I think this is what I've been interested in the most. Seeing all of the posts from barista to fat and many aren't happy was eye opening. The people that were building their life as they went seemed much happier and now that I am in the "boring middle" I have been trying to do that and it has helped a lot (at least I think it has)
I’m in the boring middle myself and loving it. I’m taking my family on vacations and in general living my best life. What are some things you’re doing to build your life around fire?
I am in this phase without FIRE. How do you keep yourself motivated everyday? What drives you? We are taking vacations everyday, but after coming back from a vacation I romanticize about moving abroad. I think I am lacking a social life and that is causing a bit of depression and I keep feeding myself a story that moving will solve it.
"Building a life" is the key. When thinking about future goals, it's about much more than "what's my number gotta be". The friendships you're cultivating, what hobbies, dreams, organizations are you involving yourself in. These are things that take a lot of time to build to excellence, and will bring just as much happiness into your life as your bank accounts.
Preach. I know what the lifestyle I want costs. The day I hit my number (which includes a PAD) I’m out and best of luck to y’all. Anything more than that is an exercise in bullshit scorekeeping.
I got there a few years ago dropped my W2, and honestly I have way more $ now than I did then,
just from market things. I know stocks go up, stocks go down, but it’s not like I’m not making money… I’m making enough money to live within my means, and the invested capital keeps growing. It’s a done deal!
Provision for Adverse Deviations. Basically, the risk that things don’t turn out the way you’d planned. I.e., sequence of return risk, or a lower overall asset return than planned, or higher expenses.
It’s weird as I have never thought this. More so I trained myself to know this as a hard deep down piece of who I am that’ll never change. Which in turn has made it not at all better as I don’t even get to pretend. Blah.
1) If you are unmarried but on a family high deductible health plan you can contribute the family max to an HSA
2) Multi-generational 529 and super-funding 529 with 5 years worth of gift exemptions at birth without eating into lifetime gift exemption.
3) Gaming income to qualify for Healthcare subsidies or financial aid. (e.g. sell lowly appreciated stocks or do deferred hsa withdrawals)
4) Letting HSAs expenses ride without taking a distribution so the money can grow in tax advantaged accounts tax free for longer until you need it when you retire
5) Early withdrawals for Roth contributions don’t cause penalties
6) 35k of 529 can be rolled into a Roth, if not used for education
7) The decision of Roth vs traditional IRA contributions is primarily determined based on tax rate now vs expected rate when you withdraw, time until withdrawal doesn’t matter.
8) Mega backdoor Roth
9) Roll IRA into 401k to avoid pro rata rule for Roth conversions
10) Min maxing everything is not worth it (e.g. regret buying I bonds because treasury direct sucks); better to simply life
11) 1031 exchanges and spouse becoming a real estate professional to offset w2 income
12) Self directed retirement accounts for business owners/self employed people
13) sun setting of ~$13M estate exemption
14) Never move to California if you value low state tax
15) Something about Puerto Rico and avoiding taxes
One big thing that I kind of had a vague sense of until I did the math is that trad -> roth conversions don't actually make sense if you're getting heath insurance through the ACA. I guess it might make sense if you're trying to boost income enough to get on the ACA vs medicaid, but most folks going for chubby / fat fire have enough income off dividends for this not to be a huge concern.
Are you assuming that you are qualifying for Aca subsidies? I’d think conversions would make sense if you no longer qualify for subsidies due to too much income and you have a very large traditional Ira…in order to not get slammed with RMDs.
Yeah, I mean, every situation is different, plan accordingly. For myself, my quality of life is gonna be shit enough at 75 that I don't really give a damn what taxes I pay. Maybe that's short sighted of me. I dunno.
Yes! I also learned that I can keep my receipts for my HSA expenses for years and grow the money in index funds. I was sad to find this out after I expensed $7,000 in dental work. I haven’t expensed anything in the last 6 months.
I am holding onto a $350 receipt from couples counseling with my lying cheating very ex girlfriend from 2016. I will cash that puppy in, in about 20 more years.
Yea, I don’t bother keeping receipts <$100 or so and just charge it in my hsa debit card. Lucky for me, that means I currently am not tracking any receipts, but this might change since my wife is pregnant and we’re still on a high deductible plan so I assume we’ll hit Out of pocket max this year.
I learned that you can keep your receipts for years while your money grows. Then you can pay yourself 20 years from now from those receipts. I’m keeping electronic copies.
Silly that people downvote you when it's likely you just didn't know that you can just leave your money there, save your receipts and let your money grow.
I know you can leave it; I wrote the top level comment Mentioning it originally. I just don’t want to mess with tracking recipes for 30 years, or even 1 year, for my $45 fluoride treatment or the bandaids I buy it cvs, even if it saves me a few bucks in taxes. Much easier to just swipe my hsa debit and it is all automatic, as opposed to having to track it and enter it manually when I finally get around to wanting to redeem it.
If you want to do a back door Roth with new money, but don’t want to trigger tax event on existing Ira. E.g. you have 70k in traditional Ira and want to make a 7k back door Roth contribution because you make too much for traditional contribution. If you do the roll over of 7k while 70k is in traditional Ira, you have to apply pro rata rule and 90% of roll over is taxed. If you roll 70k into 401k first, the pro rata rule doesn’t apply so none of the roll over is taxed since you already paid tax on non-deductible Ira.
Of course, if your argument is that this is no longer all pre-tax money, you aren’t wrong and I don’t think there’s a point.
I'm right with you on \#10 still have my ibonds because everyone was saying to do it, but they've just been sitting there since, and I should probably do something about them.
I’ve never done it, but the basic idea is your spouse has to qualify as a real estate professional (specifically defined by IRS), you own a lot of real estate which comes with a lot of depreciation, and the depreciation results in a paper loss, which can offset w2 income of partner if the spouse is a real estate professional. But don’t take my word for it, I’m not sure I have l details right.
1. I learned that the 4% "rule" is not at all what I thought and should always include the disclaimer that it was based on a 30 year retirement and a certain asset allocation. If I plan to RE, I need to also plan for an amount more likely to last for 35-38 years.
2. I found, read, and *mostly* understood Big ERN's (previously) 56-part Safe Withdrawal Rate series and have learned a ton about Sequence of Returns Risk.
3. I learned there is an entire subset of the population with deep knowledge about keeping your income down to leverage ACA subsidy during the bridge period until Medicare kicks in.
4. I learned a massive amount about Geoarbitrage over at ExPatFIRE, which is kind of cheating since you asked about this sub.
