There is FI and beyond FI-but how far?

[pb4uski]

When I was working I viewed FI as when I had sufficient assets such that if they fired me the next day that other than hurt pride I would essentially shrug and say "ok, whatever".

Once I got to that point I was a bit more outspoken about work issues and often ended up saying what everyone was thinking but were afraid to say because it wasn't the message that the client was looking for. Interestingly to me, our clients and my colleagues loved it and wanted more... I became busier than ever.... but it was fun being the grey hair in the room.

Then it ultimately got to a point where continuing to work was just enriching Uncle Sam and my kids, job-related travel was a hassle and I had better things that I wanted to do so I resigned. It helped that we had just sold our house and were down to one home... the lower expenses and more money in the bank gave me added confidence to retire even though I had delayed for a year due to the great recession.

 

[nash031]

Not there yet, but current plan is to work until the SS second bend point, which should be something like 48 or 49. That will also put us about 50% above our required spend in terms of funds available for discretionary or unexpected spending.

 

[FIREd]

We reached FI in 2010. I retired that year but DW kept working until 2015, when her own BS bucket started to overflow.

 

[Mulligan]

I have been retired for 7 years. Its a shame that people with small functioning brains like myself do not get the opportunity to base their decision on retirement like I was fortunate enough to do. Just tracked expenses 3 years, called up the pension office for a detailed report, and determined I would only spend 60% of my monthly pension....So I hit the door! Its a lot easier to spend money sent to you once a month than dig into the investment stash.

 

[Cobra9777]

We were FI in 2007-8 (age 47), but it was "squeaky tight" and the financial crisis made me nervous. Plus we still had one in high school and one in college. Then in 2010, when the youngest started college, I accepted an assignment which was a 2-3 year commitment. So I figured timing-wise, that would work out OK, and it did.

I thought about working to 55 for a pension bump and to retain all RSUs and unvested options. But the trade-off vs 3 more years of freedom was no contest. Turns out, DW ended up working 3 years longer, entirely for personal reasons, but with a very positive effect on the retirement plan as well.

Also, we never really included SS in our retirement plan. Actually it was included but with a "reduction factor" that I typically set anywhere from 30% to 50%. My skepticism is slowly waning as we get closer to SS becoming a reality (still 6-14 years out). So with no "reduction factor", all the tools like FIRECalc say we are underspending by 30-35% relative to a 100% success rate. We have no particular desire to spend more than we are now, and we are still planning to downsize the house. So I guess we overdid things a bit, but the timing felt right given the circumstances at the time, and I'm certainly glad I didn't stick around to 55.

 

[Just_Steve]

Something similar was the tipping point for me. We were FI a couple of years before retiring but kept working until I qualified for retiree insurance.

Retiree medical was the last part of my puzzle, when I achieved that I left.
To be honest without it I would still be w@rking.

 

[karen1972]

Healthcare is of course a big issue; however, the question is dual sided for me. If I continued to work, I would continue to suffer from more and more health issues to the point my health care costs could be through the roof... or I quit and fix the issues now in my 40s and hope the cost of normal health care doesn't exceed that. ie stress, bad back, overweight, bad knees... in your 40s does not lead one to worry about 95 as one won't make it there. So I pulled the plug, no stress, sleep like a baby, back issues gone, flexibility returned, weight issues under control, knees recovering.. so I may now live to be 95, but I"m hoping with such better health it makes up for the health care costs I'm avoiding. If I can avoid knee surgery or another back surgery, that would make up for a ton of premium costs over the next decades.

 

[TGL405]

Just got back from a work road trip and see there's a plethora of reasons why this is such an individual decision. As I read through all the replies it really hit me that I have been so focused and driven on achieving FI and covering all the financial bases that I really haven't put a whole lot of thought into developing a bucket list or specific things we want to accomplish after retirement. Like many, we dream & talk about more travel and buying a cabin in the woods to use as a hunting camp, but really haven't thought those ideas through, assigned realistic costs to them, or accomplished any additional planning to that end--But that's just what's needed as I determine how long to stay working. Thus far, just knowing that I COULD walk away today and maintain the same/ similar lifestyle has been enough and accomplishing that has consumed all of my spare mental capacity up to this point. I just bought Zelinski's book and will work my way through that for some deeper considerations as well. I guess this second tier "beyond FI" is a place I'm just realizing exists and needs to be something I spend more time on...

 

[ejman]

FI in 1999 at age 49, ER'd at the end of 2002, age 52. It actually worked out very well because the 2000-2002 period was not very kind to equities (although fortunately I had a well diversified portfolio) which enabled my retirement to start on an upswing as the stock market did well for a few years starting in 2003. It felt really good to see my NW increase during the period 2003-2007 even though I no longer had a salary as I got my sea legs re this retirement business.

By the time the 2008-2009 unpleasantness hit there was no going back and fortunately a 50/50 portfolio survived even that difficult period fairly well.

As noted in a prior post, although future market performance is impossible to predict it would seem that current valuations are on the rich side so if I were thinking of ER today I think I would be cautious and would want to build up reserves a bit more if retirement calculators showed my situation to be at the edge of FI. If the market took a big dip ( as it did in 2000-2002 prior to my ER) I would probably feel more confident if retirement calculators still showed a go after a big drop in the market. YMMV

 

[Fedup]

Retiree medical was the last part of my puzzle, when I achieved that I left.
To be honest without it I would still be w@rking.

Most likely for me too. Most likely I would move closer to work to avoid the commute.

 

[RobbieB]

It's always better to have more dough than less.

If you don't hate your job why try to get out as early as you can?

So you can clip coupons and agonize over every expense?

 

[NW-Bound]

...My wife and I have been discussing retirement and when to finally pull the trigger and initially thought Dec. of this year. We are at the point of struggling to determine just how far beyond FI we need/ want to go. I know this is a very personal decision and the standard answer from many posts is "it depends",...

In my case, I was tracking my expenses then saw that we should be able to live well on the 4% WR that was tossed about. Of course, we need to have some safety margin.

So, I finally spent the time to figure out what our SS will be. That helped a bunch.

Next, I looked at our expenses to see what could be cut out if things got bad.

At about the same time, I had a health scare that could have me pushing daisies long before I could claim SS even. That finally took care of all the money worries, as I realized that all that financial worries were for naught if I was 6 ft under.

 

[Danmar]

It's always better to have more dough than less.

If you don't hate your job why try to get out as early as you can?

So you can clip coupons and agonize over every expense?

This is also my view. I would aim for maybe 25-50% "cushion" if you don't hate your job. Much easier to increase your spending somewhat than to scrimp. Also, markets might not cooperate? Now, if you really hate your job, different story.

When I retired at 56, I had a cushion in this range and easily increased my lifestyle to absorb it.

 

[TGL405]

Many excellent points. It would not be good to retire from the high stress job into a high stress retirement worried about money or health.

In my case I'll be fine with a moderate pension which will cover the expenses, a small investment fund, and then SS in 5 years (or longer). I just need to figure out what I need for that 2nd tier of retirement spending "beyond FI" and plan accordingly, which may cause me to stay working a little longer. Then again, something could come up that causes me to go right away. It's good to have choices... because as related in all the posts above...life's road sometimes gives us unexpected turns.