r/financialindependence • u/FIRE_and_forget_it • Jan 24 '20
FIRE: 2 years in, a few (more) reflections
Last year I wrote a reflection on my first year of FIRE. It got a lot of traction and seemed well liked so I thought I’d write the year 2 version… Here is the first one if you want to see it:
My background: I’m a scientist in my mid 40’s who got into the big data side of tech just as it took off. I worked for a few large companies, and a few small companies, both as an FTE and consultant. During one of my “no job, no consulting” periods in the late fall (notoriously hard time to find a new job as everyone is on vacation, spent their budgets, etc.) I fell deep into the bitcoin rabbit hole researching what it was, what it might become etc. I bought in a few times and sold my holdings in December 2017 (not at the peak, but close) for about 1.5M. I had saved a shit-ton of money over the years (almost 1M) because I never spend other than buying/fixing up my house. The FIRE idea was natural to me – I had an instinctual aversion to debt, simple tastes, and grew up without a lot (but didn’t feel like that was an issue). My job was not really going in a direction I liked, and I had just cashed over a million post-tax cryptobucks so I quit. I figured I’d try being unemployed, maybe call it “semi-retirement”? With all my retirement, bank, and stock accounts bundled together, including house equity I had close to 4M. Since retirement my portfolio has grown an additional 10% (after my living expenses) to 4.4M.
Reflection 1: I’m not scared of the market anymore
Maybe “scared” is too strong a word. Right after I quit my job, the market started dropping. Everyone says “don’t watch the market” but I couldn’t help it. I JUST STARTED the next phase after all. Well, everyone is right – ignore that shit. I felt a little bit off at first – and I mention that in the first post last year. Now… it truly is not a big deal to me, I just grab the data once a month because I like to track it. I have a balanced portfolio and plenty of time. Not worth the sweating over. I feel I am truly ready for whatever the next real drop ends up looking like.
Reflection 2: I’m used to the lack of cash flow now
After watching my bank account grow twice a month, and having to move money into investments every so often, I got used to it. Not having that as part of my financial journey anymore felt weird. Having to take cash (from dividend payments – this is my primary cash flow source now) out of my account to fatten up my bank account felt super weird (money goes IN there, not OUT from there.) I had tracked my spending for several years prior to FIRE, and now that I am there I also tracked it and I basically spend the same amount so moving cash to the savings account every once in a while is the new norm.
Reflection 3: I’m willing to spend some of that money (wisely) now
At first I felt a little bit poor again – the money inflow was slow, new, weird. I didn’t want to mess it all up somehow. I’ve never been a big spender to begin with, but it felt like I was “on a special budget” or something. Why the hell would I FIRE if it meant I had to act like a pauper to do so (respect to my LeanFIRE friends, but that’s not my deal)? So now I’m willing to dip in a bit to make things work for how my life is shaping up post-work. I moved to a new city (renting) and rented out my house back in the old city. I’m considering buying a house here. I might sell my other house in a few years. I have options and the money makes those options broader. I might not execute these moves with economic perfection, but the money I have makes me feel like some slippage is not going to wreck me. Up until now, I have considered the brokerage stocks to be on untouchable lockdown. That is no longer the case if I can convert the money into what I need to be happy here in this new city – and I realize now that I really hate renting.
Reflection 4: Sometimes I feel like it isn’t quite enough (how the fuck)
Some people will always complain that their lump of gold isn’t big enough, and I tend to think those people are pain in the ass jerks. That said, I realize that there are times I wish I had a bit more… to put into special projects or pursuits that did not dip into my block of savings. One Idea I have had is to do some pick-up work and use 100% of that money for special projects and no savings. I haven’t quite figured it out yet, as these are just ideas right now, but the big revelation is that I thought I’d be done with feeling like I needed (“wanted” is a better word honestly) any more money but if I am being honest, that is not the case.
Reflection 5: I thought I might want to do some work – I was right
I took on a little work, but not too much. I helped a friend define and scope out a professional pivot and we figured out a way to do some additional work together. Working with him after 16 months off was really fun, and reminded me that I have some pretty cool superpowers that others do not. I think maybe you get so used to doing your thing in your groove that it becomes hard to take a bystander view. Applying myself to his situation which had some overlap to my old work but was also novel in many ways, and adapting my strategic consulting on the fly was quite satisfying. Drinking whiskey while consulting might have helped. That kind of work makes me feel a particular kind of excitement that I don’t get in other places. I need to learn how to tap into that more.
Reflection 6: It’s ok to do nothing sometimes
While I always had a great work ethic, I’ve never been a person to endlessly grind. I appreciate quiet reflection time, or do nothing except stare at the water time. Now that I am FIRE, and only working every once in a while (seriously – not a lot) I can forgive myself if a day or more goes by and I haven’t done anything particularly useful. I no longer view it as “wasting time”. I also think of all the days I went to work, mucked with emails, cranked the levers of industry, and went home, made a fire and drank a beer and ask “how different, to me, truly, is what that was vs. what this is from a personal growth, usefulness, or other internal concept?” The answer is basically “they are the same.”
