How to retire early - A couple retired in the early 40's

[Winemaker]

So you can do beer tasting for free?

This needs moved to the American Dream thread.

 

[scrabbler1]

I checked back to the original (linked) NYT article for more details.


First, his wife works, so I am always a little skeptical about someone claiming to be retired when the spouse works. If the husband works while the wife quits her job to stay home with the kids, do we consider her retired, or simply a SAHM? That would make him a SAHD, not an early retiree.


Second, as others have pointed out, have they considered inflation in their plan? That $40k won't buy as much in 10 or 20 years.


Third, do their kids plan to attend college? That's a big expense.


Most of the comments are from the Debbie Downer types. I don't take them seriously.

 

[Golden sunsets]

There are so many early retiree bloggers out there and their retirement is partially subsidized by the income that their blogs produce and perhaps more importantly directly aided by a roaring stock market since 2009. Our own Fuego writes a delightful blog called Root of Good and documents how his family of 5 is living the life of millionaires on less than $40,000/year, in fact much less than $40,000 per year. Their lifestyle also includes extensive travel, using a combination of travel hacking and other discounts on AirBnb type accomodations.

I say more power to them. If you reduce your expenses to numbers like $40,000/year while still working, use the ACA to get practically free healthcare, save 50-70% of your income for a number of years and are aided by a bull market, it doesn't take to long to accumulate over $1,000,000. I personally would not feel comfortable retiring with only $1,000,000, but if you did so 6 or 7 years ago, that nest egg is probably close to $2,000,000 now. Totally doable.

 

[JoeWras]

I was referring to comments such as:
...

"It sounds great, but go ahead and try it until you basically are sitting around drinking coffee at McDonald's reading the newspaper every day until you die, because you sure can't afford to go on trips or do anything nice with your wife, and your kids will hate you for forever having to pinch every penny and can't afford anything."

The best comment in the chain was a response to the above which basically refuted it. I.E. travel is done and slow mornings with coffee are some of life's best simple pleasures. And I'll add: the best "nice" things with your wife are free. Maybe not what you think. Rather, spending time on nice walks in the park as the autumn leaves fall.

We are now retired and about to do a bit of travel. Surprisingly, I see my travel window to maybe be only about 5 or 7 years. I'm pretty sure I'll be done by then. I can see coffee trips in my future. I have to support the barista-Fires afterall.

 

[dcoy]

....but she is still working...so...how is that retirement? My DW is a stay at home mom, I work...so I guess we qualify too as FIRED?

 

[daylatedollarshort]

So you can do beer tasting for free?

We can this week. Every week the available free / comp / discount activities change for our area but there are always a bunch of fun events to pick from. One of my unsold ticket subscriptions alone has 300 - 400 events each month to choose from.

Plus there are always just a lot of free and cheap events like in this list:
https://sf.funcheap.com/weekend/

 

[The Cosmic Avenger]

Our local farmer's market has a brewery, a distillery, and two wineries that have stands there, and they all offer free samples. I usually drive, so I'll only occasionally taste a tiny bit, but I usually buy something when I do anyway.

 

[ncbill]

I checked back to the original (linked) NYT article for more details.

First, his wife works, so I am always a little skeptical about someone claiming to be retired when the spouse works. If the husband works while the wife quits her job to stay home with the kids, do we consider her retired, or simply a SAHM? That would make him a SAHD, not an early retiree.

Second, as others have pointed out, have they considered inflation in their plan? That $40k won't buy as much in 10 or 20 years.

Third, do their kids plan to attend college? That's a big expense.

Most of the comments are from the Debbie Downer types. I don't take them seriously.

Barring physical disability I don't see my spouse retiring for another 15+ years.

And parents don't necessarily have to pay for college.

My kids had their Uncle Sam cover their education via a ROTC scholarship.

I bet others here did the same, or enlisted and then used the GI Bill.

 

[Bestwifeever]

I checked back to the original (linked) NYT article for more details.


First, his wife works, so I am always a little skeptical about someone claiming to be retired when the spouse works....

From the article:

"Once we started tracking our spending, we found a lot of places we can cut that really didn't hurt," Mindy said. "We are giving up fancy clothes. I don't care, I work from home three days a week."

He’s retired to become a SAHD, while she works three days a week. I wonder if they use her employer’s health insurance.

 

[GravitySucks]

I take umbrage to the comment that claimed we are crazy
As long as the S&P 500 stays above 1700 I'm eccentric.

 

[Offgrid Organic Farmer]

I retired when my employer [US Navy] forced me onto pension. To them it is normal to go on pension after 20 years. I was 42.

