'Fess up - Anybody Half-FIREd?

[spncity]

Okay, here's the question(s) if you care to comment (answer and clarify as you wish).

1. Anybody here FIREd on quite a bit less than $1 million? To me, that's 'one' definition of half-fired but that may just be me. I'm thinking of people without pensions here. How much do you spend a year?

2. Anybody here half-FIRED? Meaning, you have left megacorp with way less money than would have supported your lifestyle and you are making do without working full-time by 'either' living a pretty frugal life or doing a little part-time gig (either business, consulting or something else less than half-time work). How much do you spend a year? As in How much do you live on and how much of that is provided by the part-time income?

3. Make up your own category and define/explain.

Interested in any comments. I'll sit back down now and let others speak.

[Spanky]

We are not yet retired. Our expenses are about $55K. We feel that we will need about $2 million (to support a little bit below 3% withdrawal) before quiting our corporate jobs.

[dumpster56]

I knew the day I erd that I needed 1000 a month extra. I knew I could sub teach and coach track teams in my new state and make easily 1200 a month. I am now working 3 days a week 4 hours a day making 3300 a month teaching physical education at my certified rate with a new north carolina teachers license. Elementary schools k thru 3rd grade classes. What a blast!

[kat]

I can probably answer yes to both questions, less sure about the second.

Bit of background. No Mega-Corp in my work experience. I'm an attorney and also have a professional degree and work experience in counseling. I've worked in the public sector, for non-profits, for small law firms and for myself. I stopped working for pay with less than $1,000,000 "in the bank". I own a house in the city I choose to live in, and a tiny house in mountains I love, two hours away. I own both houses, no debt, and drive a six year old Honda I plan to have another six years. I've found it easy and enjoyable so far, very rewarding and satisfying.

Key thing for me is I stopped working for pay when I wanted to, not when any calculator said it was best. I'm positive my decision making changed after a head on car accident in 2001 a month after turning 39.

I stressed stop working for pay because I still "work" in retirement. I've chosen to be an unpaid advocate for crime victims mostly, but I am also starting up a program to help young incarcerated people in state prison. I do what I want to do.

Money is secondary. I mapped out on a yellow legal pad (of course!) what I want or need to spend each year. I can meet that with divs and capital gains. I decided, at 45, to stick to that in bad years, and go on expensive vacations in years my investments do well. I already planned for house repairs.

I'm not the least bit worried financially about emergencies or bad things. Life happens and the money will always be secondary. Sometimes I'm grateful for the car accident.

[haha]

Quote:

Originally Posted by kat I can probably answer yes to both questions, less sure about the second. Bit of background. No Mega-Corp in my work experience. I'm an attorney and also have a professional degree and work experience in counseling. I've worked in the public sector, for non-profits, for small law firms and for myself. I stopped working for pay with less than $1,000,000 "in the bank".

Kat, let me be sure that I understand. You are a young woman (or man), 46 or so, and you live adequately (given an owned house) on the dividends and interest from <$1mm? I guess you have to buy health insurance, you get no pension, and SS is still far off.

If I have it right, you are doing very well. Could you you tell us a little about how much cash income you get from your portfolio, and how you choose your securities?

Ha

[kat]

I have a "diversified" investment plan, with advice mostly from Larry Swedroe. I contacted him after I read one of his books. I'm roughly at 36 US/24 International/34 bonds/6 cash. Unlike a lot of people, my bonds are in my taxable portfolio, which is 85% of my money. I only have 15% deferred.

The distributions from that cover my basic needs, including bare bones health insurance and house repairs. I'm at 3.9% withdrawal if the declining market continues. I just re-calculated that since I paid cash for a great deal on a tiny house in the mountains this month. To make it still work with distributions, I decided to take expensive vacations only when my investments are up. I only seem to want them every 3 or 4 years. (I'd rather hike in the mountains.) My budget includes the opera in NYC, the ballet and orchestra, Mets baseball games, the track at Saratoga, and camping.

I'm positive I will sell one or both houses when I'm older when the time is right. I'll take SS when I'm 70 if it's there. No pension.

kate

[kat]

P.S. The carrying costs on the second house are ridiculously low, less than $3,000 annually and it's in great shape.

[unclemick]

1993 - his and hers maybe 350k - layed off at age 49 - sometimes life makes you an offer you can't refuse.

Did everything she worked one extra year, sold and ate the duplex proceeds, jobshopped for 1 yr, took small pension at 55, SS at 63, etc.

