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My Plan To Retire At 35 (self.financialindependence)

jgatcomb が 投稿

Just a story I felt like sharing. No questions asked and no deep insights provided.

I am now 40 and still working.

I was just over 22 when I got out of the military and entered the world of government contracting in IT. At age 25, I had no responsibilities, no bills to speak of and a very good paying job. I discovered the 4% rule and planned to retire at 35. Ten years was all it would take for me to save the money providing my situation didn't change.

Then I got married, bought a house at the peak of the bubble and had kids.

The revised plan is 57. I converted to being a government employee and that is the minimum age that I can collect benefits and keep my health plan unless they offer VERA (voluntary early retirement authority). I have plenty of other investments that would allow me to retire earlier but it certainly feels safer waiting now that I am responsible for 3 other people.

To the extent possible, I am trying to live my life now the way I will when I am retired which is a complete dichotomy.

One side of the dichotomy is about having as many fulfilling experiences as possible. I take full advantage of the 26 paid vacation days I get per year. We take no less than 3 full vacations combined with some mini vacations like an amusement park road trip to end summer break.

The other side is that, in everything not-experience related, I am as frugal as possible. Some people can't understand why I ride a scooter to work rather than buying a car. These people also have no plan to stop working before they die.

Thanks for listening.

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[–]Laker_Junkie 261 ポイント262 ポイント  (5子コメント)

most underrated message of this post is that life and priorities change, which changed your timeline, and it sounds like you're all the better for it.

there are lots of posts on here stating 'i'm 20 and want to retire by 30', but many haven't taken into account family changes, career changes, market setbacks, etc.

everyone should build in a handful of extra years.

[–]TubesBestNoob 66 ポイント67 ポイント  (4子コメント)

As much as I like hearing success stories and enthusiastic young people with good financial sense, I find this story refreshing in that it illustrates risks to early FI that many of us may dismiss at a younger age. Some things in life are more important than financial goals.

[–]Jephta 15 ポイント16 ポイント  (3子コメント)

These aren't really risks, though. These are conscious decisions. In the same way one chooses whether or not one values buying an expensive car over retiring early one must also choose whether they value getting married and having kids (and subsequently spending a lot on one's spouse and kids) over retiring early. Those things don't just happen without you choosing to go down that path.

So this whole thing is kind of silly to me because it's like saying "Your early retirement plans should really take into account the possibility that you eventually become completely uninterested in pursuing early retirement relative to other things you want more". Why bother to plan at all then? You may be a completely different person 10 years from now who doesn't resemble your current self at all...The best you can do is plan based on who you are and what your values are now.

[–]TubesBestNoob 14 ポイント15 ポイント  (1子コメント)

Buying a house at the wrong time is a risk. Unplanned pregnacy can be a risk even if reasonable / probable steps are taken with family planning. There is also a risk that you meet someone whom you love and want to marry is not in a good financial position or has terrible financial habits. These risks are something to consider when deciding how much to spend and how much to invest at a young age.

[–]Shellbyvillian 2 ポイント3 ポイント  (0子コメント)

I don't agree that buying a house at the "wrong time" is a risk. You should be buying a house you can afford to pay off, regardless of what market prices are doing. Admittedly, if you lose your job, paying the mortgage could be difficult, but that's why emergency funds and liquid assets exist to get you back on your feet.

People ask me about buying houses in the current market because I'm in an area that is increasing rapidly. Their fear is "what if the prices drop? I'll be underwater!" My response is "Will you still need somewhere to live and will you still be able to afford the mortgage? Then why do you care what your house is currently worth if you have no plans to sell?"

[–]hikeaddict 0 ポイント1 ポイント  (0子コメント)

The best you can do is plan based on who you are and what your values are now.

I agree with you 100%, but I also think it's pretty naive to assume that your plan and your values will never change. I see a LOT of posters making those assumptions, and I think it's very short-sighted. Especially if you're young (let's say, early to mid 20s?), it's pretty much a given that your life is going to change in lots of ways before you die.

[–]megatronwashere 38 ポイント39 ポイント  (4子コメント)

yea, I was planning on living in a van down by the river and do some rock climbing. I even draw up plans for a compose toilet and a mini kitchen in the van. (shout out to /r/vandwellers ) then I got married. now my money is spent on pet food and mid century modern furniture.

[–]Chift 7 ポイント8 ポイント  (3子コメント)

Lol, I own a house, but rebuilding a 1978 Westfalia in the garage... the dream can live on! :)

[–]krakmojo 1 ポイント2 ポイント  (2子コメント)

7 Edit:(Oops, pocket decided to contribute for me.)

[–]exsalaryman 34 ポイント35 ポイント  (11子コメント)

Do you mind sharing your annual expenses and networth? The reason I ask is because this post seems to have been framed as your 25 year old self was a bit naive and the wife/kids and other unexpected events made it impossible for you to retire any earlier than 57.

We'd all like to know how well you did despite having the kids, getting married, and buying a house at the peak of the bubble. Thanks for sharing.

[–]jgatcomb[S] 38 ポイント39 ポイント  (10子コメント)

In some ways, I was very naive at 25. Specifically how risk adverse I would become when I was responsible for other human lives. In other ways, I was very much ahead of the game (valuing the right things in life, having a financial mindset, etc.).

If you have a link on how to calculate a government pension into your NW, I could give a more accurate number. It is currently worth $27,200 a year but I can't start withdrawing without VERA until I turn 57. Assuming I get no raises (cost of living or otherwise) between now and then, it will be worth $54,400 per year every year until death (less if I choose survivor option).

