My net worth has increased 74% since I retired 4 years ago

[Digger1000]

My NW is up ~200% since I quit work ~11 years ago.

Now you are in very good shape. Meanwhile I (the OP) am just off to a nice start.

 

[NW-Bound]

Reading this thread, an observer may come to the following conclusion:

"The sooner one takes early retirement, the sooner his portfolio can grow".

 

[street]

Reading this thread, an observer may come to the following conclusion:

"The sooner one takes early retirement, the sooner his portfolio can grow".

I have advocated that very statement many times here on the site. I personally believe you can make more not working, but putting that lump sump/pension in your portfolio to work for you. That pension is a set number for a month etc. so it really can't grow the way it could, unless you get it working. The longer you work the short time you have to get it working.

That is my experience since I retired. There is no way I would have the money I do today, if I continued to work till now. In just about 5 years since I retired, I have averaged ~400K a year in gains/income each years for 5 years now. I could of taken that 400K each year and still have the same amount when I retired 5 years ago. I never was even close to that kind of income through the years.

That is why if you retire early, the sooner your portfolio can grow, I'm a believe in that statement.

It also could be a negative 400K a year for the last 5 years also.

 

[NW-Bound]

What if your 18-year-old son or grandson comes up to you and says "I want to retire right now, so my money can grow"?

 

[Dtail]

What if your 18-year-old son or grandson comes up to you and says "I want to retire right now, so my money can grow"?

Sounds a little like my 31 y.o. son.

 

[street]

^ Lol!
If that son has the money to invest for the long haul, I would say go for it. Being realistic, I really do beleive when people can't decide if they want to retire, because they are afraid of the unknown, but have the resources to retire, they should it will work out for them. I'm a believer in getting in the game early and stay for the long haul.

 

[RobbieB]

What if your 18-year-old son or grandson comes up to you and says "I want to retire right now, so my money can grow"?

What Money?

 

[street]

I would like to say also, in my life and career, I have done things the unorthodox way, and my finances are no exception. Lol

In most all threads on how too, I've done the opposite or at a different angle then what the pros have done it to be successful.

I'm thinking I must have had a horseshoe in just the right place. Lol

 

[NW-Bound]

What Money?

The inheritance money that the parents or grandparents will let the youngster have early.

I think what street was talking about was that one could retire early and cash out the pension or 401k in a lump sum and invest it himself to get a better return. But if the 401k plan offers decent MFs for investment choices, then the investment return of that pot of money is not contingent on one cashing it out.

I think that myself and many posters here are simply lucky to ride the bull market of the last few years. I happened to start working full-time in 1980, at the beginning of a long bull market period till 2000. I could have done a lot better if I knew more about investing then.

 

[RobbieB]

I'm glad I didn't get any of that early inheritance money.

 

[ut2sua]

Congratulations to all in this "class" of successful FIRE folks. It is motivational to those of us who will FIRE in the near future. It is great to hear that many have done so well. It actually makes sense since the SWR is "safe" in the worst case scenario, and the last 1x years were not worst case in terms of market performance.

 

[flintnational]

After 7 years our investable assets are up about 45% with AA ranging from 70/30 to current 80/20. Allocations to international, value and short term bonds have been a significant drag on returns compared to total US mkt stock and bond indexes. WR has been around 3.5%.

 

[marko]

I think what street was talking about was that one could retire early and cash out the pension or 401k in a lump sum and invest it himself to get a better return. But if the 401k plan offers decent MFs for investment choices, then the investment return of that pot of money is not contingent on one cashing it out.

True. But my personal experience was this: While working I paid absolutely no attention to investing other than making sure my 401k was maxed and matched. I didn't know a MF from a dividend. I'm sure I picked poor investment options within my company 401k. IIRC, I was happy with 'safe CD rates'. I just had bigger fish on my plate at the time. (At least I was sharp enough to take my pension lump sum vs leaving it there!)

But! Once I --involuntarily--RE'd it forced me to come up to speed on Wall St as this was now going to be my primary source of income for the rest of my life.

Maybe an early-early retirement could bring some focus and indeed provide a better outcome than being a stooge who just goes to work every day, oblivious to the finer points of investing.

Just a musing.

 

[street]

marko, I think you have described a lot of people going through their young lives. We were to busy to think of retirement and making a better plan, then just adding to a 401K.