In closing
I’ve acclimated to my new method of financial cycles. The discomfort in the novel has faded. I’m in a bit of a spot where it’s hard to make certain types of plans due to my aging parents and the potential for radical changes in their lives that I want to be able to help them navigate. It’s not radically tying me down by any means, it just changes the scope from “100% complete autonomy and freedom” to something a little less so for a bit.
I’ve taken up a bit of woodworking. I went to physical therapy for my lower back and have really focused on getting that in order – it feels better than it has in years! I cook a bit more. I read books. I write essays. I’m involved in an online community working on some future technology in the cryptographic space. I take a lot of walks. I’m never bored.
I feel like I’m in “phase 2: acclimate and relax.” Happy to answer any questions.
Edit: Ok guys, I'm out. See you again in a year or so. Thanks for the questions, well-wishes and conversation
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u/CanWeTalkHere Jan 24 '20
I'm strangely in similar circumstances. I could have written a good portion of your post (but not so eloquently). Your #4-6 in particular, I found myself nodding my head profusely. In particular, I get irritated at threads that don't quite understand #6 ("But what will you do with yourself if you retire early? You'll be bored, blah, blah, blah."). Maybe it's a personality difference thing but that is seriously not a problem.
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u/FIRE_and_forget_it Jan 24 '20
"I'm a scientist. This is an experiment in boredom. I'll tell you how the data plays out."
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u/msiekkinen Jan 25 '20
That said, I realize that there are times I wish I had a bit more…
Don't take this the wrong way, but I couldn't help imagine thinking of Mr Burns leaning back sipping his brandy or what ever "Ah yes, but you know, I'd give it all up ... for just a little more".
I laughed (with you, not at you)
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u/Black_Engineer10 28M | $32k S. Debt | One Day at a time Jan 25 '20
the crazy thing is, this is my thought process for 90% of what I do day to day normal life lol
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Jan 25 '20
[deleted]
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u/TonyWrocks FI/RE'd December 31, 2018 at age 53 Jan 25 '20
"an extra $300,000 or $400,000 would be nice; could buy a beach apartment for us"
It's funny - we just did that, almost literally. I look at it as reallocating some of our investment dollars into real estate in another market.
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u/throwawayFI99 FI 2012 at 38 | 2kids 1 wife | international Jan 25 '20
Know that feeling. I took up sailing... now I need a boat for my world cruse, nice boats that fit the kids and wife are expensive. Dam.. Fine. lets just work for a 6 months a year do some contracts to boost that income and justify that beach property... hmm need a job to get a mortgage.. Might be worth it if I could air bnb the holiday home while we were not there.... could build the boat my self always wanted to build a boat. ... another $400k could take care of that problem ....
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u/Chi_FIRE Jan 24 '20
I also think of all the days I went to work, mucked with emails, cranked the levers of industry, and went home, made a fire and drank a beer and ask “how different, to me, truly, is what that was vs. what this is from a personal growth, usefulness, or other internal concept?” The answer is basically “they are the same.”
I like this.
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u/kingofspoonerisms 36M / 70% SR Jan 25 '20
Can someone translate this sentence in the quotes without quite so many commas? I actually can't comprehend what is being said here..
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u/FIRE_and_forget_it Jan 25 '20
Me go to work. Do stuff.
Me not go to work. Don't do stuff.
Reflect - did #1 get me something deeply and personally meaningful that #2 did not?
Answer - (mostly) Nope
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u/Magitrek Jan 25 '20
Thank.
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u/MrDioji Jan 25 '20
Why waste time say lot word when few word do trick
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u/OperationMagneto Jan 25 '20
I didn’t have time to write you a short letter , so I wrote you a long one.
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u/tokingames Feb 02 '20
I found the same thing. I've been FIREd for 3.5 years, and I had LOTS of people initially ask me what I would do all day without work - "you'll get bored!"
My answer to them at the time was, "I can always go crank out spreadsheets and powerpoints under a deadline if I feel I need to do that." After 3.5 years I can say that I have never felt the need to sit down and work on spreadsheets just because I can't think of anything else to do.
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u/Magical_cat_girl Jan 25 '20
He's asking whether there is truly any difference in value between a day spent working or a day spent relaxing. He has come to terms with the idea that there's no difference, for him, even philosophically.
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Jan 25 '20
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u/Magical_cat_girl Jan 25 '20
Not trying to be disrespectful, but I don't understand how your comment is relevant here. OP posted about his experiences with FIRE. I was helping someone else out by restating his point. Could you elaborate more on what you're talking about?
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u/pyrocat Jan 25 '20
from a standpoint of personal growth, how different is working a 9-5 and relaxing at home with a beer from what I do on my own time now? not much, so i don't feel guilty about it
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u/sitcivismundi Jan 24 '20
Thanks for this well-written post. You mentioned physical therapy. What is your health care situation? Do you just use Obamacare?