Setting aside my government pension, social security, term life insurance, etc. Just using the equity in my assets, my 401K, IRAs, savings, personal investments, etc - my current NW is about 1.1 million.

As for annual expenses, it is easier to work with percentages of take home as the tax man comes for us all. 35% of my take home is used to pay bills (mortgage, groceries, etc.). 50% of it is invested into retirement. 15% is used for leisure (experience filled activities).

Edit: The life decisions didn't make the financial situation impossible to retire earlier than 57. It is more about being risk adverse and waiting for safety. I know this is very much a personal mental situation.

[–]__contrarian__ 11 ポイント12 ポイント  (5子コメント)

wow, 1.1mm net worth at 40? I think if you grow that to 2mm by 50 (very realistic) you could easily coast in to your pension at 57... but of course need to know more about your expenses, goals, etc.

[–]jgatcomb[S] 11 ポイント12 ポイント  (0子コメント)

50 is actually the point I am going to start seeking VERA opportunities. One way would be to change my job series into something more VERA friendly (IT Specialist to Program Analyst for instance).

Regardless of my NW, I don't really see retiring before 50 as that is the age both of my daughters will be hopefully out of the house and into college.

Again, it really isn't about having enough - it is about a sense of safety. Rather than figuring out how much I need to get out and seeing how soon I can get there, I am figuring out when is the earliest I feel safe getting out. Funny but 50 is it unless there is a major unexpected windfall or the current situation changes dramatically.

[–]HesAGoodfella 4 ポイント5 ポイント  (3子コメント)

Yeah, 1.1mm net worth would give him over 40k/yr to live off until 57 where he'd more than likely be able to continue withdrawing 40k+/yr AND receive a hefty pension AND social security after a few more years.

To each their own when setting retirement goals, but that is far more than I foresee myself ever requiring.

[–]sol1 6 ポイント7 ポイント  (2子コメント)

$1.1M doesn't give him $40k a year until he can withdraw his retirement savings (401k and IRA) without penalty. He's also factoring equity in assess (i.e. his house) in that number. You can't use the 4% rule based on net worth, you have to use invested assets that you have access to.

[–]HesAGoodfella 2 ポイント3 ポイント  (0子コメント)

He can begin withdrawing those in 5 years via a Roth Conversion if he so chooses. I'm sure his non-retirement savings/investments are enough to sustain him over that time period.

And yes, but housing costs are baked into that 40k. 40k total expenses including what his house costs him. If his house is worth 300k, his housing costs are 12k a year while the remaining 800k will give him 32k (32k-additional housing costs) using a SWR of 4%.

[–]RandomNumsandLetters 3 ポイント4 ポイント  (0子コメント)

Not necessarily. As long as there's a decent amount in non house/IRA/401k he can start withdrawing, it's only a problem if he needs to withdraw more than is not in one of those accounts

[–]EmAreDubs 3 ポイント4 ポイント  (1子コメント)

Holy hell, where can I get a government job with rock-solid job security and a pension of more than my current annual salary working in the private sector?

[–]jgatcomb[S] 0 ポイント1 ポイント  (0子コメント)

I'm sure there are cases of it happening but what really did the trick for me was the intersection of opportunity and preparedness.

First, I was making really good money as a government contractor before I joined the government (in fact, I took a pay cut to convert). I happened to have the specialized IT skills that companies needed to gain government contracts and/or I was willing to go where I was needed (I lived in South Korea for a year and a half for instance).

Second, after 9/11, DHS was given extreme latitude to hire temporary employees (not to exceed - NTE) from industry with comparable compensation. For most everyone, these jobs were supposed to be 1 or 2 years at most. For some of the fortunate, like myself, who proved their worth - we eventually were allowed to compete for and obtain full time positions.

Third, I live in the Baltimore/D.C. area where 27.10% of my salary comes from cost of living. If I were to move somewhere else doing the exact same job almost anywhere else, I would take a significant pay cut. I think there are probably only 2 or 3 locations with a higher cost of living according to the federal locality tables.

Finally, I am really good and have experienced salary increases and a promotion. In the government, there are three ways to get promoted:

  • Apply for a new position (extremely common)
  • Be in a multi-banded position GS 9/10/11 or FAA H/I for instance and provide enough merit (skills, expertise, etc.) to warrant the paperwork to the next higher band (limited to whatever the highest band the position is allocated for) - (less common)
  • Have the paperwork completed to convert your position in-place (extremely rare)

To be clear, a promotion isn't the same thing as a raise. In the GS pay scale, you can get step increases over time and in the FAA pay band you can get in-place increases. It also isn't the same thing as getting a title change (regular employee to team lead is just a title change). A promotion in the government is moving up beyond your current pay band.

My situation is not common but it is the reason I have chosen to stay rather than make more money in the private sector.

[–]exsalaryman 1 ポイント2 ポイント  (0子コメント)

Thanks for responding. I'm not sure how much of your net worth is tied up in your home equity but regardless a net worth of $1.1M at 40 is still a win in my book. Despite several unexpected events you're still in a great financial position because of that "naive" goal you set at age 25. So whether or not an early retirement is in your future FIRE principles have served you well.

[–]ScriptPro 0 ポイント1 ポイント  (0子コメント)

Honestly it seems like the financial decisions you made early in life have set you up to have options now. Nothing wrong with choosing to work because its a stable job and will give you and your family even more financial security in the future.

[–]insurance_novice 14 ポイント15 ポイント  (3子コメント)

Hey I resonate with you a lot. I cut corner on a lot of stuff. Cheaper phone, cheaper clothes, not a lot of new toys.

