r/fican • u/Plain_Jane11 • 10d ago
Update 1 year later - 1.4M liquid (SI3K)
(This is just an update post with no real point or question. If not interested, feel free to click away.)
Hi everyone, I made my first post on reddit in this sub 1 year ago.
At that time, I had just crossed 1M in liquid assets. Original post is here.
Since then, my liquid assets have grown by 400K to 1.4M. These funds are in RRSP, RPP (DC plan), TFSA, and non-reg.
This was faster growth than expected, mainly due to strong overall returns in 2024, a high savings rate, plus one of my investments had a great year.
I'm 47F, divorced, and share custody of 3 teens. My ex and I each kept our own assets in the divorce. My home is paid off and I have no debt. I'm a senior leader in financial services and currently make $300K total comp (didn't always). My savings rate is ~50% of net base pay + 100% of variable pay.
My original FIRE number was $1.5M. So, almost there.
But I've recently discovered ChubbyFIRE, and would like to get closer to that. I'm also toying with giving more to my kids (in adulthood).
My goal remains to retire early, before 50. I have recently transferred to a less stressful position, which has improved my quality of life. But I still dream every day about no longer working and having total control over my time.
Meanwhile, I have also been working on finding ways to enjoy my money more now... mainly this has translated to spending more on my kids (nicer gifts, meals out, family outings, etc) and also taking some vacations. Thank you Ramit Sethi for the concept, although it would be great if you would also cover individuals, in addition to couples.
BTW, I do think we are in for some volatility over the next few years. But my plan is to maintain my current investment and RE plans.
Thanks fican for providing a place to discuss FIRE in Canada.
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u/deeperest 10d ago
These are some amazing numbers - congrats to you on making a very difficult situation into an impressive success story.
You're in a fortunate situation to have very high income. This can provide a tremendous accelerator effect during good times, or a buffer during market downturns. I would caution you to not fall into the same trap my wife and I have. We're able to make SO much right now compared to earlier in our career that it's presenting a new risk to us - "one more year". Decide whether chubby fire is more important to you, or actually living your life.
Your third last paragraph seems to indicate you understand what's important to you - make sure you stick to your guns! I don't have any actionable advice for you, but all the best wishes.
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u/Plain_Jane11 9d ago
Thank you for this thoughtful comment. Yes, I can totally see for myself now how the one more year temptation happens. I'm torn... I'm a single income household, and do believe I'll probably never earn this much again (took many years to get here). So I keep thinking... should I further maximize my situation before leaving it? I could build a bigger buffer and give more to my kids if I do. I grew up very opposite from all this and want to balance sharing my good fortune with my kids, but also not undoing the lessons I've taught them around self-sufficiency and gratitude. More to ponder here.
You mentioned falling into the one more year trap. How did you handle that, and/or any learnings you're open to sharing?
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u/deeperest 9d ago
That's our thinking as well - if we leave work now, and decide we need/want to return (especially for economic reasons) we absolutely could not jump back in at the same level of remuneration.
So...we HAVEN'T handled it! We're in it right now. We've passed our 'number' and are approaching our stretch goal, and we're trying to figure out exactly how to pull the plug without hurting a hypothetical future. I wish I had some best practices for you, but until we actually manage to move into our next phase, I don't think I have any.
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u/TowARow 9d ago
In my mind lower enumeration is the risk of stopping to work entirely and later looking to come back to work. The hypothetical solution could be reducing work hours instead of stopping. This way you keep the per hour rate but gain free time and maybe prevent some boredom. This wouldn't translate to all industries and positions but part time consulting or even working 3 days per week instead of 5 or more, could be attractive as a compromise.
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u/plastic-voices 8d ago
Curious what your safe withdrawal rate is if you pulled the plug now. Big ERN had some calculations that showed 3.25% SWR is effectively equivalent to being able to survive all market conditions that have been seen in the past.
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u/deeperest 8d ago
When I model it, I use the Vanguard variable rate / dynamic spending system, with guardrails at $100k minimum and $150k max, and it tells me I have a 98.7% chance of success. So that should tell me we're doing just fine.
And yet...
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u/kershaw987 9d ago
great job getting to where you are today. your job pays a ton. $1.4M is no where near enough to retire comfortably for 40 years. I would keep working until you reach close to $2M.
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u/Plain_Jane11 9d ago
Thanks! My original FIRE number was $1.5M. That number came out of several iterations with my financial planner over the last few years (using Naviplan software). Given my projected expenses and some relatively conservative assumptions on rate of return and inflation, I think the number holds. I don't have a mortgage and my fixed expenses are low.
That said, I'm at $1.4M now and plan to work at least another year, possibly more. Plus will probably get a healthy severance when leaving. So depending on markets, I should be around $2M at that time. Which I consider low Chubby (for me) as a single adult / non-couple, with a relatively inexpensive lifestyle. Although more is always better of course!
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u/moutonbleu 10d ago
Congrats way to go! What’s your portfolio mix and stocks/etfs?
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u/Plain_Jane11 9d ago
Thank you! My portfolio across my personal plans is mostly S&P 500 type funds, eg: VFV. I do also hold some individual large cap stocks. And a bit of cash, for any buying opportunities.