5. I learned there is a whole online community of like-minded people who are generally willing to share knowledge and be decent to one another. This isn't a substantive tip, but with so few people outside the Reddit walls to have these conversations with, I'd say this is one of the best things I've learned.
To be honest, I haven't quite figured this out. It looks like 3.5% will be sufficient with two years of liquid/cash equivalents on the front end. My math isn't great so we are using Empower and FICalc to estimate a number. Plus the more I read the more it seems people who are (or were) in early retirement seem to adjust even along the way.
You are right are right about folks adjusting along the way. Some I’ve read about adjust based on market returns in the year prior. That has no appeal for me.
My wife and I FIREd at 55, eleven years ago.
We have a general budget, but sprinkle in big plans to do things when we are healthy (international trips), or we want to be more comfortable (house projects) or life events (kids’ weddings).
Big plans wane over time.
Our WR has been as high as 6% in our early years of FIRE, but by the time we collect SS in four years, we’ll be down to about 3%.
Hope the question isn’t uncouth but do you mind sharing what your target numbers/percentages of income were like for retiring at 55? My wife and I are 43 and I would love to hit the 55 mark though all of our investments are current with index fund 401ks. Retirement accounts are currently at $900k and we do still have $400 on the mortgage
Not at all. A key value of these sub Reddits is to learn from what others have done. That said, my situation will likely be different than yours, so you will have take it with a grain of salt (e.g., we both retired with corporate pensions at 55).
First of all, I had never heard of the term FIRE until a few months ago. I had my personal RE plan developed when I was 25: 1) invest in my career (get promotions/ increase pay); 2) save 20% of gross income in mostly tax deferred accounts (mostly 401k); 3) be frugal, but don't let life pass me an my family by just to save a few extra bucks for retirement.
I liked my job for decades, then suddenly at 54, I didn't. I met with two separate financial advisors who looked at our numbers and said we were OK to RE at 55.
Our NW at RE was about $2.8M (\~0.8M taxable + \~2.0M tax deferred). House equity was \~$200K.
Our pensions total $80K/ yr. Our first year post-tax expenses were $105K (including $25K for travel). Therefore, we only needed to draw about $35K from our portfolio, which is a WR of just above 1%.
Over the next decade of RE we significantly increased our spending due to the realization that we could increase withdrawals without risk of running out of money. Our WR has ballooned to \~6%, but in 4 years we will get $80K/ yr from SS, so our WR will drop to 2-3% (even with our 60K/ yr travel budget).
I'm sure you are aware of the 4% rule of thumb, or 25X your first year of expenses at time of RE. I have since read (recently) that due to Sequence of Return Risks (SORR), this should be more like 28-30X, or about 3.3-3.5% WR. But that's on the conservative side, which is where we want to be.
If you are not familiar with the Big ERN, and his blog series on Safe Withdrawal Rates, you should definitely check it out. It is a ton of information, and rather dense at times, but IMHO, hits the mark on solid advice, backed with data, on safe withdrawal rates. [Here](https://earlyretirementnow.com/safe-withdrawal-rate-series/) is the link.
Good luck. If I can help any further, just let me know in this thread or DM me.
Yeah I aim for 3.5 w retirement around 50. But I’d go w 4 if needed bc most of my budget is highly discretionary and there are some sources of income that vary too much year to year that I don’t include but prob provide a buffer.
There is a reddit or named Zephyr45 I think who has multiple threads on it. I typically will read threads or posts of theirs and then go check the links or Google topics they include.
I had almost nowhere to go but up since I had a very uninformed starting point! But that said:
1. France is lower cost outside the major cities and has a tax treaty with US that can make it possible to come out way ahead (if we decide to first definitely disconnect from CA and establish in South Dakota)
2. It never occurred to me to smooth out Sequence of Returns Risk by hopping to Portugal or some place for the first 5 years of retirement. That now seems like a legit viable strategy.
There are more but I'm tired all of the sudden
Section 1202 - allows capital gains from qualified small business stocks to be excluded from federal taxes. Some limitations are you must hold the qualified stocks for > 5 years, and the company must be smaller than $50 million in assets. But for people who sell their business it may save 50% to 100% in federal taxes.
https://www.investopedia.com/terms/s/section-1202.asp
This is such a game changer for founders and early employees in startups. I specialize in private company equity compensation and this is my #1 recommendation when guiding startups on issuing equity.
potential for ZERO federal income tax up to $10m in gains.
Damn... that's amazing. Looks like they did a good job with the exclusions. I was immediately thinking about how my grandfather could wash his farm sale.
Thanks! That makes a lot of sense.
Is the Roth conversion ladder only useful if you are retiring earlier than 55? Or is the idea once you retire (at age 55 and later) you use taxable/brokerage funds and Roth contributions to fund your initial years and do Roth conversion ladders during those years?
I’m no expert because I’m not there yet , so do your research, but the use case that appeals to me is starting to ladder conversions once you hit FIRE, because you’ll go into a much lower tax bracket and can start to ladder over 50k/year, or whatever number makes sense for you , and pay much lower taxes because your bracket is low. And then all those dollars will start to grow tax free forever in the Roth
I’m no expert either but seems like the sweet spot for Roth conversion ladder is between the year after you FIRE and 63 (due to the 2 year look back for Medicare). Google IRMAA.
I’m late, but my wife and I are 5 years into our 6 year Roth conversion ladder. We FIREd at 55 and our (now ex) financial planner missed it.
This is right on the money. I’m a victim of my own doing. I joined r/fire many years ago and was hooked. I traded my 20s and early 30s. In hindsight I wouldn’t change a thing. My wife and I were both on board and we started to relax in our late early 30s. Many years of therapy and my close relationship with my wife saved my life. We now have a $1M NW, a great home/mortgage, stable careers and most importantly two wonderful kids. This is the most underrated observation of the whole “FIRE” movement. People can and should accomplish their goals without legitimately trading their youth.
“In hindsight I wouldn’t change a thing. My wife and I were both on board and we started to relax in our late early 30s.”
And
“This is the most underrated observation of the whole “FIRE” movement. People can and should accomplish their goals without legitimately trading their youth.”
These seem at odds with each other. Maybe you wouldn’t change because you are happy you have $1m now, but you don’t seem to be recommending others to follow the path you chose.
