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Almost FI .. I think
Old 02-06-2012, 02:52 PM   #1
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Almost FI .. I think

Hello. Here is my situation. I have a company and am very burned out, beyond belief. I'm 47, wife is 54. Our assets are broken down as follows:

3.2 Million Taxable CD's
260K SEP - in CD's
200K 401 K
180K value of home : paid off
50K muni bonds
160 K cash / savings acct.
50K savings bonds
70K value of rental property paid

also 2 other rental properties, rented but mortgages of 100k on each

We would have to buy our own health insurance if we RE'd . Our expenses with taxes and ? insurance? should be under 100k a year,
I may be able to sell company and not touch savings for 5 years. Should grow to 4.7 million at that time. Would love to call it quits. Am I missing a reason why it wouldn't work? I am too scared of the market, this may hamper me in the long run. Love the forum, any advice would be great
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Old 02-06-2012, 02:55 PM   #2
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Old 02-06-2012, 03:02 PM   #3
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Love the forum, any advice would be great
Run your numbers through FIRECalc. If you like what you see, work with an independent agent to determine the cost/availability of health coverage. If that looks doable, the next move is up to you. None of us have any guarantees about the future of the markets, but we do know our health is guaranteed to crash.
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Old 02-06-2012, 03:03 PM   #4
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Deja Vu, hasn't this question been answered several times recently
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Old 02-06-2012, 03:05 PM   #5
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You have more than enough assets to ER and enjoy life. If it were me I would redeploy the invested assets into an AA of 40% equities/60% fixed income. At at 3.0% WR that would give you $117k a year, or say $100k after health care costs, which with a paid off home should allow you to comfortably retire and spend a little time managing your rental properties for fun.
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Old 02-06-2012, 03:13 PM   #6
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Run your numbers through FIRECalc. If you like what you see, work with an independent agent to determine the cost/availability of health coverage. If that looks doable, the next move is up to you. None of us have any guarantees about the future of the markets, but we do know our health is guaranteed to crash.
Along with the good advice above from a $ POV, have you thought about what you will do with yourself all day once you're through with your current working chapter? It's not enough to just retire from something (to escape), you should have something better to retire to. The transition is natural and almost automatic for some people, but it can be very unnatural and traumatic for others. People who have the initiative to run their own successful business (evidently you) are often in the latter camp. Worth some serious thought before you pull the plug IMHO. Work Less, Live More and How to Retire Happy, Wild & Free are good books on the mental, emotional side of retirement if you're interested - best of luck.
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Old 02-06-2012, 03:31 PM   #7
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Would love to call it quits. Am I missing a reason why it wouldn't work? I am too scared of the market, this may hamper me in the long run. Love the forum, any advice would be great
Financially, it certainly appears that you could retire today.

I am roughly in your situation financially and age-wise and am FIRE'ing in three weeks. I agree with both pb4uski (on investment rebalancing) and Midpack (on post-FIRE life).

I disagree with Midpack only that, if you are burned out beyond belief, a break from working can help you decompress and decide what to do (if anything) during the next stage of your life. Both books Midpack mentioned are on my March reading list. As to investments, I would suggest that you hold at least one-third of your assets as equity, rebalanced annually. I would suggest that you read Jim Otar's Unveiling the Retirement Myth, which has a good discussion about asset allocation in retirement.
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Old 02-06-2012, 03:33 PM   #8
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Along with the good advice above from a $ POV, have you thought about what you will do with yourself all day once you're through with your current working chapter? It's not enough to just retire from something (to escape), you should have something better to retire to. The transition is natural and almost automatic for some people, but it can be very unnatural and traumatic for others. People who have the initiative to run there own successful business (evidently you) are often in the latter camp. Worth some serious thought before you pull the plug IMHO. Work Less, Live More and How to Retire Happy, Wild & Free are good books on the mental, emotional side of retirement if you're interested - best of luck.
I have thought about that. We do a lot with the local schools. I would like to put a seminar together to educate these young kids about the cost of having children, etc. So many of my employees are mid twenties, have kids and cannot, they have no clue, how to manage their money. These days being a "Money Midget" is not in your best interest. Maybe do a radio show!
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Old 02-06-2012, 04:29 PM   #9
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I disagree with Midpack only that, if you are burned out beyond belief, a break from working can help you decompress and decide what to do (if anything) during the next stage of your life.
I don't disagree re: a break between one chapter in life and whatever comes next, and I don't see where I suggested otherwise. Only that it deserves some thought before pulling the plug altogether, for most if not all of us, there's no do over once we retire from a career or sell a business. FWIW...
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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 02-06-2012, 06:39 PM   #10
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Originally Posted by pletal View Post
Hello. Here is my situation. I have a company and am very burned out, beyond belief. I'm 47, wife is 54. Our assets are broken down as follows:

3.2 Million Taxable CD's
260K SEP - in CD's
200K 401 K
180K value of home : paid off
50K muni bonds
160 K cash / savings acct.
50K savings bonds
70K value of rental property paid

also 2 other rental properties, rented but mortgages of 100k on each

We would have to buy our own health insurance if we RE'd . Our expenses with taxes and ? insurance? should be under 100k a year,
I may be able to sell company and not touch savings for 5 years. Should grow to 4.7 million at that time. Would love to call it quits. Am I missing a reason why it wouldn't work? I am too scared of the market, this may hamper me in the long run. Love the forum, any advice would be great
You say your are "burned out beyond belief." It seems that you need to listen to your body. It is telling you that you need to get off that train. It looks like that is very doable for you.

Many years ago, I was burned out similarly. I had to just let go, and entered into a brand new life. I went back to school and later entered a profession that to this day nourishes my soul. Time is more precious than money, and life is the real deal - really
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Old 02-06-2012, 07:31 PM   #11
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Careful you don't overdo it on CDs if you renew them in the current low-interest environment. Inflation likes to nibble away very conservative portfolios.
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Old 02-07-2012, 05:05 AM   #12
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You are good to go and ER, IMHO.
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Love the forum, any advice would be great
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Old 02-07-2012, 07:01 PM   #13
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I would pay off rental prop morgages. You are probably paying 5 percent and making 2 percent in cds. You do have the money now if you need it but your not cash poor so payoff looks good to me. I have all my rentals payed off and treat them like bond investments paying 5+ percent partially tax defered.

Bob
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