But when it comes to buying that sky diving pass on Groupon, or going skiing for 2 weeks, I'm the first one in line.

These activities are expensive, but they give me powerful memories that a new phone can't provide me with.

[–]mrwrn2010 7 ポイント8 ポイント  (1子コメント)

That's a part of Ramit Sethi's advice that I really like. Really cut costs on things you really don't care about or don't bring you joy and you can really spend on those things you do enjoy (hobbies, whatever).

[–]insurance_novice 1 ポイント2 ポイント  (0子コメント)

Yah, it doesn't matter what the thing is. So long you like it enough to cut other aspects, to enhance this one.

[–]Dranthe 1 ポイント2 ポイント  (0子コメント)

Same here and something that put a strain on my new marriage until I figured it out. It was frustrating for my wife that I would bitch about her going out to eat two or three times a week but then turn around and drop twice what that cost on a Saturday to go do something we hadn't done before.

Once I figured out that I would gladly shell out the money for new experiences but didn't see eating out at Ruby Tuesdays as a value add to our life I looped her in on why I felt that way. She also saw herself how much we were spending every month just on restaurants. Now she's fully on board. At least as far as daily restaurant visits go.

[–]MetaPhysic16 6 ポイント7 ポイント  (0子コメント)

I'm also Fed and waiting until 57 to retire. I own one paid off house and take lavish vacations now while I'm youngish (a tad under 40) since I have to wait until 57 because I want/need the health care.

[–]pants-onfire! by 2029 [26M] 42 ポイント43 ポイント  (34子コメント)

One reason why some people don't understand why you ride a scooter over a car could be the fact that there are 3 people that rely on you. Although I don't know anyone that rides a scooter, I've known and heard of many people that have either died or encountered near death situations from motorcycle accidents that could have been avoided if they were driving a car. I guess it just boils down to a risk tolerance thing.

[–]jgatcomb[S] 16 ポイント17 ポイント  (5子コメント)

I know and understand and, yes, it was very much a calculated risk. The scooter isn't a long term solution.

I could have used any example really though. "You really cut the cord nearly 4 years ago, I could never go without my Judge Judy/Sports/Excuse".

It is in every facet of life. I only occasionally go out to eat at lunch choosing to bring my own lunch to work most days. My exception is experience driven - the same way I would go out with a group of friends for happy hour on occasion. I see others going out every day.

I'm not saying there is anything wrong with spending money on whatever you want. You just need to be honest with yourself about why you are spending money on X and what it means about Y. A great example is the vacations I take. The people who are envious about me going on another cruise are the same people who go out to eat every day.

[–]CydeWeys -2 ポイント-1 ポイント  (4子コメント)

I could have used any example really though. "You really cut the cord nearly 4 years ago, I could never go without my Judge Judy/Sports/Excuse".

Any other example isn't comparable though, as you aren't trading off your safety and future earning potential in not having cable TV at home, or not eating out for lunch.

[–]jgatcomb[S] 2 ポイント3 ポイント  (3子コメント)

That would only be true if the reason people don't understand is because of the safety. /u/pants-on said One reason why and it is a valid point but my experience is that it has nothing to do with safety. That's why I said I could have used any example because the same people shaking their heads about my choice to temporarily use a scooter while I find a great deal rather than just going out and buying whatever is available are the same people who don't understand my choice to cut the cord or not have a personal cell phone or to bring a bagged lunch to work.

[–]CydeWeys 0 ポイント1 ポイント  (2子コメント)

In my experience, people who question riding a scooter/motorcycle are doing so for reasons of safety, not cost. But this is getting speculative.

[–]jgatcomb[S] 2 ポイント3 ポイント  (1子コメント)

Sure except that I'm the one who chose the example. I did so because it is the most recent in a long line of decisions I have made to reduce my expenses allowing me to pour more into my retirement and my experiences. This post wasn't supposed to be about the scooter at all but here goes.

A few months ago, I was in an accident where my vehicle was totaled. It was paid off and the insurance payout was quite generous. Since we had previously gone a year and a half sharing a single vehicle, I knew that there didn't need to be any rush in replacing the existing vehicle. I had purchased a scooter last August as a way to save money on gas around the neighborhood. We decided the best thing to do with the insurance pay out was to invest it while we look for an extremely good deal on a second vehicle. In the interim, we would use a combination of sharing a vehicle, using the scooter when conditions were favorable and catching a ride when/where possible. I live 7 miles from where I work (one of my less frugal decisions but it maximizes the time I get to spend with my family).

[–]Dbzspee -3 ポイント-2 ポイント  (0子コメント)

As long as you are working to get a car. My uncle broke his femur on a scooter while he was going down the road. He was bed ridden for 3+ months.

[–]MingusAhhUm 34 ポイント35 ポイント  (22子コメント)

Scooters have a much lower fatal accident rate than motorcycles. They don't go fast and you can only ride around town, and are used primarily for transportation and not sport/leisure. Anyways you can make the same safety argument about bicycles.

[–]NvgtrWiggles 4 ポイント5 ポイント  (2子コメント)

Do you have an article relating these statistics? I was always under the impression that a motorcycle would be safer than a scooter due to the ability to go faster. Something I'd really be interested in reading about because I've always speculated, but not looked into the actual numbers yet.

[–]quasifun 0 ポイント1 ポイント  (1子コメント)

It is less of function of the intrinsic safety of scooters, and more about how people who ride scooters usually live in a dense urban area that has fewer high speed accidents leading to fatalities.

[–]NvgtrWiggles 0 ポイント1 ポイント  (0子コメント)

This is what I assumed. It would still be nice to have some numbers to relate the information.