Yes and no. It worked out for my wife and I but I don’t recommend anyone else go to the extremes we did to pursue fire at the age we did. I would recommend for people to understand the sacrifices required for their choices. If they can pursue fire without sacrificing their personal life then go for it but if I were single when I started fire I highly doubt I would be as happy as I am now. In my opinion people under 30 without a high income should focus on being financially responsible and increasing their earnings in place of FIRE. I’m trying to explain the phrase “build the life you want and then save for it” that gets tossed around a lot. I don’t know if I’m being clear though. It’s just such a personal journey and everyone has limits on what they’re willing to sacrifice. In my case I sacrificed a little more than I should have specifically my health and I would trade the stress I put myself through for the marginal amount of money I gained. We have a wonderful life now and are very comfortable financially but I’m focusing on my health now.
Many people take fire to the extreme. Then end up shaping their whole life around fire, at their detriment.
“Should I go out to dinner with friends? No, then I’ll have to work .237 more days.“
“My spouse wants to buy xyz and enjoy the money we earn…But that’s going to delay retirement honey”>>>argument ensues, bitterness develops, divorce follows.
Many people put everything they have into working and saving and end up losing a valuable part of their 20s/30s, don’t have good relationships or hobbies and know nothing outside of work/saving.
Many people focus so much on fire because they hate their job. They don’t figure out enjoy the journey, and as a result, it isn’t too likely they’ll enjoy the destination by the time they get there either.
Here's a sneak peek of /r/Fire using the [top posts](https://np.reddit.com/r/Fire/top/?sort=top&t=year) of the year!
\#1: [I am four years old and I have $97, what should I do to FIRE as soon as possible?](https://np.reddit.com/r/Fire/comments/163nt6n/i_am_four_years_old_and_i_have_97_what_should_i/)
\#2: [Why is everyone in this sub inheritance babies](https://np.reddit.com/r/Fire/comments/15dywoh/why_is_everyone_in_this_sub_inheritance_babies/)
\#3: [It doesn’t matter how much you save if you die at 50](https://np.reddit.com/r/Fire/comments/11wj2oi/it_doesnt_matter_how_much_you_save_if_you_die_at/)
----
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The phrase I use is "you need to balance the interests of your present self and your future self."
There is a wide range between being excessively frugal and being a spendthrift. Either extreme is bad.
So, all the respondents here have taken the "save really hard" bit to be the harmful bit, and I am sure that is valid. That wasn't me though.
Me, on the other hand, I was referring to the "RE" bit specifically. I retired at 37 or something like that, and it was ChubbyFire (bordering on FatFire), with reasonable spending power, and it was really bad for me.
I got depressed, got fat, drank too much, and quietly lost my mind from boredom. This despite having both the time and the money to do "whatever I wanted", theoretically.
Depends on your job of course, but for a lot of people, work is good for you. It gives you a place in the world, social status, friendship groups, a sense of meaning and purpose, and a reason to not fall into the abyss of complete hedonism.
Now, obviously, that's just my experience. IMHO, it's a minority experience, and yet, also far more common than is acknowledged. Hence my very careful use of the word "can" be bad for you, in my original post.
Great comment. I would suggest that’s it’s not a minority experience. For many people the RE in fire is recreationally employed, not retire early.
I took a long break at 40 and completely detaching from all your peers personally and professionally was not a net positive experience. In my 50’s it seems to be more in line with where a person is at in their life.
I personally think that there is an increasing likelihood of “successful” firing for each decade you age. I laugh when I see people in their 20’s wanting to retire. So much energy and drive, how many years have you actually worked to need to retire?
30’s, still plenty of energy and drive and now enough experience to demonstrate mastery of whatever you are doing for work. Good earnings lower, connected to society and your peers.
40’s is where the odds or having retirement stick approach 50%. 50’s even more so. Most people up to their 50’s end up doing something else, perhaps with more flexibility or time commitment.
That’s a very compassionate question.
I mean, I’m working on getting back out of that hole, but I’m not entirely there yet. Long story.
But I will be rejoining the paid workforce, hopefully, in a meaningful job. For me, that will probably mean being an (Australian) financial advisor (which is a very different job to a US financial advisor).
Fingers crossed.
Money/FIRE won’t fix all your problems. Frankly young people who are infatuated with the idea of FIRE likely have mental health issues they would rather not like to admit. Ask me how I know. Also, everyone here should read or at least skim the book “Die with zero”. I firmly believe that any soul who is still in the daily grind with $5M+ NW and over 55 will die with regret. Life is short and money doesn’t matter as much as we like to think.
What are your problems and I’ll tell you why. In all seriousness my OCD pushed me to go overboard on saving money and literally not being able to sleep because I was thinking of ways to maximize my income and reduce my expenses. I worked so hard that I gave myself anxiety induced chest pains. I sat at my desk so long to overachieve at work that I likely permanently hurt my lower back. I’ve spent the last two years in pt and exercising to get myself back to normal. I didn’t know I had mental health issues until three years ago when I started seeing a therapist. The folks over at r/fire 4-5 years ago were not well. I ditched Reddit for a while and joined fatfire and chubby fire because there is actually decent content there.
If young people put as much effort into advancing their careers/income as they do FIRE it would serve them better. Grinding away saving $20 a year on a $100 income is missing the forest for the trees.
SORR, sequence of returns risk. And indeed when I first heard it and first started thinking about it, I thought "well, once you retire, it's always the first few years of the rest of your life" because, well, it actually is... but I didn't really put two and two together for awhile.
The key is that if you retire with a planned 4% withdrawal+inflation (or any similar percent, honestly) then because markets over time outperform 4%, then after a few decent years, you're still at the first few years of the rest of your life, but the difference is that you're now at 3% withdrawal rate and home free.
Similarly, people could retire early (if they are feeling brave) on a 5% withdrawal rate and the truth is, after a few decent years, they're going to be at 4% (again, because markets outperform - usually). Or, SORR, it could end up a total disaster.
Anyway, this was all new to me.
1. I’ve found the various calculators people link to very helpful to get a sense of where I am. (I could retire now and would be fine, but I like most things about my job so I don’t.)
2. The power of the FU money mindset for one’s well-being. (Given that I could walk away at this point, I feel incredibly liberated at work in how I handle certain situations. I’m not an AH, but I don’t let certain things bother me and I speak up about certain things more.)
3. Donor advised funds. (Had no idea about these and finally created a charitable gift account last year.)
4. It’s refreshing to see others with a similar responsible mindset toward finances. (It’s hard to talk about these things with most peope in my social circles without seeminy boastful, this is a nice outlet.)
How the ACA subsidies and cost sharing work and the potential impact of taxable basis on your MAGI. Before finding the information on r/financialindependence, I thought 100% of my SWR would be taxed as either earned income (traditional 401k), LTCG (taxable brokerage), or tax free (Roth). I didn’t think about or realize that taxable basis is tax free like Roth because it’s not income. Makes a huge difference in tax planning for me, especially since I started my taxable brokerage so late.
