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Old 09-11-2008, 03:34 PM   #1
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1 year later

Hi everyone!

Long time no post. Thought I would drop a line to let everyone know how I’ve fared over the past year.

You may recall that I ER’ed from a very stressful job at MegaCorp at the end of August last year at the age of 55. September 2007 was my first month of freedom and I was on Cloud 9. This was the first time I was either not working or going to school on a full time basis since I was fourteen years old. That first month was ORGASMIC! DW and I celebrated with a trip to Myrtle Beach. When I got back, I started walking five miles each day and working on improving my health. In a fairly short time, I was able to significantly lower my blood pressure, reduce my weight, and make a lot more room in my trousers!

In October, my son bought his first house. He was 25 and still living with us at the time so actually this was more my idea than his. I think if I had left the decision of moving to him, he would one day be one of those 40 year-olds that still live with Mom and Dad. He didn’t have a lot of money so when he was house shopping, my wife and I encouraged him to buy a fixer-upper. As part of the deal, I agreed to do the “fixing upping” – at my expense! So for the next two months, I spent every day rehabbing his new house. This turned out to be a great deal of work, but it also turned out to be extraordinarily satisfying. As I returned to my blue collar roots, I continued to lose weight and become more physically fit because of the hard work I was doing. Two months later, an old run down house had been transformed into a beautiful home and in the ensuing refinancing we learned that even in this market the value of the house had gone up by more than 30%.

In December, my wife and I took another vacation to the Caribbean and between that and Christmas I stayed totally occupied.

But then January hit! My wife was still working at this time and it seemed that all of my friends had gone into a bunker to hibernate through the winter. I just wasn’t getting enough human interaction. It wasn’t bad enough to call a clinical depression, but during the month of January, I certainly wasn’t enjoying my retirement.

The doldrums continued through the first half of February until I purchased another run down property. “Why not?”, I thought. Rehabbing my son’s house was one of the most satisfying experiences I’ve had in years. I figured I could do it again and this time make some extra dollars so that I could slow the withdrawals from my retirement nest egg which by this time was starting to show some stress.

So I started working every day as a carpenter/plumber/drywall contractor/painter/chief cook and bottle washer. Once again, I found the physical labor very satisfying and watching the transformation of another run down property into a beautiful home was like magic. This time it took almost four months to complete the job. Half way through the process, my wife retired (at the end of April) and she promptly joined me with hammer and paint brush in hand. The week after she retired, we took a week off to take our first Caribbean cruise.

Work on the rehab was going so well and the projections were looking so good that DW and I had visions of maybe turning all this into a second career. But then we went to put the house on the market. Everyone who saw the house was very impressed. But week after week started going by with no offers. We finally broke down, lowered the price significantly, and agreed to sell it to a family member. At the moment, I am sitting with my fingers crossed hoping that the family member will get approved for a mortgage. If she does, we’ll end up netting about $25K on the deal – not totally horrible for four months of work but much less than what I had originally anticipated.

As I was putting the finishing touches on the rehab, I got a call from my Church. They desperately needed someone like me to put their financial house in order. By this time, I was really feeling the financial downturn. I had chosen the “Norwegian Widow” strategy for my retirement portfolio and had about 80% in equities, mostly individual stocks. When I got the call in early June, I was about 15 to 20% down from my October high. For someone of my temperament, I think I was coping quite well. Instead of focusing on market value, I was reassured by the approximately $80,000 in interest and dividends the portfolio was generating. But I was still succumbing to a few bad thoughts and I was overly ripe for something that would reduce my insecurity.

I decided to give it a try. It’s not the total freedom that I had lusted after for so many years but all in all it’s not bad. The Church is only 15 minutes from my house and I work from 9 to 5, and 9 to 3 on Fridays. If I want additional time off, I can take as much as I want without pay. The work is considerably more satisfying and the stress is pretty much gone. The pay is not up to Corporate America’s standards but it’s not horrible either. My compensation package is enough to enable me to leave my retirement portfolio unscathed plus throw a few more bucks in the kitty.