[–]lolxorlol29M, Denmark, 25% SR 1 ポイント2 ポイント  (15子コメント)

I don't think you can make the same argument about bicycles. If you start riding a bike your life expectancy goes up - not down. Sure there are accidents but the health benefits far outweigh them. Just don't be stupid and take unnecessary risks.

[–]herbine 16 ポイント17 ポイント  (11子コメント)

Skilled experienced bicyclists riding on roads can still encounter situations where they are injured or killed. It is not always a result of taking unnecessary risks.

[–]fishdogdog[10y to RE] 6 ポイント7 ポイント  (5子コメント)

Yes biking has much higher rate of accidents than people realize.

I prefer having a metal cage and airbags between me and the other drivers on the road.

EDIT: Stats I found for 2014 from UK

http://www.rospa.com/road-safety/advice/pedal-cyclists/facts-figures/

[–]newpua_bie 5 ポイント6 ポイント  (0子コメント)

biking has much higher rate of accidents than people realize

... in the US

This is also something that may get confused, especially with non-US FIREs: Biking is extremely unsafe in (most of) the US compared to most of Europe, because of traffic/city planning choices and more accidents involving cars in general (I assume its due to less mandatory driving education)

[–]the-chronic-diarrhea 1 ポイント2 ポイント  (3子コメント)

I've been in a ton of accidents on my bike. Most of them weren't really serious though, because bicycles don't go too fast and there's not a big piece of glass in front of you to cut your face open when it goes wrong.

[–]nancy_ballosky 5 ポイント6 ポイント  (0子コメント)

Yea theres just the unyielding pavement beneath you.

[–]fishdogdog[10y to RE] 2 ポイント3 ポイント  (1子コメント)

In my 40s now and noticing that my body is not what it used to be.

I have lower tolerance for accidents since my age it takes me longer to recover-- and bumps and falls seem to cause more injuries.

[–]the-chronic-diarrhea 3 ポイント4 ポイント  (0子コメント)

Maybe I'm biased since the infrastructure for cyclists is top notch here, and because I'm in my early twenties haha.

[–]lolxorlol29M, Denmark, 25% SR -2 ポイント-1 ポイント  (4子コメント)

They can - are you trying to tell me that isn't the case for pedestrians, car drivers or people in public transportation? If so that is news to me :D

You can also die from cardiac arrest sitting at home and that is much more likely than trafic accidents by any meassure. And you know what's cool? Riding a bicycle for just 20 minutes a day helps reduce risk of death by heart diseases.

[–]453265436354654 3 ポイント4 ポイント  (2子コメント)

So you're advocating for exercise.

[–]lolxorlol29M, Denmark, 25% SR 2 ポイント3 ポイント  (1子コメント)

Well I think everyone would say exercise is good. You can't really argue against it. I personally don't care what other people do for exercise or transportation but the misinformation regarding bicycle dangers just annoys me a bit. Don't ride a bicycle if you don't care for it (that's fine by me) but don't say it's because of trafic safety.

[–]453265436354654 1 ポイント2 ポイント  (0子コメント)

But I don't ride a bicycle on public roads specifically because of traffic safety. It isn't simply offset by the health benefits of cycling, because I can get exercise other ways.

[–]newpua_bie 2 ポイント3 ポイント  (0子コメント)

You're being downvoted because Americans aren't used to biking not being batshit suicidal dangerous. There are no bike lanes, tunnels/bridges, etc here. Want to commute? You have to cross a highway like cars do. Want to go buy food? You have to drive along the said highway for 1.6km (1 mile in freedom units).

[–]pants-onfire! by 2029 [26M] 2 ポイント3 ポイント  (1子コメント)

Also, lots of bigger cities now have designated bike lanes. I like to think I have a chance when I share the road with pickups and SUVs.

[–]titosrevenge 7 ポイント8 ポイント  (0子コメント)

My city has designated bike lanes, but I still assume everyone is trying to kill me when I'm riding my bike. Being constantly alert is the best way to stay alive on a bicycle.

[–]rockandrollhat -2 ポイント-1 ポイント  (2子コメント)

I'm not sure why anyone would use a scooter instead of a bicycle

[–]untaken-username 4 ポイント5 ポイント  (1子コメント)

They can go faster and don't require the physical exertion? (Not everywhere is flat, for instance.)

[–]rockandrollhat 0 ポイント1 ポイント  (0子コメント)

Physical excersion builds health and wealth over burning gas and oil

Whealth, my friend

[–]crayola88 1 ポイント2 ポイント  (0子コメント)

TBH I feel the same way about bicycles. When I lived in a small-ish town I rode my bike to work and it generally wasn't an issue, but after moving to a big city I had at least one close-call per day (even with clear bike lanes). I decided at that point that a car was worth it.

[–]Ralith 0 ポイント1 ポイント  (0子コメント)

What measures are you taking to account for reporting bias in your risk estimate?

[–]wastingtoomuchthyme 0 ポイント1 ポイント  (2子コメント)

I worked on a vintage yamaha scooter for my gf's mother who was planning on selling everything and wanted it running so she could get a better price.

So I got it running and took it out for a spin to test it..

It.. Was.. Terrifying..

Twitchy af - and I'm an experienced cyclist/motorcyclist (dirt and road). In appreciation she offered to give it to me for free and I politely declined because I felt either I or someone I cared about would have a problem.

[–]jacobw4473 1 ポイント2 ポイント  (1子コメント)

Riding a scooter/motorcycle is a much different experience than riding a bike, even if they're both 2 wheelers. The first time you get on a motorcycle will be scary, especially with zero training. Most people take MSF (safety courses) first.