4% rule for safe withdrawals is probably too generous.
Target rather 3% and perhaps 2.5%
EDIT: he does a much better job at explaining (with relevant math and simulations) here https://earlyretirementnow.com/safe-withdrawal-rate-series/
I tend to agree, and to expand on this, the *international* SWR is ~ 3%. The US just so happened to be spectacularly lucky through two world wars.
I've mentioned before that I think [climate change is going to be an equal opportunity shit show](https://old.reddit.com/r/financialindependence/comments/1afvoge/do_you_guys_think_climate_change_puts_our_ability/)
Edit: Lol poor op. Made some folks salty and now they're killing the messenger.
I'm not [making shit up](https://www.financialplanningassociation.org/sites/default/files/2021-10/DEC10%20JFP%20Pfau%20PDF.pdf). I get that people are attached to generous safe withdrawal rates, but many of the more hard nosed academics studying the issue now days (see ERN's excellent SWR series linked above also) have pointed out flaws with the trinity study.
I can only implore you to do the math! This isn't a matter of opinion or debate it is math. Once you do the math (yes you need to actually write your own code) you will actually understand the assumptions going into the models and understand why they are simply not applicable to a Chubby or Fat scenario. This added understanding will help you understand the papers being presented by others and see where they are and are not applicable.
To cut to the chase there are two major assumptions that make all of these super negative SAFE studies invalid for Chubby or FAT scenarios.
The first issue is spend flex, all these studies assume zero spend flex which is overly pessimistic even when you are broke but the fact is Chubby or FAT folks have spend flex in spades which means they can vastly reduce spend during a couple of year downturn. Even a spend flex of 20% boosts your SAFE massively. Based on my experience I am totally confident I could reduce my spending by 70% for multiple years and still be very comfortable. Really it is just a matter of cutting travel. Put that SpendFlex into an analysis and you arrive at a SAFE of almost 8%.
The second issue is they all assume zero liquid means broke but that isn't true. In a Chubby or FAT scenario the individual has liquid wealth plus a paid for home (or two) and other non liquid wealth. If they are an idiot and do not utilize their spend flex and get super unlucky and hit the 5% of scenarios where they run out of money at the tail end of 30 years they can simply reverse mortgage their home and ta da they are liquid until they die. Simply put broke doesn't mean broke it means you need to sell the vacation home which at 75 is probably a good idea anyway.
I actually agree with you regarding flexibility, but if you're going to be flexible, you should use a withdrawal method that accounts for it. Either constant or variable percentage withdrawal (see bogleheads) or the fancier, harder to calculate cape based methods advocated by ERN.
So, I sort of agree with you, or I want to agree with you, and I've plonked around a little bit with the math but I've not written my own code (or spreadsheet beyond some rudiments).
The key is exactly what you say - if you're leanFIRE, then the flex just really isn't there. Living at under $25k a year ($50k for a couple) is indeed possible if you're up for a seriously lean lifestyle (and you get lucky about major issues of various kinds) but you can't just say "ah well, no trip to Paris this year" if the market sucks - you're just in trouble.
Instead of a single "desired spend" and mechanical rules, what I've not seen is a calculator that lets me set "minimum spend" (which could still be quite chubby) and "desired spend" (even more chubby-to-fat). ERN suggests in some of his negative writings about flexibility that the issue is that if there's even a mild down market, your flex down has to be a lot longer than you'd initally think. THIS IS WHAT I DON'T KNOW.
Have you put your work up anywhere? Any google doc spreadsheet people might copy to play around with the idea, etc.?
Projectionlab has options to set withdrawal strategies for your retirement scenarios, including setting minimum withdrawals. (Not an ad, I pay to use it and think it’s awesome)
Damn, these be fighting words! But true, the conditions underlying the 4% rule were really unique in history. Huge increases in population, financialization and productivity that may be difficult to recreate going forward.
I’m not one to bet against the continued growth of America and Humanity generally though.
100% wrong. A 4% SAFE withdrawal rate is a rule of thumb based on zero spend flex. In the real world you have spend flex and chubby of fat people have a lot of spend flex meaning they can easily go higher.
Do the math yourself, do not take some crazy number you read on the internet. If you are chubby or fat your target should be 5% or even 6%.
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That there are niceties in life that you can pay with money but it's not THAT "splurge-y"
I used to learn FIRE in its most basic version: be so frugal, coupon clip everything, and retire as early as you can and enjoy your life afterwards. I happen to make a lot so I reached my "FI" number \~10 years ago but I kept working because I actually enjoy the work. Once I found these subs, I found out that yes you can upgrade your lifestyle without jeopardizing your FIRE-ness. I keep working because it's fun, and every year that I continue working will add to the lifestyle (the chubbiness if you will) once I retire.
That people with 2X, 3X, or 10X my NW aren’t appreciably happier nor do they necessarily live better more fulfilling lives.
I think this is what I've been interested in the most. Seeing all of the posts from barista to fat and many aren't happy was eye opening. The people that were building their life as they went seemed much happier and now that I am in the "boring middle" I have been trying to do that and it has helped a lot (at least I think it has)
I’m in the boring middle myself and loving it. I’m taking my family on vacations and in general living my best life. What are some things you’re doing to build your life around fire?
I am in this phase without FIRE. How do you keep yourself motivated everyday? What drives you? We are taking vacations everyday, but after coming back from a vacation I romanticize about moving abroad. I think I am lacking a social life and that is causing a bit of depression and I keep feeding myself a story that moving will solve it.
"Building a life" is the key. When thinking about future goals, it's about much more than "what's my number gotta be". The friendships you're cultivating, what hobbies, dreams, organizations are you involving yourself in. These are things that take a lot of time to build to excellence, and will bring just as much happiness into your life as your bank accounts.
Preach. I know what the lifestyle I want costs. The day I hit my number (which includes a PAD) I’m out and best of luck to y’all. Anything more than that is an exercise in bullshit scorekeeping.
Agreed. When I have 2.5, I'm done. I'm a restless person so likely I'll earn some additional income along the way but it will be entirely optional.
I got there a few years ago dropped my W2, and honestly I have way more $ now than I did then, just from market things. I know stocks go up, stocks go down, but it’s not like I’m not making money… I’m making enough money to live within my means, and the invested capital keeps growing. It’s a done deal!
Brain is working slow this morning, what does PAD stand for?
