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Two Years Into FIRE
Old 05-15-2012, 03:58 PM   #1
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Two Years Into FIRE

I am 57 and just finished second year of retirement after 25 years with a pharma company. DW still working as a teacher and 2 kids on their own. It is amazing what you are able to appreciate when you really have the time. I had my head buried in the sand for 25 years-working, traveling non-stop and family and never had the time to enjoy a rainy day on the front porch. Anyhow-glad to be joining the forum. Look forward to learning from everyone.
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Old 05-15-2012, 04:03 PM   #2
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Welcome aboard Gonzo. I retired 11 months ago, and I had a similar thought yesterday. The Japanese iris that DW planted beside our house are blooming like mad, I've been checking them daily and taking pictures. I enjoyed watching the daffodils, hyacinths and tulips come and go earlier - also planted by DW, though I probably dug the holes.

For the 32 summers before this, it's unlikely I could tell you what flowers were in our yard or whether they were even blooming. Even mowing every 5-7 days I didn't notice them - except when DW dragged me out to look at them. 'Yeah, they're purty.'

Now maybe I finally grasp "stop to smell the roses." Only took 57 years...
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Old 05-15-2012, 04:27 PM   #3
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Thanks. I know exactly what you mean. I am 57 as well and I sometimes regret it took so long to appreciate everything (including neighbors I never even new lived around here) but I guess it was all the hard work that got us to this point. I feel very blessed.
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Old 05-15-2012, 05:38 PM   #4
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Originally Posted by Gonzo304 View Post
... and never had the time to enjoy a rainy day on the front porch. Anyhow-glad to be joining the forum.
Welcome and congratulations, Gonzo304! I love this image (front porch). Enjoy it!
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Old 05-16-2012, 02:13 AM   #5
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Welcome, Gonzo304.
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Old 05-16-2012, 05:29 AM   #6
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Welcome Gonzo!

I'm close behind you; in time I mean.

...Had to beat REW to it.
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Old 05-16-2012, 10:42 AM   #7
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Look forward to learning from everyone.
Look forward to learning? How about doing some teaching!

Besides stopping to smell the roses, what would you have done differently during those 25 years? I'm hoping to retire around the age of 45 (I'm 31 now), what kind of financial advice would you give? What were some financial mistakes that you felt you made over the years? Any suggestions about houses and cars?

What's your favorite thing to do now that you're in retirement?
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Old 05-16-2012, 10:53 AM   #8
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Look forward to learning? How about doing some teaching!

Besides stopping to smell the roses, what would you have done differently during those 25 years? I'm hoping to retire around the age of 45 (I'm 31 now), what kind of financial advice would you give? What were some financial mistakes that you felt you made over the years? Any suggestions about houses and cars?
The broad answer to your question of course is LBYM. The less of your income you spend during your accumulation years, the more available to save & invest, and the sooner you'll reach FI. There's no way around that despite many people I know looking for a silver bullet to have their cake and eat it too.

Our house was very inexpensive for our income level, and we've paid cash for entry level cars (though well optioned) and kept them for 7-10 years on average. FI was our overriding goal.

What's appropriate for each of us is matter of balancing your now with your future. What I might suggest may seem like deprivation to some, or excessive to others. Only you can decide how much now you're willing to sacrifice for future.
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Old 05-16-2012, 11:00 AM   #9
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The broad answer to your question of course is LBYM.

Our house was very inexpensive for our income level, and we've paid cash for entry level cars (though well optioned) and kept them for 7-10 years on average. FI was our overriding goal.
So are you recommending to live in one house forever? Or just to LBYM in regards to buying/selling different houses?
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Old 05-16-2012, 11:02 AM   #10
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So are you recommending to live in one house forever? Or just to LBYM in regards to buying/selling different houses?
The latter. We moved around many times, but we bought houses that were far below what any bank said we could afford. They want you to buy the most house you can afford to make the biggest (interest) payments they sign you up for. It's up to us to handle FI for ourselves, banks, financial planners, etc. aren't in that business.

