Journal of MDFIRE2024

[5to9]

Great Journal so far! I love all the different ways of calculating and visualizing progress you've got in here. Definitely going to think about taking some of them up.

[Forskaren]

Germany seem to be in fourth place when it comes to local purchasing power. Very good place to live in.

https://www.numbeo.com/cost-of-living/r ... ountry.asp

Of course the average does not tell the whole story. If you not buying and earning like the average person, the story can be different. But, generally I think it is easier to make smart choices and avoid poor ones if you are very familiar with the country. In a new country you will probably be at a disadvantage when it comes to finding good choices.

[wolf]

@Forskaren
Yes, I think so too, that it would be difficult for me to make good choices in another country, if I am not familiar with it. Although I have traveled much in the last decade, I don't think I am prepared to live in another country without good preparation. Recently I have thought about living as an expat or moving to another country in order to live and work there. To be honest, I like it (currently) very much in Germany and where I live and where I work. That makes it hard to decide against it. Maybe it is some kind of home-bias, because I mainly trust these indeces (Quality of Life, Expat Insider, Better Life, ...) Well, long story short: I am familiar with my country in many aspects therefore I make good decisions. Have you ever lived or worked outside of Sweden? Is working abroad almost the same as working in your homecountry, I wonder? Of course living abroad, would be totally different. I have seen as a statistic that Sweden has also a very high rate of single-households, as does Germany. I think you and me "sit in the same boot".

[Bankai]

ERE person will surely find out the cheapest/optimal groceries, rental and transportation fairly easy. Things get a bit more difficult when dealing with healthcare, schools, and bureaucracy. Here, the knowledge of local language is crucial. In the beginning, it might be a bit difficult and one might want to use the help of a local, or just use the internet a lot. But chances are, by the time you actually need to deal with something difficult, your language will be good enough for the task. I'm only speaking from experience of moving to the UK, which is certainly a hassle-free country to live in. The farther away one moves from one own's culture, the more difficult this might potentially be. However, open-mindedness is a great ally. Also, when you moved and lived in another country once, it's likely to be much easier to do it again.

[wolf]

Together with ideas and inspirations and equations from fish and jacob (THANK YOU both!), I have created several indizes for comparing countries regarding how easy/difficult it is to achieve a high Saving Rate for the average person/household. Just wanted to post it also in my journal because I have invested quite some time during the last few days. It was challenging, insightful and fun! If you have further ideas about that topic, feel free to share your ideas and post it over there: Influencing factors of the best country to accumulate FI money and RE?

[wolf]

Today I have been released from the hospital after three days and two nights. I was in there in order to start a basic immunization against my allergy. In total I got nine injections. Everything was ok in the end, but I was horrified from the usual days in the hospital. I couldn't go outside. I had to stay inside. I didn't bring my laptop. I only read an ebook, listened to an audiobook and wrote things into my daily journal.
There was a thread when jacob said, that one of the worst things is when you are dependend on medicine because of health. As I have experienced the hospital and my dependence during the last three days, I understand it now even better.
Being and staying healthy is one of my top priorities. The treatment in the the hospital confirmed that very much. Luckily I am not dependent on medicine or the hospital right now. And I do everything that I am not going to be in the next few years/decades. So, if there is a lessons learned here. Do everything in order to avoid the dependence to medicine or hospitals. It would have a negative effect on the life quality. Well, my treatment against that allergy has only begun. I have to get an injection every four weeks now for the next three years. I do that, because there is the chance that my allergy will improve and weaken. I trade short-term pain (next three years) for long-term health (weaker allergy in the next ten years).
My routine helped my to stay sane in the hospital, e.g. reading, writing, looking into nature, listening to music, walking around, meditating, etc... If you ever have to stay in a hospital for a few days, make sure to bring something with you in order to avoid boredom. Next time I am going to bring my laptop with me.

[Viktor K]

Glad you're out and about. After spending the last (nearly) 4 weeks sick with a sinus infection (could have been cured sooner by going to the doctor earlier), I feel you on staying able and out of bed rest.