The good thing is, I beleive anyway we all had that frugal/saving gene in us to make it retirement easier then some.

 

[NW-Bound]

True. But my personal experience was this: While working I paid absolutely no attention to investing other than making sure my 401k was maxed and matched...

But! Once I --involuntarily--RE'd it forced me to come up to speed on Wall St as this was now going to be my primary source of income for the rest of my life.

Maybe an early-early retirement could bring some focus and indeed provide a better outcome than being a stooge who just goes to work every day, oblivious to the finer points of investing.

Just a musing.

Took the words out of my mouth. My wife and I both maxed out our 401k contributions, but we were way too conservative in our AA. And I kept my after-tax savings in cash and CD, while telling myself that one day I would spend some time to tend to the matter, but never did. Raising a family and being busy with work left me no desire to do much else.

For me, the time I realized that I had enough accumulated that I should better pay more attention to it was when the two startups that I helped found were crashing and burning. This was in the late 90s. I sat down and added up all my accounts, and found that I had a 7-figure stash. Dang!

Anyway, I have been more active since, except for a few years when I was battling a serious illness. Just selling out-of-the-money options allowed me to collect more than $300K last year. This year, I got more than $100K YTD on option selling. I find making money this way is more fun than blowing it.

I still occasionally missed technical work, but the time I spend watching the market is a lot less than the time I used to spend working. And it brings higher return too, so far that is. Knock on wood.

 

[marko]

marko, I think you have described a lot of people going through their young lives. We were to busy to think of retirement and making a better plan, then just adding to a 401K.

The good thing is, I beleive anyway we all had that frugal/saving gene in us to make it retirement easier then some.

The fact that I was able to RE with a low 7 figure starting point (50/50: 401K plus pension lump sum.) just shows how powerful the stock market can be over time and how even an idiot can do well.

I feel sorry for those that use the word 'casino' when talking about the market.

 

[Koolau]

For me, I think I relaxed somewhat about being ready to FIRE once I noticed that my "results" were about the same, then better, then much better than my salary. What revelation! It happened over that roughly 7 year period when I could have said, well, yes, I have pension/medical insurance taken care of and a nice chunk in the 401(k), etc. Then, suddenly, when I looked at results, they began to overwhelm my salary. THAT's when I knew THIS WILL WORK! The first time Megacorp tried to give me a curve ball - I was outa there! YMMV

 

[RetireeRobert]

From April 1 of 2020 to March 31 of 2021 the Russell 2000 index increased about 80%.

 

[Time2]

From April 1 of 2020 to March 31 of 2021 the Russell 2000 index increased about 80%.

And I was in that lowly VTSAX at 41%.

 

[NW-Bound]

From April 1 of 2020 to March 31 of 2021 the Russell 2000 index increased about 80%.

Yes, but that's because the whole market crashed when news of the pandemic broke out in early 2020. And the Russell 2000 crashed harder than large cap stocks.

If we looked at the pre-pandemic high in Feb 2020, then the Russel 2000 is up only 31% from that high.

Still pretty darn good. In fact, way too good while people are still waiting to be vaccinated.

 

[ychuck46]

Sounds familiar

Looks like many of us are in similar circumstance judging by the posts. Maybe a slight difference in years or what % one's net worth is up, but most are nicely positive. The last 4-5+ years were very good to those with financial assets. Not sure they will continue over the next 4-5 but hope springs eternal.

 

[NW-Bound]

Looks like many of us are in similar circumstance judging by the posts. Maybe a slight difference in years or what % one's net worth is up, but most are nicely positive. The last 4-5+ years were very good to those with financial assets. Not sure they will continue over the next 4-5 but hope springs eternal.

I don't know about eternal hope, but if you miss out on a bull run, you may not have enough fat to live through the next famine.

I would not feel good looking like this guy, going into an economic downturn.

 

[Retired Expat]

Coming on 8 years retired and NW up 400% but admittedly there was a rather nice estate I shared in. But along with that and market returns managed to cut our spending in a very big way. And yet I still worry!

 

[RetireeRobert]

And yet I still worry!

Don't worry. Be happy!

 

[FIREarly]

Similar for us, as with many here I suspect. But I don’t let it go to my head, as we’ll have a serious pullback sooner or later. In the meantime, WHEE!

WHEE!!!!

Purchase some Ethereum... WHEEEEEEEEEEE!!!!!*

*Please don't change the thread topic about the investment choice