Net just passed $3MM, $2.9MM invested, cannot FIRE!?

[COcheesehead]

If you can’t pull the trigger


You aren’t ready.

 

[MrLoco]

OP......2 big issues/problems that I can see.



1) Do you have children and do you want to help them with college costs and other expenses?


2) The biggest issue. Healthcare. You are 20 years away from Medicare. Your wife almost 30 years. And this assumes MEdicare will still be around in it's current form which I am sure it will not be. Plus if you do have children, you will be adding them to a policy.
As you age expect more healthcare issues and for you and your wife to carry the burden for future healthcare costs.


People at age 60 looking to FIRE fret about having to pay the bulk of their healthcare costs (high premiums and deductibles) just 5 years away from Medicare age. Imagine the burden if you are 25-30 years away from receiving this benefit.
You say you want to "see the world." So travel is in your future plans which is great as you two I assume are healthy and can travel effortlessly. But you may find yourselves having to decide whether to pay for that next cruise/vacation or paying the next round of ACA premiums.


I think even at a NW level of $3M it is way too early to consider FIRE at your ages.

 

[Badger]

Retirement is not just a money issue. You might consider what your time is worth and what would make you happy and fulfill your needs for the years you have left (and we never know what that is). If your job is too stressful then what other career path would provide the same fulfillment with more flexible work schedule for travel and leisure time. Only you can determine that.



Cheers!

 

[HadEnuff]

If you can’t pull the trigger


You aren’t ready.

Exactly! Just because you can, doesn't mean you should. It's a big jump.

Sounds to me like your BS Bucket is not completely full yet. Right now, at least, it's good to know that you don't have to put up with the BS to come if you don't want to, at least not because you need the dough.

Don't be surprised though if once you really wrap yourself around the fact that you have enough money, your BS Bucket fills up rapidly, and is very suddenly overflowing. For many folks, good results from Firecalc seem to make the BS Bucket get smaller.

 

[Cut-Throat]

My wife knows this has been our aim for years. We have "arrived" at our number (and I have a $19k/year non-COLA pension at 65, not counted in the 2.9) and she is pissed that I do not seem to be pulling the proverbial plug on the high stress gig.

I am 46. She is 37. Spend is around $85k with lots of travel baked in. We have shed the McMansion and most earthly possessions already.

She is ready to see the world. I am too but cannot separate from megacorp (the people & THE CHECKs).

What's wrong with me anyway?

Any advice from those who have been in this spot?

See Here

 

[audreyh1]

See Here

Seems like anyone with enough funds to retire early and coming here with can/should they do it questions could be accused of humble brag. I’m sure you would have accused me given my young retirement age.

Not helpful! (In addition to posting a naked link that comes off as a rude surprise)

 

[SpinDr]

See Here

Cut-Throat. Not sure that is a fair assessment of the OPs post. Looks pretty close to the types of questions that are posted regularly.

 

[ivinsfan]

.. the OP has a couple things going on. Even though they picked a number he's a little uncertain that the number is high enough. That's pretty common, as we've seen by the number of people that run multiple programs for retirement spending.

The other thing is his spouse is onboard with him pulling the plug and doesn't want to delay, maybe because the spouse can see clearly that his job is having a very negative effect on him. Keep talking and thinking and hopefully things will work out.

I'll also add that even good change is stressful and people under stress sometimes have a hard time changing things as they just keep their heads down and slog on.

 

[coltsfan53]

Thanks for the thoughtful response. I believe you nailed the spouse angle perfectly.

.. the OP has a couple things going on. Even though they picked a number he's a little uncertain that the number is high enough. That's pretty common, as we've seen by the number of people that run multiple programs for retirement spending.

The other thing is his spouse is onboard with him pulling the plug and doesn't want to delay, maybe because the spouse can see clearly that his job is having a very negative effect on him. Keep talking and thinking and hopefully things will work out.

I'll also add that even good change is stressful and people under stress sometimes have a hard time changing things as they just keep their heads down and slog on.

 

[Dtail]

Cut-Throat. Not sure that is a fair assessment of the OPs post. Looks pretty close to the types of questions that are posted regularly.

+1
Sorry Cut-Throat but there are many posters here wealthier than the OP and they are not perceived as humble brag.
The flip side of humble brag could be interpreted as jealousy.