[–]wastingtoomuchthyme 0 ポイント1 ポイント  (0子コメント)

very true.

I've been riding motorcycles and bicycles my whole life.. the tiny wheels of scooters make them very twitchy and vulnerable to potholes or other hazards that larger wheels will just roll over.

having cars buzz you in traffic is a whole other issue as well

[–]Swoledier21 4 ポイント5 ポイント  (3子コメント)

Thanks for your story. Nobody at 25 can predict what they'll want in their 30s, 40s, 50s, etc. At 25 I was 100% sure I'd never want kids. Now at 32 I'm maybe 80% sure I never want that. My logical brain always comes back to "Is the value gained from a child worth having to work another 20-30 years to achieve FIRE?" I know it's weird to look at children in such a calculated way but that's how I'm wired. I'm sure most parents would unequivocally say yes and I'd never argue against their choice but I don't think it's for me.

[–]hutacars23M, 60% SR, FIRE 2032 2 ポイント3 ポイント  (2子コメント)

"Is the value gained from a child worth having to work another 20-30 years to achieve FIRE?"

I look at it from the perspective of the child. "Will a child gain value from being brought into a world where he's oppressed by externally imposed rules and arbitrary standards from which there is no escape?" And to me, that answer is a solid No.

Yes, he can try to build a better life for himself. Certainly that's what we're all trying to do here-- live the best lives we know how to. But the fact that he's stuck in the system, at the mercy of some government and social system, unable to fully disassociate even if he wanted to, well... that just depresses me. I don't like the idea of forcing anyone to do anything.

[–]They_are_coming 0 ポイント1 ポイント  (0子コメント)

"Will a child gain value from being brought into a world where he's oppressed by externally imposed rules and arbitrary standards from which there is no escape?" And to me, that answer is a solid No.

I can't believe that you can say this with a straight face. Even if we all agree that oppression exists and life isn't ideal, you can honestly say the negatives of life outweigh the positives? Based on your comment history, you live in the U.S. You can honestly say that you would have rather not been born than deal with the "oppression and arbitrary standards of our government and social system"?

[–]productive_monkey 0 ポイント1 ポイント  (0子コメント)

ah, good ol' "does free will exist"

[–]WadeWatts2000[27M | 60% Adj. Savings Rate] 9 ポイント10 ポイント  (0子コメント)

Thanks for listening.

Thanks for sharing.

[–]Scabon[FIREd in 2012 @46] [US] [M] [single] [ex-IT] [<2% WR] 9 ポイント10 ポイント  (1子コメント)

My story is different, but I too have changed enormously since my early 20s. Like I wrote the other day:

If you are young, your greatest risk is probably the possibility of dramatic changes in your priorities. I am not sure how to account for that.

On the other hand, some people hardly ever change. I have a childhood friend whose career paralleled mine: a STEM background, then a transition to IT. He hasn't changed at all in the last 30-40 years.

[–]untaken-username 2 ポイント3 ポイント  (0子コメント)

I once read that if asked, most people will say they are a very different person than they were 10 years ago, but of those people, only a small minority will agree that they expect to be a very different person than they are today 10 years in the future.

We are weird creatures.

[–]frenzyattack 3 ポイント4 ポイント  (0子コメント)

I drive a scooter to work! It keeps me sane by not having to rely on public transit.

[–]nontoxicreddit 3 ポイント4 ポイント  (0子コメント)

TLDR: Don't have kids and you can retire early

[–]b1ebSR: 60%, FI: 2025 7 ポイント8 ポイント  (0子コメント)

My wife and I love scooters. Maybe it is the nostalgia of Vietnam but they are fun to ride around town. My wife prefers 50cc scooters but I like up to 200cc. Of course you can cram a kid in the middle and two hanging from the handlebars like one would do in Vietnam, so a car is needed to move around the kids.

[–]hutacars23M, 60% SR, FIRE 2032 6 ポイント7 ポイント  (0子コメント)

Honestly, this is kind of depressing. Yes, situations and priorities change, but to totally give up on a dream for some illusion of safety? Definitely not a life I'd want to live. I'm tired of letting dreams remain dreams. But of course, I'm 23 with no dependents.

I just hope you don't become one of those people on their death beds who wishes he'd worked less.

[–]PotLobster 2 ポイント3 ポイント  (1子コメント)

So what I've learned is: don't get married, don't buy a house, don't have kids. Got it!

[–]jgatcomb[S] 0 ポイント1 ポイント  (0子コメント)

I used to vacation in the Philippines. There is the nice open air bar where you would see all of the tourists and the expats. You didn't need to be there long to tell who was who just by how they spent their money.

It was rare but not unheard of to see a younger expat. Universally they didn't have kids, didn't buy a house, were single before they moved to the Philippines and had a really good paying job before they moved there.

My life would be very different but I could have stuck with my original plan and retired at 35 even after buying a house, getting married and having kids. That is because I have been fortunate enough with a great paying job from a very early age.

I didn't just want to retire early though - I wanted to live life the way I wanted to which mostly means experience filled activities. I also realized that it is pretty scary being completely responsible for 3 other lives so I added stability in there too.

I know you're mostly just joking but avoiding those 3 things are not recipes to success by themselves.

[–]Niceguysarebestguys 4 ポイント5 ポイント  (0子コメント)

Can you keep your pathetic story to yourself next time please?

[–]GlorifiedPlumber[36M/32F][PDX][14%FI/34%SR] 6 ポイント7 ポイント  (4子コメント)

Ten years was all it would take for me to save the money providing my situation didn't change.

