Walking away from Options and RSU's

[2017ish]

...

My wife and I have been talking about doing this before potentially having kids so it is a bit of a life goal thing. We also aren't averse to returning to work if needed and things don't completely work out.

I've also looked at potentially earning some side income and believe that even part time work could sustain us for quite some time.

I agree with others that you probably don't have enough assets IF you plan to retire permanently now. From this followup post, however, it looks like it could be more in the way of a sabbatical? How easy would it be for you to return to work/income?

Another question would revolve around your wife's age if this Caribbean sojourn is seen by the two of you as something to do before potential kids. If she is exactly your age, you probably don't want to delay the sailing while waiting for the RSUs--non-interventional fertility is not helped by putting things off in one's thirties--especially after 35.

 

[felizcortez]

I agree with others that you probably don't have enough assets IF you plan to retire permanently now. From this followup post, however, it looks like it could be more in the way of a sabbatical? How easy would it be for you to return to work/income?

Another question would revolve around your wife's age if this Caribbean sojourn is seen by the two of you as something to do before potential kids. If she is exactly your age, you probably don't want to delay the sailing while waiting for the RSUs--non-interventional fertility is not helped by putting things off in one's thirties--especially after 35.

The wife is 30. We are unsure whether we want to have children.

Returning to work in the exact same position probably wouldn't be an option if I took a longer sabbatical and not sure I'd like to continue working for the organization at least where I'm located now. I've moved a few times for work and I'm in an area of the country we don't particularly care for (prefer the west coast).

I work in the tech industry in sales management, I've told a few of my friends who work for other companies what we are thinking about doing and each one said they would hire me after I returned. In short, I don't think I'd have a problem getting another 6 figure job at megacorp after returning if that is what we wanted to do. Would it be the same level of compensation, maybe not, but it would still be more than enough to cover living expenses and contributions to retirement.

I interviewed for a job in SoCal and before we got to the offer stage I bowed out because I didn't want to take a position and quit on them in about a year. I leveled with the hiring manager and HR manager and they both told me to call them when I get back from the trip.

Can I fully retire on the asset level that we have today just living off the assets and never make another dime... probably not.

Do I have a healthy cushion that provides flexibility that enables my wife and I to make some lifestyle based choices - absolutely. I am starting to get to the point where I have some goals I want to accomplish and my 60+ hour a week job is getting in the way.

 

[2017ish]

Based on this last post (11:51), I'd go for it. Take the time off and contemplate life and further options both family and financial.

DW and I agreed that I'd quit a few years to raise kids, which was a major AGI hit, and delayed our retirement, especially after "a few" turned into 15. I'm back working for seven years with excellent income--albeit far from the trajectory I was once on, but the lifestyle decision was worth it (DW agrees). Sounds like you are in similar situation.

 

[Symbiotic]

I quit at about the same age and left ~1mm in RSUs on the table, and it was a sizable percentage of NW. I am pretty sure I will go back to some form of earning in a while, but the downtime is also nice. We can stay RE if we want to.

If you do quit, I think you will look back at the 124k six months from now and laugh and say to yourself, "what was I thinking?" It's not material in your grand scheme... either you can live an RE lifestyle at 1.2m invested, or you can't do it at 1.3m. And this is 9 months of work for you anyway, so... yeah. Go have fun and find yourselves together!

 

[RunningBum]

Thanks for clarifying the options. Only you and your wife can measure the value of the time off vs. plowing on and taking the money, but I'm not seeing a bad decision either way. Maybe it was already covered, but I assume you've got health insurance figured out?

 

[felizcortez]

Wanted to provide an update on this post. My wife and I had made the decision to buy a boat and sail the Caribbean. I was about 2 weeks away from turning in my notice at work, but they approached me about moving back to the west coast. As a kicker, they threw in a bonus of 4 months base pay grossed up to cover taxes as an incentive to move. (about $60k). We accepted the position and we are moving within the next few months. It's a two year commitment or I owe back moving expenses, but this will enable us to capture all the equity and continue to pad the nest egg. The moving incentive enables us to purchase a boat with no change to our current net worth ($1.25m). We'll have two years to outfit the boat and sail around the west coast. it was definitely a struggle to change plans since we were so far down the path of going, but we both feel comfortable with this plan.

