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Old 07-07-2020, 06:30 PM   #41
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Is the $15k per month spend grossed up for taxes? If you are taking the money from a taxable IRA account, you'll need to add around 25% for federal and state taxes.
Good point, plus the "expect taxes to go up" - #1 IMHO. And don't forget at that income level, your SocSec is almost all taxable.

Healthcare is expensive, especially if you are covering your kids. Assume you have a well-funded HSA already. As you age, you'll need it. Medicare is in serious financial difficulties and it's getting worse. I expect premiums to go up and the tier levels to get "tighter". When you get closer to 65 you'll want to keep an eye on that. We have retiree health benefits and Medicare tripled our monthly costs.

PandaBear's and Dawgman's posts re college costs/help to young adults are on point. It's a real struggle for Millennials right now and will probably get worse before it gets better. And none of us can be 100% sure what the economy/job market is going to look like when your kids start their careers. What happens when they want to buy their first houses? It's tempting to want to pitch in some $$$$ help.

Also, are you looking at the possibility of graduate school costs? Because even in today's job market, and probably more so in the future, college degrees are just an entry level step. In some careers a graduate degree is a necessity to be considered for any kind of promotion.

I mention this because a friend of mine ten years ago left a very good marketing job with a major corporation (everybody would recognize the brand name), to get an MBA at Harvard. She was well-regarded, but she realized that every single one of her co-workers had graduate degrees; she was the only one who did not. She was never going to get any further promotions without an MBA.

After getting the degree and re-entering the workforce - right at the height of the recession - she's had no trouble finding marketing jobs in both finance and technology companies. She pretty much writes her own ticket these days.

Just something else to think about, LOL. Good luck to you as you consider your options going forward.
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Old 07-07-2020, 06:34 PM   #42
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DH and I will also have a FatFIRE plan and will retire (hopefully if the COVID stuff ever ends) in our mid-50's. Our monthly budget is higher than yours and every single calculator we use shows us at a 100% success rate. But we just got to 100% in the last few years.

As far as comfort, yes, I agree it feels risky. We aren't there yet. The numbers work in theory but it's still nerve wracking to make that decision. We don't want to ever have to w*rk again after we FIRE, not ever, not 10 hours a week or 10 hours a month. Keep thinking we forgot something in our planning so the next step for us is to hire a fee only advisor to review our plan. Maybe hearing from a third party will help us move on.
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Old 07-07-2020, 07:21 PM   #43
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One option is keep working. Your $5M should grow to $8M to $10M in 10 years if invested wisely in a simple index equity fund. At that point, you should be less worried about money. The question is whether you want to continue to work in your current position or another more satisfying job elsewhere.

I went through this same situation and I choose the latter. As expected, my nest egg grew to a comfortable amount. My more satisfying job was better than expected. Good job, good pay and good co-workers. I was planning to work for 5 more years but I ended up working 10 more years.

The best time to look for a more satisfying job is when you still have an existing job. If that second job turns out to be less satisfying, then you still have the option to retire as you originally planned from your existing first job.

Remember that when you get another job you do get re-energized in meeting new people, learning your new job and you will find that change in environment will help you mentally because your mind is being challenged. If you do not like to be challenged mentally, then it is time to retire for good.
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Old 07-07-2020, 08:01 PM   #44
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This is also a good time to remind that FIRECalc retirements of longer than 30 years have tended (or used to tend) to look rosier than 30 year retirements. The reason is that the last historical period it can look at for a 30 year period starts in 1990 or so. Longer retirements have to start even farther back. Fewer trials and less chance of seeing a recession at the beginning of retirement can result in a seemingly better probability of success for a 50 year period than a 30 year period, which is not likely to hold true in real life.
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Old 07-08-2020, 06:37 AM   #45
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Its a private company and im fully vested. Theoretically the private company, if sold would be more than I can spend in a life time.

FIREcalc, im still learning but the financial industry doesnt make sense to me. For example, financial advisor at wellsfargo daid they'll charge 1%. Then the mutual funds the invest in charges 0.5% -1%.

How the logic work if Im to live on 3% and i have to pay tax on it.