My absence from this board for almost a whole year has not been an accident. I’ve thought many times about touching base with a progress report but each time, I’ve backed off because I didn’t want to give a report that wasn’t 100% idyllic like all the rest of the stories that I read here. More importantly, by embarking on a money making venture and more recently actually getting a job, I have once again proved my moniker, ScaredtoQuit.
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Old 09-11-2008, 03:38 PM   #2
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Great update, Scared. And it is okay, really, not to go sit under a palm tree all the time. You done good, and are an inspiration to those of us still toiling. Quitting the corporate world, finding your own way, and enjoying yourself--what's not to love about that "retirement" lifestyle.
And good for you for helping your church in such a personally rewarding way!
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Old 09-11-2008, 03:39 PM   #3
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Nice post. Thanks for updating us. To me you seem to be doing very well.

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Old 09-11-2008, 03:52 PM   #4
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If I were offered a job that I liked, and I could take off when ever I wanted for as long as I felt comfortable, I think I might take..... might. Deep down I'm glad there is no place close.
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Old 09-11-2008, 03:57 PM   #5
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Sounds like you got it right to me! A year lived well!
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Old 09-11-2008, 04:39 PM   #6
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Scaredtoquit, I was wondering how you made out. Glad to hear your happy and doing what you want to. Good luck.
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Old 09-11-2008, 04:41 PM   #7
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Thanks for the update. Nothing wrong with going back to work if your happy. Who knows, maybe while you work a little over the next couple of years adding to your portfolio balance, the stock market might rebound some during that time frame. If so, maybe you will be ready to give full time retirement another try.

Just curious, do you regret going with a 80/20 allocation?
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Old 09-11-2008, 04:54 PM   #8
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Congratulations on what sounds like a great first year. I wasn't on the forum last year to see your earlier postings, but hope my first year goes as well as yours. DW and I love to remodel, don' think we would want to do it full time in ER, but to be able to do it as a labor of love like you did for your son is inspiring.
All the best,
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Old 09-11-2008, 05:15 PM   #9
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Hmmm - you done good. My remodels 95, 2000 -2001 didn't count cause Katrina wiped out any potential profit plus I haven't moved out of the house remodeled in Missouri.

But if I did - I wouldn't count it against myself ER wise. If you are FI - slap a hobby, fun, new adventure label on whatever you enjoy doing or might seem interesting to try. That's what ER is for. Money, if there, is lagniappe.

heh heh heh - .
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Old 09-11-2008, 05:21 PM   #10
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ScaredtoQuit, thanks for the post! It's good to hear from you again, and you sound like a pretty happy camper. I'm glad you posted -- we all know it won't necessarily be 100% idyllic. But it sure sounds good.

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Old 09-11-2008, 05:39 PM   #11
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Quote:
Originally Posted by ScaredtoQuit View Post
As I was putting the finishing touches on the rehab, I got a call from my Church. They desperately needed someone like me to put their financial house in order. By this time, I was really feeling the financial downturn. I had chosen the “Norwegian Widow” strategy for my retirement portfolio and had about 80% in equities, mostly individual stocks. When I got the call in early June, I was about 15 to 20% down from my October high. For someone of my temperament, I think I was coping quite well. Instead of focusing on market value, I was reassured by the approximately $80,000 in interest and dividends the portfolio was generating. But I was still succumbing to a few bad thoughts and I was overly ripe for something that would reduce my insecurity.
Thanks for the update. Congrats on the Church job - ER is about doing what you want to do.

This is an interesting scenario, considering it has been 1 year of ER. What interest me is how you looked at the numbers.

Decline from the high (instead of in Aug. when you decided to ER)

Interest & dividends covered your expenses? (no need to touch principle).

A few years of expenses in cash equivalents? (to help getting through down markets)

I remember your post and your concern about finances. If working for the church gives you peace of mind, that should help with your ER.