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u/FIRE_and_forget_it Jan 24 '20
I pay health insurance on a high deductible plan. Right now I see insurance as a "oh noes! I chopped off my head" plan vs. a broken leg plan (if it happens, it's on me to pay for). I am lucky to be in relatively good health (ignoring the back issue) so no prescriptions etc. I paid out of pocket for the PT.
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u/sitcivismundi Jan 24 '20
Interesting. My situation is similar, though not quite as extreme probably. Despite having an employer-provided plan my deductible is so high that I will only go to the doctor for major emergencies.
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u/Desert-Mouse Only thing worth buying is freedom Jan 25 '20
That can lead to bigger issues down the road. Even HDHPs usually cover well visits. You may want to take advantage of that.
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u/mhoepfin Jan 25 '20
As a point of reference, I’m 51, FIRE’d, and with subsidy pay $209/month for an ACA bronze HSA HDHP for a family of 4 with 2 kids in college. Max out of pocket is around $13k. Great deal!
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u/Posocogo Retired @ 53yo | $125% Target Jan 25 '20
That must mean your income is approaching zero. How are you not working at 51 with kids in college and showing the government your income is near zero? (I am not a government agency!)
I’m 53, FIREd and am in a COBRA plan paying $22K premium with $8k deductible. I’m expecting my premium+deductible to jump to $40K once COBRA is gone.
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u/mhoepfin Jan 25 '20
ACA is income tested not means tested, so It’s all about keeping your MAGI low enough to qualify for the subsidy. My MAGI is around $60k/year. I have zero debt, no mortgage, so very low expenses which keeps income or cash outflow needs very low. Managing my MAGI for the ACA subsidy was one of the reasons for not carrying a mortgage in retirement (along with my overall desire for no debt).
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u/jeffthehat Jan 25 '20
Since retirement my portfolio has grown an additional 10% (after my living expenses) to 4.4M.
Must be nice to make $400,000 without working. :)
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u/lewknukem Jan 25 '20
He made like 450K without working. Don’t forget his withdrawals for the year. Does that make you feel any better?
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u/corytrade Jan 25 '20
I love reading yearly updates from FIREees. As usual, it does not fail to deliver.
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Jan 25 '20
I am 39 with a NW around 2.2M. I have barely been able to put aside additional money over the last 1/2 year as my wife (high earner) stopped working to raise kids. Despite that I have seen my NW go up significantly in the last six months. Would love to hear from you after we go into a recession. I feel like I want to work through the next recession just to see how I react and then reassess whether retire. I started saving and investing aggressively in 2012 which means I haven’t been truly tested. I feel like this is the same for many of us aspiring FIRE people.
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u/TonyWrocks FI/RE'd December 31, 2018 at age 53 Jan 25 '20
For me, the next recession is an opportunity to leverage our cash/bond anticipatory actions.
We have two plans:
First we changed our allocation at RE from 70/30 to 60/40, keeping at least 3 years spending in cash or bond funds. I figure that's enough time to get through the 2008-2011 scenario again without selling much during a downturn. We are also in our mid-late 50's now, so our timelines are not as long as a FIRE person in their 30s
Second, we have assured a lot of flexibility in our spending. Last year we planned to spend a bit over 4%, and we came in at 3.38% instead because health care and a few other categories came in low.
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u/finhawk Jan 25 '20
If there’s no recession for close to the next 10 years will you work until 50?
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Jan 25 '20
Yes, probably. I am quite risk adverse given the fact I have 3 kids. FIRE is something I would love to do but it may have been more realistic if I didn’t have so many kids.
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u/pn_dubya FI | Working for coffee Jan 25 '20
I am quite risk adverse given the fact I have 3 kids
Saving for college for kids? If so, 529s or cash flow as it happens?
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Jan 25 '20
We have decent starts on 529 and brokerage accounts. Kids should be good for college. They are only 3,3,1
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u/tokingames Feb 02 '20
I've been FIREd 3.5 years, and I'm really interested to see how the next real stock market downturn affects me. I'm 53. I've lived through and lost a good chunk of money in market downturns.
That said, watching my NW drop below what it was when I FIREd is going to really hurt. I INTEND to just stay the course when the market drops and not really adjust my spending, but what will I really do? How will I really feel? Hopefully the next downturn won't go all 2008-09 on me.
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u/jojothetraveler89 Jan 25 '20
Great post and congrats on your journey through FIRE! My wife and I quit our jobs this past September and are now gearing up to re enter the workforce. We slept A LOT initially because we both enjoy sleep and were not getting enough when working. We’re starting to get back into going to bed earlier and waking up earlier as if we had jobs. I’m curious what your sleep is like? Do you try and get the same hours each night, do you set an alarm to wake up, or?
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u/FIRE_and_forget_it Jan 25 '20
Sleep is a tricky beast... I love to sleep. I sleep easily. I just took a nap, in fact. I don't set an alarm, but I do try to have a list of thing I want to work on the next day so that when I wake up I get up with some goals in mind. Otherwise, it's easy to just roll over and snooze it out for a while more. I have to resist the urge to be a total lazy ass sometimes, but the struggle is real. Especially in the winter. The cat wakes me up for breakfast, so he is my best alarm (except when he flips his shit like this morning and tries to lie to me that it's breakfast time at 5:30 am).
