Vagabond2020
Recycles dryer sheets
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- Mar 8, 2014
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Investable assets just cracked $313k
+$100k in the last 12 months.
+$100k in the last 12 months.
28 Years Olds Journey to FIRE!!!
- Thread starter Vagabond2020
- Start date
Congrats and thanks for the updates.
UnrealizedPotential
Thinks s/he gets paid by the post
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Maybe I am missing it, and if so I am sorry, but don't you have your assets in pre tax accounts? If so, how will you access the money if you retire before 59.5 for roth IRA or 55 if you stay on the job for your 401k? But you are doing great. Way ahead of me when I was your age. Your killing it, Keep it up. However, to retire really early you will need significant taxable accounts or you could use the equal periodic payments for Roth IRA, but for the 401k I don't know if there is a loop hole.
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97guns
Full time employment: Posting here.
Your path is eerily similar to mine, got my first corporate job at 26, retail with Home Depot, and said to myself that I would retire by 40. I put my nose to the grinding wheel and made dept manager in 4 months, Max'd out the stock purchase plan and walked out with $80k in stock in 4 years. I hated school, never went to college and graduated HS with a D- average, suffice to say I did manage to fire 9 years ago at 39 years old
Why did you get banned on the other site you used to frequent?
97guns
Full time employment: Posting here.
I posted a link to an article and was deemed a spammer
Vagabond2020
Recycles dryer sheets
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- Mar 8, 2014
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Thank you!
Obliged.
Hey there. Tons of ways to access 401k money. Primary is to roll your 401k into a tIRA when you leave a job. Once you leave the workforce and drop to the 15-25% tax bracket, you do a Roth conversion pipeline. Where you can convert say $20k/yr from IRA to Roth IRA in your new low tax bracket, and 5 years later access the funds penalty free, if you do that each year you create a ladder of Roth money you can touch every year.
Also, existing roth IRA you can withdraw principal penalty free at any time.
Taxable I do have, currently ~$50k sitting in there and growing.
For healthcare in retirement I also have an HSA that is growing quickly thanks to contributions. Putting $6,900/yr in there.
That is wonderful! Did you stay with Home Depot your entire career?
Yikes, was that MMM?
Update.
By the end of 2017,
Investable assets will be a hair over $340k now, which throws off $1100+/month @ 4% SWR. That covers 55% of my current expenses (including luxuries/wants)
I decided to take my foot off the pedal for a bit in 2020. Taking a sabbatical starting April 1 2020 for 9-12 months.
Vagabond2020
Recycles dryer sheets
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Did everyone survive the market correction? 
Sitting @ $375k net worth. That's $15k/yr @ 4% draw down.
Spending for 2017 came in @ $24k, therefore I am able to cover 62% of my actual spending through investments.
Sitting @ $375k net worth. That's $15k/yr @ 4% draw down.
Spending for 2017 came in @ $24k, therefore I am able to cover 62% of my actual spending through investments.
KCScubaSteve
Confused about dryer sheets
Very cool to read this. I'm 27 so this is inspiring.
Background: Been out of college with a Master's since Dec. 2015. Just came across this site. My FIRE goal is 50 w/ $5M nest egg. Married. DINK.
Currently This is where I am at.
Mid to high 90’s salary (wife + me) plus some incentive compensation (variable)
Paying off ~$2k/month in consumer debt
Budget is $5k/month in KC area.
Currently at $30k Investable Assets
Currently at $40k Consumer Debt
Currently at $215k Mortgage
On track to have consumer debt paid off by EOY. 2019 and beyond will max Roth IRA's and 401k.
Background: Been out of college with a Master's since Dec. 2015. Just came across this site. My FIRE goal is 50 w/ $5M nest egg. Married. DINK.
Currently This is where I am at.
Mid to high 90’s salary (wife + me) plus some incentive compensation (variable)
Paying off ~$2k/month in consumer debt
Budget is $5k/month in KC area.
Currently at $30k Investable Assets
Currently at $40k Consumer Debt
Currently at $215k Mortgage
On track to have consumer debt paid off by EOY. 2019 and beyond will max Roth IRA's and 401k.
Dtail
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Welcome to our wonderful site.
Keep up the savings and investing. Great to discover this site at a young age.