And that sums up in one sentence why I think the legions of 22 year olds who come in with a plan to turn their newfound silicon valley job and newfound ascetic monk lifestyle into a 65 year retirement plan 5 years from now, 4 if they live at home, are completely delusional.

Life happens, and THAT IS THE POINT. It is literally the 2nd from the top stickied post, "build the life you want, and then save for it." Who besides an ascetic monk wants an ascetic monk lifestyle??

You sound perfectly happy.

I just want to swat these kids with a newspaper and be like "NO!" Statistically, you're going to meet a nice person and want to settle down. Statistically, you are going to WANT and have kids. Statistically you are going to have wants in addition to your needs in life. This is NORMAL and OKAY!

Is it inexperience that drives them? Something else? Am I just a lean luddite who just does not understand the "LeanFire" schtick??

A life devoid of wants just sounds... unhappy.

[–]_neminem 5 ポイント6 ポイント  (0子コメント)

Yep, there's a reason I don't think I'll retire until 50ish, even though I probably could retire earlier, if my dream life was "sit at home all day, eating cheap", which it is not. My dream life is traveling all over the world all the time, and eating and drinking in relative style at least some of the time, and even with the benefit of churning and travel deals, that still takes money. I don't need first class, 5 star everything, but I'm not planning on backpacking and staying in hostels either.

[–]FIREmillenial[30m] [hcol] [32.57% SR][4.18% fi] 2 ポイント3 ポイント  (0子コメント)

I mean... not everyone wants to be a plumber either.

Different strokes, different folks.

[–]hutacars23M, 60% SR, FIRE 2032 1 ポイント2 ポイント  (0子コメント)

Who besides an ascetic monk wants an ascetic monk lifestyle??

Who here is advocating an ascetic monk lifestyle? Most leanFIRErs just want an MMM-esque lifestyle, where we get $X of value out of $X/3 spent. And FWIW, MMM has a wife, kids, and fairly substantial (and nice) house.

[–]MrLlamaSC 0 ポイント1 ポイント  (0子コメント)

I think the drive simply comes from the age and the lifestyle shock of shifting into work. We 2X year olds don't know what we want in life and for the first time we are actually starting to realize we control our own destiny. Growing up I had no choice in going to school or not, no choice in what I ate, etc. My parents and others planned all the major decisions in my life and set me up to be successful. After a couple of years of work I finally realized I suddenly had all of the power in my life but no clue how to use it. Additionally, I feel a lot of stress and pressure coming from all sides. "Now is the best time to save!" "Live while you're young!" "Find a girl and get married." "You only get so long until you have kids." the list goes on. Then I look at how tough 3 years of work has been and I picture 37 more of these and it seems forever away and like if I sit here and do this I'll just wake up old and retired and unhappy one day without knowing what happened.

So there is a drive to save and retire early and do it Lean or whatever because there's only X more years until life settles down and that's so scary when we don't even feel like we have lived at all right now. A lot of people our age just say screw it and go burn all of their money doing everything and then they have no savings come that time and regret it. I think the more responsible ones come here and try to at least build out a plan where they can be responsible but also free themselves to make that journey soon where they can find who they want to be.

Anyways, that's just kinda my thoughts/experiences on the matter

[–]Eli_Renfro37 Pieces 1 ポイント2 ポイント  (1子コメント)

Ahh, the ol' golden handcuffs. They can be tough to break out of. What are the chances that you can get VERA? Is it based on the economy at all? I don't know much about it.

[–]jgatcomb[S] 1 ポイント2 ポイント  (0子コメント)

VERA

If I were 50 today the chances would be pretty good as I have a number of options available to me (changing job series, taking a position with another agency that is more VERA friendly, etc.).

Who knows what things will look like in 10 years from now which is why I say the plan is 57 not 50.

[–]RandomNumsandLetters 1 ポイント2 ポイント  (0子コメント)

The good thing in my mind is if you change your mind from the FI lifestyle you'll still have a bunch of money!

[–]arizala1325M, 25% SR, FI 2040 1 ポイント2 ポイント  (0子コメント)

Thank you for sharing!

[–]Poko318 1 ポイント2 ポイント  (8子コメント)

I like this. I have kids as well and can't see why I would want to retire at 30, 35, 40. I'd rather make more money and do more enjoyable things, and eventually help my kids out financially when I'm gone. No point in wasting your body when it can do work. I applaud you taking 3 vacations a year though. I'm so cheap that I can't bring myself to go anywhere nice besides the zoo and different things for my kids haha

[–]jgatcomb[S] 3 ポイント4 ポイント  (7子コメント)

My experience is that there are two hurdles to vacationing.

The first, I can't help with as it is all mental. If you do not see the value in taking the vacation at any cost then you will never take it.

The second is much easier. Doing vacations frugally is the same thing as the first step in planning for FI. First, you need to know where all the money is going. How do I get the transportation costs down? How do I get the lodging down? How do I get the meals down? How do I get the experience/tickets down?

It takes some work but the same way my spouse can walk out of a grocery store with $150 in groceries for $30 using coupons, sales, etc. you can go on a vacation much cheaper than it would otherwise cost you.

[–]Poko318 0 ポイント1 ポイント  (6子コメント)

I don't have much experience traveling because I've never been anywhere outside of my state so I really wouldn't know how to budget with transportation and all that honestly. Would be nice to go somewhere for once though without spending 5 grand

[–]Grizknot 1 ポイント2 ポイント  (1子コメント)

If you're good at budgeting then I'd recommend checking out /r/churning they're great at starting you off (they can be a bit cold so expect some downvotes as you get started). I recently took a vacation and spent a total of ~$100 for food expenses everything else was paid with points.

