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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 01:11 PM   #21
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Re: Could the FI of FIRE be good enough?

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Wonder what I would do if hit $2M and had a huge salary.
I think I would stay awhile.
Would be nice to be able to RE and afford to live almost anywhere, even if had kids. Get the best doctors. Eat the best healthy, tasty, well prepared food. Travel. Not penny pinch so much.
You can have that set of 'luxuries', within some limits, on less than $2M. Obviously you wont be able to afford a waterfront hawaiian estate with maids, butlers and Emeril Lagasse chasing herds of live lobsters around the house.

Sticking around just to up the ante though can be problematic.

I was once engaged to a gal who worked at the same company I did. Sort of a secretive person, which is what ended up sinking the relationship. About four months after we moved in together I noticed her stock options "roundup" sheet laying on the coffee table and had a gander. At that moment she was worth roughly $5M. Big eyed I said "Hey...between yours and mine we should take the money, pay the taxes and retire rich right now!". Her response "I dont think its enough...I want to travel a lot".

In the meanwhile the stock has dropped 80% and is now hovering at less than 25% what it was. She kept every share. I kept none, diversified and RE'ed on a lot less than that original number would have been had we both pulled the ripcord right then and there.

She's still working. Hates it. I dont see her travelling a lot either.
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 02:44 PM   #22
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Re: Could the FI of FIRE be good enough?

DH and I retired over a year ago. He left work 1 year earlier and I worked part time (3 days per week) for the health insurance and a bit of extra money. I figured we'd do that for a few years.

Then I got laid off. On the drive home that day, I thought, if not now, when?

It took awhile to figure things out - health insurance, safe withdrawals, etc. We got a catastophic policy with a $5,000 deductible.

The difference between one of us working part time and both being RE'd is like night and day.
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 03:11 PM   #23
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Re: Could the FI of FIRE be good enough?

th,

That story hurts. Glad you made FIRE, though.

In my opinion, it sounds like the biggest financial mistake your ex made wasn't that she didn't quit, it was not diversifying. Even if she only sold half, after taxes she would be FI, whether she knew it then or not. She must really have regrets.


I agree that a good life can be had for under $2M. Under 1M, even under .5M depending on situation and location.

It's this line from Ben I'm thinking of: "1-2 years added corresponds to 10 years or more of desperate work later on"

I'm sure Ben knows what's good for him--it's just that if I'm not misunderstanding the above line, and were making that much, I'd have to truly hate my work to stop at 2M. Would love to RE a little later on a bigger pot.

(Sorry hope this doesn't embarass you Ben. )
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 03:43 PM   #24
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Re: Could the FI of FIRE be good enough?

You're 100% right, not diversifying is the biggest mistake. Note that the company culture lionized those who proclaimed "...and I've never sold a single share!".

I sold every year at what I felt was a favorable price point, and plowed the proceeds into a diversified asset mix. When I wasnt playing roulette with flipping a few hundred $k worth of QQQ's on the little dips during the Days Of Insanity. I was considered an idiot by my fellow investors at the company for 7 straight years. Then all of a sudden I became a genius without doing anything differently.

Guess that goes to show that sometimes it takes a REALLY long time for the 'right strategy' to really show its colors.

There was a second mistake made though. She doesnt love the work. It eats her entire personal life. I had to make a rule at one point that the $^%#ing laptop didnt get opened after 7pm or on weekends. When we went on vacation she smuggled her blackberry and pager into her luggage. She had the opportunity to end all of that, definitely had the FI part well in hand...but the "just a little more" or "it isnt enough" worries kept her at the helm.
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 03:55 PM   #25
 
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Re: Could the FI of FIRE be good enough?

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It took awhile to figure things out - health insurance, safe withdrawals, etc. We got a catastophic policy with a $5,000 deductible.
Sparky,

Can I ask what the policy cost you? I will need to go this route in a few years.
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 04:11 PM   #26
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Re: Could the FI of FIRE be good enough?

We're with Golden Rule - got a recommendation from a doctor in the area that we know.

We got info directly from their website - if you go to Ehealthinsurance.com, you'll pay a premium. But seeing the options on Ehealthinsurance.com gives you a clearer picture of what's available in your area. Then contact the insurere directly.

At 44 and 45, it costs us $193 per month total, up from $163 last year.

We're normal weight, although on high blood pressure and high cholesteroal meds that we buy outright. No drug coverage, $5,000 deductible for each per year.

So far, so good. We visit doctors about 2x per year - manageble so far.

Sparky
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 04:17 PM   #27
 
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Re: Could the FI of FIRE be good enough?

Sparky,

This is pretty manageable. There are folks here that are dropping over $10K per year on insurance. But, Really all you need is your plan for less than $3K. You can do a lot of self insure with the leftover $7K per year!