Living expenses 12k(my super best) to 89k(last yr includes 25k remodeling).
It was the 90's and Mr Market was kind to my balanced index, 60/40 rollover IRA.

I excel at doing absolutely nothing in particular each day in the finest tradition of ER professionalism - and only achieving partial success.

I was 'unemployed' until I became an ER in my own mind. 33% That's My Story post by Dory36 way back when got me to join this forum.

heh heh heh - I think there are as many variations on the theme as there are ER's.

[In-control]

I am going to be FIRE's in January. Got a nice package. As a general rule I like this one = for evey $10k expences that you need you need $200/250k to support it. That and the 4-4.5% withdraw rate seem to work very nicely. I used FIRE tool to confirm and reached was 100% successful @ a 4.5% withdraw rate.

I also have a 40/40/20 allocation with 4-5 years of living expences locked up in laddered CD's. So basically I am building 2011's budget this year. This gives me lots of flexibility and the abiltiy to forcast out any budget shortfalls/windfalls.

Everyone dose it differently and it depends what your goals are - mine are to sleep nights, explore new experiences and hang out with my 3 kids.

Good luck

[W2R]

Quote:

Originally Posted by In-control As a general rule I like this one = for evey $10k expences that you need you need $200/250k to support it. That and the 4-4.5% withdraw rate seem to work very nicely. I used FIRE tool to confirm and reached was 100% successful @ a 4.5% withdraw rate.

How do you figure that? if you have $200K, then even if you take 4.5%, that gives you $9000, not $10,000. And that is before taxes, so maybe after taxes you might have $7000-$8000, I suppose, not $10,000. If you only took 4% of $200K, then you'd have $8,000 before taxes, which would give you maybe $6000-$7000 spendable income after taxes, not $10,000. I don't get it.

Also, for how long is 4.5% sustainable? Most who retire early need at least 40 or 50 years, I would think.

[unclemick]

Hmmm - handgrenade and horseshoe wise 25 times expenses seems to be the working benchmark to use as the bogey to play 'your indvidual plan' against.

I think we've made progress - Trinity Study and all.

Circa 1993 when I sent for my Vanguard retirement planning booklet(exact name??) - 6 to 8% in popular articles and 16 to 18 times expenses were numbers I seem to recall.

Bernstein's Efficient Frontier series using the Trinity Study is the first I remember.

I am still old school enough to think you can aggresively vary expenses(aka cheap bastardhood) to fit circumstances easier than outguess Mr Market(safe withdrawal rate for your whole retirement stretch).

Of course in my 14th year - I have varied both - plus a non cola pension click in at 55, SS at 63, and some minor adjustments like a tornado in 95 and Katrina in 2005.

Would make a very messy spreadsheet. I think the studies and tracking your own expenses give you a backdrop to work against as you progress thru ER. Plus your hobbies/interests/etc will change as time marches on.

heh heh heh

[haha]

Quote:

Originally Posted by unclemick Would make a very messy spreadsheet. I think the studies and tracking your own expenses give you a backdrop to work against as you progress thru ER. Plus your hobbies/interests/etc will change as time marches on.

What i notice is that although I do few or none of the expensive vacations, home makeovers, meals out, expensive hobbies that are reported here, I still manage to spend way more than the other frugal posters report, and on a household of one.

I use MS Money, and only use cash for entertainment, so I have accurate figures. Essentially nothing costs me as little as is commonly reported here.
Go figure.

Ha

[unclemick]

Quote:

Originally Posted by haha What i notice is that although I do few or none of the expensive vacations, home makeovers, meals out, expensive hobbies that are reported here, I still manage to spend way more than the other frugal posters report, and on a household of one. I use MS Money, and only use cash for entertainment, so I have accurate figures. Essentially nothing costs me as little as is commonly reported here. Go figure. Ha

Hmmm - Memory said I was always broke in Seattle as a student at UW(early 60's). The PacNW had a rep even then as expensive. Worst - nightclubbing in Vancouver BC(after I got degreed/with job) and best Portland Or.

My sister/BIL(semi frugal) say it's still expensive - south of Seattle around Kent. Especially compared to Paducah Ky(previous location).

heh heh heh

[W2R]

Quote:

Originally Posted by haha What i notice is that although I do few or none of the expensive vacations, home makeovers, meals out, expensive hobbies that are reported here, I still manage to spend way more than the other frugal posters report, and on a household of one. I use MS Money, and only use cash for entertainment, so I have accurate figures. Essentially nothing costs me as little as is commonly reported here. Go figure. Ha

I agree with UncleMick - - you live in a very expensive part of the country, from what I can tell. It is also a very beautiful part of the country, but I know that I (for one) could never afford to live there.

