million, which more than covers our expenses now, we will almost certainly save some more in that time frame too. Even if it's a little less, that 15-20 years of time will be worth it in spades.

Downshifting around 40 is a possibility - and I find that just amazing.

 

[irishgal]

Great job and congrats!!


Sent from my iPhone using Early Retirement Forum

 

[TheMCP]

We're in a relatively similar situation... a bit less saved, and our savings rate is not as high (10k+ / month is extraordinary... great job with that), but the way you write about your situation is the way I think about mine.

Mostly what I am after at this point is time. I don't dislike what I do for work, but I don't think I want to do so much of it anymore. I feel like if I buckle down for a while longer, continue figuring out ways to cut expenses, and look for potential alternative income streams... maybe in a few years we can cover our living costs with part-time work and let compounding do it's thing.

I feel like I'm ready for less structure and more free time. If I have to give up some luxuries in the future to make that happen, I think I've figured out over the past few years that I'm actually perfectly okay with that. I find myself thinking in terms of extra years of FI, then backing up and contemplating what that really means. A year is a long time... what would I do for another year of independence? I could do a lot with a year's worth of free time, I think.

Best of luck to you...

 

[dallas27]

We're in a relatively similar situation... a bit less saved, and our savings rate is not as high (10k+ / month is extraordinary... great job with that), but the way you write about your situation is the way I think about mine.

Mostly what I am after at this point is time. I don't dislike what I do for work, but I don't think I want to do so much of it anymore. I feel like if I buckle down for a while longer, continue figuring out ways to cut expenses, and look for potential alternative income streams... maybe in a few years we can cover our living costs with part-time work and let compounding do it's thing.

I feel like I'm ready for less structure and more free time. If I have to give up some luxuries in the future to make that happen, I think I've figured out over the past few years that I'm actually perfectly okay with that. I find myself thinking in terms of extra years of FI, then backing up and contemplating what that really means. A year is a long time... what would I do for another year of independence? I could do a lot with a year's worth of free time, I think.

Best of luck to you...

Thanks. We ended up averaging 9200 a month saved last year, ~111 total. Some of that was one time windfalls. So far this year we've only stashed 23k, hoping to pick that up in the second half of year and end up around 60-80. We had some sizable unexpected expenses this year, some planned expenses coming up, and had to replenish the emergency funds.

 

[old woman]

Sorry to hear you are schizophrenic that is a horrible disease. Glad you still able to save.