 

[bigcmagor]

Seems to me she has good reason to be pissed if you don't follow through or convince her that an alternative plan (or number) is warranted.


I wish my wife (and family) was as eager for me to completely retire as yours.

 

[MichaelB]

IMHO this is not humnlebrag, and it would be helpful to the OP if we could forget that post and stick to the OP questions and situation, which resonate to both long time and new members alike.

 

[Spanky]

I am too but cannot separate from megacorp (the people & THE CHECKs).

It's the latter for me. Regardless of how much you have, you never feel totally secure as the future is unknown. Walking away from a steady stream of income (especially a sizable one) is seemingly difficult. It usually requires a major event, such as health problem, death of a family member or friend, to realize that time is limited and that there is more to life than a steady paycheck.

 

[Chuckanut]

I understand it is a personal decision. I was interested in the mechanics involved in others' decisions. That's all.

The mechanics for me were quite simple, though I did not retire nearly as early as you may.

As this cartoon makes clear:

 

[Ronstar]

If I were OP, I would try to work out a part time gig with his current employer. Lowers the stress level, yet still provides a little meaningful work for someone who is not sure if they want to retire. And it works out nicely for someone whose spouse is still working. I did an 8 year transition from full time to retirement while my DW still worked. Worked out quite well for me. No stress, had some income, plenty of time for hobbies, and DW was happy that I “worked” as long as she did.

 

[Offgrid Organic Farmer]

...
What's wrong with me anyway?

Any advice from those who have been in this spot?

I get it.

In my profession [US military] that is very common. Servicemembers reach 20 years and have the pension available, but, ...

The idea of living on pension scares them. So 99% either try to stay in uniform, or they seek a secondary career.

Once your pension and investment income exceeds your Cost-of-Living, you are there!

My wife had to convince me that it was time to retire.

 

[gwraigty]

I've posted something similar before, but here it is for your money situation:

$2.9M invested for yields of 4.5% to 6% = $130,500 to $174,000 annual income. Yes, I get yields in this range on most of my investments, mainly individual corporate/muni bonds that I've held for a long time, with recent additions of ETFs of corporate bonds/preferred stock/high dividend stock. Most of our portfolio is in fixed income.

If you're more of a stock person, you can get yields of 3.5% to 5.5% in ETFs, which would give you $101,500 to $159,500 annual income. I know some people prefer to invest for growth, selling off shares as needed for income. That's not my area of expertise, so I'll leave it to others to chime in on the best ways to get at least $85,000 annual income using the growth method.

Bottom line though, it doesn't have to be one or the other method, exclusively. You can do a blend.

 

[BigMoneyJim]

Can you define yourself outside of your career? That was a hurdle that I needed to overcome and own.

Yeah, I think a lot of people don't understand their own identity apart from their jobs or careers. Losing/changing your identity can feel existentially threatening, even if you've been planning a break such as retirement for a long time.

I don't have that problem. What I'm going through right now--and the past two years and probably the next couple of years--is realizing how close retirement is and reassessing what it means to me. I would absolutely love to downshift and coast the rest of the way to full retirement, but I didn't plan for it or lay the groundwork for it, and I currently have the most engaging, rewarding, and successful job I've ever had; I'd just rather not do it 49 weeks of the year, 40 hours a week, plus the commute and other work-related prep time.

I'm also realizing that I'm going to have a challenge finding and connecting with 'my people' after downshifting or retiring, to avoid becoming a crazy hermit. (I'm not totally against the crazy hermit thing, though....)

The biggest issue for me is when to downshift or completely pull the plug. It's easy to rationalized how much more lucrative it is to keep working, but then I realized that is *always* the case, no matter if I retire at 49 or 79. With that logic I'll never retire.

So I guess what you (OP) need to ask yourself is what you want the rest of your life to be like, and unlike single me, you have a spouse impacted by your decisions.

 

[WhenIsItTime]

I've posted something similar before, but here it is for your money situation:

$2.9M invested for yields of 4.5% to 6% = $130,500 to $174,000 annual income. Yes, I get yields in this range on most of my investments, mainly individual corporate/muni bonds that I've held for a long time, with recent additions of ETFs of corporate bonds/preferred stock/high dividend stock. Most of our portfolio is in fixed income.

