Is there a way out of this maze?

[Grainiac]

Hi all! I think it has come the time I introduce myself and start getting some friendly advice from the awesome members of this forum, so here we go (sorry this is probably going to be long):

We are a DINK couple both 46 years old. We have been fortunate enough to achieve relatively well compensated management level positions with our megacorp employers (separate companies). While our employers and industries are not overly sensitive to economic swings, we currently feel far from secure in our jobs due to the predominant meat grinder cultures and abusive political climates in the companies. Especially I am at the point when every Friday going home and still employed feels like a big achievement. Add average 12 hour working days and difficulties to schedule vacation time more than just couple of random days at the time, I feel I am getting close to a burnout. DW's situation may be a little less difficult most of the time anyways, but at times she is dealing with some similar feelings.

I constantly ponder various career change options including but not limited to ER. Simply finding new jobs for DW and I would be difficult because we are both highly specialized within our fields, and there is nothing else available at least for me in this part of country, if I were to leave my current job. At the same time we absolutely love living here and if things would just work out we would love never having to move again.

After one decade of financially very tough years while getting our degrees, LBYM has been a natural philosophy in our lives, and we have been entirely debt free for some time now. During recent years both DW and I have advanced well in our careers putting our joint annual income over 300k (actually way over the years when bonus and option payouts are good). At the same time we still enjoy fairly simple life style in a relatively inexpensive area of the country. We are currently spending only about 40k per year for non-discretionary expenses (company cars and company sponsored health plans help). Even with all discretionary spending included we currently use total of 55k - 70k per a year. Not forgetting that the average household income in our town is less than 40k, we could obviously get by with much less if we had to, and having been there before I know that we would be just fine.

We currently have about 800k sitting in several 401k and IRA accounts, and another 200k in stock EFTs and cash (efund). Our house (our only indulgence so far) should bring about 4-500k if we sold in the current market (definitely not in our plans).

One apparent option I have is to simply quit my job and ER next time I have a bad day, since DW's income alone would cover all of our living expenses and we could still add nicely to our retirement savings. But honestly this option worries me because DW is not all that happy in her job either, and seeing how I would enjoy my new life as a full time gardener and home maker might cause some major strains in our marriage. Besides, DW and some of my friends, to whom I have mentioned about the ER option keep telling me that I would be bored silly in two weeks. After all, I have only taken a full week of vacation twice over the past 16 years, and most people would probably consider me a workaholic based on just how things appear on the surface (they are wrong though). Another option of trying to hang on to both of our jobs for a few more years until we both could FIRE is probably not feasible either, since DW and I both have some pre-existing conditions and other health history that would make a private health insurance very difficult to get.

All this makes me feel conflicted in so many different levels. DW and I have been truly fortunate in many ways. We worked extremely hard first to achieve world class education, and finally achieved more in our careers than we had ever even dreamed about. I guess I actually feel guilty that all this did not make me happier in my life - quite an opposite. It feels like we have built our life into a virtual maze but forgot to leave a way out.

Any advice, anyone?

 

[plex]

Hash out a reasonable post-retirement budget for your expenses. One that you and your wife would agree upon, includes reasonable health care costs, and excludes work/work travel expenses. That's the hard part, then it is pretty easy to figure out how close your are. I wouldn't count the house's trade-down value if you don't intend to trade down when you ER or anytime near ER. Without the trade down amount, you have a ways to go still to hit 70k, probably 4-6 years. On the other hand, if the trade down was realistic, and your expenses in ER could actually reasonably be expected to be 55k, then you would be really close, maybe a 1-2 years away.

 

[TooFrugal]

Another option of trying to hang on to both of our jobs for a few more years until we both could FIRE is probably not feasible either, since DW and I both have some pre-existing conditions and other health history that would make a private health insurance very difficult to get.

You could see if you could qualify for private health insurance before you quit either of your jobs. In 2014 you should be able to qualify anyway unless the health care reform laws get repealed. Eighteen months before that you could quit and go on COBRA. You might also be able to get a policy under HIPAA - The Best Kept Secret of the 1996 HIPAA Legislation

This article has some good tips (though it is pre-healthcare reform)
Tips for getting insurance when you have a pre-existing condition - CNN.com

It you don't have kids and can pack up and move there are some states that don't allow pre-existing condition clauses right now.

Friends of ours with a small business have insurance through the National Association for the Self Employed they have been happy with.