It is now 17 years later, and we are still living below our means, on my pension.

I have a few more years to go before I become eligible for SS.

 

[marko]

From the article:

He’s retired to become a SAHD, while she works three days a week. I wonder if they use her employer’s health insurance.

That's how I had read it. How is this FIRE'd?

Seems everyone wants to get in on the 'movement' but I think half these people are just kidding themselves.

Reminds me of a wife of a friend once who, when learning she was pregnant, quit her job and proudly and dramatically announced that "I'm now a woman of leisure".

Yeah. Right.

 

[texasdiver]

Wow. A lot of ignorance and denial in the comments. I had to wade into the worst of it, but I might not go back and read the replies.

My only concern is whether they've taken inflation into account and budgeted COLA raises for themselves for 20+ years until SS and Medicare kick in. It might get uncomfortably tight, depending on how the economy is doing.

How much social security is actually going to kick in if you and your spouse both retire in your early 40s after less than 20 years of employment?

 

[pj.mask]

20 years earning 100k is the same as 40 years earning 50k. You can reach the second bend point in SSI by mid 40s

 

[PoF]

I don't think I want to read the comments. The Jensens are friends of ours. I've eaten in that kitchen, and they've eaten in ours even though we live 1000 miles away.

It's always interesting when commenters' first reaction is some combination of "they're lying," "they're living like paupers," "my life is way better," etc... I think for every person that responds that way, there are several that are at least a little bit curious and might think to try learning more.

Also, FWIW, the subjects of the piece track their net worth on 1500Days. It's north of $2M now. More than most of the deniers will ever see.

Cheers!
-PoF

 

[Bestwifeever]

He has had a blog with ads and credit card offers for five years? So there's income there too. Got it.

 

[FIREarly]

There is a reason I personally never tell anyone who doesn't already know that I am retired. The biggest reason is I don't want to have to justify my decision to someone who I feel I don't have to defend myself to. The other reason is I have nothing to prove to anybody. I live in a rather small town, and I'm sure some know that I am retired. But I have never told them .

This is one of many great quotes in this thread. I enjoy hearing about other retirees lives and what they are doing. Not everyone has this same point of view. Congratulations on your early retirement!

 

[TDub]

I retired when my employer [US Navy] forced me onto pension. To them it is normal to go on pension after 20 years. I was 42.

It is now 17 years later, and we are still living below our means, on my pension.

I have a few more years to go before I become eligible for SS.

Wow! You are officially my hero.

 

[imoldernu]

We couldn't have retired at 40, and probably shouldn't have retired at 53, but a health scare made the decision. Our four sons were out of school by then. Now 30 years later, I have to go to the government inflation calculator, to even begin to make sense of the dollars. Last corporate position was in 1984 with a salary of $49K, (about $105K today). Five years of my own business and then cancer.

Retire... If I die, sobeit, if I live, could go back to w*rk if necessary.

Instead, living a great snowbird life, IL and FL, 1990 to 2012. Campground in IL and over 55 community in a super active park in FL. Now live in our house in a CCRC in IL. Early years were frugal, but very happily busy.

All at less than 1/2 the savings that we're supposed to have to retire at age 65 today.

With all of that, my calculations show jeanie and I to be safe to age 91...
.......................................................................

So back to the article... I can see living on $40K, even with children, but that leaves a potential shortfall, when education costs or unexpected expenses come due. Looking at their plans, a little hard to figure how they'd make it through the next 42 years to get where we are today (age 82).

My opinion... OK to retire early, at any age... with the idea in mind that going back to w*rk is there as a safety net.

 

[mrWinter]

I was referring to comments such as:

"What a boring life. Just find something you like to do and enjoy your life. Who wants to live on a restricted budget for 60 years?"
"Really. That's exactly what I was thinking"

"VERY RISKY! ... the market can go flat for 15 years at a time, during which over 1/2 their initial savings will be gone, and no longer provide an optimistic return needed for paying the bills. The couple here should have saved much more before retiring. ..and what about escalating health insurance costs This FIRE thing only makes sense for people who HATE their job, and need to quite for mental health reasons, LOL"

"I'll be more interested in their story in five or ten years. No doubt they will both be back at work."

"It sounds great, but go ahead and try it until you basically are sitting around drinking coffee at McDonald's reading the newspaper every day until you die, because you sure can't afford to go on trips or do anything nice with your wife, and your kids will hate you for forever having to pinch every penny and can't afford anything."

"who wants to retire at 43 with a combined income of 40k?? I mean I guess I could live comfy and extremely bored in a trailer out in NO Where America... But they say you need at least 100k p/y to live comfy where I live"

"How ridiculous. No part time job pays health benefits. Since they have limited income, their health insurance is being subsidized by the government. Good way to go, retire early so the government can foot the bill for your insurance. That is the problem with Obamacare!"

