Retire at 53?! Intro post

[mrfeh]

1. Did you look to somehow backfill with a part time job the first few years? We would love to just travel, but with a school aged daughter who is involved with lots of sports... that just isn't an option yet.

Any chance to work part time at your current company?

I worked 2 days/week between 50 and 55. Made for a nice transition.

 

[Markola]

A fudge factor is being used if one does not include all assets and all liabilities when calculating net worth. You wouldn't walk away from your primary dwelling would you? And let the neighbor's kids take possession of it for nothing? I wouldn't. The bank wouldn't let you walk away from their mortgage, either. All RE is on the balance sheet at market value less mortgage principle, in my book.

There is a vein of posters on this site who put fudge factor on top of safety factor on top of extra safety factor when calculating the 4% equation. I call it dithering. I suggest to strip the calculation bare of fudge factors, account for all assets and all liabilities, and make a decision on whether or not to retire.

I may have chosen words poorly by using "pretax". I mean living expenses grossed up for taxes. So we agree on this point.

Yeah, we left the grind in our mid-50s and every known asset is included in our plan, because DW is a cancer survivor and we are intentional about living fully rather than scrimping so that the portfolio grows and grows, making us the richest people in the graveyard. We have no heirs. YMMV.

We’re spending about 7-8% right now in our healthier, Go-Go Years;
We have substantial, growing home equity over time, some of which will be accessed around age 70 when we, like our parents did wisely, downsize;
We include full SS for us two former professionals taken between 67-70 as conditions warrant then;
Part time work we both do now, as long as it remains enjoyable;

We aren’t projecting inheritances, however. Parents’ end of life finances are too unpredictable relying on the bankruptcy-oriented American medical industry, and their end is too painful to think about about anyway.

 

[newchapter]

Congrats! I retired in December of 2019 at 50y/o. I had big plans to do some traveling in 2020, start volunteering in 2021, and go from there. Well.... things didn't exactly work out how I had it planned as COVID hit.... But... My Doberman and I did hike many, many, many trails all around GA in 2020 and 2021, I did get some volunteering in, but not the kind I am wanting to do, then in July 2021 I took a 3 week trip through Alaska. It was great as the cruise ships were not running yet, and I felt I had some towns all to myself. Then just 3 weeks ago my mother fell and broke her hip, so that has put my hiking on hold and everything else and it has been a mess navigating her recovery with the new lockdowns in her physical therapy center. Not sure what my life will be like once she is back to her home and glad I can be there for her. In any event what I am trying to say is just be prepared for what life throws at you. If I had it to do over again, I would have continued working through 2020 and some of 2021 as they were allowing everyone to work from home. I don't regret retiring early at all, especially when I talk to old coworkers whose stories remind me why I had to leave for my mental health. I am also much more healthy than I have ever been since being able to focus on me rather than the 9-5. Wishing you the best!

 

[Koolau]

1. Did you look to somehow backfill with a part time job the first few years? We would love to just travel, but with a school aged daughter who is involved with lots of sports... that just isn't an option yet.

2. Am I crazy to give up huge income potential in the prime of my earning years?

3. How did those of you with FIRE plans come to grips with the actual exit?

Thanks in advance for any perspective!!

1) No need. We had "enough" (If all the calculators say you have enough and you FEEL like you have enough - you have enough.)

2) I'm tempted to say "see 1 above - but what is it about "huge income potential" appeals to you. Do you NOT have enough? If you don't, then stay put. If you do, you can leave. It's that simple - and that complicated as well.

3) The ACTUAL exit was easy. I literally walked out the gate for the last time and never looked back. I had stayed to enjoy the w*rk. When that w*rk was changed, I left - a week later. Easy - though YMMV

 

[HMMY]

1) I was offered PT work shortly after I retired, even though I was rejected when I asked for PT work after I had my 2 kids. Retired at 52 with 2 high schoolers. The kids, plus getting back in shape (quit the gym when pregnant), and a couple volunteer gigs filled my time until Covid.
2) I don't want to think about how much I walked away from, but there was nothing I wanted to buy or do that I couldn't already afford.
3) I moved my assets from 80/20 to 55/45 over 2 years. I delayed my exit for a year to do some surgery and rehab. I hired a financial planner to confirm I was good to go.

 

[37andhappy]

I should have called out the fact that I'm in the process of doing some MAJOR diversification to eliminate that risk. That is the first step in our 18 month exit plan. Thanks for the keen eye.

Important to do. Even if the tech stock keeps going up, its the right thing to diversify now.

Also, be very weary of any "financial advisor". How are they making money? And what biases and kickbacks do they have an any investments they recommend?

I would be inclined to look towards a mix of global equities (perhaps 75%) with the remainder in cash/BTC.

 

[Exwallstguy]

Retired last year at 42 and certainly agree with people that time is your most valuable resource. What’s the point of working and trading your time for money when firecalc is at 100%. Unless you LOVE your job, go out there and live your best life before any unexpected health issue arise (knock on wood)

 

[scrabbler1]

I didn't retire then work part-time. Instead, I switched from working full-time to part-time for 7 years before I retired in late 2008 at age 45.