We have health insurance and lots of other great benefits through my husband's day job so this is a subject near and dear to my heart. We both had corporate jobs like you and your wife. I quit years ago and started a business and have never been happier, but my husband still has a corporate job with long hours. But his job is easier I think because I can set my own hours and take care of more of the cooking, shopping, kid stuff like scout meetings, orthodontic appointments, sports practices, etc. especially during the work week.

 

[Onward]

It feels like we have built our life into a virtual maze but forgot to leave a way out.

Welcome to the American Dream. Have you started to feel like someone is sitting on your chest and holding a pillow over your face yet? If not, you will.

Retiring yourself, leaving your wife to work, sounds like it could endanger your marraige. If I were you I think I would try to keep w*rking till 2014, when the new healthcare laws will make it much easier to get private health insurance with pre-existing conditions. Use those next four years to save & invest all you can, then design a budget that requires no more than 3.5% annual withdrawals from your stash. Then get the heck out.

Also, as soon as possible, I'd do whatever it took to get away from the meat grinder for a couple of weeks, just to clear my head and have a look around.

 

[Grainiac]

Welcome to the American Dream. Have you started to feel like someone is sitting on your chest and holding a pillow over your face yet?

How did you know? That's exactly how it feels.

 

[ziggy29]

We are a DINK couple both 46 years old. We have been fortunate enough to achieve relatively well compensated management level positions with our megacorp employers (separate companies). While our employers and industries are not overly sensitive to economic swings, we currently feel far from secure in our jobs due to the predominant meat grinder cultures and abusive political climates in the companies. Especially I am at the point when every Friday going home and still employed feels like a big achievement. Add average 12 hour working days and difficulties to schedule vacation time more than just couple of random days at the time, I feel I am getting close to a burnout. DW's situation may be a little less difficult most of the time anyways, but at times she is dealing with some similar feelings.

If you both want out, it could cause some issues or resentment if one of you gets out before the other -- even if you reach a point where one of you could feasibly retire on the other's salary and benefits.

Have you and your wife discussed an exit strategy for the both of you? That would include when you could both get out, how much you would need, how issues like health insurance would be handled (as said already, possibly easier after 2014 and arguably in mid-2012 if you could afford COBRA payments) and how much you need to save to get there -- and if you're willing to make those financial sacrifices today.

That would be my first step if you haven't done so already.

 

[FIREd]

Hi Grainiac,

welcome. We have so much in common, it's almost spooky!

DINKs: check
Well compensated management positions: check
Industries not overly sensitive to economic swings: check
Less than secure jobs with abusive political climate: check
Long working days with difficulty scheduling vacations: check and check
Close to burn out: check
Highly specialized within our fields, nothing else available in this part of the country (and no desire to move): check
LBYM is a natural philosophy: check
Good, six figure income plus bonus and options: check
Spending in the $55-70K range: check
Living in low cost of living area: check

on and on...

Personally I don't think you should quit just because you had a bad day. What my wife and I decided to do was to hang in there as long as we could because with our high incomes/bonuses/options and low cost of living location, we were able to make great strides toward financial independence within a short period of time.

You guys need to sit down and decide what financial goal you want to achieve before one of you can pull the plug. For us, financial independence was a must.

 

[Gerbil Wheel]

"meat grinder cultures and abusive political climates"

Do we work at the same place? (lol)

Welcome and good luck.

 

[walkinwood]

Grainiac,

Have you looked into getting individual health insurance? Or are you just going by what you've heard. A number of states have high-risk pools. They're very expensive, but you'll have insurance and if it fits in your budget, you're good to go. As others have said, things get better in 2014.

Getting empirical, categorized data on your spending is your first step. Add some cushion to that, and use firecalc to figure out how much you need. Then you can think about your choices.

All the best.

 

[spncity]

After all, I have only taken a full week of vacation twice over the past 16 years

No wonder you are starting to feel burned out. Just using some vacation time could give you a new outlook on things. Two consecutive weeks off might feel like a sabbatical....

 

[ziggy29]

No wonder you are starting to feel burned out. Just using some vacation time could give you a new outlook on things. Two consecutive weeks off might feel like a sabbatical....

Yeah, unfortunately in this economic environment where employers can run roughshod over employees with near impunity and employees see little option but to suck it up and take it (unless they are securely FI), good luck insisting on it...

