Things to do pre- vs. post-FIRE

[Scrooge]

My personal FIRE is likely about 3+ years from now (see my introductory thread if you want the details), but I am beginning to think that I should start a few pre-FIRE projects earlier rather than later. Here is a preliminary list that I have come up with and I was wondering what other folks thought based on their FIRE experiences?

In no particular order:

1. De-cluttering.

I have read a few threads on decluttering and many contributors commented that they did a lot of that after they FIREd. I am thinking, however, that clutter would be best handled before you FIRE rather than after the fact. Among the advantages I count:

(a) the ability to better plan just how much house you will need after FIRE;

(b) making it easier to sell your house; and

(c) general peace of mind once you don't have all that stuff hanging over your head.

Earlier this year I donated 20 boxes full of books that I am sure I will never read  Do I really need a full set of documentation for an OS that was obsolete 10 years ago? And what about my 15 year old utility bills? 

2. Exercise and health insurance.

I am reasonably healthy and in passable shape, but I am no longer 25 and the body is beginning to show signs of abuse tear and wear. I was in great shape in my 20s, but then had a minor injury that prevented me from exercising. I got back in shape in the mid-30s, but I am back to "mediocre" now that I am 40. I figure getting more exercise will help with quality of life as well as lower my health care costs in the long run.

Also, I am considering applying for an individual health insurance policy as a dry run. It's much better to find out that you are in the high risk pool due to some obscure medical condition before you FIRE rather than after the fact 

3. Places to live.

Start looking for a place to live in retirement now rather than later. I have a few ideas since I have done so much business travel, but I need to start digging deeper. Staying in hotels and corporate apartments is not the same as buying a house, paying taxes, etc.

4. Hobbies.

Thankfully, I have quite a few (but not enough time to pursue them while I am working, of course), so I think I am all set in this respect. Other people may want to investigate this area prior to FIRE. What if you FIRE and then discover that your newfound hobby is so expensive that it jeopardizes your SWR? 

So, am I overanalyzing these issues? Missing something?

Edit: Clarity, spelling.

 

[REWahoo]

Here is a "Best of the Boards" thread on the subject:

http://early-retirement.org/forums/index.php?topic=7357.msg131837#msg131837

 

[Rich_by_the_Bay]

So, am I am overanalyzing these issues? Missing something?

Good post.

Maybe not along the lines of your "to do list," but I recently decided, as I observed the stock market in the last few weeks, that I would have my cash reserves in place before I retired, rather than allocating them at that time.

FIRE just before a long bear market and it may be too late to carve out your big "expenses bucket" without a major hit. By selectively building it up during good market runs before FIRE, I hope to have it all in place by then. If the market tanks a week after I FIRE, I can ride it out.

 

[SteveR]

Good post.

Maybe not along the lines of your "to do list," but I recently decided, as I observed the stock market in the last few weeks, that I would have my cash reserves in place before I retired, rather than allocating them at that time....

Very good point. If you don't have some kind of plan to convert assets into a more liquid form before you retire you could take it on the chin in a bear market. This might best be done a little at a time a few years out from retirement. I am still doing that now and started a couple of years ago so the conversion is sort of DCA in reverse. It also keeps the tax bite down too unless you have a very low tax situation right after you retire and you can save a lot on taxes but the risk is doing it in a bear market and losing far more than to LT Cap. gains taxes.

 

[donheff]

Good post.

Maybe not along the lines of your "to do list," but I recently decided, as I observed the stock market in the last few weeks, that I would have my cash reserves in place before I retired, rather than allocating them at that time.

Same here. DW is still working and we are putting all current savings into cash equivalents to fill that bucket without pulling out of existing equities.

 

[Scrooge]

Here is a "Best of the Boards" thread on the subject:

http://early-retirement.org/forums/index.php?topic=7357.msg131837#msg131837

Thanks! I knew I saw this thread somewhere, I just couldn't remember where.

Hm, where did I put my memory pills again? 