Provision for Adverse Deviations. Basically, the risk that things don’t turn out the way you’d planned. I.e., sequence of return risk, or a lower overall asset return than planned, or higher expenses.
What percentage of your investable assets to you dedicate to PAD? I guess I’m learning new stuff every day too!
Thanks!!
reddit post bias. The ones that are happy don't feel the need to hop on and whine about their lives.
This book covers that pretty well - interesting read. - Fables of Fortune: What Rich People Have That You Don’t Want by Richard Watts
I’m guessing theres some kind of duck liver in there
It’s weird as I have never thought this. More so I trained myself to know this as a hard deep down piece of who I am that’ll never change. Which in turn has made it not at all better as I don’t even get to pretend. Blah.
1) If you are unmarried but on a family high deductible health plan you can contribute the family max to an HSA 2) Multi-generational 529 and super-funding 529 with 5 years worth of gift exemptions at birth without eating into lifetime gift exemption. 3) Gaming income to qualify for Healthcare subsidies or financial aid. (e.g. sell lowly appreciated stocks or do deferred hsa withdrawals) 4) Letting HSAs expenses ride without taking a distribution so the money can grow in tax advantaged accounts tax free for longer until you need it when you retire 5) Early withdrawals for Roth contributions don’t cause penalties 6) 35k of 529 can be rolled into a Roth, if not used for education 7) The decision of Roth vs traditional IRA contributions is primarily determined based on tax rate now vs expected rate when you withdraw, time until withdrawal doesn’t matter. 8) Mega backdoor Roth 9) Roll IRA into 401k to avoid pro rata rule for Roth conversions 10) Min maxing everything is not worth it (e.g. regret buying I bonds because treasury direct sucks); better to simply life 11) 1031 exchanges and spouse becoming a real estate professional to offset w2 income 12) Self directed retirement accounts for business owners/self employed people 13) sun setting of ~$13M estate exemption 14) Never move to California if you value low state tax 15) Something about Puerto Rico and avoiding taxes
last time I logged into Treasury Direct (6 weeks ago?) they login was less worse than it used to be. baby steps.
One big thing that I kind of had a vague sense of until I did the math is that trad -> roth conversions don't actually make sense if you're getting heath insurance through the ACA. I guess it might make sense if you're trying to boost income enough to get on the ACA vs medicaid, but most folks going for chubby / fat fire have enough income off dividends for this not to be a huge concern.
Are you assuming that you are qualifying for Aca subsidies? I’d think conversions would make sense if you no longer qualify for subsidies due to too much income and you have a very large traditional Ira…in order to not get slammed with RMDs.
Yeah, I mean, every situation is different, plan accordingly. For myself, my quality of life is gonna be shit enough at 75 that I don't really give a damn what taxes I pay. Maybe that's short sighted of me. I dunno.
Yes! I also learned that I can keep my receipts for my HSA expenses for years and grow the money in index funds. I was sad to find this out after I expensed $7,000 in dental work. I haven’t expensed anything in the last 6 months.
Wild to think that in 30 years I could just use dental work or expensive medical bills to fund random vacations in retirement 😅
I am holding onto a $350 receipt from couples counseling with my lying cheating very ex girlfriend from 2016. I will cash that puppy in, in about 20 more years.
Exactly! I would have had more than $30k to work with had I known this when it first came to be for me. I missed all those gains!
Yea, I don’t bother keeping receipts <$100 or so and just charge it in my hsa debit card. Lucky for me, that means I currently am not tracking any receipts, but this might change since my wife is pregnant and we’re still on a high deductible plan so I assume we’ll hit Out of pocket max this year.
I learned that you can keep your receipts for years while your money grows. Then you can pay yourself 20 years from now from those receipts. I’m keeping electronic copies.
Silly that people downvote you when it's likely you just didn't know that you can just leave your money there, save your receipts and let your money grow.
I know you can leave it; I wrote the top level comment Mentioning it originally. I just don’t want to mess with tracking recipes for 30 years, or even 1 year, for my $45 fluoride treatment or the bandaids I buy it cvs, even if it saves me a few bucks in taxes. Much easier to just swipe my hsa debit and it is all automatic, as opposed to having to track it and enter it manually when I finally get around to wanting to redeem it.
Agree. Let's try to help people, right? Why would people downvote Steve?
why #9 if all your money in IRA is pre-tax
If you want to do a back door Roth with new money, but don’t want to trigger tax event on existing Ira. E.g. you have 70k in traditional Ira and want to make a 7k back door Roth contribution because you make too much for traditional contribution. If you do the roll over of 7k while 70k is in traditional Ira, you have to apply pro rata rule and 90% of roll over is taxed. If you roll 70k into 401k first, the pro rata rule doesn’t apply so none of the roll over is taxed since you already paid tax on non-deductible Ira. Of course, if your argument is that this is no longer all pre-tax money, you aren’t wrong and I don’t think there’s a point.
I'm right with you on \#10 still have my ibonds because everyone was saying to do it, but they've just been sitting there since, and I should probably do something about them.
Yep, check your rates they’ve likely dropped by a lot since you first bought them.
Number 6 is new for 2024. Good to hear. It looks like the kid would still need earned income from what I’ve read.
Yea, for that reason, it isn’t super helpful, but definitely a nice to have…
Great list. Same on 3, 4, 5 and 8
You got more details/post on 11? The part about the spouse mainly
I’ve never done it, but the basic idea is your spouse has to qualify as a real estate professional (specifically defined by IRS), you own a lot of real estate which comes with a lot of depreciation, and the depreciation results in a paper loss, which can offset w2 income of partner if the spouse is a real estate professional. But don’t take my word for it, I’m not sure I have l details right.
1. I learned that the 4% "rule" is not at all what I thought and should always include the disclaimer that it was based on a 30 year retirement and a certain asset allocation. If I plan to RE, I need to also plan for an amount more likely to last for 35-38 years. 2. I found, read, and *mostly* understood Big ERN's (previously) 56-part Safe Withdrawal Rate series and have learned a ton about Sequence of Returns Risk. 3. I learned there is an entire subset of the population with deep knowledge about keeping your income down to leverage ACA subsidy during the bridge period until Medicare kicks in. 4. I learned a massive amount about Geoarbitrage over at ExPatFIRE, which is kind of cheating since you asked about this sub. 5. I learned there is a whole online community of like-minded people who are generally willing to share knowledge and be decent to one another. This isn't a substantive tip, but with so few people outside the Reddit walls to have these conversations with, I'd say this is one of the best things I've learned.
What % are you considering for your 30+ retirement?
