Am I good to retire on 650k with family?

[RunningBum]

Seeing the downturn of the market, I will immediately add some part time work or IT contracting work. That will keep my capital same. Or infact it will even make it better.

You could probably do that now, but if it's not for 5 years, will your skills be current enough to get hired in the tech world? I've been out for 7, and my skills are way too out of date. Nobody would hire my for my tech skills now. I might be able to sell my sell on project leadership and organizational skills. I know you talked about other jobs, but they won't pay much in comparison. My thought was to add some buffer in my high paying job so that I'd almost certainly never have to take a $10/hr job. I think my chances of needed to work again are about 1-2%. Yours look to be about 50/50 IMO. But I suffered from OMY syndrome. I also wasn't miserable in my job.

ER won't be miserable because the things I hated about school and work are these:


- Lack of freedom
- Dealing with people (aggressive, bossy etc.)


In ER, I will have my freedom. Now I know some people will say you have to retire TO something not AWAY from something. While it is true, I don't think that's necessary for ER. Anyway I will fill your blank with what I love to do.


I want to retire now so I can "happily browse all day, watch youtube videos, watch movies, lie down in bed, swim in the pool" and be happy

OK, that doesn't sound all that far from what I do. Wanted to see if you'd thought about it, or were just enamored with leaving work.

 

[aja8888]

I am not going to mention whether or not your plan can work. I am going to mention your self centered attitude. It is all about you, you, you and what you want (to retire) or don't want to do (work).
No mention about how this is going to affect your family. Do you want to tear you family away from their current lifestyle, your kids away from their friends and school to go live in a LCOL area? Cram everyone into a cheap apartment, not have money to give your kids at least some luxuries? Worry about every dollar that comes in and every dollar that goes out, and constantly telling your family "no" to everything because you can't afford it, not matter how inexpensive or necessary it may be?
I did not like working either, I hated my job, but I was woman enough to "man up" and face my responsibilities. Work another 10 years or more until you have more of a cushion and then retire.
Have you even discusses any of this with your family?
I don't want to sound harsh, but it's time to think of other people besides yourself. I'm used to seeing parents sacrifice for their kids, but not the other way around.

My emphasis on the "it's about you" part. I have to argeee, very self-centered and I would feel sorry for the kids and wife to step down into living a touch above poverty.

This $700 per month 2 - 3 bedroom apartment is fictitious in an area where it's in walking distance to good schools, shopping, etc. Around here in our LCOL areas, something like that is $1200 - $1500 and you better speak a second language and carry a firearm. I've lived on all U.S. coasts and spent some 30 years on the east coast and understand what it takes to live cheap. Good luck! Maybe Baltimore central is in your sights?

 

[Major Tom]

In your original post in the thread linked at the bottom of this post, you state that you make $280K/year. I'm assuming that you haven't been on that level of salary for long, because with the frugality you claim to be capable of, $650K doesn't strike me as a whole lot to have saved up on that kind of income.

http://www.early-retirement.org/forums/f26/retire-early-vs-work-to-leave-for-kids-89814.html

 

[MrsHaloFIRE]

No and no. When your kids are on their own and stable, do what you want at that point. Braces, graduation robes, activity clubs, library fines, trying new fruit and vegetables, these things cost money. And what about if the market takes a big whack? Bicycle immediately to a job interview you don't have scheduled?

 

[Nature Lover]

Seeing the downturn of the market, I will immediately add some part time work or IT contracting work. That will keep my capital same. Or infact it will even make it better. .....

Yes an additional year or a few years will give me more safety net. But there is honestly no end to this my friend. I can keep giving myself excuses and continue accumulating.

Excuses:
"3 more years to 1.1M so that I feel safe"
"3 more years then to 1.5M so that I can pay kids college"
"3 more years then to 2M so that I can leave kids money"
"3 more years then to 2.5M so that kids will have a million each atleast"
"3 more years then to 3M so that I can start living lavishly now and leave kids so much that they can reitre early"

I'm cherry picking here, to make a point, not to suggest you don't care about your family (my bolds). The key words missing are "we" and "us". You've said how much you care about family, and am just concerned that in this discussion/analysis, you don't appear to have consulted your wife or children on the portions that affect them, yet. If you really care for them, you'll make sure they're well cared for and that their desires count.

Going back to your prior thread, the discussion was about how moving and downsizing from a 2 BR apt to a 1 BR you could get your non-tax living expenses down from ~$80k to $60k. Going from spending $80k for a family of 4 to $25k (instead of $60k) is huge (especially with growing children). If you haven't already....I think you need to talk with your wife about what you're considering, and ultimately your kids..regarding the changes it would mean for them. What is possible mathematically, isn't necessarily desirable...and I suggest you'll want their input on whether this plan will work for them, too, before acting.

