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Mike's Big Plan!
Old 05-10-2004, 11:31 AM   #1
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Mike's Big Plan!

Hi everyione! I'm new here and enjoy reading the posts. Here's my Big Plan. I'm 45, married with 2 kids. The older one is 15, the younger is 9. I've got about $1 million in taxable and non-taxable accounts. My plan is to retire in 13 years when the younger child has finished college. I'm in a good paying job and can save (including employer contributions) about $50,000 per year right now in 403(b), 401(k), and 457 accounts. I try to max them all out. If I could hit 8-10% return per year, it would be feasible to have a nest egg of $3 million by the time I'm in my mid-50's. I'm fairly sure that will do it, as far as having enough money to retire early, unless there's some major, major upturn in inflation or health catastrophe.

Look forward to chatting with you all.

Mike
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Re: Mike's Big Plan!
Old 05-10-2004, 11:49 AM   #2
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Re: Mike's Big Plan!

Mike, as long as you enjoy your work, that sounds like a good plan to continue milking the salary. There are a lot of people here who would retire *today* if they were in your situation. I'm 42, and the thought of 13 more years of the daily grind doesn't appeal to me at all.
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Re: Mike's Big Plan!
Old 05-10-2004, 12:47 PM   #3
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Re: Mike's Big Plan!

Believe me, I *would* do it today if it was just me, but I'm thinking about the kids. I want to get them through college before I kick back. I brought them into the world, I figure I have a responsibility to do right by them. Maybe some day they'll reciprocate! The other reason to stay until 55 is that I can buy health insurance through the group health plan after that age.

Just because I'm waiting, doesn't mean I'm not looking forward!

Mike
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Re: Mike's Big Plan!
Old 05-10-2004, 02:58 PM   #4
 
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Re: Mike's Big Plan!

Hello Mike! I think your plan is fine, and thinking about
what's best for your kids is unassailable. Otherwise, my only advice is: Don't wait too long..............

John Galt
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Re: Mike's Big Plan!
Old 05-10-2004, 08:51 PM   #5
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Re: Mike's Big Plan!

I think you're doing pretty well for having two kids at the ages you stated. As you know, kids can be very expensive when you take into account the need for a decent-sized house, food, clothing, etc... Does your wife work? If so, that would probably explain your ability to put away $50k a year into various taxable and tax-free accounts.

Personally, my plan was to have $1MM by age 40, but in light of a bit of burnout on my part, combined with a desire to move on from my current employer to other opportunities, I don't think that's going to happen. Then again, anything's possible if the stock market provides some consistently solid returns.
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Re: Mike's Big Plan!
Old 05-11-2004, 02:14 PM   #6
 
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Re: Mike's Big Plan!

In an effort to determine how much out of the norm
I am, I would really like to know how many other people
just up and ERed because they wanted to, with little or no thought to how they would manage. Am I alone in the universe? Wouldn't be the first time........

John Galt
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Re: Mike's Big Plan!
Old 05-11-2004, 02:21 PM   #7
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Re: Mike's Big Plan!

John Galt
Quote:
In an effort to determine how much out of the norm I am, I would really like to know how many other people just up and ERed because they wanted to, with little or no thought to how they would manage. Am I alone in the universe?
Not I. From what I've read, you are the only guy who just up and ER'ed without planning BUT who also knew all of his financial details to the very last penny (and dryer sheet as well) when he did.

Have fun.

John R.
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Re: Mike's Big Plan!
Old 05-11-2004, 02:44 PM   #8
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Re: Mike's Big Plan!

My 'plan' was 1.3 mil at age 63 in mid 2006. Actual was closer to 0.3 mil in 1993 at age 49. It worked out well although we should have took better notes. I always have a plan, and a rough budget - sometimes life offers wonderful surprises. Even today I wouldn't plan to ER on .3 mil.
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Re: Mike's Big Plan!
Old 05-11-2004, 05:37 PM   #9
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Re: Mike's Big Plan!