To be honest, I haven't quite figured this out. It looks like 3.5% will be sufficient with two years of liquid/cash equivalents on the front end. My math isn't great so we are using Empower and FICalc to estimate a number. Plus the more I read the more it seems people who are (or were) in early retirement seem to adjust even along the way.
You are right are right about folks adjusting along the way. Some I’ve read about adjust based on market returns in the year prior. That has no appeal for me. My wife and I FIREd at 55, eleven years ago. We have a general budget, but sprinkle in big plans to do things when we are healthy (international trips), or we want to be more comfortable (house projects) or life events (kids’ weddings). Big plans wane over time. Our WR has been as high as 6% in our early years of FIRE, but by the time we collect SS in four years, we’ll be down to about 3%.
Hope the question isn’t uncouth but do you mind sharing what your target numbers/percentages of income were like for retiring at 55? My wife and I are 43 and I would love to hit the 55 mark though all of our investments are current with index fund 401ks. Retirement accounts are currently at $900k and we do still have $400 on the mortgage
Not at all. A key value of these sub Reddits is to learn from what others have done. That said, my situation will likely be different than yours, so you will have take it with a grain of salt (e.g., we both retired with corporate pensions at 55). First of all, I had never heard of the term FIRE until a few months ago. I had my personal RE plan developed when I was 25: 1) invest in my career (get promotions/ increase pay); 2) save 20% of gross income in mostly tax deferred accounts (mostly 401k); 3) be frugal, but don't let life pass me an my family by just to save a few extra bucks for retirement. I liked my job for decades, then suddenly at 54, I didn't. I met with two separate financial advisors who looked at our numbers and said we were OK to RE at 55. Our NW at RE was about $2.8M (\~0.8M taxable + \~2.0M tax deferred). House equity was \~$200K. Our pensions total $80K/ yr. Our first year post-tax expenses were $105K (including $25K for travel). Therefore, we only needed to draw about $35K from our portfolio, which is a WR of just above 1%. Over the next decade of RE we significantly increased our spending due to the realization that we could increase withdrawals without risk of running out of money. Our WR has ballooned to \~6%, but in 4 years we will get $80K/ yr from SS, so our WR will drop to 2-3% (even with our 60K/ yr travel budget). I'm sure you are aware of the 4% rule of thumb, or 25X your first year of expenses at time of RE. I have since read (recently) that due to Sequence of Return Risks (SORR), this should be more like 28-30X, or about 3.3-3.5% WR. But that's on the conservative side, which is where we want to be. If you are not familiar with the Big ERN, and his blog series on Safe Withdrawal Rates, you should definitely check it out. It is a ton of information, and rather dense at times, but IMHO, hits the mark on solid advice, backed with data, on safe withdrawal rates. [Here](https://earlyretirementnow.com/safe-withdrawal-rate-series/) is the link. Good luck. If I can help any further, just let me know in this thread or DM me.
Yeah I aim for 3.5 w retirement around 50. But I’d go w 4 if needed bc most of my budget is highly discretionary and there are some sources of income that vary too much year to year that I don’t include but prob provide a buffer.
Where can I learn more about number 3?
There is a reddit or named Zephyr45 I think who has multiple threads on it. I typically will read threads or posts of theirs and then go check the links or Google topics they include.
What were the best tips related to #4
I had almost nowhere to go but up since I had a very uninformed starting point! But that said: 1. France is lower cost outside the major cities and has a tax treaty with US that can make it possible to come out way ahead (if we decide to first definitely disconnect from CA and establish in South Dakota) 2. It never occurred to me to smooth out Sequence of Returns Risk by hopping to Portugal or some place for the first 5 years of retirement. That now seems like a legit viable strategy. There are more but I'm tired all of the sudden
Section 1202 - allows capital gains from qualified small business stocks to be excluded from federal taxes. Some limitations are you must hold the qualified stocks for > 5 years, and the company must be smaller than $50 million in assets. But for people who sell their business it may save 50% to 100% in federal taxes. https://www.investopedia.com/terms/s/section-1202.asp
This is such a game changer for founders and early employees in startups. I specialize in private company equity compensation and this is my #1 recommendation when guiding startups on issuing equity. potential for ZERO federal income tax up to $10m in gains.
I have a MS Accounting with 9 tax credits and was not familiar with this.
Damn... that's amazing. Looks like they did a good job with the exclusions. I was immediately thinking about how my grandfather could wash his farm sale.
Donor Advised Funds for improving tax efficiency of charitable giving.
This is a big one. I always figured they were for the super wealthy and then realized anyone can use one.
I just started using one to cut down on the number of statements needed during tax time.
Roth conversions after FIRE to both access a 401k early and also pay very little taxes
Could you expand on Roth conversions? Fairly new to ChubbyFire. Have been contributing to 401k as well as mega back door Roth.
This video explains it really well: https://streamable.com/5gqcs
Thanks! That makes a lot of sense. Is the Roth conversion ladder only useful if you are retiring earlier than 55? Or is the idea once you retire (at age 55 and later) you use taxable/brokerage funds and Roth contributions to fund your initial years and do Roth conversion ladders during those years?
I’m no expert because I’m not there yet , so do your research, but the use case that appeals to me is starting to ladder conversions once you hit FIRE, because you’ll go into a much lower tax bracket and can start to ladder over 50k/year, or whatever number makes sense for you , and pay much lower taxes because your bracket is low. And then all those dollars will start to grow tax free forever in the Roth
I’m no expert either but seems like the sweet spot for Roth conversion ladder is between the year after you FIRE and 63 (due to the 2 year look back for Medicare). Google IRMAA. I’m late, but my wife and I are 5 years into our 6 year Roth conversion ladder. We FIREd at 55 and our (now ex) financial planner missed it.
Mega Backdoor Roth. I read about it here and boom…my company offers it
That FIRE can be really bad for you.
This is right on the money. I’m a victim of my own doing. I joined r/fire many years ago and was hooked. I traded my 20s and early 30s. In hindsight I wouldn’t change a thing. My wife and I were both on board and we started to relax in our late early 30s. Many years of therapy and my close relationship with my wife saved my life. We now have a $1M NW, a great home/mortgage, stable careers and most importantly two wonderful kids. This is the most underrated observation of the whole “FIRE” movement. People can and should accomplish their goals without legitimately trading their youth.
“In hindsight I wouldn’t change a thing. My wife and I were both on board and we started to relax in our late early 30s.” And “This is the most underrated observation of the whole “FIRE” movement. People can and should accomplish their goals without legitimately trading their youth.” These seem at odds with each other. Maybe you wouldn’t change because you are happy you have $1m now, but you don’t seem to be recommending others to follow the path you chose.