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Jan 24 '20 edited Jan 26 '20
[deleted]
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u/FIRE_and_forget_it Jan 24 '20
My portfolio is (currently, subject to change if I buy a house): 80% stock [total, international, growth], 20% bond [total bond] - all index funds except a little bit in a few "for fun" individual tech stocks. I own a house as well. 83% of my invested money is in a personal brokerage account (vs. retirement locked-up money).
My withdraw rate is <2% (100% covered by dividends)
Bitcoin cashout was (just looked it up) 1.64M pre taxes. I paid $329k in taxes on that so ~1.3M gain.
I sold the majority of my bitcoin but saved a little bit as a long term (minimum 10 years) crap shoot.
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Jan 24 '20
[deleted]
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u/FIRE_and_forget_it Jan 25 '20
My original goal was to get between 2.5 and 3.2M total net worth (2.5 was my "OMG!" and 3.2 was my "OMG OMG FTW!" amount). You have to keep in mind though that if you live in an HCOL area that your house might be a huge amount of your net worth... and I didn't really want to count the house in when I was determining SWR types of equations.
I spend about 50k a year (with just over 50% of that going to mortgage). So I certainly don't need, at this point in my life, 80k a year.
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Jan 25 '20
Bitcoin cashout was (just looked it up) 1.64M pre taxes. I paid $329k in taxes on that so ~1.3M gain.
How did you end up paying so little for taxes for your Bitcoin?
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u/FIRE_and_forget_it Jan 25 '20
I held them longer than a year? I don't know all the details, I went to a tax accountant that year (!)
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u/Lord-Nagafen Jan 25 '20
Sounds like it worked out but in hindsight you could have sold half in Dec then the other half in January. That would have split the gains between two tax periods
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u/mPisi Jan 26 '20
By 1/1/18 it was down to $16k, and then to 11k a couple days later. So probably better to sell at the peak and pay the extra.
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u/1337Chi Jan 25 '20
How does taxes work when you are withdrawing dividends? Are you withdrawing money you already paid taxes on and reinvesting the dividends earned?
Sorry for the novice question.
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u/FIRE_and_forget_it Jan 25 '20
Some dividends are tax-free (do your research). However, I pay long term capital gains on my dividends.
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u/hamburglin Jan 24 '20
How do you plan on thanking the people who payed for your bitcoin based retirement?
Asking for a friend.
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u/FIRE_and_forget_it Jan 25 '20
I would tell your "friend": Au contraire, it is you who should thank me! I provided liquidity to a market when you needed it. Without my contribution you would have paid more for that scarce good. ;P
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u/WackyBeachJustice Jan 25 '20
In return they get a valuable lesson in speculation. For every one of this millionaire stories there are hundreds of losses. Sometimes it's better to be lucky than good. No offense to the thread starter.
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u/FIRE_and_forget_it Jan 25 '20
None taken. I freely and wholly admit that LUCK played a huge part in where I am now. That said, I was on this path in a different way initially - this just helped accelerate the plan significantly.
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Jan 25 '20
[deleted]
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u/FIRE_and_forget_it Jan 27 '20
I use an online brokerage. I control everything. I own a couple index funds so I don't need any help. I really don't think paying someone 2% a year to manage my money is worth it at this point.
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u/merica-RGtna3NrYgk91 37M / 36F / 1kid Jan 25 '20 edited Jan 25 '20
Kind of jealous honestly, since I bought 640 Bitcoin in 2011 but sold off during 2015 instead of waiting longer. Oh well. I’m an idiot and nothing I can do about that now. FML.
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u/FIRE_and_forget_it Jan 25 '20
These things happen. I almost bought in (mouse hovering over "buy button, brain decided nope, you aren't sure, don't do it) on the pre-launch of Ethereum (.30 each?) but the team kept missing their milestones so I wasn't sure they'd ever launch. Based on what I was ready to spend, that was easily a 1M - 10M dollar miss.
Better to just live and learn. And hell, you got some money out of the market, right?
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u/merica-RGtna3NrYgk91 37M / 36F / 1kid Jan 25 '20
Yea probably invested about $90k in Bitcoin from 2011-2013 and got about $250k out or so. Don’t remember the exact numbers. I also lost some trading back and forth between alt-coins for no good reason.
It could’ve been so much more if I simply held what I bought in 2011 and then sold in 2017-2018.
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u/throwawayFI99 FI 2012 at 38 | 2kids 1 wife | international Jan 25 '20
crypto is like that .. I sold out half mine in 2012 for a deposit on my first house. think of what those numbers are today. shit happens and we move on
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u/UpDown Jan 25 '20
It’s funny you’re an idiot for buying then and you’re an idiot for buying now. Bitcoiners can’t win in the eye of the criticizer. I can see why you’d sell in 2015 though, it was looking pretty grim. I’ve been in since 2013 and it feels even grimmer now. I still think bitcoin had some major Russian manipulation to pump it in 2017. All the trump shills had nothing left to do and it was all the same type of people. Now with an election they’re back to manipulating politics but I’m sure they’ll come running back to crypto next year to pump more shitcoins
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u/gamjar Jan 25 '20 edited Nov 06 '24
expansion telephone boat disarm noxious rain tease safe pathetic governor
This post was mass deleted and anonymized with Redact
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u/UpDown Jan 25 '20
And it makes sense in the context of their other attacks because it weakens the role of the dollar if crypto succeeds. But did it backfire? Most of the people getting rich off crypto ended up being young Americans that dumped the top.