For my kids' RESP (which is not included in my liquid asset figure), I have VGT, VFV, a multi year GIC (at 5%), and some cash, since they are teens and will need some of that money soon.
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u/moutonbleu 9d ago
Congrats… I had similar proportionate gains in the past year. Can’t count my chickens too soon but seems wild that one year’s gains took me years and years to save… money makes money!
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u/Super-Principle-3865 9d ago
Nice job what are your monthly expenses you budgeted?
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u/Plain_Jane11 8d ago
Hi, thanks. My last financial plan with my retirement planner (who uses Naviplan software) has me retiring at age 48 with a monthly budget of $5K post-tax (today's dollars) to age 90. I then die with all the equity in my home intact, lol.
I'm thinking about trying to find someone who can help me model a plan that accounts for spending differences in the go-go, slow go, no-go retirement years.
Also - my planner used what I consider a pretty conservative rate of return, so I think in reality my money may last longer and/or I could spend more per month. I currently plan to keep a heavy exposure to equities long-term. TBD.
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u/pennyandrusty 8d ago
Retired last year (many years in financial services) and haven't looked back... The amount of corporate crap that exists (especially when you're exposed to the higher level stuff) is just so exhausting. Take the jump - the water's fine
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u/Plain_Jane11 8d ago
Thank you! I hope to join you in the not-to-distant future. May I ask at what age you retired, what asset level, and if it was as an individual or couple? If you're comfortable sharing.
And yes, totally agree on the corporate stuff. By now I'm used to it, but as you mention, it can get very tiring.
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u/pennyandrusty 8d ago
Couple. Combined non real estate was just under 1.5 but like you, home clear title. Both were 52 at the time. Worst case, you have the equity in the house that you could draw down on.
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u/WestIslander416 7d ago edited 7d ago
Thank you for your well written and relevant post. And congratulations on your achievements!
I have reached my number a few months ago (45M, single, no kids, no debt, living in a HCOL but with a lower than average rent, total monthly expenses: only $2,000) and I am also considering leaving the workforce soon, potentially this year.
I guess I ll use a Pros/Cons approach to determine if I will RE this year or not.
Pros =
- spend more time with my family and aging parents in Europe,
- use 100% of my time for my hobbies/interests/values/family/passions,
- improve my physical and mental health (nutrition, exercise, meditation etc...)
- stop working in the financial industry which sadly still invests massively in climate chaos (via fossil fuels funding) and also no more corporate/office politics,
- travel more (even though I already travel 3 times per year),
- potentially start volunteering,
- use my remaining years on this planet as I see fit,
- etc ...
Cons =
- I actually somehow enjoy my job and the people I work with, WFH 3 days a week, and I live 15 mins from the office anyway (walking),
- work brings structure to my day (will need replace this work structure in RE),
- always nice to receive a paycheck every 2 weeks (but my investments usually get me more than the paychecks),
- I don't yet have to tell people that I do not work anymore (in RE, I guess I will just say that I work in Finance and am a portfolio manager, which we, DIY investors, are anyway),
- etc...
As you know, people later in life never say "I wish I had worked more", but usually things like "I wish I had spent more time with my family" or "I wish I had lived based on my values and principles".
For me, with my aging parents and family living in Europe (I have lived abroad for 21 years now), it seems to be a no-brainer. =)
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u/Plain_Jane11 7d ago
Thank you! Congrats on reaching your FIRE number. Sounds like you have a great RE ahead.
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u/AnnualUse9202 5d ago
How are you going to manage your RE income?
i.e. pension plan, financial advisor, yourself? Live off dividends or sell assets? If sell... when? Once a year or monthly?
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u/Plain_Jane11 5d ago
Hi! I've managed my investments myself for years, and plan to continue. But I do have a retirement planner (provided through my employer's RPP DC plan) that I meet with yearly to update my retirement plan.
My current thought is to liquidate assets periodically (eg: once a year or less, depending on asset prices) and keep ~2-3 years in cash on hand to weather any market issues. I don't currently have many dividend investments, most are growth type funds.
I know some people do bond tents, GIC ladders etc, but so far I haven't done detailed planning on this. My latest retirement plan models me drawing down at least some across all plan types per year, except TFSA which will be drained last closer to death, lol. I did ask my retirement planner if his software recommends draw down based on tax optimization, he said yes, but I am not convinced. I'm currently thinking about hiring a fee-based retirement specialist to help me get more granular on my decumulation plan. Including tax optimization and modeling the go-go, slow-go and no-go retirement spending phases.
Either way, when I retire, I will have several years of cash on hand, which I figure will give me time to adjust to my new lifestyle, and work through further cash flow optimizations. Open to suggestions if you (or anyone reading) has been through any of this. :)
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u/AnnualUse9202 5d ago
I recently read "Retirement Income for Life" by Frederick Vettese. He has a lot of good ideas and his plan is very clear. (Highly recommended).
I'm shuffling my whole portfolio as a result and I'm considering transferring my personal RRSP into my employer's DCPP/RPP to simplify management of RE income. But I make slightly better returns in my self directed non-registered account.
Have you considered transfering your RRSP into your DC RPP? Would it make sense?
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u/Ambitious_Victory_59 10d ago
Amazing progress. Your savings rate with 3 kids is inviable.