 

[cyber888]

Just do it ... walk away if you feel burnt out and you need some time off. Your work is not your life. And if you had no life before, now would be the time to Live the Life.
I don't think you will really retire. Maybe you'll find a new gig in 3 or 4 years, so taking a 2-3 year break is great.

 

[MichaelB]

Wtanted to provide an update on this post. My wife and I had made the decision to buy a boat and sail the Caribbean. I was about 2 weeks away from turning in my notice at work, but they approached me about moving back to the west coast. As a kicker, they threw in a bonus of 4 months base pay grossed up to cover taxes as an incentive to move. (about $60k). We accepted the position and we are moving within the next few months. It's a two year commitment or I owe back moving expenses, but this will enable us to capture all the equity and continue to pad the nest egg. The moving incentive enables us to purchase a boat with no change to our current net worth ($1.25m). We'll have two years to outfit the boat and sail around the west coast. it was definitely a struggle to change plans since we were so far down the path of going, but we both feel comfortable with this plan.

Thanks for the update. Hopefully those two years will sail by quickly. you'll be able to collect all the options (especially that big RSU) and still have an opportunity to go sail the Caribbean.

 

[Aiming_4_55]

Congrats. Can you negotiate a 6 week paid timeoff transition? This could give you 1 - 2 weeks to move (pack/unpack) and maybe 4 weeks to "sail" to seize the moment and enjoy!

 

[felizcortez]

Congrats. Can you negotiate a 6 week paid timeoff transition? This could give you 1 - 2 weeks to move (pack/unpack) and maybe 4 weeks to "sail" to seize the moment and enjoy!

I'm taking about 3 weeks off prior to the move. 2 weeks in May and then another separate week for a family commitment.

The relocation handles all the packing/moving/shipping cars etc. pieces of the move. We'll likely be in temporary housing for about a month when we get there as well (paid by the employer).

We'll be driving out to the west coast due to not wanting to fly our pets. Should take a few days and we'll stop and see some sites.

 

[felizcortez]

Thanks for the update. Hopefully those two years will sail by quickly. you'll be able to collect all the options (especially that big RSU) and still have an opportunity to go sail the Caribbean.

I think the two years will go by pretty quickly. We've lived in this area before and had a blast.

 

[RunningBum]

Sounds like a great plan! Seems to me when you make a decision like that and feel good with it, it's usually the right one.

 

[felizcortez]

We are almost 2 years into our work contract and things are going well. Our net worth has climbed to ~$2.08M (not including any RSU's or NQO's) as of this morning and the stock price on the RSU's and options has gone up from ~$58 to over $100 since authoring the original post.

We still plan to go sailing, but will be likely quitting my job in the January 2019 time frame. This will enable us to capture the large equity slug that vests in October and collect a bonus at the end of the year.

We've spent the last two years getting more familiar with the boat and taking trips around the area we live. It's been an eventful year and we've learned a ton about boat maintenance/ownership. It has definitely had it's ups and downs with regards to expenses and the learning curve. I'm glad we didn't pull the trigger 2 years ago as I feel much more comfortable with our financial position and believe this gives us many more options in the future.

 

[Cayman]

Sounds like your plan is working out for you. Very nice that you have more cushion for ER.

 

[Shanky]

Most folks in highly compensated positions have to leave significant $$$$$$$ on the table to retire early. Long term compensation vesting over 4 years is not unusual. The key is determining what is “enough”. Once you know that, how much you leave on the table becomes a moot point. Looks like you have figured that out.

 

[brett]

Think carefully about protecting your retirement by exercising the options in a timely, planned manner.

I was fortunate to have options that had significant value. I was slowly exercising them until I had two pieces of advice. The first was from a colleague in another firm who claimed he had lost out on about $1.5M of gain because he did not exercise. Stock price went down, options expired.

The other advice was from our financial advisor who commented that my employment, pension, and options were all tied to one company. We followed his advice and began to aggressively exercise the options. The top exercise price was $54. Within about nine months the stock was trading at $15-20.