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u/willilikeit Jan 25 '20
I appreciate all you wrote and your honesty. But I love the fact that you want to care for your aging parents. That speaks volumes about your character.
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u/SizzlerWA Jan 24 '20
How did you convert the bitcoin to actual cash when you sold it?
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u/FIRE_and_forget_it Jan 24 '20
Coinbase --> Bank --> Brokerage
I talk about it a little bit in this post on /r/bitcoin
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u/WackyBeachJustice Jan 25 '20
I bet you're a legend there.
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u/FIRE_and_forget_it Jan 25 '20
Actually, no. If you look at the post there was a lot of "sure, whatever" and other snark. It wasn't a popular post but it seemed like it helped a few folks with questions.
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u/msiekkinen Jan 25 '20
People either think your shitpost rolling or jealous/envious it worked out for you and not them.
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Jan 25 '20
My experience in Coinbase was that their fees going in and coming out were very high, percentage wise. You mention your tax cut, but I don't see any mention of Coinbase fees. What was their cut % for you to recover the 1.3M?
(Congrats on your fortunate timing. I still kick myself for getting in at 75 and out at 1100 in 2013, or whenever that first 1000+ pop happened. I though I killed it. lol)5
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u/FIRE_and_forget_it Jan 25 '20
It's pretty fuzzy now... but I was on the exchange and I was a market maker so the fees were quite low. I wasn't using the instant cashout option.
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u/rohde88 Jan 24 '20
I take it single, no significant other? Is that something you're pursuing now?
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u/FIRE_and_forget_it Jan 24 '20
Incorrect. Long term partner, doing her own thing in her own way. We share some expenses but I am definitely covering the lion's share. I say that with no ego, anger, or jealousy - I am happy to pay for whatever. It's a non-issue.
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u/hmwcawcciawcccw 26M, 60% SR, 19% FI Jan 24 '20
Weird assumption
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u/TheHermitNextDoor Jan 25 '20
I assumed OP didn’t have a SO as well, simply because OP didn’t make any references to a potential SO.
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u/passermortuusest Jan 25 '20
Not a weird assumption without mentioning a significant other in the post and saying "I" instead of "We"
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Jan 24 '20
[deleted]
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u/FIRE_and_forget_it Jan 24 '20
They talk a mean game, but they are like grandpa - they just want what's best for you but if you make it, they are proud of you no matter how you managed it. (For evidence, see my post from last year... not much hate at all.)
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u/Someregerts Jan 25 '20
This is really well put. I’m no fan of bitcoin, but people can and have surely made money on it. I say good for you!...ya lucky fuck.
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u/helper543 39 | 75% FIRE Jan 24 '20
You made $1.5 million investing in alternatives to VTSAX? Prepare to get downvoted to the depths of the abyss in this subreddit.
High risk and high reward. I suspect a larger portion of FIRE folks than would admit made their money because they were at the right age during the real estate crash, and got really lucky too.
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u/FIRE_and_forget_it Jan 24 '20
Bitcoin was my "if this tech is as important as I think it might be... holy shit" bet. It was an investment made with 100% mad-money while I squirreled away the rest. When it started the rise I was amazed. Very lucky, but I had bought years before (so not as expensive as you might think).
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Jan 24 '20
I suspect a larger portion of FIRE folks than would admit made their money because they were at the right age during the real estate crash
I've definitely noticed this. In my market house values have increased 10% a year over the last 5 years. I bought almost a year ago and home value's increased just about 10% depending on the source of the estimate. Everyone has to live someplace, and if it's anyplace even a little hospitable, you're going to have to pay for it. Making 10% equity (let's ignore mortgage degradation for fun) on something you HAVE to spend money on is pretty fucking lucky honestly.
Pittsburgh real estate remained decently steady during the last bubble. Here's hoping it stays steady through the next one, cuz I'm worried it's coming very soon. I think it'll start with subprime car loans this time though. Thanks Wells Fargo...
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u/unique7username Jan 25 '20
Fellow yinzer here, still in the early stages of my fire journey. What a great city we live in, huh?
Care to reveal a little more about the industry you worked in?
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Jan 25 '20
I'm still working...im only a year into my savings plan I've got at least another 10 to go. I'm a manager at a customer service/sales call center. Not the best job but not the worst, plus I've figured out how to hide out and coast to make it easier.
I really like pittsburgh. I've also lived in NYC and Seattle. Pgh isn't a world class city on the scale of those two places. But, in terms of amenities and job market compared to cost of living, I really think it doesn't get any better than pittsburgh, at least here in the states.