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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 04:23 PM   #28
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Re: Could the FI of FIRE be good enough?

We spend a lot of money on insurance. I often question
if we might be better off cutting back and self insuring
more. With the house, condo, 3 cars and health coverage, it's a pile. We have no debt, so no one is forcing us to buy all of this. Could cut back more I guess.

JG
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Re: Could the FI of FIRE be good enough?
Old 03-23-2005, 05:42 PM   #29
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Re: Could the FI of FIRE be good enough?

It gets better ...

You can split your pills - SOME, that is, talk to your doctor or pharmacist - for instance, if you're on lipitor 20 mg, get a script for lipitor 40mg and split them. The cost is almost identical so you are getting your drugs for half-price.

Our dentist also gives us a break because we don't have insurance - about 1/3 off the usual price. Doctors and medical professionals are USUALLY sympathetic and will work with you.

Sparky
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Old 03-24-2005, 12:53 AM   #30
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C-T

We've been looking at HSA policies. Have received three quotes (still with our group policy at this time, but may change). All three with a $5,200 health savings account, with a similar deductibe, 100% coverage after that. Cost varies, but about $350-380 per month. Two people, mid 50's, good health.

Policies are state specific. Got our start at http://www.hsainsider.com/.

uncledrz
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Re: Could the FI of FIRE be good enough?
Old 03-24-2005, 06:31 AM   #31
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Re: Could the FI of FIRE be good enough?

Nice thread Azanon.

I suspect that I am FI. Early 40's, no debt, with a net worth of 1.5M+. I
haven't worked out whether I can RE since the job is still interesting. Stll,
most of us wouldn't be visiting this site we didn't think about RE from
time to time. FI for me is about having choices.
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Re: Could the FI of FIRE be good enough?
Old 03-26-2005, 05:29 PM   #32
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Re: Could the FI of FIRE be good enough?

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She's still working. Hates it. I dont see her travelling a lot either.
But when she does retire boy-howdy will she be travelling. You'll regret your rash move to FIRE then.
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Re: Could the FI of FIRE be good enough?
Old 03-27-2005, 06:09 PM   #33
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Re: Could the FI of FIRE be good enough?

Azanon asked,
Quote:
Just wondering how many others have FI more as their #1 goal rather than RE.
I'm one.

Bpp
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Re: Could the FI of FIRE be good enough?
Old 03-28-2005, 10:05 AM   #34
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Re: Could the FI of FIRE be good enough?

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Just wondering how many others have FI more as their #1 goal rather than RE.

This goal (FI) is much more important to me as well (maybe because it is the first step). I fantasize about it more than I do about leaving the job. However I will say that it is still pretty important to be able to say bye bye to the corporate gig. In one sense I would like to retire from that, but not necesarily from work all together.

I think of FI as the point where I can have a decent life by living off of 4% real from my investments. Not a glorious life, but one where I could get by. RE would require a bit more dough I think.

-Biker
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Re: Could the FI of FIRE be good enough?
Old 04-05-2005, 09:58 AM   #35
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Re: Could the FI of FIRE be good enough?

Being young (30), FI is more important now than ER. And even if my blog is named "The blog of a man who plans to RETIRE at 37", actually, I plan to be able to retire at that time, but FI is the real goal there.

People already have said here many reasons to seek FI:

- having options (you can leave your job to travel for a year and get back to work somewhere else, you can decide to work part-time at a new job, you can switch to lower wages, but more interesting job)...
- security (you don't mind getting laid, at least, financially speaking)
- no need for further savings (thus, you know exactly how much you can spend and don't feel guilty)

Jack
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Re: Could the FI of FIRE be good enough?
Old 04-05-2005, 10:53 AM   #36
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Re: Could the FI of FIRE be good enough?

The whole idea of FI is dependent on the same things that SWR is dependent on -- and therefore is never guaranteed. That's a little bit of problem if you say that FI is your goal. You can say you've reached FI provided 1) the future is no worse than the past in terms of inflation and investment returns, 2) you're spending desires and needs in the future are consistent with your planned spending, 3) you are not saddled with an unforseen financial crisis or combination of crises. . .

The second critera above can be really slippery -- especially if you are many years away from FI or RE. Your desires and needs are likely to change in ways that you do not forsee today. Also, costs of specific things you spend money on can change dramatically. For example, rising gas prices have has a significant impact on my travel costs that I did not count on just a few years ago.

I'd say the first order goal is simply to enjoy a comfortable, low-stress, satisfying life. Financial stability (FI) is likely to be a big factor in achieving that goal. Retirement may or may not be a big factor depending on what you find most satisfying and how comfortable you are with your job.