You asked for our opinions. Notwithstanding the need to to include your family before finalizing the lifestyle you're designing, I also think your plan is "too lean" at present to leave work entirely. Suggestions that you may want a vacation or sabbatical to refresh, or change your job to something that you can enjoy, or at least tolerate better, are worthy of consideration...even if it means relocating and earning less. I expect both you and your family would be happier with this approach.

BTW, You've already said that in a worst case scenario you'd find work (and being flexible is the KEY to ER success (re-read MMM's 4% Rule posting, of which I'm a fan)).... Why not pursue that option today. Plan a mini-retirement, or find a new job that better meets your needs and your family's. It just might be the compromise needed to replace your current situation with one that is better for you and your family long-term.

 

[corn18]

I want to retire now so I can "happily browse all day, watch youtube videos, watch movies, lie down in bed, swim in the pool" and be happy

Fascinating. This is exactly what I don't want to do in retirement so I am working hard and saving hard so I don't HAVE to do what you so desperately seek in retirement. Or at least have the option to not do that. I want to explore the world. I want to save animals. I want to make a difference in the world.

Your freedom = my slavery.

 

[daylatedollarshort]

It's risky at best. It is possible that you could retire successfully but probably less than 50%. There are so many factors to consider. ACA may not exist in 5 years let alone 20 years. If you and wife are in your 50's or early 60's and there is no ACA you could be paying $12K/yr just in premiums and if one or both of you are sick or injured you could double that number. My parents hit their $12,000 OOP most years in addition to paying around $8K in premiums.

+1. Medical care in the U.S. is very expensive even for people who are otherwise into low overhead living. Our premiums without the ACA tax credits would be ~$1.8K a month and the fate of the ACA is far from certain. Our out of pocket max also is somewhere around $12K and we helped a relative out with a $6.5K OOP max last year. We also spent $3K on dental bills this year.

 

[ocean view]

I want to retire now so I can "happily browse all day, watch youtube videos, watch movies, lie down in bed, swim in the pool" and be happy

And your wife can watch the children, clean the house, buy and prepare your meals on the $50 a week food allowance. Does she get to retire too? Or even a day off?

You sound like my fifteen year old.

 

[joeea]

I am 38 year old male with a total networth of 650k. I have two kids aged 9 and 5.

Do you have a spouse or partner?

From childhood I never wanted to work or even go to school.

Many children are like that.

I'm fed up with working in general and am looking to retire. With this net assets of 650k, at a 4% rate, I would make about 2166$ per month. Stock market usually does good so this can even be as high as 5400$ per month (at 10%) or 3800$ (at 7%).

You are kidding yourself if you think you can depend on drawing $3800 or $5400 on any kind of regular basis. Doing so would almost certainly mean failure as soon as the next recession hits. And at 38, you will lkely encounter several recessions in your life ahead.

If I move to east coast and rent an apartment for 700$, and arrange the rest of expenses to be under 1500$, I should be able to FIRE now. I know it is a bit tight but I can always supplement it with working again if needed.

Tight? You think?

I never lived life in my terms.

If your terms were not going to school and not working, then it's not much of a surprise that you weren't able to live your life that way.

Rent: 700$ (2 BR in a low COL area)
Grocery+Household items: 400$
Health Insurance (Premium+OOP): 700$
Utilities (Gas+Elec+Water+Internet): 200$
Entertainment (Eating out+Shopping): 100$
Kids School: 100$

Total: 2200$

I think you are kidding yourself. I think you have decided you don't want to work and are deluding yourself that you are in a financial position to do whatever you want.

I wish you luck.

 

[purplesky]

[mod edit]

 

[joeea]

And I don't have car.

I can always drive uber for that month and cover those up ONLY if needed that month.

Hmm, I think you are missing something important here...

 

[daylatedollarshort]

Firenow, I haven't checked lately, but does MMM's published budget have any travel, home repairs, taxes or medical or dental costs in it? If you account for those expenses he is not really spending less and maybe more than many other households in the U.S per the Consumer Expenditure Survey.

It is probably more realistic to find a new job or career you enjoy more than your current line of work than it is to check out of the labor force completely given your current savings level and a family to support (which is what most of the ER bloggers seem to do in reality anyway). Some are upfront about earned income like rootofgood and others simply lie. Some online sleuths found records showing one of the more famous "retired" bloggers has a $200K work at home job most likely with group health insurance and other benefits.

 

[flintnational]

I want to retire now so I can "happily browse all day, watch youtube videos, watch movies, lie down in bed, swim in the pool" and be happy

Not really the answers one would expect from a 38 year old high earner with a wife and two young children. Once again, lots of red flags. You might want to discuss some of this with a professional. Best of luck.

 

[firenow]

[mod edit]

 

[MichaelB]

Thanks for an interesting discussion.