 

[Grainiac]

Grainiac,

Have you looked into getting individual health insurance? Or are you just going by what you've heard. A number of states have high-risk pools. They're very expensive, but you'll have insurance and if it fits in your budget, you're good to go. As others have said, things get better in 2014.

Good point. I have actually not talked to an insurance company to get exact quotations for DW's and my insurance cost. Just have heard about obscene numbers for individuals with similar issues (35k per year or so). Like some of the earlier commenters mentioned, as long as we are not ready to liquidate or down scale our house, we really don't have sufficient savings for FIRE for a couple more years at least, so did not really see a point in talking to insurance companies seriously.

Somehow 2014 and the health care reform actually fully taking place for good still seems a bit distant and even unrealistic, so I have not started counting on that.

 

[Grainiac]

Have you and your wife discussed an exit strategy for the both of you? That would include when you could both get out, how much you would need, how issues like health insurance would be handled (as said already, possibly easier after 2014 and arguably in mid-2012 if you could afford COBRA payments) and how much you need to save to get there -- and if you're willing to make those financial sacrifices today.

We have not exactly gotten to the point of discussing strategies yet. The ER together is still much more just my dream, while DW continues to be quite ambiguous. By writing in earlier post that my ER while DW would still continue working might strain our marriage, I actually talked about the possibility of doing it NOW. Letting DW get adjusted to the idea for a couple more years might be entirely different case. I must admit that as much as DW some times gets stressed out and swears how she hates her job, I don't think she can even imagine ER for a good number of years yet. With her personality it is really not a financial decision, as she is not at all a money centric individual. To her it is rather a matter of being committed to the profession she worked so hard to get in, and for which she developed the skills and knowledge to become one of the leading authorities in this country within her very narrow specialty. For a long time DW could not believe that I want to ER either, as I have always been the more financially ambitious (=greedy) of us, and recently also higher earning one of us. Now she at least some times believes me, so I guess I am in my way to finding out in another year or two if she is actually going to be OK with me retiring first while she still continues to work, if she so desires. However, I would prefer both of us retiring at the same time, as we still after 18 years enjoy very much doing even every day things together. We shall see...

Hmm! I seem to be able to see my situation in a bit more positive light today than when I started this thread yesterday. It must be Friday, and I MADE IT THROUGH ANOTHER WEEK!!!

 

[Htown Harry]

You guys need to sit down and decide what financial goal you want to achieve before one of you can pull the plug.

No wonder you are starting to feel burned out. Just using some vacation time could give you a new outlook on things.

Have you and your wife discussed an exit strategy for the both of you? That would include when you could both get out, how much you would need, how issues like health insurance would be handled (as said already, possibly easier after 2014 and arguably in mid-2012 if you could afford COBRA payments) and how much you need to save to get there -- and if you're willing to make those financial sacrifices today.

Also, as soon as possible, I'd do whatever it took to get away from the meat grinder for a couple of weeks, just to clear my head and have a look around.

I'm seeing a connection here...

Sounds like you two might benefit from a fall "business" trip to a quiet beach with very spotty cell phone coverage.

Just the two of you, your laptops and a copy of Work Less, Live More.

 

[Grainiac]

I'm seeing a connection here...

Sounds like you two might benefit from a fall "business" trip to a quiet beach with very spotty cell phone coverage.

Just the two of you, your laptops and a copy of Work Less, Live More.

Hmmm. Duly noted.

DW's current frequent flyer mile balance cold take us around the world three times in first class (just a guess I did not really calculate that ).

The book is kind of pricey in Amazon $12.23. Hope they have it in county library.

 

[Amethyst]

We worked extremely hard first to achieve world class education, and finally achieved more in our careers than we had ever even dreamed about. I guess I actually feel guilty that all this did not make me happier in my life - quite an opposite.

How about trading the guilt in for a sense of triumph, that you cleverly front-loaded all the effort and misery into your first 40 years or so, and now have the remaining 40-50 years to do whatever the heck you want, once you figure out what that is? (Not dismissing your other concerns, just haven't seen others address this particular concern yet).

Amethyst

 

[Sea Kayaker]

Nice thread, Graniac... alot of simalarities between our situation and yours, except we are younger DINKS, 38...