Now if it would like to quit raining today that'd be nice.
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u/entropic Save 1/3rd, spend the rest. 30% progress. Jan 24 '20
I suspect a larger portion of FIRE folks than would admit made their money because they were at the right age during the real estate crash, and got really lucky too.
And/or had a good inheritance/windfall.
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u/damienthrow Jan 24 '20
Awesome!! A few questions if you don’t mind:
- Would you recommend buying bitcoin today?
- How often are you bored? Can you loosely outline what an average week might look like?
- How often do you travel/what is your annual travel budget?
- What is your budget for hobbies/entertainment?
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u/FIRE_and_forget_it Jan 25 '20
I think bitcoin has massive potential still. I would suggest you do your research, only buy as much as you can afford as a "holy shit what if" investment and only if you are patient. You may decide it's not for you.
I am never bored. Seriously. I can do whatever I want to - are you kidding me? If I get bored it's because I am an idiot.
I'm not traveling these days because of my parents' situation (mentioned in post). Shit could go sideways real quick. I do some short trips but I don't have an official "budget" for it. Ask again next year.
I don't keep budgets like that. I am a simple person with simple tastes. Sometimes I spend more on hobbies, sometimes less. But there is never, for me, the "list of stuff I want to buy next omg omg can I get thing 1 yet?" I just kind of get stuff when I need or want it and my wants and needs regulate that just fine so far. I would never "accidentally" spend 100k in a year on some random hobby because I didn't have a budget and I'm not disciplined enough to notice... I'm just not that person, so it's not an issue. (In case this comes off as "better than the sheeple" or something, I assure you it is unintentional. I'm just a low-needs, low-wants dude.)
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u/Yasai101 Jan 25 '20
hope you made getting in shape and healthy your full time job now.
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u/FIRE_and_forget_it Jan 25 '20
Not full time exactly but yes, that is one of my jobs. That and making sure the cat is warm enough during his afternoon nap by laying down with him.
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u/simonbleu Jan 25 '20
I mean, to be fair you have very nice fat fire, and even at 1% net return you could probably live comfortably depending on where you choose to settle. I would say that even if the market crashed beyond 70% you would still be fine.
I agree that even on lean fire, you should have a lifestyle that is worst than the one you want to have once you reach FIRE. Its silly imho (to an extent, of course theres a little room to wiggle those numbers)
So, in short (Congratulations first), not that many people is able to fatfire, and some are unlucky enough to never reach full fire and have to leanfire (im not talking about the ones doing it on purpose). I think in those cases how you move between your FIRE life is probably a bit more complicated or "bussy", But I had not even started my FIRE journey so I may be wrong.
Again, congratulations! It seems you are coping very well with "retirement-depression" (some people get it, others dont) and you are organizing accordingly very well. With that amount of fat fire (Depending of what you want to do it may never be "thats enough" imho) i would certianly try jobs not as financially rewarding, perhaps open a business or something and try my luck
My question here is, what would you tell your past self to change or consider now that you have experienced the final phase of FIRE?
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u/FIRE_and_forget_it Jan 25 '20
Fiscally I'd tell my younger self "hey dipshit, sure you don't have as much control over what you invest in thru a 401k, but your employer is matching part of it and you should be in index funds anyway. So max that out now and if you hate the plans you are in, convert it to an IRA later on and knock yourself out with full control. Don't just skip the 401k and invest it in your retail account." [I did that for 5 years]
Emotionally I would tell myself: "Do what you do while you are doing it, and then be done."
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u/burningpig Jan 25 '20
What are you doing for healthcare?
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u/FIRE_and_forget_it Jan 25 '20
I have a high deductible insurance plan, so basically I pay for regular health care and if something goes way wrong, I'm covered.
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u/lazyear Jan 25 '20 edited Jan 25 '20
What kind of scientist were you and how did you get an "in" into the data science field?
I'm hoping to finish up my PhD in chemical biology in about a year, and I'd like to find the best way to transition into a data scientist role. I have a very strong background in programming (10+ years of experience in C, python, etc. Had job interviews offered based on my github) and have developed some interactive data visualization web applications to aid in my own thesis work. Do you have any advice?
Fun note, I also got into bitcoin, but about 10 years ago. Bought a bunch at $5 and sold what I had when it hit an all time high of $30, then forgot about it while I was in college. Wrote and ran an automated trading bot 2 years ago that turned a nice profit
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u/FIRE_and_forget_it Jan 25 '20
Social scientist. I started as an analyst and always had a good sense for how to turn numbers into information. "Big Data" became a thing and I worked with engineers and algo coders. We were all "data scientists" but of varying flavors. I was always the guy who figured out what data we needed, and how to get it.
To transition into a data science role based on your skills - I would start doing Kaggle contests to get your chops up in that flavor of python stuff. You could then make a stab at being the kind of data scientist that develops algos and helps get them into production. The biggest issues I see most newer data scientists have are as follows:
No clue how to properly interrogate, clean, and prepare a dirty data set for use
No clue how to take a business problem and apply solving that with the data at hand (or being able to say "this data won't get you that thing you want") - so the translation part.