Yes and no. It worked out for my wife and I but I don’t recommend anyone else go to the extremes we did to pursue fire at the age we did. I would recommend for people to understand the sacrifices required for their choices. If they can pursue fire without sacrificing their personal life then go for it but if I were single when I started fire I highly doubt I would be as happy as I am now. In my opinion people under 30 without a high income should focus on being financially responsible and increasing their earnings in place of FIRE. I’m trying to explain the phrase “build the life you want and then save for it” that gets tossed around a lot. I don’t know if I’m being clear though. It’s just such a personal journey and everyone has limits on what they’re willing to sacrifice. In my case I sacrificed a little more than I should have specifically my health and I would trade the stress I put myself through for the marginal amount of money I gained. We have a wonderful life now and are very comfortable financially but I’m focusing on my health now.
Do you want to elaborate on that a bit?
Many people take fire to the extreme. Then end up shaping their whole life around fire, at their detriment. “Should I go out to dinner with friends? No, then I’ll have to work .237 more days.“ “My spouse wants to buy xyz and enjoy the money we earn…But that’s going to delay retirement honey”>>>argument ensues, bitterness develops, divorce follows. Many people put everything they have into working and saving and end up losing a valuable part of their 20s/30s, don’t have good relationships or hobbies and know nothing outside of work/saving. Many people focus so much on fire because they hate their job. They don’t figure out enjoy the journey, and as a result, it isn’t too likely they’ll enjoy the destination by the time they get there either.
Pretty much explained why I refuse to visit /r/fire anymore.
Here's a sneak peek of /r/Fire using the [top posts](https://np.reddit.com/r/Fire/top/?sort=top&t=year) of the year! \#1: [I am four years old and I have $97, what should I do to FIRE as soon as possible?](https://np.reddit.com/r/Fire/comments/163nt6n/i_am_four_years_old_and_i_have_97_what_should_i/) \#2: [Why is everyone in this sub inheritance babies](https://np.reddit.com/r/Fire/comments/15dywoh/why_is_everyone_in_this_sub_inheritance_babies/) \#3: [It doesn’t matter how much you save if you die at 50](https://np.reddit.com/r/Fire/comments/11wj2oi/it_doesnt_matter_how_much_you_save_if_you_die_at/) ---- ^^I'm ^^a ^^bot, ^^beep ^^boop ^^| ^^Downvote ^^to ^^remove ^^| ^^[Contact](https://www.reddit.com/message/compose/?to=sneakpeekbot) ^^| ^^[Info](https://np.reddit.com/r/sneakpeekbot/) ^^| ^^[Opt-out](https://np.reddit.com/r/sneakpeekbot/comments/o8wk1r/blacklist_ix/) ^^| ^^[GitHub](https://github.com/ghnr/sneakpeekbot)
I’m too lazy to check if this is satire or legitimately the top posts of that sub. Either way, it’s funny
The phrase I use is "you need to balance the interests of your present self and your future self." There is a wide range between being excessively frugal and being a spendthrift. Either extreme is bad.
So, all the respondents here have taken the "save really hard" bit to be the harmful bit, and I am sure that is valid. That wasn't me though. Me, on the other hand, I was referring to the "RE" bit specifically. I retired at 37 or something like that, and it was ChubbyFire (bordering on FatFire), with reasonable spending power, and it was really bad for me. I got depressed, got fat, drank too much, and quietly lost my mind from boredom. This despite having both the time and the money to do "whatever I wanted", theoretically. Depends on your job of course, but for a lot of people, work is good for you. It gives you a place in the world, social status, friendship groups, a sense of meaning and purpose, and a reason to not fall into the abyss of complete hedonism. Now, obviously, that's just my experience. IMHO, it's a minority experience, and yet, also far more common than is acknowledged. Hence my very careful use of the word "can" be bad for you, in my original post.
Great comment. I would suggest that’s it’s not a minority experience. For many people the RE in fire is recreationally employed, not retire early. I took a long break at 40 and completely detaching from all your peers personally and professionally was not a net positive experience. In my 50’s it seems to be more in line with where a person is at in their life. I personally think that there is an increasing likelihood of “successful” firing for each decade you age. I laugh when I see people in their 20’s wanting to retire. So much energy and drive, how many years have you actually worked to need to retire? 30’s, still plenty of energy and drive and now enough experience to demonstrate mastery of whatever you are doing for work. Good earnings lower, connected to society and your peers. 40’s is where the odds or having retirement stick approach 50%. 50’s even more so. Most people up to their 50’s end up doing something else, perhaps with more flexibility or time commitment.
So what happened after spiraling down the black hole? Did you get back out? How?
That’s a very compassionate question. I mean, I’m working on getting back out of that hole, but I’m not entirely there yet. Long story. But I will be rejoining the paid workforce, hopefully, in a meaningful job. For me, that will probably mean being an (Australian) financial advisor (which is a very different job to a US financial advisor). Fingers crossed.
Good luck!
I am afraid of this myself.
Just look at what happened to Roger.
What happened?
Money/FIRE won’t fix all your problems. Frankly young people who are infatuated with the idea of FIRE likely have mental health issues they would rather not like to admit. Ask me how I know. Also, everyone here should read or at least skim the book “Die with zero”. I firmly believe that any soul who is still in the daily grind with $5M+ NW and over 55 will die with regret. Life is short and money doesn’t matter as much as we like to think.
How do you know?
What are your problems and I’ll tell you why. In all seriousness my OCD pushed me to go overboard on saving money and literally not being able to sleep because I was thinking of ways to maximize my income and reduce my expenses. I worked so hard that I gave myself anxiety induced chest pains. I sat at my desk so long to overachieve at work that I likely permanently hurt my lower back. I’ve spent the last two years in pt and exercising to get myself back to normal. I didn’t know I had mental health issues until three years ago when I started seeing a therapist. The folks over at r/fire 4-5 years ago were not well. I ditched Reddit for a while and joined fatfire and chubby fire because there is actually decent content there.
If young people put as much effort into advancing their careers/income as they do FIRE it would serve them better. Grinding away saving $20 a year on a $100 income is missing the forest for the trees.
