Join Early Retirement Today
Thread Tools Search this Thread Display Modes
Stuck in OMY cycle
Old 06-10-2015, 04:55 AM   #1
Confused about dryer sheets
Join Date: Jun 2015
Posts: 2
Stuck in OMY cycle

Been lurking on these forums for quite some time now and decided to come into the open. So here are the stats and info : (I’m located in an emerging market country – so for the purposes of this forum have translated expenses and assets into USD using prevailing exchange rates)
Age 44, married with no dependants. No mortgage or other debt. Total assets (spouse and mine) around USD1.6m (excluding our home which we own fully). There are no deferred pensions or state benefits in our future – this is it for us. Our expenses have equated to around USD36k per annum over the past 12 months – I’ve tracked every cent! Do not expect this to change much once retired (well for the near future anyway) as we live very frugally and in a cheap area as it is.
Asset allocation : here’s the scary bit – 100% local equities. I’m OK with this for now as we have been in an accumulation phase to date, and our current dividend income on the stock portfolio would currently cover our expenses, but I do plan to slowly de-risk/rebalance over a long time period (to minimise tax impact) once we are FIRE’d.
I’m currently working, but my spouse (48) is retired (thanks to a layoff) already and just waiting for me to join – and herein lies my dilemna. I am, for the most part, emotionally ready to leave the working world behind (really haven’t enjoyed my work/corporate environment atall for around 6-8 years now) but have been stuck in OMY syndrome for the last couple of years. Honestly I’m just too scared to take the plunge. Even if the math works out (have run firecalc - historic and monte-carlo options), we are still pretty young and living in an emerging country poses its own unique set of risks and challenges. Things could look very, very different here in 20-30 years’ time. Fortunately our country has very well developed and robust financial markets which are comparable with most developed markets, but geo-political and other risks abound. We also have no social security (retirement or healthcare) in our country, but private healthcare rates are currently still reasonable and full costs are included in expenditure discussed above. So the “what-ifs” are pretty scary and I tend to adopt a “make hay while the sun shines” approach - being lucky enough to have a well paid job. Thing is, if it all went to hell in handbasket here, no amount of money or job would really save the day anyway J
Would be great to hear your views/comments?

Due South is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 06-10-2015, 05:13 AM   #2
Full time employment: Posting here.
Join Date: Jan 2006
Posts: 863
Consider a 12 month sabbatical? You are both young enough that you could get a job after that.

48Fire is offline   Reply With Quote
Old 06-10-2015, 05:16 AM   #3
Full time employment: Posting here.
Join Date: May 2011
Location: Twin Cities
Posts: 517
Congrats and welcome!

Well $1,6000,000/50 (years) = $32,000/yr if you stuffed it under a mattress. As you said, you are pretty set financially and probably should think more in terms of reducing risk.

Sounds like you are sure you don't like your current job but have you examined what you will do in retirement? Nothing says you can't find another job, consult or just find something that will create income along the way if the desire suits you.
Fishingmn is offline   Reply With Quote
Old 06-10-2015, 06:02 AM   #4
Thinks s/he gets paid by the post
Join Date: Dec 2014
Posts: 2,434
Part of what your dealing with.. we all have to deal with. I don't think the US social security and medicare system is "stable" as we won't see changes in it. We have seen changes over my lifetime and expect more coming soon. So don't assume the developed world has rock solid stability for planning a 30 to 50 year retirement. The pensions of the past are much less frequent already. Our pension (mine and my wife's) vanished in the tech bust in 2001.

I don't mean to make this sound "woe is me", but we all are planning in uncertain times and for an extended period where so many things will change. Yes, it is kind of scary.

One thing I don't know about firecalc.... will it use your countries stock/investment history for prediction? I suspect not, but don't know.

Good luck with your decisions.
bingybear is offline   Reply With Quote
Old 06-10-2015, 07:47 AM   #5
Confused about dryer sheets
Join Date: Jun 2015
Posts: 2
Thanks bingybear. Yes that does create some perspective in terms of social security. And no, firecalc doesnt use my country's equity returns - so I just use US as a proxy. Its not great but better than nothing. We dont have reliable or relevant data going that far back.
Due South is offline   Reply With Quote
Old 06-10-2015, 08:58 AM   #6
Thinks s/he gets paid by the post
38Chevy454's Avatar
Join Date: Sep 2013
Location: Cincinnati, OH
Posts: 2,531
Are you stuck having the savings in your local country market? Might be able to reduce risk and increase the stability by some diversification outside. That does not mean it has to be US, just in a system outside the potential issues of your country. Especially if you want to get out of 100% local equities and into something more fixed income type.

Assuming a 3% withdrawal rate, on $1.6M is approx $48K. You state current expenses at $36K, so it seems from a simple check you are good shape. The main issue you have with the OMY or get out is more of an emotional decision and not as much financial.
The advice we're giving you is invaluable, that's why it's free
Experience is a good teacher, but the tuition can get expensive real fast

Semi-Retired 7/1/16: working part-time (60%) for now [4/24/17 changed to 80%]
Retired Aug 2, 2017; age 53
38Chevy454 is online now   Reply With Quote
Old 06-10-2015, 03:15 PM   #7
Confused about dryer sheets
Join Date: Jun 2015
Posts: 1
Thanks for the post. Biggest question I see is why haven't you diversified your portfolio to other geographies and asset classes? Diversification is the closest thing to a "free lunch" that exists in investing!

Also, if there are political or other issues in your country in the next 20 years, this may be somewhat of a hedge.


Sent from my iPhone using Early Retirement Forum

Expat Canuck is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Noob stuck in a cube Sonflower Hi, I am... 5 08-19-2008 08:50 PM
Stuck newbie RoadAhead43 Hi, I am... 63 04-04-2007 08:15 PM
"...if you don't, you get stuck in Iraq" mickeyd Other topics 76 11-02-2006 04:07 PM

» Quick Links

All times are GMT -6. The time now is 03:53 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2020, vBulletin Solutions, Inc.