Bonds and CDs rate cant live off of. Any wisdom will be appreciated it.
Pick up Bogleheads guide to Investing. Great book written based on thoughts of founder of Vanguard. As a CFO, you should be able to pick up concepts easily. If you choose to go advisor route, just remember they are in sales business.

I’m in similar situation as you and waited until my withdrawal rate was 2%. Helped tremendously avoid panic during Covid stock market dip.
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Old 07-08-2020, 11:26 AM   #46
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Originally Posted by Fremontpoke

"FIREcalc, im still learning but the financial industry doesnt make sense to me. For example, financial advisor at wellsfargo daid they'll charge 1%. Then the mutual funds the invest in charges 0.5% -1%."


Yeah-- that does not make sense at all-- DO NOT GO TO ANY ADVISOR LIKE WELLS FARGO or anyone who claims their compensation should be proportional to your success. AUM fees are a bogus rip off perpetuated by those who profit from them. If you need investment or financial advice pay for it by the hour or a flat fee unrelated to how much money YOU have, but how much work they DO. Several hundred dollars an hour should more than suffice for any honest professional for a one time charge. On going portfolio management should not exceed a few thousand a year maximum. If they are doing more and claim that justifies higher fees they are really just taking more risk than necessary and running up your costs. Do it yourself is best, but may not be something you enjoy. If you think you might, the Bogleheads or one of several of the good books by William Bernstein will set you on a good path. A good website is also the Oblivious Investor.
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Old 07-08-2020, 02:52 PM   #47
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Don't do it

Similar situation 15 years ago. I can tell you with your investments and expenses of $15K/month and kids with college still to go, you need to work till they are finished.
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Old 07-08-2020, 03:43 PM   #48
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Hi OP...you and I are neighbors. One way the wonderful people of this forum could help you is if you are willing to do a comprehensive expense breakdown of your budget. Forum members can offer ways to trim the budget and make FIRE immediately very realistic.
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Old 07-08-2020, 04:28 PM   #49
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Similar situation, but a few years behind you. Currently 42, was the CISO for a F100 corporation, now run the Security portfolio at a large consulting firm. Current NW around $3.5M, but would expect I'll have another $2M on the pile by the time I'm 49. I'm already itching to pull the rip cord, but know it's too soon. Hearing the pros/cons in this thread for a similar income / NW scenario, just fast-forwarded a few years, is super helpful to me, so thanks!
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Old 07-09-2020, 10:02 AM   #50
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I pulled the trigger last year at 52 with a slightly higher nest egg and lower expenses.

Be sure your expenses show the enormous reduction in taxes. If you invest wisely and manage tax loss harvesting, you can be easily less than $10-15k per year in total taxes until you have Soc sec and RMDs.

For me, the final catalyst was timing, not math. My children were early college and late high school, so this time was best to maximize family time. My parents are also just moving to a retirement home and I wanted to maximize that time too. Even my lifetime best dog is 10 so these next few years are special. OK, it’s really all about the dog, I don’t need much more.
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Old 09-21-2020, 03:29 PM   #51
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What happens to your stake in the private company if you retire? Can you sell? If so, I'd seriously consider retiring.

If you can't sell, I'd keep working. I suspect you're still adding enough $$ per year to the nest egg that it's material to your future lifestyle. You also frankly don't seem all that ready to retire. Why not pad the nest egg a couple more years, make sure you're good on paying for college, and then have a great retirement. In the meantime, rest easy at night knowing that you can retire any time you want should it come to that.
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Old 09-21-2020, 05:39 PM   #52
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What happens to your stake in the private company if you retire? Can you sell? If so, I'd seriously consider retiring.

If you can't sell, I'd keep working. I suspect you're still adding enough $$ per year to the nest egg that it's material to your future lifestyle. You also frankly don't seem all that ready to retire. Why not pad the nest egg a couple more years, make sure you're good on paying for college, and then have a great retirement. In the meantime, rest easy at night knowing that you can retire any time you want should it come to that.


