FIRE Performance Review

[Rianne]

Here's where we are after years of LBYM,

-We're making more $, 1.5x more than in working years. Finally, let your money work for you rather than you work for money.
-Paying fewer taxes - during working years we paid > 30% income tax
-Spending more than in our working years with less stress, more fun, and more interesting friends. During the megacorp years, we had to make friends with co-workers. Social gatherings became work discussions.
-We pay approximately as much for Medicare as we did for megacorp healthcare insurance when you include the copays and deductibles etc.

Sadly, that's not the case for everyone. I assume for most on this forum it is.

 

[ls99]

After more than 15 years of retirement too laid back to measure.

 

[Koolau]

Here's where we are after years of LBYM,

-We're making more $, 1.5x more than in working years. Finally, let your money work for you rather than you work for money.
-Paying fewer taxes - during working years we paid > 30% income tax
-Spending more than in our working years with less stress, more fun, and more interesting friends. During the megacorp years, we had to make friends with co-workers. Social gatherings became work discussions.
-We pay approximately as much for Medicare as we did for megacorp healthcare insurance when you include the copays and deductibles etc.

Sadly, that's not the case for everyone. I assume for most on this forum it is.

Our situation is actually very similar to yours. Our stash has been extremely productive since FIRE. Between modest pension, decent SS and savings expansions, we too have significantly more income than when we were w*rking. Taxes are much lower too - especially State and Real Estate taxes. Our financial life is very good indeed. YMMV as always.

 

[O2Bfree]

The words "performance review" triggered my PRA (Performance Review Anxiety), which is due to having to complete those painfully detailed self-evaluation each year at w@rk. Deep breath...

All is good, and I'm still amazed to be earning way more than I ever did working. And still waking up many mornings with that delightful "it's Saturday!" feeling.

 

[1242Vintage]

Retired in May 2020.

Income is also significantly higher (approx 30%) than when I worked with no stress and a high fun factor.

Our biggest financial decision this week was how much to increase the monthly on one of our rentals. After a brief friendly negotiation we settled on a 4% annual increase on a two year lease. With no mortgage on the rentals all rental income continues to build our portfolio.

Life is good.

 

[teej1985]

Our situation is actually very similar to yours. Our stash has been extremely productive since FIRE. Between modest pension, decent SS and savings expansions, we too have significantly more income than when we were w*rking. Taxes are much lower too - especially State and Real Estate taxes. Our financial life is very good indeed. YMMV as always.

How did this happen?!? Does it mean that you w*rked too long?

 

[Koolau]

How did this happen?!? Does it mean that you w*rked too long?

I did w*rk too long (w*rked 7 years beyond financial independence because I enjoyed what I was doing - until I didn't. I quit on the Friday after I found out the previous Thursday (8 days before) that my new assignment would be awful.)


Taxes are much lower because of quirks in Hawaii tax system. SS, Pension and much of 401(k) are non-taxable while my old state taxed these things - a lot. Also, you might guess that real estate taxes in Hawaii would be very high as real estate values are very high. But you would be wrong (about the taxes.) Our RE tax rate is the LOWEST in the nation.

 

[Dtail]

Stash is good in retirement but yearly spending is not close to my working years but doesn't need to be as that was a different lifestyle in the North.

 

[DrRoy]

I would say virtually the same thing, except starting Medicare later this year.

 

[LateToFIRE]

I have to ask - Could it be that those of you who pulled the trigger since the 2008 Great Recession, retired into a Golden Age of perfect timing. I mean, low inflation and strong market returns have characterized most of this period. Most of the people I know who retired with last 10-15 years are feeling pretty flush with portfolios exceeding what they started with, notwithstanding complaints about recent inflation. Seems to me like y'all have been shooting fish in a barrel (he said enviously has he contemplates retiring into the next protracted global Bear Market destined to only realize weak, below-trend returns and stagflation and come to know SORR up close and personal).

 

[pacergal]

I have to ask - Could it be that those of you who pulled the trigger since the 2008 Great Recession, retired into a Golden Age of perfect timing. I mean, low inflation and strong market returns have characterized most of this period. Most of the people I know who retired with last 10-15 years are feeling pretty flush with portfolios exceeding what they started with, notwithstanding complaints about recent inflation. Seems to me like y'all have been shooting fish in a barrel (he said enviously has he contemplates retiring into the next protracted global Bear Market destined to only realize weak, below-trend returns and stagflation and come to know SORR up close and personal).

DH and I were in local govt jobs with pensions (we were hired before big changes happened with pension and grandfathered in with old system). We could have had private jobs with much better pay, but looked at the long term with the pensions.
We planned our retirement budget on our pension income alone. When SS was added, it increased our budget 32%. We very rarely take from our investments.
We survives several Bear market crashes: 1987 and on ( we were still working, though)
The pensions are the key for us.