[fingeek]

• Savings Rate = 87% (12 months rolling average)

• Withdrawal Rate = 8,1% (12 months rolling average + Margin of Safety)

• yearly expenses = 5815€ (12 months rolling average)

• FI = 42% (accumulated FI-money compared to FI-goal of 350k€)

• invested = 55% (invested FI-money in stock market, rest of it in cash)

• passive income = 12% (compared to yearly expenses)

• time to FI(RE) = 86 months (counting down months till end of year 2024)

That's really great - Quite a big jump in FI= from a month or two ago, well done! Let me ask you a question: Are you limiting yourself by MDFIRE2024 (or MDFFIRE2024)? If you increased FI= by ~10% in a few months, I suspect you might hit FI earlier than you expect. Have you re-calculated since?

For me, my time-to-FI(RE) keeps changing by around +/-3 months, which is to be expected. Over the years, I've learnt to obsess about the data/process, and then relax about the outcome a bit, knowing that the process covers enough for contingency.

---

Also I forgot to ask before, looking back at your 3-week mini-retirement, how did that go? I would love to do that, but I don't think my current employer will allow it, so currently I plan to leave eventually and then maybe get a new/different/interesting/part-time job after a month or two (or more).

[wolf]

@fingeek Thank you!!

regarding: "Are you limiting yourself by MDFIRE2024 (or MDFFIRE2024)?"
I am not limiting myself by my user name. If I hit FI earlier than that won't be a problem. Also it could be that I strive for FF. RE is a whole other story. I have some ideas about my transition phase from FI/FF to RE, e.g. sabbatical, part-time, ... but I have nothing decided yet. First I concentrate on my ERE-skills and lifestyle, work, passive income, etc. Then comes FI, FF, transition phase and ER. It is true that my user name could be inconsistent with my goals... Well, first things first. I am also not obsessed with the "projected FIRE"-year/date.

regarding: "Also I forgot to ask before, looking back at your 3-week mini-retirement, how did that go?"
I had two 3-week mini-retirements. The first one was in July. The second one in September. On the whole it was great to have done them. I learned some lessons. In summary, I missed my work colleagues a bit, because I was not used to spend so much time alone. Usually I have my colleagues around me during working days. I underestimated the community part of my work life. Most other things were great. I enjoyed the flexibility to spend the day how I liked. I enjoyed to wake up without an alarm clock. That is a habit I have kept. My work is mental challenging (IT sector, same as you). So I missed some mental challenges during my 3-week mini-retirements. I spend many hours outdoors and I had many new ideas, e.g. daily journal writing, which I still do and implemented as a habit. When I retire early I have to prepare myself to fulfill somehow my need for community. Also I have to plan for mental challengeing work or things to do, because I like to do that. I can't really say, if I had experienced all aspects of full early-retirement within my 3-week trial. I think, I haven't experienced everything what can be in about 7 years, when I possible retire early. Therefore I value adaptability more in my life. Whatever there is, I want to be able to adapt to many circumstances. Still, I don't want to miss my two 3-week mini-retirements, because these were really worth it. I can recommend you doing that.

[wolf]

Savings Rate = 86% (12 months rolling average)
Withdrawal Rate = 7,4% (12 months rolling average + Margin of Safety)
yearly expenses = 5433€ (12 months rolling average)
FI = 43% (accumulated FI-money compared to FI-goal of 350k€)
invested = 54% (invested FI-money in stock market, rest of it in cash)
passive income = 13% (compared to yearly expenses)
time to FI/FF(RE) = 85 months (counting down months till end of year 2024)

[wolf]