I’m in a similar situation as the OP. Similar expenses (slightly higher) similar net worth. I’m 52 and will likely wrap up Megacorp by 54, then work part time for a few more years wrapping everything up by 56ish. My kids are only 9 and 11 so I feel the need to work a little longer, I just want out of the daily grind. Hoping I can find a part time gig that will bring in ok money but allow me the flexibility of taking 30-60 days off whenever I want.
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I don't have the answer to your question, BUT...
Old 09-22-2020, 01:24 AM   #53
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I don't have the answer to your question, BUT...

To make decisions like this I use this process. First, define what I really want to do. Do I really want to keep working or do I really want to retire now? If I want to retire now, how can I make it work and what are all the obstacles to that? If it seems very doable even with obstacles, I could try. What I do is figure out what is the worst case scenario. If I do what I want (retire) and the worst case scenario happens, can I deal with that? In my case, the worst case scenario would be that I would have to go back to work part-time. I was ready to stop working so badly that I was willing to accept that. If I didn't retire, I'd be working anyway. My mother and father did the same thing when they left work early and they lived on disability and a small pension. My mom knew she might have to work some if things got tight and she accepted that...but that moment never came.
Time may begin to seem more precious to you as you get into your mid fifties. It did for me, anyway. The truth is we don't know how much time we have and that becomes particularly evident in your fifties I think. My oldest brother only got to enjoy three years of his retirement and nice pension. I'm just saying we can assume we have more years than we do. Enjoy the fruits of your labor if you can.
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Old 09-22-2020, 07:59 AM   #54
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OP, I retired about a year ago. Like you I was also was in a pressure cooker C-suite role at a very successful company. I retired at 58, with about $4M NW, kids out of the house, college and grad school already paid for, and a lower annual burn rate. My prior posts detail my challenge in pulling the plug. I wanted to mention one item which surprised me about retirement. I also thought that once I walked away from the high paying gig that it was irrevocable and I would never be able to step back in at that level again. I was wrong. I have had literally dozens of opportunities to jump back in at the same level for equal or greater pay. If your firm is successful, then your reputation is out there and executive recruiters will come knocking relentlessly. Surprising as it may sound, even amidst a pandemic, the demand for experienced and accomplished C-level execs is very high. In my case, once I tasted freedom for a few months, I could never go back and have had no regrets or second thoughts. My point is this: if you decide to pull the plug and then regret the decision, you will have opportunities come your way to jump back in. You may have to relocate, but opportunities will be there.
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Old 09-22-2020, 09:29 AM   #55
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I built a good career and have achieved highest level of corporate hierarchy. My earning power now and next few years will be highest of my career/life. Have a comfortable life but I'm drawn to making a change and retiring for simplier life.



As far as retirement savings: I have over $5M in networth and worrier in me says, may not be enough. I have couple of kids to send to college and who knows what the life challenges to come.



I can either stay where I am and make as much as possible to retire early or retire early and see what life will be like as early retiree - which has been my dream.



My monthly expense, even if I retire, will definitely be over $15k a month. Health care, food/dining out, kids expense, traveling, auto, insurance, etc.



With low interest environment, its going to be hard to get yields on conservative investments (ie CD/bond). So 4% rule may not be so comforting going forward.



How do you get comfortable Firing yourself? Welcome comments.


Hi and wow what an achievement at such a young age of 49. Most would love to have 5M in assets :-)
That being said, after reading through most of the posts, you have a lot to consider indeed.
1. If you really want to retire you can by making some modifications to your expenses. 15k monthly seems awe fully extreme.
2. Know the difference between want and need. Not trying to be rude just real.
3. College is expensive and there are ways to reduce that cost but?
4. Expenses, pare down if possible. It seems like you are use the higher end of living and that is fine although just know your realistic limits.
5. Retirement income: I did not see any from a retirement plan at age 62 or are you just planning on SS? The 5M will run through rather quickly if you do not use a wise withdrawal process. You are correct, in my opinion the 4% rule would very optimistic if the market keeps up on this environment. The stock market of our parents days are much different and will continue to morph.
6. Lastly, if you insist on the 15k withdrawal proposed, recommend as others have, to work until 55 and max out all you can. If you haven’t done so yet, put your numbers through some reliable retirement calculators like FireCalc. The numbers do not lie if they are actually reliable:-)