Quote:
In an effort to determine how much out of the norm
I am, I would really like to know how many other people
just up and ERed because they wanted to, with little or no thought to how they would manage. Am I alone in the universe? Wouldn't be the first time........

John Galt
Dont think you're alone. Pretty much describes me. I of course always wanted to quit working, being basically a lazy bastard, but didnt have any planning and for the most part was very good at spending every penny I earned on dumb stuff.

When the windfalls kept falling ER started to look like something I might do, but I gave it only passing thought. When the company offered a years pay with benefits, I remember scoffing at that with a fellow co-worker. When the stock dropped 80%, making the job worth about 79% less per year for the effort, I took the money and ran. Figured I could worst case take a year off paid and go back. After many napkin "planning sessions", thoughtful afternoons, and then some more serious portfolio planning, I discovered I wouldnt need to go back, didnt want to, and probably wont.

Deciding to sit down for a while really isnt that big of a deal. You can, after all, always go back. If after just a year or two or three you think your skills are no longer viable, I'd be pretty damn concerned about your viability right now...
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Re: Mike's Big Plan!
Old 05-11-2004, 05:49 PM   #10
 
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Re: Mike's Big Plan!

The skills I need to get hired are hopelessly
non-viable. The skills I need to make lots of money are
still robust. I have the skills. It's the energy and
motivation that I lack.

John Galt
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Re: Mike's Big Plan!
Old 05-11-2004, 05:51 PM   #11
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Re: Mike's Big Plan!

I don't quite have a plan yet, either, but three years ago, I was an overworked, overcooked workaholic with a husband who could not or would not make a decent living. I had been funding my retirement accounts steadily, though not to the max.

Two things happened. I got rid of the husband (although first I made him get a job and stop pretending he ran a business), and my sister died, leaving me a very nice, roughly half-mil nest egg.

I realized, 1) If your sister can die at 47, you can't count on living forever, and can't wait for "later" to come to start having a life outside of work, and 2) I now had enough money to start thinking about how to get out of the rat race.

I quit my job, a jworkplace full of wonderful, dedicated, hardworking, underpaid people, and went into business for myself. I'm a psychologist, mostly doing evaluations for the courts, and I make more money working about half time than I did working 50 hours at that job.

And I started to get serious about learning about finances. I'm looking into buying real estate, putting all the cash into a nearly maintenance-free Vanguard arrangement, finding work that I like that I can do on my own terms. Life is sure different. I go back to the old workplace twice a month, to consult, and as much as I love all my old colleagues, I sure am glad to be out of there.

It'll take me a while to accumulate enough to ER. I have one to put through college; she's almost 15 now. But I am not waiting until I can live off of the net worth, I'm learning some of the ER lessons right now!

Mike, you and your wife have done an amazing job to save all that money, and you will no doubt be very comfortable when you do leave work. But don't work yourselves to the bone between now and then!

Anne
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Re: Mike's Big Plan!
Old 05-11-2004, 05:58 PM   #12
 
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Re: Mike's Big Plan!

Hello Anne. The posts that make me smile are from working
couples with no kids, a paid off house worth $500,000,
and a $1,000,000 portfolio who want to know when they
might be able to retire.

John Galt
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Re: Mike's Big Plan!
Old 05-11-2004, 09:10 PM   #13
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Re: Mike's Big Plan!

Quote:
In an effort to determine how much out of the norm
I am, I would really like to know how many other people
just up and ERed because they wanted to, with little or no thought to how they would manage. *Am I alone in the universe? *Wouldn't be the first time........

John Galt
I'm nearly alone at the opposite end of the universe. I'm sitting here looking at the same basic version of my Excel spreadsheet that I've had for four years now and will likely watch for the next 22 years.

Currently looks like $3.8M in November 2026 at age 57.44 (at 4.117%). I like the way that sounds...it reminds me of Clue -- Mr. Green, in the Conservatory, with the Lead Pipe. ;-) Several kids to get through college and a mortgage between here and there.

malakito
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Re: Mike's Big Plan!
Old 05-12-2004, 04:14 AM   #14
 
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Re: Mike's Big Plan!