+++++
My net worth (excluding house) is down 6.3% from 12/31/07.
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Old 09-11-2008, 07:38 PM   #12
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My net worth (excluding house) is down 6.3% from 12/31/07.
We must have a similar asset mix. I'm down 6.3% as well.
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Old 09-11-2008, 08:24 PM   #13
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Just curious, do you regret going with a 80/20 allocation?
No, the 80/20 dividend strategy has worked okay for me. There have been a few times during the past year when things looked grim but so far my assets keep coming back. At the moment I'm only down about 9%.

I'm VERY satisfied with the dividend strategy. It's a great feeling to watch your income increase as Companies raise their dividends every year. It's an automatic hedge against inflation and in this environment it's actually easier to find stocks that pay more than a 4% dividend yield.

For those who want to know more, go to Morningstar.com and get a free copy of the Morningstar Dividend Investor Newsletter.
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Old 09-11-2008, 08:35 PM   #14
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I also flunked retirement the first time . I retired in Nov.2006 and was offered a one maybe two day a week job at $30.00 an hour in Feb.,2007 . I figured why not . It was flexible so I could work when I wanted and travel as I wanted . It only took me ten months to decide I did not want to do this anymore . I do sell on ebay as a hobby but other than that I am completely retired . Some people make it on the first try and some of us need a few more tries.
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Old 09-11-2008, 08:48 PM   #15
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Quote:
Originally Posted by dex View Post
This is an interesting scenario, considering it has been 1 year of ER. What interests me is how you looked at the numbers.

Decline from the high (instead of in Aug. when you decided to ER)
Actually, even though I left work at the end of August, I didn't get my 401K payout until the middle of September. The value of my portfolio hit its peak about a month later in mid October.


Quote:
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Interest & dividends covered your expenses? (no need to touch principle).
+++++
My net worth (excluding house) is down 6.3% from 12/31/07.
Interest and dividends COULD have paid my expenses but didn't. My withdrawals for the past year were very minimal (only a little more than 1%) For the most part, I paid my bills from DW's salary (until she ER'ed) and nonqualified savings. Fortunately with both kids gone, my expenses just aren't all that bad!

When I finally leave the payroll for good (If I decide to do this in the future, I will probably continue to work for free, but for the time being, why hurry?!) I should be able to live comfortably on a steadily rising stream of dividends.

Quote:
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A few years of expenses in cash equivalents? (to help getting through down markets)
Yes, I have about $300K in my company's fixed income alternative. It currently pays about 4.7% and has no restrictions on tenor... i.e. it can be withdrawn just like a money market account. At my current rate of spending, (also counting income) that has the potential of lasting me at least 4 years. With dividends, it's indefinite.
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Old 09-11-2008, 09:55 PM   #16
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Those 100% idyllic stories are probably at least 10% bs anyway!
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Old 09-11-2008, 10:06 PM   #17
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I really appreciate the candor, it's really insightful for those of us still in the work force. It's also very encouraging, as it shows even in the face of adversity, your scenario is 1000% better than living paycheck to paycheck or working until you are too old to work.
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Old 09-12-2008, 01:26 AM   #18
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... at $30.00 an hour in Feb.,2007.
Holy cow, I'm charging $25/hour for handyman painting & picture-hanging, which is probably half of what I'm actually worth... with your training & experience, $30/hour is practically a charitable donation!
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Old 09-12-2008, 08:02 PM   #19
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Holy cow, I'm charging $25/hour for handyman painting & picture-hanging, which is probably half of what I'm actually worth... with your training & experience, $30/hour is practically a charitable donation!

It would be in New Jersey but in Florida unless I want to work in a hospital (which I do not )that is a decent rate . It's sad . I took a huge paycut when I moved from New Jersey to Florida . By the way my handyman gets $50.00 an hour . Ouch !
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Old 09-13-2008, 02:27 PM   #20
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For those who want to know more, go to Morningstar.com and get a free copy of the Morningstar Dividend Investor Newsletter.

The only one I saw at Morningstar was :

Morningstar DividendInvestor
12 monthly issues | 16 pages Print and Electronic Edition
$149.00 U.S.
Electronic Version Only
$139.00
$129.00 Morningstar.com Premium Members

Do I need to look elsewhere for the free version?
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