 

[DrRoy]

I have to ask - Could it be that those of you who pulled the trigger since the 2008 Great Recession, retired into a Golden Age of perfect timing. I mean, low inflation and strong market returns have characterized most of this period. Most of the people I know who retired with last 10-15 years are feeling pretty flush with portfolios exceeding what they started with, notwithstanding complaints about recent inflation. Seems to me like y'all have been shooting fish in a barrel (he said enviously has he contemplates retiring into the next protracted global Bear Market destined to only realize weak, below-trend returns and stagflation and come to know SORR up close and personal).

Re'd in 2017. We are definitely able to (and do) spend more because the investments have gone up. That was good fortune.

 

[Koolau]

I have to ask - Could it be that those of you who pulled the trigger since the 2008 Great Recession, retired into a Golden Age of perfect timing. I mean, low inflation and strong market returns have characterized most of this period. Most of the people I know who retired with last 10-15 years are feeling pretty flush with portfolios exceeding what they started with, notwithstanding complaints about recent inflation. Seems to me like y'all have been shooting fish in a barrel (he said enviously has he contemplates retiring into the next protracted global Bear Market destined to only realize weak, below-trend returns and stagflation and come to know SORR up close and personal).

I have just one word for you.

DIVERSIFY!

It's unlikely everything will be a loser and at least some things will lose less than others. Spread it out to minimize any losses.

You are right. Even though I had to live through '08, I just sort of ignored it and eventually, it went away. Pretty much since then, things have generally looked up. Of course, I STILL did my best to diversify. Oh, and YMMV.

Regards and aloha.

 

[Andre1969]

Even for those who retired right before the Great Recession, I wonder how rough it really was? I was still working then (and still am), so that definitely makes a big difference. But, looking back on my records, the market pretty much peaked around late 2007. Then it treaded water for the first half of 2008. Overall trending slowly down, but a few bright spots here and there. But then by August, I was down maybe 8-10% compared to June. Again, nothing TOO scary. But then the big drop came in Sept/Oc/Nov. December, as well as January 2009, were actually good months. At least, the early part of January. Then it went down in February, bottomed out on March 9, 2009, but then went nowhere but up. Slight drop in Feb of 2010, and then that summer I saw about a 10% drop for a few months, but overall 2010 was a great year. 2011 started off great, but in the summer I took about a 15% hit, and ended up finishing the year basically flat.

So, I'm thinking that if you retired, say on 12/31/2007, and took out a big chunk of money on or around 12/31/2008, that would definitely put a big crimp in your portfolio. But I wonder if just one bad year would be enough to make for a sequence of return risk? The Great Recession certainly seemed scary while we were going through it, but just looking at my spreadsheet, these days it looks like a momentary blip. Actually, on my chart it looks like a quick double-dip, because I hit bottom in November of 2008. The gain in December/early Jan was actually pretty substantial, about 30% for me. But then the second bottom hit on 3/9, and from there it shot up fast.

Now, during a long-term downturn, it's going to cause problems, but was the Great Recession a long enough of a downturn?

 

[LateToFIRE]

Even for those who retired right before the Great Recession, I wonder how rough it really was? I was still working then (and still am), so that definitely makes a big difference. But, looking back on my records, the market pretty much peaked around late 2007. Then it treaded water for the first half of 2008. Overall trending slowly down, but a few bright spots here and there. But then by August, I was down maybe 8-10% compared to June. Again, nothing TOO scary. But then the big drop came in Sept/Oc/Nov. December, as well as January 2009, were actually good months. At least, the early part of January. Then it went down in February, bottomed out on March 9, 2009, but then went nowhere but up. Slight drop in Feb of 2010, and then that summer I saw about a 10% drop for a few months, but overall 2010 was a great year. 2011 started off great, but in the summer I took about a 15% hit, and ended up finishing the year basically flat.

So, I'm thinking that if you retired, say on 12/31/2007, and took out a big chunk of money on or around 12/31/2008, that would definitely put a big crimp in your portfolio. But I wonder if just one bad year would be enough to make for a sequence of return risk? The Great Recession certainly seemed scary while we were going through it, but just looking at my spreadsheet, these days it looks like a momentary blip. Actually, on my chart it looks like a quick double-dip, because I hit bottom in November of 2008. The gain in December/early Jan was actually pretty substantial, about 30% for me. But then the second bottom hit on 3/9, and from there it shot up fast.

Now, during a long-term downturn, it's going to cause problems, but was the Great Recession a long enough of a downturn?

I had a front row seat on what was happening in 2008/2009 [can't elaborate on that until fully FIRE'd and j*b-free]. What was notable about it wasn't so much the ACTUAL economic destruction, it was the prospect of WHAT COULD HAVE HAPPENED had the Fed/Treasury/Congress/etc. not acted swiftly and decisively to avert disaster. The worst case picture was unimaginably bad. Most folks have no idea just how badly it could have gone. Let's just say that in the worst case, would have been a total reset of the global economy - none of our lives would have ever been the same again. Yes, know I sound like a nut job. No, I'm not kidding. Yes, I am actually well-qualified to know what I'm talking about.