Spreadsheet? We don't need no stiiiiiiiiiiiiinking
spreadsheet

John Galt
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Re: Mike's Big Plan!
Old 05-12-2004, 07:56 PM   #15
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Re: Mike's Big Plan!

John-

Sometimes I feel like it's a big adjustment, working less (I keep running into reasons to take on more work, and have to be careful about it). And then there are the long days of doing not-very-much, which are just fine.

I would quit in a heartbeat, though, almost all of my work (or maybe all of it!) if I had no kids and a big pile of money. There's plenty to do just here in the house and the yard, not to mention on the computer.

Anne
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Re: Mike's Big Plan!
Old 05-13-2004, 06:34 AM   #16
 
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Re: Mike's Big Plan!

Hello Anne. I posted this once before but it's been a while now.

Shortly after I semiretired (1993) my brother said to my
parents "But, what does he do all day?" He was mystified. That still makes me smile, as like most ERs
my days are loaded. Before I retired my father told me
he didn't see how he ever found time to work. It's
a bit trite but I now realize how true that statement is.

John Galt
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Re: Mike's Big Plan!
Old 05-18-2004, 12:26 PM   #17
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Re: Mike's Big Plan!

Quote:
*Before I retired my father told me
he didn't see how he ever found time to work. *It's
a bit trite but I now realize how true that statement is.

John Galt
Scary, but true; I wonder though, is it just the whatever principle that a task expands to fill the time alotted it? Are we just frittering away our time because we can? I know I've got lots of new interests and hobbies, but somehow I used to fit in a significant amount of work in there, too. Now I am relaxed and happy but can't imagine having time to do anything much on the work front again.

In my first year in ER, people would ask me if I was going back to work, and I would truthfully tell them "I'd like to, but I just don't have time to work any more!" That was always a bit of a paradigm shifter for them and usually the conversation ended pretty quickly after that...
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Re: Mike's Big Plan!
Old 05-18-2004, 12:43 PM   #18
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Re: Mike's Big Plan!

Time entropy along with doing stuff you would have paid others to do is definitely at play here.

I used to buy a coffee in the company cafeteria before I went up to my office. Now I buy whole beans, grind them for each pot I make, and I bought an espresso machine to spend 10 minutes making fancy coffee drinks when it suits me rather than paying $3.50 for them.

I used to pay a gardener to spray weed killer on my lawn. Right after I fired the gardener, I went out for the mail. On my way back, I spotted a couple of weeds. Stopped to pull them out. Saw a couple more. Pulled them out. Went in, dropped off the mail, got a beer and spent the next hour pulling weeds by hand, talking to the neighbors, and playing with two cats who determined that this russling of the grass simply must constitute some effort to initiate playtime with them.

Far more enjoyable than writing someone a check for $100 every month.

That cutting the grass crap isnt that much fun, but its part and parcel of the deal I guess. And my new house has a little tiny bit of grass that takes about 5 minutes to cut.

At least 3 times a week I must utter "I have no idea how I'd fit a full time job into my life" and the wife says "Thats easy, you'd be paying other people $500 a month to do all the stuff you do yourself!" :P
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Re: Mike's Big Plan!
Old 05-18-2004, 06:05 PM   #19
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Re: Mike's Big Plan!

Oh I gots chemicals. I just enjoyed sitting in the grass, drinking a beer, screwing around, and also being somewhat productive in weed removal.

Expedience wasnt my objective!
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Re: Mike's Big Plan!
Old 06-22-2004, 07:31 PM   #20
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Re: Mike's Big Plan!

Quote:
Oh I gots chemicals. *I just enjoyed sitting in the grass, drinking a beer, screwing around, and also being somewhat productive in weed removal.

Expedience wasnt my objective!

Isn't it great to decide when you want to do the yard work instead of having to do it Saturday evening or Sunday after church. Choices. That's what ER is all about.
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