The house we live is more than nice enough, but it cost a little under half what the two managers that preceded me spent on their (lavish) houses in this same town. I retired last summer, they're both still working even though they're older than I am. And they probably still live in big houses with big mortgages, we paid off our mortgage early almost 5 years ago. Presumably they're happy with their choices in life, and so am I.
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No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
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Old 05-16-2012, 11:13 AM   #11
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So are you recommending to live in one house forever? Or just to LBYM in regards to buying/selling different houses?
The first option is also great. Unless you can sell your house yourself and by having a deeply discounted broker to help you, it's not cheap potatoes to have your house sold. Commission to the RE broker alone is 6%
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Old 05-16-2012, 04:01 PM   #12
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Midpack is right on target with his comments regarding houses cars etc. In response to your question about financial advice-max out on your 401 (k) Roth or any other type of retirement plan that you have. I wished I would have done that when I started--instead I began deferring 5% to get the match and increased it by 1% every year. Big mistake! Take the max deferral early on and you will never miss it.

Also learn everything you can about managing your money--never just go along with what an advisor or friend tells you to do. Read books, subscribe to Money, Kiplingers or any of the thousands of other ways to learn about investments, allocations etc. Learn about management fees vs index funds and how to adjust your portfolio as your personal situation changes.

Save for college if you have kids. We saved every bonus I received until the kids were 18 and when it was college time it was not a hardship.

Try to stay away from debt other than a mortgage. We had credit card issues early on and once we were able to recover we swore off credit cards. Pay your mortgage down every month--even if it is only and extra 50 bucks-over the long haul it makes a difference.

We also moved around a lot--10 times in 25 years but we never over-extended on the house-we have had nice homes but not McMansions.

Finally, looking back I would have balanced better between work and family--I am sure everybody feels that way--didn't do a bad job--just could have done better. Cause you blink and the kids are gone and on their own.

Hope that is helpful--I think it is great that at your age you have a target for retirement. With careful planning and a little luck along the way you can achieve it if you make it a priority!
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Old 05-17-2012, 01:40 PM   #13
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Thanks Gonzo for your replies.
I used to max out my 401k and Roth IRA before I bought a house. With that monthly payment I'm no longer able to max them out. Actually 75% of my investments are in retirement accounts that I cannot access until I am 60 years old (29 more years!). Since I desire to retire at 45, I have cut back on the 401k and Roth IRA to try and focus more on my taxable account so I can retire early.
What are your thoughts about that?

You retired at 55, but at least have your wife to generate some income for the two of you until she retires / you turn 60.
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Old 05-17-2012, 11:33 PM   #14
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The broad answer to your question of course is LBYM. The less of your income you spend during your accumulation years, the more available to save & invest, and the sooner you'll reach FI. There's no way around that despite many people I know looking for a silver bullet to have their cake and eat it too.

Our house was very inexpensive for our income level, and we've paid cash for entry level cars (though well optioned) and kept them for 7-10 years on average. FI was our overriding goal.

What's appropriate for each of us is matter of balancing your now with your future. What I might suggest may seem like deprivation to some, or excessive to others. Only you can decide how much now you're willing to sacrifice for future.
Have you been sneaking a view of the script of my life?
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Old 05-18-2012, 12:09 AM   #15
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Keep investing costs low. that means index funds. vanguard ON YOUR OWN IF YOU CAN or a LOW COST fixed fee ONLY advisor and DFA FUNDS.
Keep taxes low.
If saving for college tuition, use 529 and do NOT put money in the child's name in any other accounts as it counts against financial aid eligibility more than your assets.
Avoid anything beyond term life insurance. No whole life -no universal life.
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Old 05-18-2012, 03:36 AM   #16
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Congrats and welcome Gonzo304. Welcome to the Forum. Looking forward to your sharing.
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Old 05-18-2012, 04:37 AM   #17
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The broad answer to your question of course is LBYM. The less of your income you spend during your accumulation years, the more available to save & invest, and the sooner you'll reach FI. There's no way around that despite many people I know looking for a silver bullet to have their cake and eat it too.
+1

There aren't all that many "silver bullets" available - business start ups (your own or someone else's), marriage, inheritance, lottery. For most of us LBYM combined with sensible investing is the only realistic way of getting there.
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Old 05-18-2012, 10:45 AM   #18
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Have you been sneaking a view of the script of my life?
Yes, make sure you behave...
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Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
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Old 05-18-2012, 11:27 AM   #19
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Young Saver--Sounds reasonable to me but I'm not a financial planner. I would suggest you meet with a fee only planner and determine what investments you need to make between now and 45 to have enough dollars to generate income. You can also determine if it is better to invest additional dollars or use them to decrease your mortgage so it is paid down when you retire. Again a good fee only planner can map out scenarios for you. It is an aggressive goal but with the right strategy and you making it a priority you can achieve it!
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