Now obviously you could just cash out points and turn them into small bonuses for paying off student loans or something but that's really not maximizing their worth. Do your research, make a few spreadsheets and you could really go on quite a few vacations for next to nothing.

[–]jgatcomb[S] 0 ポイント1 ポイント  (0子コメント)

(they can be a bit cold so expect some downvotes as you get started)

That has turned me off from that subreddit. If I were to characterize myself in terms of churning, I'm definitely "gone mild". I get a new card a couple of times a year with the best bonus but prefer cashback to points.

Now if someone wrote a guide to cruise vacations using points, I would up my game and be more tolerant of the intolerance of that sub.

[–]jgatcomb[S] 1 ポイント2 ポイント  (3子コメント)

What state do you live in?

I'll give you a real world example. In just under a year, I plan on going on cruise from Tampa Florida with my Dad for his birthday since he has never been on one. There are a number of options for travel from where we live (Maryland) to where we are going (Florida):

  • Drive personal vehicle
  • Drive a rental car
  • Fly
  • Train
  • Combination (1 method there and another method back)

Typically (without special conditions), the cheapest method is driving a personal vehicle. I eliminated this for two reasons:

  • The upper limit of what I can handle for a road trip with my spouse and daughters is 12 hours and this trip would be 15 without stopping to eat, unscheduled bathroom breaks, etc.
  • The last thing I wanted to do after a week long relaxing cruise was to drive 15+ hours before immediately returning to work completely negating the vacation

I opted to fly. I just didn't want to pay for a family of 4 to fly.

I looked into reward travel credit cards. Southwest offered me 50,000 points for signing up but required a $69 annual fee and a minimum $2,000 spend within the first 3 months. The minimum spend was no problem as I was already paying for the cruise and the annual fee wouldn't be a problem because I will cancel the card before it renews if I can't negotiate them to waive the fee to keep me a member.

Normally, 52K (50K bonus plus 2K for minimum spend) points wouldn't be enough for 4 people to fly somewhere but this is Southwest where not only are they inexpensive but bags fly free. So for the cost of the annual fee and taxes/fees that get added on regardless, I will be flying my family of 4 round trip for $69.

[–]Poko318 0 ポイント1 ポイント  (2子コメント)

I live in massachusetts, so we actually aren't too far apart, and I wanted to ask some advice since you seem to know what you're doing. I want to send my parents on vacation for mothers day, but don't want to spend more than 1k really. Are there any ideas you can think of or any places you have vacationed for cheap that were nice? I was considering just giving them like 500$ for a trip to foxwoods but I'm not sure. I've even come across some vacation packages for somewhat cheap up in the white mountains.

[–]jgatcomb[S] 0 ポイント1 ポイント  (1子コメント)

I don't know your parents, but here is what I would do for myself in your situation:

Driving to Pennsylvania is only about 6 hours depending on your endpoints in MA and PA. Plan the trip in advance so that they can stop along the way and take in some site/event/meal. Check tripadvisor. Perhaps there is a quaint little BnB with a picturesque view that isn't too far off the highway for them just to have a meal together.

You can even use gasbuddy or something similar to let them know where to stop to get the most inexpensive fuel.

Lodging

Do you know anyone with an RCI membership? This is the site where people can "bank" their timeshare, get extra vacations, etc.

Transportation

  • Get a week long resort rental through RCI
  • Get a week long rental near a resort through VRBO or similar

I see plenty of resorts in PA for under $500 for the entire week (May 2017).

Activities

Literally just search for Groupons in the time/area.

Next week I am going to Louisville, KY for the week. We got a 2 bedroom house for the week for $400. We are driving so our transportation costs are limited to gas (use gasbuddy or roadninja). I have activities planned for every day of the trip using groupons where the activity was at least 50% off.

[–]Poko318 0 ポイント1 ポイント  (0子コメント)

Sounds like a great idea, thank you

[–]j8_gysling 1 ポイント2 ポイント  (0子コメント)

Good, you have your priorities straight.

Some young people here seem to believe that you cannot enjoy life while you work, and retiring as soon as possible is the only objective

[–]cockswick26m. 350k of 1M saved 0 ポイント1 ポイント  (2子コメント)

So, I should plan on being a military lifer? That O pension looks pretty good

[–]jgatcomb[S] 1 ポイント2 ポイント  (0子コメント)

I have no idea what military pensions look like - I paid a nominal fee to convert my military time over to civil service in the FERS program for civil service.

[–]Silent_Samp 1 ポイント2 ポイント  (0子コメント)

Officer pensions are pretty good, but the retirement system is being changed at beginning of next fiscal year, plus being in military can be pretty awful, and as most of the people here value freedom the most, you need to decide if you are willing to entirely give that up for 20 years

[–]JustTryingToRant 0 ポイント1 ポイント  (2子コメント)

Do you mind sharing your GS level? Any advice you have for a fellow government employee?

[–]jgatcomb[S] 2 ポイント3 ポイント  (1子コメント)

I'm equivalent to a GS15.