Are these examples of replies that are astonishing or are resentment towards early retirees? The majority of these comments seem completely reasonable to me.

"I'll be more interested in their story in five or ten years. No doubt they will both be back at work."

Sounds like the wife is in fact still working, so this comment isn't far off.

"It sounds great, but go ahead and try it until you basically are sitting around drinking coffee at McDonald's reading the newspaper every day until you die, because you sure can't afford to go on trips or do anything nice with your wife, and your kids will hate you for forever having to pinch every penny and can't afford anything."

A perfectly valid opinion. I understand that some are happy to sip coffee for a long time and just stroll through the park watching leaves fall down. But that doesn't mean everyone wants to do that. I've heard of plenty people who retire only to get bored and go back to work because they found it fulfilling. More power to them.


As far as the kids hating them, strong words, and engenders ethical questions about what is entitled to them, but considering that they could be working to save for their kids college, and aren't, I wouldn't be entirely surprised if there was some animosity there. Should there be aniumosity is another question, but it could happen.

"who wants to retire at 43 with a combined income of 40k?? I mean I guess I could live comfy and extremely bored in a trailer out in NO Where America... But they say you need at least 100k p/y to live comfy where I live"

This is just a disagreement on what annual spending would lead to a comfortable life, the person commenting would rather work more to save more, a fine opinion, certainly all members on this board don't agree where the cutoff point is.

"How ridiculous. No part time job pays health benefits. Since they have limited income, their health insurance is being subsidized by the government. Good way to go, retire early so the government can foot the bill for your insurance. That is the problem with Obamacare!"

This is a totally valid criticism of the ethics of claiming government subsidy while retiring early, and of the setup of the ACA itself. And I'm a fan of the ACA as opposed to what came before, but the incentives and discounts were not designed to subsidize people who have the skills and ability to work more but choose no to for 20 years, they are almost certainly going to be a net loss for the system. I don't blame them, and they aren't bad people, they are operating in their best interests given the incentives provided to them, but this wasn't what the system was designed for.

 

[HtownRose]

From the article's comment section "No part time job pays health benefits" is not true & is one primary motivation for "barista FIRE" - in my industry there was no such position that I could find, so I searched for & found a position in a different industry - airline reservations. Flight benefits are a nice bonus but I'm there for the health insurance.

 

[JoeWras]

A perfectly valid opinion. I understand that some are happy to sip coffee for a long time and just stroll through the park watching leaves fall down. But that doesn't mean everyone wants to do that. I've heard of plenty people who retire only to get bored and go back to work because they found it fulfilling. More power to them.

This is a personal thing. A lot of people have high touch or high impact jobs that they would miss. If they get bored, I'd rather that they get another job than run the HOA.

Me? I don't have the need to run for office so I can tell other people what to do. I'll take coffee and walks any day.

 

[Walt34]

"How ridiculous. No part time job pays health benefits. Since they have limited income, their health insurance is being subsidized by the government. Good way to go, retire early so the government can foot the bill for your insurance. That is the problem with Obamacare!"

Yet another example of a part time job that offers health insurance is Home Depot. Work there for 20 hours or more a week and they offer it. When we were painting FIL's house the paint-mixing lady said she was a single mom and was glad to have the job.

As far as someone manipulating their income to qualify for ACA subsidies I don't see that as any different than configuring assets to legitimately pay the lowest amount of taxes possible. They didn't make the rules but they do have to comply with them.

 

[JoeWras]

Yet another example of a part time job that offers health insurance is Home Depot. Work there for 20 hours or more a week and they offer it.

A friend of mine is doing exactly that.

 

[NW-Bound]

I was referring to comments such as:

"How ridiculous. No part time job pays health benefits. Since they have limited income, their health insurance is being subsidized by the government. Good way to go, retire early so the government can foot the bill for your insurance. That is the problem with Obamacare!"

This is a totally valid criticism of the ethics of claiming government subsidy while retiring early, and of the setup of the ACA itself. And I'm a fan of the ACA as opposed to what came before, but the incentives and discounts were not designed to subsidize people who have the skills and ability to work more but choose no to for 20 years, they are almost certainly going to be a net loss for the system. I don't blame them, and they aren't bad people, they are operating in their best interests given the incentives provided to them, but this wasn't what the system was designed for.

In this manner, ACA is no worse than universal healthcare in other developed countries. Everybody gets healthcare, whether he pays anything or not. That's just the way it is, by definition.