 

[GravitySucks]

Seems to me like y'all have been shooting fish in a barrel (he said enviously has he contemplates retiring into the next protracted global Bear Market destined to only realize weak, below-trend returns and stagflation and come to know SORR up close and personal).

Retired in 2013. The News was -
S&P is over valued!
The recent rally’s a dead cat bounce!
The market will have to pay for the 2009/10 bailout!

Plus the 10 yr Treasury was around 2.5% - negative real return.

Dont bother with the prognosticators. I did get lucky, but you and your cohorts will probably have lucky periods too.

 

[Koolau]

Even for those who retired right before the Great Recession, I wonder how rough it really was? I was still working then (and still am), so that definitely makes a big difference. But, looking back on my records, the market pretty much peaked around late 2007. Then it treaded water for the first half of 2008. Overall trending slowly down, but a few bright spots here and there. But then by August, I was down maybe 8-10% compared to June. Again, nothing TOO scary. But then the big drop came in Sept/Oc/Nov. December, as well as January 2009, were actually good months. At least, the early part of January. Then it went down in February, bottomed out on March 9, 2009, but then went nowhere but up. Slight drop in Feb of 2010, and then that summer I saw about a 10% drop for a few months, but overall 2010 was a great year. 2011 started off great, but in the summer I took about a 15% hit, and ended up finishing the year basically flat.


So, I'm thinking that if you retired, say on 12/31/2007, and took out a big chunk of money on or around 12/31/2008, that would definitely put a big crimp in your portfolio. But I wonder if just one bad year would be enough to make for a sequence of return risk? The Great Recession certainly seemed scary while we were going through it, but just looking at my spreadsheet, these days it looks like a momentary blip. Actually, on my chart it looks like a quick double-dip, because I hit bottom in November of 2008. The gain in December/early Jan was actually pretty substantial, about 30% for me. But then the second bottom hit on 3/9, and from there it shot up fast.

Now, during a long-term downturn, it's going to cause problems, but was the Great Recession a long enough of a downturn?

Retired '05 but the main issue with the great recession was that I moved from the Midwest (average COL area) to Oahu (HCOL area) about the time of the Great Recession. For the most part, I ignored the GR but burned through all of my cash cushion. Toward the end of the GR, I wasn't panicked, but was becoming "concerned" when, right on time, the economy began to turn around. YMMV

 

[Al18]

Retired just over 5 years ago. Networth is up 25% since retiring. I must admit Covid shutdown was a wild ride, but health and financial wise we are doing fine. I enjoy selling stock worth thousands and paying no capital gains tax. I wasn't really paying attention to this deal while I was working (and not in the 0% capital gains bracket).

 

[foxfirev5]

I have to ask - Could it be that those of you who pulled the trigger since the 2008 Great Recession, retired into a Golden Age of perfect timing. I mean, low inflation and strong market returns have characterized most of this period. Most of the people I know who retired with last 10-15 years are feeling pretty flush with portfolios exceeding what they started with, notwithstanding complaints about recent inflation. Seems to me like y'all have been shooting fish in a barrel (he said enviously has he contemplates retiring into the next protracted global Bear Market destined to only realize weak, below-trend returns and stagflation and come to know SORR up close and personal).

Class of'16. Yep, luck played a significant role in my investments growing by a third since retirement. Offset by inflation to a large degree, but I'll take it. Note to those in a similar boat - we now have a safe option in positive yielding TIPS. IMHO, not a bad way to take some risk off the table. Prepare, invest and hope for the best.

 

[GravitySucks]

The words "performance review" triggered my PRA (Performance Review Anxiety), which is due to having to complete those painfully detailed self-evaluation each year at w@rk. Deep breath...

All is good, and I'm still amazed to be earning way more than I ever did working. And still waking up many mornings with that delightful "it's Saturday!" feeling.

Got me hyper-ventilating here.

I really liked my work but the constant Defend Your Job interviews when they rotated VPs, yearly budget estimates due before assignments were set, yearly reviews pushed me over the edge.

 

[Koolau]

The words "performance review" triggered my PRA (Performance Review Anxiety), which is due to having to complete those painfully detailed self-evaluation each year at w@rk. Deep breath...

All is good, and I'm still amazed to be earning way more than I ever did working. And still waking up many mornings with that delightful "it's Saturday!" feeling.

Got me hyper-ventilating here.

I really liked my work but the constant Defend Your Job interviews when they rotated VPs, yearly budget estimates due before assignments were set, yearly reviews pushed me over the edge.

Yeah, I had the same reaction to the Thread Title. And I hated GIVING Performance Reviews almost more than receiving. One of the few "nightmares" I've ever had about w*rk revolved around PAs - receiving AND giving! YMMV