FIREHacker
Dryer sheet wannabe
- Joined
- Jan 25, 2018
- Messages
- 15
This. Lately, I've been feeling like I'm the only person I know who is on the path to FIRE. None of my friends nor my parents know. But you just gotta keep going. I'm glad there's a supportive and knowledgeable community for this.
Did everyone survive the market correction?
Sitting @ $375k net worth. That's $15k/yr @ 4% draw down.
Spending for 2017 came in @ $24k, therefore I am able to cover 62% of my actual spending through investments.
That's really good! Keep it up!
Another one, I'm 25 and most people tell me I am "nuts" either directly or indirectly if they realize I am working on that.
But it seems that by not bending to the comments some people have started to want to try it as well (for example my younger brother).
The only people that kind of respect it completely are my grandparents. I think they are a one of the sources of inspiration for me. As a quick story: my grandfather started with nothing literally her mother told him that as he was the youngest of the sons they had nothing to give him so he would have to find a way to survive. He started working on a factory I think by age 14, and after working some time for different people and going by bike every morning to the places, he managed to save enough to buy one textile machine with credit. The business went well and soon he payed the credit and bought more machines on cash. He built a small textile company that employed him and some other people. He worked there until 60 I believe, and then he retired and let the rest of he workers use the machines until they all retired. With the money he made he was able to buy houses for all his sons when they were all still studying at university. And managed to buy also some small orchards that he now uses to cultivate most of his food and provide other people with free food. He has always spend his life living frugally (one example is that to travel across Europe during the summer holidays he bought a van that he modified to have a kitchen and beds), and he mostly builts things and repairs things by himself, by learning from others how to do it. We all know that he has quite a few money in investments and other things, but he never wants to talk about it. What he always says is that we should not spend money in things that we don't need, but he only says it if we ask his opinion. He also sometimes says that some risk is important to have higher returns. But that's all what he will say about money, as he says he is not an expert.
Bryan Barnfellow
Thinks s/he gets paid by the post
When I was in my 30s and told a visiting friend (just a bit younger) about my wife's and my plan for financial independence and early retirement, he responded, "BB, I would never dare to ask so much from life," and then went off to bed with full confidence that ours was a pipe dream.
Well, we asked and we got it; he's still a wage slave. Don't let others write your script!
-BB
Well, we asked and we got it; he's still a wage slave. Don't let others write your script!
-BB
Thanks, it's good to have benchmarks.
You will start to see the benchmark of your peers get further and further in the rear-view mirror. And all of a sudden the benchmarks of older folks become something you achieve before they.
I've now passed up my 4yr old sister, and my 8yr old sister in terms of Net Worth. Working on catching some younger aunts and uncles now, my goal is to surpass DF before he or I dies. Doubtful on my end.
Vagabond2020
Recycles dryer sheets
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- Mar 8, 2014
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Nice to see some activity in here.
OP checking in.
Just cracked $400k NW ($500k combined with SO).
We are definitely taking 9-12 months off in 2020! Currently spending a combined $36-40k/yr so we are sitting on ~12-15 years of assets.
OP checking in.
Just cracked $400k NW ($500k combined with SO).
We are definitely taking 9-12 months off in 2020! Currently spending a combined $36-40k/yr so we are sitting on ~12-15 years of assets.
exnavynuke
Thinks s/he gets paid by the post
With $320k increase in assets over the past ~3 years, and knowing that it will likely accumulate even faster (more money grows faster than less money after all) going forward, I'm wondering why you're only considering a sabbatical in a couple years when you could be looking at having the ability to FIRE by working just a couple more years?
exnavynuke
Thinks s/he gets paid by the post
If they had a desire to increase their lifestyle they could do so now as they make a lot more than they spend, so I assume that isn't currently a desire. To withdraw $36k/year at 4% he'd need $900k. Alone, he's already at $400k. $60k/year (which probably is pretty close to what he's been putting away) in contributions with 7% growth gets him all to that $900k by 2023, just 3 years later than the sabbatical.
The spending is also "combined" so they're, together, actually even closer. Starting at $500k (combined), putting $65k/year at 7% gets them to ~$940k after just 4 years (about 2 years later than the sabbatical). Wait until 5 years and they're closer to $1.1M
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Not many people will suggest using a 4% swr for a 31? Year old - especially after such a long bull market. 3-3.5% seems much more realistic.