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Re: Could the FI of FIRE be good enough?
Old 04-05-2005, 05:35 PM   #37
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Re: Could the FI of FIRE be good enough?

Sparky mentioned the idea of saving health care costs such as cutting pills in half saves usually 50%. This is absolutely true and unless one is taking a specially designed slow release medication with a special delivery system, most medications can actually be done this way.

Another way people with high deductables or are forced to go without insurance can save money on big ticket items is to be honest and forward. As an example, when I see a patient that truly needs a big ticket test such as a CT scan, ect. I write them a script and tell them to call several centers, either hospital based or independent. Be honest and say that you need this study done ordered by your doctor and you will walk in with cash in your hand in 100 dollar bills and you are calling around to se where you can get it done most economical. Every one on the centers in general will discount immediately 30% and I have seen 50% if they know that you are captain of your ship and have cash in your hand. I do this almost daily.

Another way for patients in similar conditions that have to go to the hospital and come out with a big ticket is after receiving all hospital bills to call the business office and be honest by explaining that you are on a fixed income and will have to make payments for years. But if you tell them you are willing to "mortgage the home" what will they offer as a discount for cash in their hand? Every hospital has a policy for this and has a person hired to handle just such situations and all will make an offer

Another way is when you are going to have a proceedure done such as surgery I tell the patient to address the surgeon honestly beforehand and ask his bill, tell him your situation, and offer to pay him cash in advance. Virtually every physician will understand and greatly discount. If he won't, fire the doctor and find a caring one.

Sailaway
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Old 09-05-2007, 01:27 PM   #38
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Sorry to bump such an old thread, but this thread really hits home to me right now. I'm at a j*b that like very much, but always have the threat of budget cuts/layoffs hanging over our heads. But in the last 2+ years some really significant things have happened to me.

My Father passed away after an 8 year battle with cancer

We became debt free except for the house

We hit over $125k in retirement savings.

I vested at my work for a company pension.

When a death hits you hard, as most of you know, priorities change. Little things at work and life don't bother me as much anymore.

Although we aren't near FI yet, vesting, becoming debt free, and getting over 100k in retirement has completely changed my w*rk stress. I no longer worry about layoffs. I hope it doesn't happen, but the only thing I can control is how I work. Since all these milestones I perform better at my j*b and people have noticed it. I worry about what I can control, and forget about the rest. True FI may hit in about 10 years, but for now I feel more free and involved at w*rk, then ever before.

Thanks for all the advice from the great people on this board. Somebody on here once said that they are FI enough that "they need A j*b, but not this j*b." I find that very liberating.

Again sorry to bump such an old thread, I just thought there were quite a few nuggets in these pages.

Mudd
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Old 09-06-2007, 02:13 PM   #39
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Originally Posted by Mudd View Post
Sorry to bump such an old thread, but this thread really hits home to me right now. I'm at a j*b that like very much, but always have the threat of budget cuts/layoffs hanging over our heads. But in the last 2+ years some really significant things have happened to me.

My Father passed away after an 8 year battle with cancer

We became debt free except for the house

We hit over $125k in retirement savings.

I vested at my work for a company pension.

When a death hits you hard, as most of you know, priorities change. Little things at work and life don't bother me as much anymore.

Although we aren't near FI yet, vesting, becoming debt free, and getting over 100k in retirement has completely changed my w*rk stress. I no longer worry about layoffs. I hope it doesn't happen, but the only thing I can control is how I work. Since all these milestones I perform better at my j*b and people have noticed it. I worry about what I can control, and forget about the rest. True FI may hit in about 10 years, but for now I feel more free and involved at w*rk, then ever before.

Thanks for all the advice from the great people on this board. Somebody on here once said that they are FI enough that "they need A j*b, but not this j*b." I find that very liberating.

Again sorry to bump such an old thread, I just thought there were quite a few nuggets in these pages.

Mudd
An older client of mine summed it up best:

"When I had one year's worth of living expenses saved up ,I figure I could tell the boss where to go"

"When I had TWO years worth of living expenses, I figure I could tell the WORLD where to go".......

Total LBYM guy, he lived on about $20,000 a year
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Old 09-06-2007, 02:19 PM   #40
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An older client of mine summed it up best:

"When I had one year's worth of living expenses saved up ,I figure I could tell the boss where to go"

"When I had TWO years worth of living expenses, I figure I could tell the WORLD where to go".......

Total LBYM guy, he lived on about $20,000 a year
I have 8 years' living expenses saved up (well, if you count the equity in my house, then 18 years), but I don't figure I could tell the WORLD where to go, just yet.

When I have 25 years' saved up, then, maybe!
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