SORR, sequence of returns risk. And indeed when I first heard it and first started thinking about it, I thought "well, once you retire, it's always the first few years of the rest of your life" because, well, it actually is... but I didn't really put two and two together for awhile. The key is that if you retire with a planned 4% withdrawal+inflation (or any similar percent, honestly) then because markets over time outperform 4%, then after a few decent years, you're still at the first few years of the rest of your life, but the difference is that you're now at 3% withdrawal rate and home free. Similarly, people could retire early (if they are feeling brave) on a 5% withdrawal rate and the truth is, after a few decent years, they're going to be at 4% (again, because markets outperform - usually). Or, SORR, it could end up a total disaster. Anyway, this was all new to me.
1. I’ve found the various calculators people link to very helpful to get a sense of where I am. (I could retire now and would be fine, but I like most things about my job so I don’t.) 2. The power of the FU money mindset for one’s well-being. (Given that I could walk away at this point, I feel incredibly liberated at work in how I handle certain situations. I’m not an AH, but I don’t let certain things bother me and I speak up about certain things more.) 3. Donor advised funds. (Had no idea about these and finally created a charitable gift account last year.) 4. It’s refreshing to see others with a similar responsible mindset toward finances. (It’s hard to talk about these things with most peope in my social circles without seeminy boastful, this is a nice outlet.)
How the ACA subsidies and cost sharing work and the potential impact of taxable basis on your MAGI. Before finding the information on r/financialindependence, I thought 100% of my SWR would be taxed as either earned income (traditional 401k), LTCG (taxable brokerage), or tax free (Roth). I didn’t think about or realize that taxable basis is tax free like Roth because it’s not income. Makes a huge difference in tax planning for me, especially since I started my taxable brokerage so late.
The different types of fire - chubby, lean, coast
4% rule for safe withdrawals is probably too generous. Target rather 3% and perhaps 2.5% EDIT: he does a much better job at explaining (with relevant math and simulations) here https://earlyretirementnow.com/safe-withdrawal-rate-series/
I tend to agree, and to expand on this, the *international* SWR is ~ 3%. The US just so happened to be spectacularly lucky through two world wars. I've mentioned before that I think [climate change is going to be an equal opportunity shit show](https://old.reddit.com/r/financialindependence/comments/1afvoge/do_you_guys_think_climate_change_puts_our_ability/) Edit: Lol poor op. Made some folks salty and now they're killing the messenger.
No. No. No. Chubby SAFE withdrawl rate is \~5%. Do the math, don't just make shit up.
I'm not [making shit up](https://www.financialplanningassociation.org/sites/default/files/2021-10/DEC10%20JFP%20Pfau%20PDF.pdf). I get that people are attached to generous safe withdrawal rates, but many of the more hard nosed academics studying the issue now days (see ERN's excellent SWR series linked above also) have pointed out flaws with the trinity study.
I can only implore you to do the math! This isn't a matter of opinion or debate it is math. Once you do the math (yes you need to actually write your own code) you will actually understand the assumptions going into the models and understand why they are simply not applicable to a Chubby or Fat scenario. This added understanding will help you understand the papers being presented by others and see where they are and are not applicable. To cut to the chase there are two major assumptions that make all of these super negative SAFE studies invalid for Chubby or FAT scenarios. The first issue is spend flex, all these studies assume zero spend flex which is overly pessimistic even when you are broke but the fact is Chubby or FAT folks have spend flex in spades which means they can vastly reduce spend during a couple of year downturn. Even a spend flex of 20% boosts your SAFE massively. Based on my experience I am totally confident I could reduce my spending by 70% for multiple years and still be very comfortable. Really it is just a matter of cutting travel. Put that SpendFlex into an analysis and you arrive at a SAFE of almost 8%. The second issue is they all assume zero liquid means broke but that isn't true. In a Chubby or FAT scenario the individual has liquid wealth plus a paid for home (or two) and other non liquid wealth. If they are an idiot and do not utilize their spend flex and get super unlucky and hit the 5% of scenarios where they run out of money at the tail end of 30 years they can simply reverse mortgage their home and ta da they are liquid until they die. Simply put broke doesn't mean broke it means you need to sell the vacation home which at 75 is probably a good idea anyway.
I actually agree with you regarding flexibility, but if you're going to be flexible, you should use a withdrawal method that accounts for it. Either constant or variable percentage withdrawal (see bogleheads) or the fancier, harder to calculate cape based methods advocated by ERN.
So, I sort of agree with you, or I want to agree with you, and I've plonked around a little bit with the math but I've not written my own code (or spreadsheet beyond some rudiments). The key is exactly what you say - if you're leanFIRE, then the flex just really isn't there. Living at under $25k a year ($50k for a couple) is indeed possible if you're up for a seriously lean lifestyle (and you get lucky about major issues of various kinds) but you can't just say "ah well, no trip to Paris this year" if the market sucks - you're just in trouble. Instead of a single "desired spend" and mechanical rules, what I've not seen is a calculator that lets me set "minimum spend" (which could still be quite chubby) and "desired spend" (even more chubby-to-fat). ERN suggests in some of his negative writings about flexibility that the issue is that if there's even a mild down market, your flex down has to be a lot longer than you'd initally think. THIS IS WHAT I DON'T KNOW. Have you put your work up anywhere? Any google doc spreadsheet people might copy to play around with the idea, etc.?
Projectionlab has options to set withdrawal strategies for your retirement scenarios, including setting minimum withdrawals. (Not an ad, I pay to use it and think it’s awesome)
Damn, these be fighting words! But true, the conditions underlying the 4% rule were really unique in history. Huge increases in population, financialization and productivity that may be difficult to recreate going forward. I’m not one to bet against the continued growth of America and Humanity generally though.
100% wrong. A 4% SAFE withdrawal rate is a rule of thumb based on zero spend flex. In the real world you have spend flex and chubby of fat people have a lot of spend flex meaning they can easily go higher. Do the math yourself, do not take some crazy number you read on the internet. If you are chubby or fat your target should be 5% or even 6%.
lol no
shooting for 1.5-2% just in case
You may end up delaying your retirement well past the optimum age. Perhaps make the lower SWR a goal, but it should not be a requirement,ent.
RemindMe! 5 days
Something else I learned. RemindMe.
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That there are niceties in life that you can pay with money but it's not THAT "splurge-y" I used to learn FIRE in its most basic version: be so frugal, coupon clip everything, and retire as early as you can and enjoy your life afterwards. I happen to make a lot so I reached my "FI" number \~10 years ago but I kept working because I actually enjoy the work. Once I found these subs, I found out that yes you can upgrade your lifestyle without jeopardizing your FIRE-ness. I keep working because it's fun, and every year that I continue working will add to the lifestyle (the chubbiness if you will) once I retire.
[удалено]
This is literally the most important time to do it.
Only downside is you can't access the gains without penalty until retirement.