At their age, that is a big decision to make about never wanting to increase spending. Do/will they have kids?
7% growth is very optimistic for the next 5 years. That is the historic average for stock returns (after inflation) but if I were retiring in 5 years I would have around 30% bonds and those currently yield almost nothing after inflation so I can’t support making big life decisions on 7%.
Without additional funds, there is limited room for unaccounted for items - health insurance. If the ACA stays around and IF they can get subsidies, how much will oop be? Will they stay married? What about big expenses? (Roof, car accident, etc). There are people who advocate retiring with 400k and live in Thailand off of $1k/mo. I prefer to plan for more than my immediate-5 year plan but account for what I will need throughout my lifecycle. If one of them needs long term care wiping out their savings is the surviving spouse going to live on SSI only with a Work history of 8 years and no savings (spent on care)
At their age, that is a big decision to make about never wanting to increase spending. Do/will they have kids?
7% growth is very optimistic for the next 5 years. That is the historic average for stock returns (after inflation) but if I were retiring in 5 years I would have around 30% bonds and those currently yield almost nothing after inflation so I can’t support making big life decisions on 7%.
Without additional funds, there is limited room for unaccounted for items - health insurance. If the ACA stays around and IF they can get subsidies, how much will oop be? Will they stay married? What about big expenses? (Roof, car accident, etc). There are people who advocate retiring with 400k and live in Thailand off of $1k/mo. I prefer to plan for more than my immediate-5 year plan but account for what I will need throughout my lifecycle. If one of them needs long term care wiping out their savings is the surviving spouse going to live on SSI only with a Work history of 8 years and no savings (spent on care)
Vagabond2020
Recycles dryer sheets
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Great question sir.
I've been suffering from OLY syndrome ever since I discovered the concept of early retirement. Originally thought I could pull it off by 50 when I started my first FT job, then in 2012 I discovered personal finance blogs and forums, and changed my goal to 40. 2020 will mark my 10 year anniversary in the corporate world, and a great point to step back and take a breather to reassess what I want to do with the rest of my life.
There are certain things we want to do on this planet, that are going to be a very different experience in our 30's vs. our 40's or 50's. A round the world trip is one of those, especially to mostly developing countries, and a more spartan method of travel and lodging.
Your math in the next post is very accurate, and we are not even sure we will go back to FT career work after the sabbatical, I might just for a year or two because I make 75% of our income. She might find a PT job with health benefits or we may do seasonal work, work for stay, or find other projects with money as an afterthought.
My career is in sales/business development, so getting back to a 6 figure income would take me less than a year, were I to have to re-enter the workforce after FIRE. I have no problem taking a more Jr. position and quickly working my way up in an organization.
I am most definitely going to be using a 3.5-4% WR, so we would only need $900k-$1.1M. About 3.3-4.7 years away based on $84k/yr contributions (average over 3 years), and 6% growth.
We are contributing ~$84k/yr and assuming 5-6% investment growth. We will hit $900k in 3.3 years at this pace, assuming no commissions or increases in income.
There is a ton of safety net baked into our plan.
4% is extremely comfortable, I would even say 4.5-5% as long as you do a few things.
Don't spend 4%+ when the markets are down. Our $36-40k/yr has a ton of fat to trim to temporarily reduce WR to 3-3.5% in down years.
PT work, two people working two 8 hour days a week each, even at $15/hr, ends up $24,960 gross, assume 18% lost to FICA, Taxes and that covers 50% of our higher end spending.
If we have a really bad 5-10 years in the market, we can both go back to FT work, even making 50% of what we do now, we would be able to earn enough to save 50%+
The 4% SWR assumes a 50/50 portfolio, and no SS, inheritance, etc.
The way I look at it, if we quit and the money somehow starts to deplete faster than anticipated, the worst thing happens is we have to go back to work for a few years.
By waiting for a super safe 3-3.5% WR, we are ensuring that the worst happens, working an extra few years.
Vagabond2020
Recycles dryer sheets
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@pj.mask
I forgot to address your last paragraph.