[Moemg]

I agree with Uncle Mick and want to retire that Seattle is expensive . I also agree with HA that I could not ( unless forced at gunpoint ) live on some of these austere budgets.

[tightasadrum]

How about it Ha? What is so expensive up there in the opposite corner?

However, I am often stunned at how little money some of the people on this board can get by on. Of course, a lot of them are single, Ha. Of course that also includes you doesn't it.

I'll show you mine if you'll show me yours. From memory, but close:

property tax - 4500
fire insurance - 2500
car insurance - 4000
life insurance - 3000
health insurance - 7200
car taxes - 600
electricity - 2900
telephones - 2400
water & sewer - 0
lp gas - 500
--------------
Sub-Total - 24700

Of course I have to eat and purchase gasoline and ...

[W2R]

Quote:

Originally Posted by tightasadrum From memory, but close: property tax - 4500 fire insurance - 2500 car insurance - 4000 life insurance - 3000 health insurance - 7200 car taxes - 600 electricity - 2900 telephones - 2400 water & sewer - 0 lp gas - 500 -------------- Sub-Total - 24700 Of course I have to eat and purchase gasoline and ...

For a single LBYM'er living in a median priced 1558 square foot house here in New Orleans, from memory but close:

property tax - 1200
homeowners' & flood insurance - 1600? (likely to increase)
car insurance - 400 (minimum, plan to increase)
life insurance - none
health insurance - 1500 (group, through work before taxes)
car taxes - none
electricity - 1000
telephones - 670
water & sewer - 180
natural gas - 350

Sub-Total for these items: $6,900, though my insurance expenses could probably be $1000 more next year due to unplanned and planned increases. There are a lot of other expenses that you didn't include, such as gasoline, gym fees, and so on.

I am beginning to wonder if average people really spend what you are spending, or if we have some Donald-Trumps-in-training here! I know that I would spend more if ER wasn't such a high priority, but then I don't feel like I especially scrimp, either. If I am hot, I turn down the thermostat until it is bearable so I can sleep, and such. I buy whatever is the most nutritious food, even if it is expensive or out of season, since my health is a priority to me.

[kat]

Mine is similar. And sometimes I wonder where other people spend more. I rarely eat out now, preferring barbecues with friends. I buy wine from friends who own a store and give me a discount. I have a vegetable garden and eat well, but watch prices ever since I was a kid, learning it from my parents. As gas goes up, I use less, and it's better for the environment. Biggest change is I rarely buy clothes or house gadgets. I need a new pair of running shoes, but I have a credit on something I'm returning, and a few gift cards I haven't used. I keep the thermostat low -- another thing I'm used to.

So none of this was hard. I'm living the life I CHOOSE. If I was fabulously rich, it would be harder.

[TexasGal]

Let's see how my expenses stack up for a single grandmother in small town (with grandkids who visit often):

$4,020 COBRA (will be $6,000+ when COBRA ends)
$1,160 homeowners insurance with high liability
$1,560 property tax (1,500 sq ft house)
$4,800 electric, gas, water, phone, internet
$ 900 auto insurance with $500K liability
$12,440

$1,100 cell phone (family plan incl daughter's family)
$ 605 LTC insurance
$ 750 Medical co-pays & drugs (including OTC)
$ 600 Gasoline
$1,000 auto upkeep, registration & inspection fees
$2,500 groceries (these grandkids eat a lot)
$6,555

$18,995

[unclemick]

Once upon a time - in a fish camp far, far away(pay attention I'm half way serious) and before she threatened to murdalize me if I 'ever' got 'that' cheap again.

Lk Catherine on leased ground - no home insurance of anykind(over water), no property tax(225/yr camp lease), dial up phone, no gas, electricity only - no A/C needed in Louisiana over water, minimal car insurance, no health insurance(didn't plan on getting sick), you had your own pump house/well - no utilities there, free garbage pickup cause you were unimproved urban(the only official slum in New Orleans), no lay away for deferred maintenance. A lot of fish and crab boils where people brought some stuff - always extra food and beer.

In MO - probably triple 12k before I even think I'm not being frugal - actually have health insurance, property tax, internet connection, cable, house and car payments,real utilities(gas,electric,water,garbage), full house and car insurance etc.

Over the last 13 yrs my retirement portfolio(the old quasi 60/40 balanced index more or less) has drifted up - as more and more of my frugal has drifted away.

heh heh heh - what the heck - ain't getting any younger.