 

[audreyh1]

A lot of the things you list might work better after FIRE. Then you have TIME to do these things like declutter, etc. It's really hard to imagine ahead of time what your life will be like after FIRE, so you might not make the best decisions if you do this stuff early.

Another thing - people do tend to make drastic changes in their life right at retirement, and sometimes come to regret it. The change from stopping working is a big one. It's best to take moves like selling the house/downsizing and moving somewhere else kind of slow. Give yourself a couple of years to adjust to your new life before making drastic moves.

Audrey

 

[Leonidas]

I had little time/opportunity to prepare for RE'ing, but I don't know if I would have thought of decluttering before retiring. The amount of time and energy that I have spent getting rid of crap that I don't need, and organizing what I do need, has been tremendous. I never realized how much stuff I had hung on to that was just taking up space - 15 year old utility bills, indeed.

 

[Scrooge]

A lot of the things you list might work better after FIRE.  Then you have TIME to do these things like declutter, etc.  It's really hard to imagine ahead of time what your life will be like after FIRE, so you might not make the best decisions if you do this stuff early.

Sounds reasonable, but I am rather concerned that I don't know how much house I will need after decluttering, which affects my projected post-ER costs, which in turn makes me uncomfortable. 15 years ago I was living in a large efficiency apartment and was as happy as I could be, but can I do it now 

As Leonidas said, you need to decide what you want to keep and what you want to get rid of and at least in my case it's not a trvial question. I am 99% sure that I will get rid of my old utility bills and that 20 year old spare tire for the car that I got rid of >10 years ago, but there are whole rooms (!) full of stuff that I am not so sure about.

For example, I have quite a few boxes of VHS tapes from the 1990s (e.g. the Charlie Chan movies that Fox Movie Channel won't show any more) that I should probably transfer to DVD to save space, but is it worth the time and aggravation? Worse, I have thousands of books that I am no longer truly interested in. I have already gotten rid of 20 boxes (see above), but there are easily hundreds more where they came from. Will I ever read that 10 volume history of the Netherlands that I bought on a whim years ago, back when I wasn't as concerned with LBYM? And how many French dictionaries do I really need?

Professional booksellers often comment that women tend to read for pleasure throughout their lives while men usually stop in their early 20s, but many start again in their 50s. I may no longer have much interest in the Complete Works of E. W. Hornung (painstakingly collected years ago), but will I regret getting rid of them 15 years from now? Or will the fact that many of them are now available at Project Gutenberg (and even more will be likely available by 2020) make the point moot?

And if I do decide to get rid of most of my books, how long will it take to sell them? I don't expect to get rich -- although the first magazine publication of Stephen King's first story, which I paid $100 for some 10+ years ago, may be worth something now -- but some of the books are relatively rare and I will probably sell them on Ebay/half.com. Given how many I have, it can take many many months 

Another thing - people do tend to make drastic changes in their life right at retirement, and sometimes come to regret it.  The change from stopping working is a big one.  It's best to take moves like selling the house/downsizing and moving somewhere else kind of slow.  Give yourself a couple of years to adjust to your new life before making drastic moves.

That's another thing that I have been toying with. Yes, I have read about "churning", which can be expensive and stressful. On the other hand, my house would likely sell for at least $370-380K if I were to put it on the market now. That's a pretty big chunk of money for a minimalist like myself who lives on $15-20K/y and would like to maintain the same level of expenses in retirement. I'd much rather sell the house right before I RE and have the money in the bank rather than stay in the house for a while and be at the mercy of the real estate market.

Ah well, decisions, decisions...  :

 

[audreyh1]

Yeah - I understand the need to downsize now to lower overall expenses and thus make FIRE possible earlier. I guess there is no way to move to a less expensive arrangement now so that you can reap the economic benefits while you are still saving?

As for decluttering - that's good to do at any time I suppose. But frankly, I wasn't able to really tackle it until about 4 years after FIRE. I was working too hard before. And then in the immediate years after FIRE I was playing too hard LOL! Then, when we finally decided what change in lifestyle we really wanted, we tackled the decluttering issue head on.