I'm not sure we will legally marry in the USA for the very reasons you pointed out around exposure of assets in a situation like that, or many other legal ways to **** someone in this country using our fantastic system.
Our $36-40k a year already accounts for housing costs amortized over time. We are renters, at least for now. The spending also includes a decent amount for healthcare. We have absolutely no problem leveraging geographical arbitrage and self insuring if the ACA (or something like it) is not around for low income individuals. No kids for us either, which makes things a bit easier to plan.
At the end of the day, I just don't see myself never earning money again. I'm an extroverted problem solver, and I enjoy working on mentally stimulating projects with good people. I have a feeling that paid work will find me, and it won't even feel like work, because I won't need the $$.
There are plenty of things I could see myself selling, and not in a consumerist or business sense. Using my skill set for philanthropy, charity, politics perhaps?
There is always www.coolworks.com
I forgot to address your last paragraph.
I'm not sure we will legally marry in the USA for the very reasons you pointed out around exposure of assets in a situation like that, or many other legal ways to **** someone in this country using our fantastic system.
Our $36-40k a year already accounts for housing costs amortized over time. We are renters, at least for now. The spending also includes a decent amount for healthcare. We have absolutely no problem leveraging geographical arbitrage and self insuring if the ACA (or something like it) is not around for low income individuals. No kids for us either, which makes things a bit easier to plan.
At the end of the day, I just don't see myself never earning money again. I'm an extroverted problem solver, and I enjoy working on mentally stimulating projects with good people. I have a feeling that paid work will find me, and it won't even feel like work, because I won't need the $$.
There are plenty of things I could see myself selling, and not in a consumerist or business sense. Using my skill set for philanthropy, charity, politics perhaps?
There is always www.coolworks.com
I’m all for early retirement - that’s why I’m here. I’m not trying to be a contrarian. If you’re able to cut that budget and don’t mind returning to work then the plan is certainly possible. I plan to keep my SWR lower because I don’t want to have to return to work. Lack of kids simplify that.
Congrats on your plan and thanks for the update.
Congrats on your plan and thanks for the update.
FIRE, let's do this
Amen to that. I talk to my coworkers who are nearing retirement (at least in age, anyway) and they think I'm crazy for even thinking about leaving the rat race. What's the saying...fail to plan, plan to fail?
A little background story about me
- Been working F/T as of 3 years ago after getting a post graduate degree (currently 28 y/o so this forum title perked me right up!)
- Paid off my car in full last year, S/O has a monthly lease on his (currently our only debt).
- We pay off our cc monthly, we don't carry a balance
- Upcoming mortgage on a pre-construction home that will be done 11/2018, will have paid 20% down payment by the time we move in
- Average savings rate: 41-63%/month
- Receiving company match for 401k, putting ~40% of earnings in 401k, Roth or index funds
I've been frequenting FIRE blogs like Afford Anything, MMM, GCC, Frugalwoods, Millennial Revolution (to name a few) as of the last year.
While I would love to put every penny saved into index funds, I worry about our mortgage. I can't say that I'm personally used to, or comfortable with, having a huge debt looming over my head. But paying off a mortgage in record time is ill-advised, especially if it is at the expense of my retirement savings.
Amen to that. I talk to my coworkers who are nearing retirement (at least in age, anyway) and they think I'm crazy for even thinking about leaving the rat race. What's the saying...fail to plan, plan to fail?
A little background story about me
- Been working F/T as of 3 years ago after getting a post graduate degree (currently 28 y/o so this forum title perked me right up!)
- Paid off my car in full last year, S/O has a monthly lease on his (currently our only debt).
- We pay off our cc monthly, we don't carry a balance
- Upcoming mortgage on a pre-construction home that will be done 11/2018, will have paid 20% down payment by the time we move in
- Average savings rate: 41-63%/month
- Receiving company match for 401k, putting ~40% of earnings in 401k, Roth or index funds
I've been frequenting FIRE blogs like Afford Anything, MMM, GCC, Frugalwoods, Millennial Revolution (to name a few) as of the last year.
While I would love to put every penny saved into index funds, I worry about our mortgage. I can't say that I'm personally used to, or comfortable with, having a huge debt looming over my head. But paying off a mortgage in record time is ill-advised, especially if it is at the expense of my retirement savings.