I hope to stop working, or at least scale things WAAAAYYYY back when I'm about 45, but I also face the issue of a spouse that will likely keep on working. She does enjoy her bio tech megacorp job however, and if I transform into a happier, fitter, version of myself, I'm hoping she's okay with it - she understands that the nature of my work can make me quite miserable. I've tried to casually bring up the subject of my retiring before her, and I get the raised eyebrows "Are you serious?" look. I think she needs to know soon just how serious I am about this.

 

[Joshua]

I've tried to casually bring up the subject of my retiring before her, and I get the raised eyebrows "Are you serious?" look. I think she needs to know soon just how serious I am about this

I'd say that's something you definitely need to make sure you're both clear on. Differing expectations about money, jobs, and lifestyles can be rough on relationships, so it's always better when you're actively communicating about your wants and needs with your partner. In my case, my wife knows I like my job most of the time, but I've also let her know that when I can exit it and start collecting my monthly check, I will definitely do so.

If nothing else works, you can always emphasize that retirement will mean you have more time to spend with her.

Josh

 

[Rambler]

The book is kind of pricey in Amazon $12.23. Hope they have it in county library.

...but worth every penny!

R

 

[haha]

If nothing else works, you can always emphasize that retirement will mean you have more time to spend with her.

Josh

That one can really backfire.

Ha

 

[travelover]

The book is kind of pricey in Amazon $12.23. Hope they have it in county library.

Four bucks, used.

BookFinder.com: Search Results (Matching Books)

 

[Grainiac]

How about trading the guilt in for a sense of triumph, that you cleverly front-loaded all the effort and misery into your first 40 years or so, and now have the remaining 40-50 years to do whatever the heck you want, once you figure out what that is? (Not dismissing your other concerns, just haven't seen others address this particular concern yet).

Amethyst

I appreciate you pointing this out. I guess I need to overall work harder trying to find positive angles about all this.

 

[Grainiac]

Hash out a reasonable post-retirement budget for your expenses. One that you and your wife would agree upon, includes reasonable health care costs, and excludes work/work travel expenses.

In an effort to do that I pulled together all our spending numbers from the past 12 months. It was a tedious task but I believe the result is relatively accurate since we use very little cash and virtually everything goes through either credit cards or direct payment from bank accounts. To my own surprise my earlier estimates were way off: over the past 12 months we only spent $37k, and that includes about $10k of what I might consider discretionary purchases. Now, for the post-retirement purposes I need to add the expense of at least one vehicle and health care, in addition to some extra money for hobbies and entertainment, as we will not be spending 60-70 hours per week working any more. Regardless, I imagine $55-60k might be a very generous estimate for what we need for maintaining the lifestyle we are accustomed to.

 

[TooFrugal]

One option to consider is to do consulting or start your own business doing something you enjoy and working when you want to work. According to the authors of The Millionaire Next Door, "Interestingly, self-employed people make up less than 20 percent of the workers in America but account for two-thirds of the millionaires."

Plus the tax advantages are a huge plus. Health insurance premiums may be a deductible expense. The amount you can tax defer in retirement plans is another plus.

You may not have to choose between a high stress job for a mega corp with long hours and no earned income at all.

Just a thought.

 

[chinaco]

I can relate. I am ready to FIRE. I have toyed with going over the last 10 years because of the money we accumulated... but am sticking with our plan because I am very confident that I will be FI.

Fortunately, I am no longer doing the long work days.

I would recommend not making any rash decisions. Take your time. Do some analysis to determine your income needs and identify the funding gaps. It is easy to over estimate your spending needs by focusing on "rule of thumb" expenses based on income level.

Keep in mind when you stop working, certain expenses go away, but others will appear... and example would be paying the full medical premium for health insurance.

You may be at your highest earning potential (may be not) and working a couple of more years at your current job is probably less stress and effort than starting over at a new job or quitting and going back to work later.

Once you know your true (realistic projected) expense needs and have identified your funding gap for FIRE, buckle down on current spending and save.

Focus on managing your resources to achieve your goal rather than force-fit your goal into your resources (if possible).

I would recommend against taking on high risk to achieve high returns on investments.

IMO - sticking with tried and true, prudent, and conservative investment strategy is best for retail investors... it seems to yield better long-term results. I try to strike a balance between preservation of capital and growing assets.

If you think you are approaching FIRE in a couple of years, remember that traditional strategies for investments shift somewhat when one is going out of accumulation mode and into decumulation. There are several legitimate and workable variations on how to do it. This is an area where you should do some self education.