Again, you have done so very well and so, I recommend that you prepare for the worst case at age 55, and just see how it goes if you can leave earlier.
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Old 09-22-2020, 10:51 AM   #56
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OP, I retired about a year ago. Like you I was also was in a pressure cooker C-suite role at a very successful company. I retired at 58, with about $4M NW, kids out of the house, college and grad school already paid for, and a lower annual burn rate. My prior posts detail my challenge in pulling the plug. I wanted to mention one item which surprised me about retirement. I also thought that once I walked away from the high paying gig that it was irrevocable and I would never be able to step back in at that level again. I was wrong. I have had literally dozens of opportunities to jump back in at the same level for equal or greater pay. If your firm is successful, then your reputation is out there and executive recruiters will come knocking relentlessly. Surprising as it may sound, even amidst a pandemic, the demand for experienced and accomplished C-level execs is very high. In my case, once I tasted freedom for a few months, I could never go back and have had no regrets or second thoughts. My point is this: if you decide to pull the plug and then regret the decision, you will have opportunities come your way to jump back in. You may have to relocate, but opportunities will be there.
OP: If you are like the rest of us mere mortals, I wouldn't count on more corporate opportunities surfacing. In my experience (and I'm clearly less talented and skilled than others on this board), it is very hard -- impossible, perhaps -- to find job opportunities in one's 50's, certainly at the same compensation level or higher.

So as a matter of risk management for one's financial life, I would never assume that one could re-enter the corporate world after exiting it. That was certainly the case pre-pandemic, and is likely more pronounced now, and likely for the foreseeable future. Maybe some fields or skills -- IT, for example -- are immune from this. Other fields -- energy, travel, hospitality, you name it -- I would assume as a matter of prudence that a corporate exit was permanent.

Consulting is another matter, I suppose.

I actually think age discrimination exists.
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Old 09-22-2020, 03:36 PM   #57
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...........I actually think age discrimination exists.
And water is wet.
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Old 09-23-2020, 09:16 AM   #58
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OP: If you are like the rest of us mere mortals, I wouldn't count on more corporate opportunities surfacing. In my experience (and I'm clearly less talented and skilled than others on this board), it is very hard -- impossible, perhaps -- to find job opportunities in one's 50's, certainly at the same compensation level or higher.

So as a matter of risk management for one's financial life, I would never assume that one could re-enter the corporate world after exiting it. That was certainly the case pre-pandemic, and is likely more pronounced now, and likely for the foreseeable future. Maybe some fields or skills -- IT, for example -- are immune from this. Other fields -- energy, travel, hospitality, you name it -- I would assume as a matter of prudence that a corporate exit was permanent.

Consulting is another matter, I suppose.

I actually think age discrimination exists.
Not sure what you mean by "mere mortals", but the OP said he was a CFO. I was simply sharing my current experience that seasoned successful C-level talent is in high demand. I retired last October and it was in high demand pre-covid as well as post-covid.
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Old 09-23-2020, 09:28 AM   #59
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This is also a good time to remind that FIRECalc retirements of longer than 30 years have tended (or used to tend) to look rosier than 30 year retirements. The reason is that the last historical period it can look at for a 30 year period starts in 1990 or so. Longer retirements have to start even farther back. Fewer trials and less chance of seeing a recession at the beginning of retirement can result in a seemingly better probability of success for a 50 year period than a 30 year period, which is not likely to hold true in real life.
That is a really good point that I hope people consider. It's easy to overlook..
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Old 09-30-2020, 02:37 PM   #60
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I left the w*rkforce eight years ago after a 27-year mega corp career. Our son was a 9th-grader at the time in HCOL area, and our financial situation was similar to yours albeit higher liquid NW but also higher spend rate. We started out at just under 4% WR. Since then, our investable assets have grown more than 50%, so now sub-3% WR. My recommendation is to not count on lowering your spending in retirement and, given your young age, wait to pull the trigger until your WR is closer to 3% WR.
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