I was fortunate. Several of my colleagues were holding out for the stock to hit $75 on options pegged at $15-30. Some left $1M plus on the table. The old market saying is so true....pigs get slaughtered'.

 

[thepalmersinking]

We are almost 2 years into our work contract and things are going well. Our net worth has climbed to ~$2.08M (not including any RSU's or NQO's) as of this morning and the stock price on the RSU's and options has gone up from ~$58 to over $100 since authoring the original post.

We still plan to go sailing, but will be likely quitting my job in the January 2019 time frame. This will enable us to capture the large equity slug that vests in October and collect a bonus at the end of the year.

We've spent the last two years getting more familiar with the boat and taking trips around the area we live. It's been an eventful year and we've learned a ton about boat maintenance/ownership. It has definitely had it's ups and downs with regards to expenses and the learning curve. I'm glad we didn't pull the trigger 2 years ago as I feel much more comfortable with our financial position and believe this gives us many more options in the future.

Tell us about the boat?

 

[felizcortez]

Tell us about the boat?

The boat is a 1980 Tartan 37 Sailboat. We have been working on outfitting the boat and have been doing mostly day sailing and a few longer weekend type trips to Catalina Island. The Catalina Island trips have been overnight sailing to either Avalon Harbor or Two Harbors. Staying for a few days then heading back to our home port. A good way to shake down what works and what doesn't on the boat.

I built a navigation system out of a Raspberry Pi running Openplotter/OpenCPN. It's really cool and also receives AIS. Seems to be a great little system.

We've done quite a bit of work to the boat and still need to get a few major projects completed.

Still to do
Windlass to help raise the anchor - right now it's powered by my back.
Solar Panels - Charge the house battery bank.

Most of the other items we want to do are nice to have and aren't critical for leaving, but would be significantly easier to accomplish with more time.

 

[wsmurdoch]

You all should have a ball. We retired in 2004 in a financial situation similar to yours but at the age of 53. We have spent all we needed to spend, and in dollar terms the balance has doubled. Our boat is a 1988 Pacific Seacraft 34, and for each of the last eleven years we have taken it to the Bahamas for the winter returning to our house in the Tennessee mountains for the summer and fall. Since retirement I have also finished hiking the Appalachian Trail in sections. My wife keeps a blog of our boat travels. You can find its address by clicking on my name to the left then 'About Me'.

Bill

 

[felizcortez]

You all should have a ball. We retired in 2004 in a financial situation similar to yours but at the age of 53. We have spent all we needed to spend, and in dollar terms the balance has doubled. Our boat is a 1988 Pacific Seacraft 34, and for each of the last eleven years we have taken it to the Bahamas for the winter returning to our house in the Tennessee mountains for the summer and fall. Since retirement I have also finished hiking the Appalachian Trail in sections. My wife keeps a blog of our boat travels. You can find its address by clicking on my name to the left then 'About Me'.

Bill

Sounds like you are having a great time . I'll check out the blog.

Are you spending the entire cruising season on the boat when you go to the Bahamas? Any particular boat items you'd recommend for the trip? e.g. one thing we love is the aquabot waterbottle sprayer. I thought it was gimmicky, but it works great to conserve fresh water.

Awesome job on the AT. I've been doing some backpacking and am section hiking the JMT right now. Did a chunk last year and will do another chunk this year.

 

[wsmurdoch]

We have our kids and grandkids at our house for a week or so after Christmas, race a
Tanzer 22 on a mountain lake on New Year's Day, put up the Christmas stuff, drive to the North Carolina coast, move onto the boat, and head to the Bahamas arriving in maybe late February. We stay aboard until we return in June.

Helpful stuff... dry boat, flush toilet, propane stove (40 lb gas), reliable refrigeration, big anchor, electric anchor windlass, anchor wash down pump, reliable dinghy, tools, spare parts... you know the list. Among the odd things is a 1 gal orchard sprayer with its hose and nozzle replaced with a home kitchen sink rinsing nozzle and hose. Since adding that we have seldom used the shower in the head.

When we first started this, you do not know how many older couples told us over a drink on the beach that we were doing the right thing going earlier while we were younger. As it turns out they were right. We have no regrets.

A long time ago when this forum was young there was Dory36. I read everything he posted.

Bill