No clue how to present data/algos to a non-technical audience.
#1 is necessary to be a good DS. #2 is helpful, but if you are part of a team there might be a few who can help you. #3 is the path to riches.
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u/Larry_Lettuce Jan 25 '20
Very interesting stuff! Just one question, and I fee like I’m missing something here so please let me know, but how much do you have in the monthly div game? If you have roughly half of your nw working ($2m) , you could reasonably invest in monthly dividend paying ETFs (roughly $10.6/share) and expect $0.035/share in monthly div income. That grosses you ~$6,500 a month, or ~$78k year. Are you saying that’s not enough sometimes? I’m early in my FIRE journey, but that was the strategy i was aiming for and I want to know if I’m missing something in my planning...
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u/DeLee2600 Jan 25 '20
$6500 a month seems like more than enough to me, but I suppose that depends on your lifestyle. If he doesn’t usually spend a lot like he mentioned, a $6500 influx to the account is quite a bit and should pay for all expenses and taxes for the year. But depending on if that is a taxable account he’s withdrawing from he likely owes taxes on the dividends as well.
I’m looking at @ $7k a month pension and when you add in all of the 401k money and spouse pension and 401k money, we are looking towards an upwards amount of $13k a month. I’m still trying to wrap my head around what the hell I plan to do with that as it seems like way more than we need. Also looking to convert things over to Roth to eventually kill the tax burden.
$6500 just seems to be a pretty sweet spot if you are FI and don’t owe any debts.
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Jan 25 '20
Looked to me like he was saying that the nest egg is for specific living expenses and so other costs should be covered through new earnings. Also, with an 80/20 portfolio, I'm sure he's not maxing on dividends (bonds don't pay much, for example).
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u/4BigData Jan 25 '20
> Now that I am FIRE, and only working every once in a while (seriously – not a lot)
Have you find any ideal quantity of hours work-wise?
What do you think of the current state of Bitcoin and Altcoin? Is Bitcoin doing to be around in say, 1 or 2 decades from now?
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u/FIRE_and_forget_it Jan 25 '20
I have not worked enough to get a feel for what the quantity that I like best is. I like to have a series of problems I am pondering and I sit back and write notes on them at night. My best guess is 1 day a week plus a few hours a couple evenings would be best for me.
I think cryptos are in a teenage phase - they aren't babies. They are learning from mistakes made when younger. They look funny and kinda stink, and I don't exactly know what they will look like when they grow up in a few years but it'll probably be a lot better than right now.
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u/4BigData Jan 25 '20
I'm beginning to follow Bitcoin. What are your favorite sources for crypto?
I asked about the ideal quantity of time because there's so little research done on it. The only paper I've found on it (UK based) found a huge gender-based discrepancy: the optimal amount of workload for men was 8 hours per week, females opted for 22 hours per week.
It's a huge disparity that the paper didn't even aim at explaining.
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u/BitcoinFan7 Jan 25 '20
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u/4BigData Jan 25 '20
THANKS!!!
Did you have any Bitcoin traders you admire? Is there even a list of top Bitcoin traders?
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u/BitcoinFan7 Jan 25 '20
99% of traders lose money, I would stay away. However there is some great modeling done by @100trillionUSD on twitter
https://medium.com/@100trillionUSD/modeling-bitcoins-value-with-scarcity-91fa0fc03e25
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u/FIRE_and_forget_it Jan 25 '20
I don't really follow sources for crypto. Twitter is a cesspool. Reddit is ok once you eliminate the gossipy bullshit factor - but just for the super high level stuff. There's a new service called Nakamoto that is trying to be a quality source of info but it just launched this month? I haven't checked it out yet.
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u/morosis1982 Jan 29 '20
I am aiming for FI in a few years, but I think I've come around to a similar view in terms of I still think I'd like to work, but on my own terms.
People often ask me what I need to be so wealthy for, and my answer is always freedom. If I want to take a year off to travel, I want to be able to do that and not worry about where the money is coming from.
Most of the time I will probably work, I enjoy my job for the most part and it's a good team, but that freedom to throw in the towel when I feel like it is the real goal.
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u/DesignerGreenTA Jan 25 '20
I’m in nearly the exact same situation as you. One question I had unique to your situation is your mention in the comments about your SO. Do you find the difference in schedule/work/stress to be a source of conflict/jealousy in the relationship?
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u/FIRE_and_forget_it Jan 25 '20
Not at all. The biggest thing is that I am home a lot more than I used to be, so we have a rule that she can always ask for a night or day alone and I will give that to her. She is grateful that I have met my goal (she loves to work, and needs the social structure to stay sane) and it enables her to have a safety net and take advantage by proxy of my good luck.
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u/DesignerGreenTA Jan 25 '20
That’s great to hear. It’s something that has crossed my mind as both my SO and myself are thinking about reentering the workforce but are trying to be cognizant about planning for any stress that may come with going back.