You see by then we finally realized that what we really wanted to do longer term was to live the fulltime RV itinerant traveler lifestyle. At that point it became imperative to finally tackle getting rid of the house and a bunch of big toys and stuff. We halted our laid-back retirement lifestyle for about a year to make this transition - get rid of boat and most of the house stuff, order a motorhome and move into it, sell the house. Hard work but we were really motivated now!

There is no way I could have gone through that process pre-retiring, because we had absolutely no idea that was what we ultimately wanted to do!

Just sharing my personal experience.

I did lose weight (get down to a healthy weight) before retiring. That was good. I didn't get in great shape until afterwards - because getting that level of exercise is more time consuming and much easier to do retired.

Ditto on addressing any health and dental issues while your insurance is paid for.

Also - we set aside extra "play money" for those first few years. Was really glad we did that.

Audrey

 

[kcowan]

Scrooge
1) decluttering
It sounds like you have a long way to go! e.g. when was the last time you watched many of those VHS tapes?

So, in your case, this is probably mandatory to at least get some way through it for the reasons you state.

3) Where to live
I think this is tough to do pre FIRE. You lifestyle will change in the the first 5 years and this may dictate a different living arrangement. Some want a larger garden because they have time for gardening. Others want no garden because it detracts from travelling.

Many do not move because they cannot face up to your item #1. We have swapped homes with such people: Big 4 BR homes with cupboards full and garages and basements full!

 

[Scrooge]

when was the last time you watched many of those VHS tapes?

Well... The idea was that I would accumulate all these tapes (and now thousands of DVDs) and then watch them I in retirement. Film history was one of those college era "liberal arts pursuits" that I mentioned earlier and has remained a hobby of mine ever since. As long as they cost me pennies per DVD to make, I figure it's a good compromise between my hobbies and LBYM  8)

Now, 20 year old computer games are a different story. Pass the blowtorch, please

You lifestyle will change in the the first 5 years and this may dictate a different living arrangement.

That's a concern, although I hope it's not a major one in my case. I am OD'd on traveling for a while (wonder if the total number of frequent flier miles is over one million yet?) and walks in the park are as adventurous as I am likely to get for a few years. But you never know what the future may bring and it can be expensive 

 

[Scrooge]

So I have spent a few hours on decluttering over the last few days.

One of the first things that I pulled up was a stack of bank statements documenting the ups and downs of my primary savings account between 1988 and 1996. I spent 5 minutes reviewing the numbers before tossing it in the trash can and noticed that my account, which grew steadily between 1990 and 1993 (when I bought my house), didn't grow nearly as quickly afterwards. I was a little puzzled since my mortgage payment wasn't that much bigger than my rent payment had been even with the extra $300/mo that I was sending to the bank. And I had "gotten" LBYM by then, so where did all the money go 

Then I moved to another area where I kept a pile of my bookbuying records, including catalogs, receipts, orders, etc back in the mid-1990s. After 10 minutes of shoveling this stuff, I knew all too well where the money had gone. Sure, I had "gotten" LBYM by the early 1990s and I was quite frugal about buying groceries, clothes, and so on, but I wasn't counting book expenses as "expenses" because ... well, they were different! 

Oh well... Anybody want to buy The Complete Works of Joseph Conrad? Rudyard Kipling? Barely touched since 1936! May very well be the deal of the century! Don't miss your chance! 

 

[audreyh1]

Selling stuff....

eBay is pretty good. Depends on the class of "stuff", but there are often markets for all sorts of obscure items, you just have to look. Takes some work, but you can get the most money back this way.

Craig's List is a local free classified ads on-line service - available in most major metropolitan areas. Much better than the paper. www.craigslist.org

Also freecycle.org is good for giveaways - when you have something that is perhaps more unusual than the normal stuff donated to Goodwill/Salvation Army. You get to choose the recipient, plus they come get the goods!

Audrey