Lately I started to learn more about "Prime Harvesting" from the book "Living off your money". As I researched for further information, I came to the conclusion that I want to implement this strategy for withdrawing from my investment portfolio. Although this will start in about six to seven years, I would like to plan it, in order to prepare my portfolio asset allocation for that.
Yesterday I thought about creating a simulation with real data, in order to learn more about the mechanics off "Prime Harvesting". Also, I want to simulate my portfolio AA with real data from the ETFs I am planning to have. I hope to learn some lessons along the way and gain deeper understanding for the pros and cons of such a withdrawal strategy. In addition to that I want to see how the portfolio positions "behave", e.g. returns, volatility, etc. I want to watch the changes by simulating my portfolio just now and not only in a few years. So I started to create a spreadsheet.
First I build my portfolio by gathering the values of all ETF positions back from Quarter4 of 2016 till now. The spreadsheet is designed on a quarterly basis, as I plan to use it in the future (quarterly controlling and withdrawing).
Secondly, I extended my portfolio with the asset allocation. Now I saw how it changed quarterly regarding returns and volatility. Not only did I see the positions change, but also the portfolio on the whole.
Thirdly, I created a simulation spreadsheet based on my virtual portfolio in order to simulate "Prime Harvesting" starting the the first quarterly withdrawal in Quarter4 of 2016.
By creating those spreadsheet I already learned some things about portfolio and the behaviour with "Prime Harvesting". As expected "Prime Harvesting" withdrew from my bond allocation. Stocks did rise during the last year, but they didn't exceeded the 120% inflation adjusted initial value.
I will update this virtual portfolio and the simulation quarterly. I want to do that at least some years, best case till 2023/2024. As I mentioned before I want to learn things about "Prime Harvesting" with my favoured portfolio asset allocation with real data (ETFs values in EURO as I will buy them in the next few years). I hope to adapt "Prime Harvesting" to my portfolio as my retirement withdrawal strategy. Maybe I can even optimize it, suited to my needs and circumstances, e.g. the original "Prime Harvesting" method suggests to review it annual, but I want to do that quarterly in order to have a more constant stream of sell and buy orders and withdrawal with small portions instead of big ones.
I spent quite some time creating these spreadsheets, but I really like doing those kind of things. And it has real value for me, because I think there are some insights for me to learn here. I don't want to start experiencing "Prime Harvesting" with my portfolio in a few years. I like to learn about it now. Then I think I can verify "Prime Harvesting" by myself for my situation. I don't want to just trust the method, that it is better. I want to verify it by myself and how it is suited with my portfolio asset allocation. Well, that was another saturday in my life with numbers, calculations, formulas, data collecting, thinking about the implications and interpreting the results. It was fun and insightful so far

[wolf]

Savings Rate = 86% (12 months rolling average)
Withdrawal Rate = 7,7% (12 months rolling average + Margin of Safety)
yearly expenses = 5830€ (12 months rolling average)
FI = 43% (accumulated FI-money compared to FI-goal of 350k€)
invested = 76% (invested FI-money in stock market, rest of it in cash)
passive income = 15% (compared to yearly expenses)
time to FI(RE) = 84 months (counting down months till end of year 2024)

[Jason]

RE: your 2018 goals - I'd be interested in the 50 items you decide to get rid of as well as thought process behind each one.

[Sabaka]

Wow, smashing the savings rate man! I've also heard of prime harvesting, I'll have to read more into it. Although I'm quite abit off having to think about asset withdrawal compared to you!

[fingeek]

I love that your invested% and income% continues to increase, and look forward to seeing it increase quicker.

It would be great to see your *real* time to FI, based on projection to target SWR, rather than just counting down. Maybe it's slightly better than you think, or perhaps you might overshoot the target a little .

Nice progress!

[thrifty++]

Holy shit thats a huge saving rate! Well done.

[wolf]

@Jason
Reducing 50 items of my household this year will be a challenge, because I already have a minimalist mindest and household. I'll post about them.

@Sabaka
Thank you Sabaka! Two years ago when I started with ERE and committed to it, I would not have guessed that such a high SR is possible. Thanks to Jacob's "21 day makeover" program I figured out ways to even higher my SR compared to the years before ERE. I find that very satisfying.
Regarding "Prime Harvesting", I guess my motivation for it depends on my affection for numbers, models, statistics, long-term planning and optimization. If you want to read something about "Prime Harvesting" ERN wrote a good article about it in his SWR-Series. He suggests to "smooth" the original "Prime Harvesting"-approach. You can read about it here: ERN - Part 13: Dynamic Stock-Bond Allocation through Prime Harvesting

@fingeek
"real-time" numbers to FI would be great. But to be honest, I already do a lot of statistics ... I am trying not to get obsessed with these numbers. You are right, I think too, that I could be nearer to FI, than the number show. We will see more in the upcoming years. I hope that we can share that journey and experiences together within the next years. Thank you.

@thrifty++
That hugh SR helps me a lot to achieve my financial goals. On a deeper level that SR satisfies my need for independency and security. It also tells that I'm content with less expenses and have learned some ERE skills and competencies to master that efficiently.
It is only fair to say, that without Jacob, ERE and all experiences from you on this forum, I couldn't have achieved that. Therefore I thank you.

[10cents]

I want to give an overview about my ERE-lifestyle with cost influencing topics......
Housing:
- I live in my own apartement outside of a city
....
Food:
- I eat a wholesome, plantbased diet (very seldomly I eat meat or cheese...)
...
Other:
- I cut my hair by myself....