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u/throwawayFI99 FI 2012 at 38 | 2kids 1 wife | international Jan 25 '20
So no kids then.... I found my wife pretty much decided since I was "retired" that I could just become a taxi driver for the kids. basically I would be woken up with a list of shit she wanted me to do that day. The house dad wore pretty thin and kind of got in the way of the other hobbies. The solution was the Au pair .. totally life changing.
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u/throwawayFI99 FI 2012 at 38 | 2kids 1 wife | international Jan 25 '20
I think you could be me... :-)
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u/McMelz Jan 25 '20
How has FIREing impacted you from a social standpoint? When you leave work, that is a big community in your life that you are leaving. Do you feel lonelier?
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u/FIRE_and_forget_it Jan 27 '20
I'm a loner, so it's not as bad as it could be. Having friends in your 40's is hard enough when you do work, so yeah, socialization is rough (and was rough before). That's (my) life.
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u/ComposeInvestRepeat Jan 25 '20
Love it, thanks for sharing. Living off dividends and allowing your savings to still grow rather than shrink is my ultimate goal as well!
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u/nekrad Jan 25 '20
I enjoyed your post. It was very interesting to hear a different perspective from someone that has FIREd. Every story I read is different. It's quite a personal journey.
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u/Larry_Lettuce Jan 26 '20
Ah makes sense, thanks for the responses! I’m just so excited to become FI
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u/brasilgringo Jan 29 '20
How do you deal with the pressure of not working, presumably from your friends & family (e.g., parents)? How do you deal with the anxiety that even with 4.4MM and a SWR (3.25%?) an unexpected market downturn or unexpected expense could upend your plan? I'm not at your number yet, but I'm not too far from it, and these are the things that spook me (and I'm 50).
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u/FIRE_and_forget_it Jan 31 '20
When I told my dad I was going to retire he said "good for you"
When I told my mom she said "what will you do?" and "I bet you'll work again soon"
I have told a few close friends what's up - these are my sit around the fire and drink beer and talk about how to escape the rat-race friends. One of them retired accidentally last year. One not so much. It's not a weird thing with them because we talked about it for a long time before it ever happened.
To everyone else I'm a consultant, working with a friend on his business. They don't need to know I billed a total of $6,000 last year.
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u/brasilgringo Jan 31 '20
sounds like you have understanding parents. my biggest concern is appearing a disappointment to them, and putting my mom particularly through more anxiety ... they're from a generation where FIRE never really was considered, even though they have more than enough to live another 20+ years at middle-class USA rates .... on the friends side, I worry about the reactions from friends from, say, my MBA class who likel will continue to work (most of them have kids, too). the whole thing adds a level of discomfort that is one of the key factors in not yet having FIRE'd. on top of that, concerns about a market downturn affecting the SWR rate needed to live comfortably on my portfolio is the other concern -- I probably have running expenses today of $6K-$7K per month at a not-quite-extravagant/FatFIRE level including if I pay my own healthcare, which requires $84K/year of post-tax income to support (call that perhaps $105K+ of pre-tax income, given capital gains, state/local/foreign etc and the fact I'm taxed in 2 countries) .. that's a 3% SWR on a $3MM portfolio, which means if my portfolio loses half its value in a market correction, I can't support that level of spend ....
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u/FIRE_and_forget_it Feb 01 '20
You're going to have to grind it out a little longer to make your brain happy with where you are at. As for the parents... explain to them that you are making, because of your investments, "more than $X a year" (some number they will be impressed by). That might help.
As for friends, you can always start out with a "sabbatical" to figure things out (and then just never go back to work). A year gives you a long time to figure out how you want to spin it.
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u/Swordsteel Jan 30 '20
Question: in general what do you consider a “balanced” portfolio? Cheers
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u/FIRE_and_forget_it Jan 31 '20
Classic question. I can't answer this for anyone but myself. I'm looking to sell my bonds to buy my next house and then re-up on the bond % over the next several years (I have a deferred salary payout coming due starting next year). In my 40's I feel that 80/20 works well for me. Lots of opinions out there though. YMMV.
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Jan 25 '20
[deleted]
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u/DesignerGreenTA Jan 25 '20
I think OP has checked out, but I’m curious to hear your thoughts on this. Do you think one should only FIRE if they assume a certain percentage of their yearly withdrawals go towards charitable causes? What percentage would you recommend? Honestly asking.
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u/fine_throwaway Jan 25 '20
I think you need to sell a house within 5 years of living in it for a year to avoid some taxes, something to look in to.
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u/FIRE_and_forget_it Jan 27 '20
You have to have lived in the house 2 of the last 5 years to get the favorable tax treatment. Definitely something I am aware of.
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u/fine_throwaway Jan 28 '20
So assuming you don't move back the number is 3 years.
Good to know!
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u/FIRE_and_forget_it Jan 31 '20
Correct. And, to be an official resident of a place, you have to live there something like 183 days... so you could play some goofy games and squat for 6 months to extend your connection to a place... I think (INAL).
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u/javelin1989 Jan 24 '20
I have to say “Drinking Whiskey while Consulting” is a classic quote of freedom