Like you, dlgobeavs, I was greatly helped by the exploding value of my company stock. This was back in the 1997-2008 period which included the downfall of companies such as Enron and Worldcom. When I had the chance to sell some shares after 2002, I did. Still, I had plenty of shares I had to hold onto until I left the company, and I was able to cash out those shares and not get hit so hard on the tax side. Dlgobeavs, are you aware of NUA (Net Unrealized Appreciation) which allows you to sell shares of company stock using the lower long-term cap gains rate? There are some specific rules about selling such shares, so make sure you are aware of them. NUA works well when the cost (par) basis is small and the appreciated gain is big, which is what happened with me (97% NUA, 3% par).

I switched to part-time and later stopped working in large part to despising the commute, even as little as 2 days a week in the last 17 months I worked. I had already been doing some new or resurrected activities when I first switched to working PT, so I didn't suddenly have to find new things to do when I retired. (The big change was when I switched to part-time 7 years earlier,)

I agree that building a cushion into your budget is a good idea. I made sure I had that in case I went on a small spending spree from time to time. The cushion absorbed the spree without affecting anything else in my day-to-day life, something I required in any ER plan.

One part of my ER plan was to split it into 2 parts. The first part was getting from age 45 to ~59.5 using only the taxable part of my overall portfolio. After that, when my reinforcements arrive (SS, frozen company pension, rollover IRA), my picture looks only better. Do you have similar assets currently not readily accessible but will be later on?

I hope this helps.

 

[Luvtoride]

“
2. Am I crazy to give up huge income potential in the prime of my earning years?”

Read the Book “Die with Zero” to get a good perspective on this question. The answers from other about TIME and HEALTH to do the things you want to do are of more relevance than earnings! Congrats for being in such a good position.

 

[bingybear]

I retiree at 53 from a promising start up.

hindsight... should of retired earlier.

see if you can make this start up go good for you.... work on making retirement successful like a great startup.... but with different goals

 

[Retired Expat]

I also retired at 53 but knew that I was changing most aspects of my life when I did it. 20 year marriage to a high maintenance and high cost wife was over. Selling house in a VHCOL area and moving to a VLCOL area. (Put it this way, what I used spend on annual property taxes alone would now cover all my annual living expenses)

So I traded the high income and high expenses for low income low expenses and have actually been able to save more and reinvest more to where I have doubled my net worth in the 8 years since retirement and have had a great time doing it. So anything is possible! Where there is a will there is a way, kind of thing. Oh and there has been a lot of travel!

 

[Koolau]

I also retired at 53 but knew that I was changing most aspects of my life when I did it. 20 year marriage to a high maintenance and high cost wife was over. Selling house in a VHCOL area and moving to a VLCOL area. (Put it this way, what I used spend on annual property taxes alone would now cover all my annual living expenses)

So I traded the high income and high expenses for low income low expenses and have actually been able to save more and reinvest more to where I have doubled my net worth in the 8 years since retirement and have had a great time doing it. So anything is possible! Where there is a will there is a way, kind of thing. Oh and there has been a lot of travel!

I am glad that it has worked out for you in your new life as an expat. I briefly looked into that myself before I became convinced I could retire to a relatively HCOL area. I just wasn't willing to compromise what I wanted for more affordable living. For me, it is worth it to pay for what I want. Clearly, we have had to make some compromises to live where we want. Most of the compromises we have made were not an issue to us (we drive older cars, live in a condo instead of house, travel "cattle car" class when we fly, never do "fine dining" etc.) To us, Paradise still seems like a "bargain." It sounds like you still consider your expat life as a "bargain." Fantastic!

 

[Retired Expat]

I am glad that it has worked out for you in your new life as an expat. I briefly looked into that myself before I became convinced I could retire to a relatively HCOL area. I just wasn't willing to compromise what I wanted for more affordable living. For me, it is worth it to pay for what I want. Clearly, we have had to make some compromises to live where we want. Most of the compromises we have made were not an issue to us (we drive older cars, live in a condo instead of house, travel "cattle car" class when we fly, never do "fine dining" etc.) To us, Paradise still seems like a "bargain." It sounds like you still consider your expat life as a "bargain." Fantastic!

Thanks Koolau, yes Expat life is still a bargain but it is also a GREAT life. We live 7 minutes from the beach while our house is a lake front home with gorgeous views, plenty of space, a separate guest house and even a “barbacoa” a covered open air grill house. We moved during the pandemic and renovated this house. But a fairly extensive renovation here is still 25% of what I would have paid in the US. So in no way do I feel that becoming an Expat was a step or a compromise. Quite the opposite! Medical care is excellent, big supermarkets like at home, high speed internet, safe, clean, nice people. So to clarify, I think I traded in my VHCOL life for a much cheaper but a much better life too. If it was just about the money, not sure I would have stayed….