If you're more of a stock person, you can get yields of 3.5% to 5.5% in ETFs, which would give you $101,500 to $159,500 annual income. I know some people prefer to invest for growth, selling off shares as needed for income. That's not my area of expertise, so I'll leave it to others to chime in on the best ways to get at least $85,000 annual income using the growth method.

Bottom line though, it doesn't have to be one or the other method, exclusively. You can do a blend.

If somebody was setting up investments today, do you have suggestions for where to get 4.5-6% bonds or other fixed income? Curious to hear more.

 

[cfran]

You are doing great saving and thinking about the issue. I suggest you find a less-stressful job. You have not been happy for many years now (based on earlier posts). I suppose you are proving that money can't buy happiness. IMO you don't have enough saved yet to support $85k spend for 50 +years. BTW, less stressful does not have to mean less compensation. Good luck!

Really, 2.9% isn’t workable? Seriously not great advice to be giving.

 

[gwraigty]

If somebody was setting up investments today, do you have suggestions for where to get 4.5-6% bonds or other fixed income? Curious to hear more.

Start by choosing some ETFs in your area of interest. For ETFs, I take the most recent distribution, annualize it, then divide by the current asking price to guesstimate the current yield. As an example, I did this for just a few of my investments last week, PSK - 5.629%, VCLT - 4.041%, USHY - 6.111%.

That's the easiest way to get started, although it's not the way I started with this over 15 years ago. I started with CDs, then branched out into individual corporate bonds and muni bonds. I buy with the intent to hold until maturity. Some of my holdings with higher coupons have been in my portfolio for years. Lately, it's been more challenging as coupons/yields have dropped, making ETFs a better option sometimes.

Last year, I bought a corporate bond with a coupon of 6.85%, and a couple of months ago, I bought one with a coupon of 6.75%. Investment grade on both. So, it's still worth looking for individual issues.

I buy through Fidelity, Schwab, and Vanguard.

 

[gwraigty]

Really, 2.9% isn’t workable? Seriously not great advice to be giving.

I agree that it's very workable. A quick look at Fidelity shows over 3% yield on CDs right now. 10 year maturities. An easy start for someone who wants little risk or fuss.

 

[HarveyS]

Really, 2.9% isn’t workable? Seriously not great advice to be giving.

Boy, lots of anger out there....
OP asked for thoughts. I guess he (and the community) only wanted thoughts that agreed with his......seems to be alot of that lately.
$85k spend was stated. I assume he needs to spend $85k to live his life as he lives today (inclusive of a generous travel budget). Food, shelter, transport, etc. But, he needs to pay medical, dental, income tax, life insurance. So, if $85k to live, he needs another $25k for medical. That is max out of pocket for plans I am familiar with. May be less without kids - I'll give you that. And maybe he can get ACA subsidies. But I plan for worst case, and that's $25k/year. Subsidies may go away someday. Bear with me, if they don't that's now at $110k to live. Oh, what about tax? Thats easily another 15%, assuming a low income tax state. Now we are at $126.5k. Oh, and the markets dropped ~2% from peak last week, so OP's 2.9M is now $2.84M. $126.5/2.84M = 4.4%. Sorry if I am raindrops on your parade. Not sure how many of you support a 4.4% SWR for 50+ years, but I am willing to say this is not a good plan.

OP asked for opinions. My opinions are in line with what he got several years ago. Not sure why today they are being bashed in the forum.

As I said in post 18, Good Luck.

 

[daylatedollarshort]

What's wrong with me anyway?

Any advice from those who have been in this spot?

We're herd animals at heart. For us it still seems a bit surreal to have enough money to not have to work plus have discretionary money for entertainment and travel in a world where many households either aren't good at saving or simply don't make enough to have money left over to save. I think at some point you just have to have faith in your numbers and spreadsheets or calculators and take the leap. We had a couple of hobby businesses we ramped down over the years so that made it less of an abrupt transition.

 

[audreyh1]

Too young — find something else to do, to build ...

Something between megacorp and seeing the world.

Hmmm - I don’t get the too young part as long as sufficient funds. I expect to here that from non-FIRE folks, but not from this forum.