Retired @ 55. H4H volunteer. Disruptive Philanthropist

[Tesla boomer]

Just joined today after a friend referred me. I retired on May 1, 2020. I worked 26 years for HP and another 5 with Red Hat Software before retiring. I was a software engineer.

I was never a FIRE guy. I started thinking about retirement in 2019 and I talked to many people and watched many videos on retiring early. Several people said that it was important to figure out how you will spend your time in retirement in a meaningful way. One person suggested to look back on your life and think of times you really felt satisfied doing something outside of work. The thing that popped into my mind was helping with construction projects at school work parties for my kids' Waldorf school. We built fences, decks, and did other things like re-roofing a barn and laying flooring in several rooms. The camaraderie I had felt during those times was the best. So, I decided to look into volunteering with my local Habitat for Humanity affiliate. I did 1 day a week while I was still working. And as I approached my retirement day, I was doing 3 days a week and had been promoted to volunteer Crew Leader. I have now been doing this for 2 years and it is the most fulfilling work I could ever imagine for me in retirement.

In 2016, I started getting into EVs and Tesla. I was watching every Tesla Youtuber and learning more and more about the company. I ordered a Model 3 the day after it was announced and waited over 2 years before it was delivered. At some point in 2019, I decided after much research that $TSLA was going to be the best long-term investment and I moved all our IRA holdings into $TSLA. At the time, it was about $1.2M. Now, it's worth ~$15M.

So, I started researching how to best do philanthropy. I had been donating stocks to various charities for over a decade, but I wanted to find a way of "teaching them to fish" instead of "giving them fish". So, this year I picked 3 local charities and did a large donation of stocks with restrictions. First, the charity would have to hold the shares in the stocks that I donated for a full year without selling them. At the anniversary of this "Fund", the charity can sell up to 10% of the value of the holdings. I will be interested to see how well this works out come next Nov. I plan to add 3 new charities each year.

 

[martyp]

It sounds like you have found something you want to do in retirement. I suggest that you take advantage of slowing down to live life at your own pace. Don’t let commitments take over your life. I also retired at 55 in 2011. I taught science classes to seniors. I did it on the school schedule but it was still on my terms. I stopped doing this after 5 years after I moved away and have occupied myself in different ways.

 

[HI Bill]

Conngrats! While your move to TSLA may have been unusually prescient, I, along with most here, would recommend diversifying your investments to protect their value long-term, since you've already 'won the game', and you're now retired. No one knows how the EV market will go over the next decade or three, but investing everything you have in one company over the long-term, is exceptionally risky, IMHO, especially when you're FIREd.

Cheers!

 

[Tesla boomer]

I also coach boys high school volleyball during the spring semester for the last 4 years. It allows me to have a positive impact on the self image of a lot of freshman boys.

 

[Good_Life]

Wow, congratulations Tesla boomer! Definitely a risky move on your part, but amazing payoff. That is a lot of capital gains and assuming you are donating to them that Tesla stock what a great way to do some great things with charities, while limiting your tax bill. I work for a non-profit and I have been on several non-profit boards. Quite a while ago (I would say 10+ years ago) we had someone gift us shares in several companies, but similar to you put restrictions on the stock saying we couldn't sell it for a certain number of years. He thought they were guaranteed winners. If I remember correctly because of those restrictions he took a decent hit on his tax deduction because the gift came with restrictions. Just wondering if you experienced anything similar to that? We were of course still very thankful and happy regardless.
Not saying this will happen to you, and you obviously seem to have a good track record, but the stocks he gave us performed horribly. Our balanced endowment portfolio's significantly outperformed them in comparison. He was a traditional value investor and had some stocks he felt were incredibly cheap. If we just held on to them over the long-term they would perform well. Well they were cheap for a reason, but it made him happy and still gave us a nice donation.

 

[Tesla boomer]

Disruptive Philanthropy

I specifically donated a mix of better performing stocks and worse performing stocks and requested that at the "Fund" anniversary, they rank the performance of the holdings and start from the bottom of the ranking when selling up to 10% each year.

All 3 charities were very pleased with this and were excited to encourage other donors to donate their stocks to this fund. They realized that it sets up a meritocracy among their donors investment picks that favors the highest performing assets and disposes of the lower performing ones (like the value picks you mentioned) within a year.

As for the restriction impacting my charitable contribution deduction, my tax accountant told me that I value the donation on the day the transfer of shares happens regardless of how long the receiving charity decides to hold. And there is really no enforcement of the restriction anyway. The charities agree to the restriction informally without the need for a signed legal document.