I would need to know a lot more about your situation to give you advice but here are some universal things:

  • Educate yourself. Find all the ways that you can benefit from being a federal employee and take full advantage of them. Don't expect your boss or even your HR representative to know about all of them. You will need to research.
  • Take full advantage of the TSP as it has some of the lowest fees/overhead around. I find the lifestyle funds a bit too conservative for my taste but they do make things simple (choose the fund closest to when you are going to retire and it does the rest). Just don't choose the default G fund to put all your money in and don't leave money on the table (ensure you are investing at least enough to get employer matching and if you are maxing out - don't max out early as the matching contributions are on a per-paycheck basis and if you max out before the end of the year you stop getting matches)
  • Don't limit yourself to the TSP. Open up a Vanguard IRA. Figure out if the tax liability best now or later when choosing between traditional and Roth IRA.
  • If you can afford to, don't stop there
  • If you haven't already subscribed to /r/personalfinance and /r/frugal do so immediately - you can hate yourself later
  • If you work with highly compensated contractors, realize that is an option post federal employment
  • If your pay comes from NFC, use the allotments to automatically deposit portions of your check where it makes sense to do so. This can help in a myriad of ways. For instance, many banks will waive fees if you have direct deposit which means you can have this benefit at multiple locations (no need for it to all be deposited in 1 spot). You can also get used to living on a smaller budget by only looking at the account with discretionary spending. Finally, it makes bill paying a lot easier if you have accounts set up with automatic withdrawal and the money if the money is automatically deposited before the automatic withdrawal.

If you want more advice, tell me more about you and what you are trying to do.

[–]JustTryingToRant 0 ポイント1 ポイント  (0子コメント)

Thanks for such a well thought out answer! I'm going to shoot you a private message to disclose a bit more information.

[–]Dewlinedew 0 ポイント1 ポイント  (1子コメント)

Freedom 35 Rickie! Deeeecent

[–]hutacars23M, 60% SR, FIRE 2032 0 ポイント1 ポイント  (0子コメント)

That's the way she fookin goes, boys.

[–]valeyard89 0 ポイント1 ポイント  (0子コメント)

Same here... working at dotcom company with net worth 2MM++ at 26... thought I'd retire at 35. Then came the crashes (2000, again in 2008), got married, both of us went back to school, and had a kid. Now it's going to be at least another 10 years, still have a net worth less than nearly 20 years ago. But I've done a lot of travel and have a job that keeps me just enough busy. So can't complain there.

[–]YouAreNotASlave[🍰] 0 ポイント1 ポイント  (1子コメント)

The other side is that, in everything not-experience related, I am as frugal as possible.

Can I get people's opinions on whether the neighborhood one chooses to live in is experience-related?

We live in lower Manhattan and I'd been unsuccessful in convincing my spouse to move to Brooklyn or New Jersey where it'd be cheaper.

[–]jgatcomb[S] 1 ポイント2 ポイント  (0子コメント)

I chose to live 7 miles from where I work which was way more expensive then living an hour or so away simply because of the extra time I got not working as I consider my commute as work - or at least not my time.

What is an is not "experience related" is a personal decision though. I found Manhattan intoxicating the few times I have visited but I don't think I would want to live there. Others may find that environment a daily form of entertainment worth paying for.

Personally, I don't like people and would much rather live on a large plot of land without neighbors if all things were equal. They aren't though - earning potential goes down or you have to have the self-discipline to work from home or you have to sacrifice time by commuting or....

[–]jaknoir 0 ポイント1 ポイント  (3子コメント)

Step One to Retire: Don't Marry or Have Kids.

[–]Argosy37 0 ポイント1 ポイント  (0子コメント)

So many people seem to say, "I had these dreams/goals in life and plans to achieve them, and then I got married and had kids, so they pushed out 20+ years." Seems like the best way to achieve your dreams/goals is to just not marry or have kids.

I'm on my way to FIRE in my early 30's, and I'm not letting marriage or kids be roadblocks to my goals.

[–]_neminem 0 ポイント1 ポイント  (1子コメント)

Not sure why you would think getting married would hurt your ability to FIRE - in our case, we're definitely way stronger financially a few years out than we would have been if we hadn't met, and were still single, due to being able to pool resources. One mortgage, one electricity and phone bill, etc. Granted, I probably wouldn't go on as many vacations if I didn't have anyone to go on them with, but still.

Fun fact: it is possible to get married and then not have kids. :p

[–]Argosy37 0 ポイント1 ポイント  (0子コメント)

Not sure why you would think getting married would hurt your ability to FIRE

I mean, the (not insignificant) risk of divorce is certainly a major reason, even if you never plan to have kids. Sure, everyone says it will never happen to them, but we have tons of evidence even from posters on this sub of how much divorce has set back their FIRE goals.

[–]pchampn -1 ポイント0 ポイント  (1子コメント)

Newbie here...what is a 4% rule? I am sure it is highlighted somewhere in the FAQs, will appreciate if you can more info.

[–]jgatcomb[S] 0 ポイント1 ポイント  (0子コメント)

In its simplest form

  • The market will increase 7% per year on average (over long periods of time)
  • Inflation will be 3% per year on average (over long periods of time)
  • That means you can live on 4% of your principal for long periods of time (not indefinitely though that would be nice)

For instance, let's say you have 1 million dollars invested in indexed accounts with very low administrative fees (Vanguard for instance).

You could theoretically have the buying power of 40K a year for a very long time and still have roughly 1 million of buying power invested.

Notice I switched to buying power instead of dollars. Everything will go up over time - the amount you have invested and the amount you need to withdraw because the cost of everything is going up (inflation).

So think of the lifestyle you could live on today for 40K and if you had a million dollars invested as I indicated above, you could continue that same life style for decades while still keeping the equivalent of a million dollars invested.

The problem is the law of averages is a fickle beast when you are dealing with very long periods of times so you have very lean years where the market is doing horrible or for some other reason you need more than you normally earn back.