I 've had some free time and have slipped through your journal.
You are frugal - that's great, you have your FIRE target - that's perfect, but what about your current life. Don't you devote too much now in what goal? Your description of future FIRE life doesn't look different from your current life. Only no paid job. But what are you going with ALL the time you gain when you leave the job. DIY works, hiking, traveling? You can't fill with this every single day of many FIRE years. Why do I write about this here? I have similar plans but started to doubt about this. I predict I will have too much energy to lead my life this way.Dont you think you miss sth in your life? Hard question, both to me ...

[wolf]

@10cents
Thank you for reading my journal and asking those questions. It's always good to get feedback from other persons with another point of view.

Well, there are many things to write about. Because I like to see the bigger picture and the context of everything, it's not easy to answer your question with only one direct answer. I try to answer your questions step-by-step.

1) "Don't you devote too much now in what goal?"
You have observed correctly, that I devote some time in my goal. By that I think of two different areas.
First, I think about my lifestyle along ERE principles, e.g. living car-free, cutting my hair or reducing inefficiencies. I don't think, that I devote too much time in those aspects, because I like what I do now and how I do it. A high productive lifestyle suits me very well. These type of habits and things are all well connected within my Web-of-Goals. So I am very content with that.
Secondly, I think about overhead and administrative kind of activities, such as controlling, measuring, ... my journey towards FI. Because I like numbers etc., this is challenging and I try not to get obsessed with statistics, etc. From an outside point of view one could see that this takes up too much time. If I had to guess, it takes about a few hours each month.

2) "Your description of future FIRE life doesn't look different from your current life."
Yes, it looks like that, because I haven't painted a picture of my future FIRE life. There are too many variables to consider. There are many scenarios.
First, there are activities I like doing everday, e.g. journal writing, -reviewing, reading books, hiking, ..., which I do already.
Secondly, I have alread brainstormed many ideas, about what to do in my future FIRE life. I call them ULAL ("Ultimate-life-adventure-list" based on the book "How to retire happy, wild and free".) If you haven't read it, I can recommend doing this. So I have already set a list of my Top10-ULALs. This list contains bigger activities, such as taking a sabbatical and traveling long-term for a year, or working abroad, or doing a long-distance walk. I want to say, that I know what I could do.

3) "Don't you think you miss something in your life? "
Nowadays, no. I am content. I do the things I like every single day. And a big plus is that I like working at my job at my current company. I try to "live more in the present" and avoid "future surfing". I don't know how the future looks like. But I do know that with FI-money and ERE-skills, I do have many more options to choose from.

Other points I like to mention.

- For about 2 years now, I have created and updated a document, in which I collect experiences from persons, who are already FI, RE, ERE.
So I try to learn from them, in order to think about upcoming challenges in the next few years. I do this, because I don't want to visualize a perfect future, where everything is better. This helps me a lot to get many different perspectives on things like FI, RE and ERE.

- When I think about future phases of my journey, I try to think about the following ones:
1. life before FI
2. an optionally phase from FI to FF
3. transitioning to ER
4. ER
All phases along ERE principles...

- Work is not bad. As already said, I am happy with my current job.
One possible sustainable lifestyle (belongs to one of my Top10-ULALs) is part-time work or temporary work, as BRUTE wrote here: Work, is it so bad?

brute imagines working 3-9 months out of the year, only on the more interesting projects, or maybe a 3-4 day work week, would be good.

So, all in all, I hope that I draw a picture of my current and future lifestyle which is more complete and more whole.
Maybe I write too many times about FI statistics or my ERE related activities and habits. But let me assure you, that there is much more going on in my life, than I talk about here. One challenge for me is, that I have so much stuff (available in my native language German), that I could spend endless hours to translate it in my mind in English and write about it here As said before, I try not to get obsessed with my future goals. And that contains also the time I spend on the ERE forum, although I love to read, write and discuss about it.

[10cents]

Thank you for your response. You are so confident and this is good.
Your savings rate is so exceptional. Even you skipped a holiday last year, but
.... I couldn't do that.
What I would be affraid of is that you have 5-6 years of work ahead of you.
Don't you feel mental fatigue now? 5-6 years is a long way, it would be bad to be exhausted in a year or two.
FIRE targets are like a marahton, don't you run in too fast pace?
------
On the other hand, thank you that you mention about 'prime harvesting', I have never heard about this.