A little about me:
40yo, male, engineer, INTJ. I currently live in southern California, having grown up in the southeastern US and lived in many places throughout the western states...Utah, Oregon, Alaska, California.
People think of SoCal as an expensive, consumerist area. But there are actually very inexpensive property/homes in SoCal once you get inland and/or out of LA and the immediate suburbs.
Current stats:
Debt = 15k auto loan
Net worth = ~ 230k-250k (depending on stock market fluctuations and how much value placed on pension and real estate).
Breaks down as:
401k = 75k
NPV pension = 80k
Brokerage account = 40k
Home equity = 50k
The auto loan...I knew which car I wanted and intended on buying a 2-3 year old used Prius. Found a low mile (25k mi) unit in the color and options I wanted being returned from a lease, along with about 12 others than came off lease at the same time. Dealer had to get them off the lot, so I made a lowballish offer. I walked in there with a checkbook and enough cash in my account to just write a check, but they said "how's your credit"..well, my score is over 800. They offered 2.5%, so I just financed the whole thing...I am clearing well above 2.5% on my equity investments, so I view it as not an auto loan, but as a much cheaper rate on a margin-loan for stocks.
Of course the downside is that I have to carry full insurance on the car, which I never do (I always bought junkers in the 2k-5k range..dad was a mechanic so I learned to work on them as a kid). However, I view this a positive in the first 3 years of owning the car, after which I will payoff the balance and drop to minimum liability coverage.
Enough for now, I'll clean up the format of these journal entries going forward, to try to make it easier to read.
SoCal Will Journal
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Work:
l manage a group of engineers/scientists in the public sector. It pays well, good benefits. But it is a soul-sucking nightmare. An absolute waste of my life energy, which achieves very little other than shuffling a lot of paper around. On the occasions that our work is actually important, it's very important indeed...critical to the functioning of the org, and with benefits to society as a whole. But that is maybe 2% of the time and effort. The other 98% is meaningless b.s., and it feels like I'm wasting my talents and my life in this job.
The org is facing a lot of obstacles with budgets, hiring freezes, and so-on, and it makes my job impossible to do well because I don't have the resources, neither human nor fiscal, to run the dept as a fully staffed, fully funded entity. Couple that with my best employee leaving for another job, and being half-staffed with increasing responsibilities and programs...it's a nightmare. Instead of being pro-active, planning well, etc, we are constantly in reactionary, putting-out-fire mode because of the lack of resources. It increases the stress of the job by 10x.
I would actually enjoy the job more than any other I've worked, if I had the resources to do it well (and if I had a different boss). But the way forward is clear in this org, it will face a constant pressure on resources and is not handling the boomer retirement transition well. So while I know that my job stress will decrease a bit in another 4-6mo, once I get a couple more staff on board, it will only last until someone else leaves/retires, or more budget cuts occur. That path is clear to me: stay in this job until meeting my ERE goals, then walk away and work part time in another field where I feel the work is worthy and meaningful to society.
I have many passions outside work, mostly revolving around outdoor recreation...fly fishing, biking, climbing, some gardening, landscape photography. Also love to read, watch european soccer, cook, and putter around the yard doing xeriscape type landscaping. So the idea of "what do I do once I retire" was never a question to me. I've taken years off from working a few times just to pursue my outdoor rec hobbies, so I'm not too concerned with how to fill my days.
l manage a group of engineers/scientists in the public sector. It pays well, good benefits. But it is a soul-sucking nightmare. An absolute waste of my life energy, which achieves very little other than shuffling a lot of paper around. On the occasions that our work is actually important, it's very important indeed...critical to the functioning of the org, and with benefits to society as a whole. But that is maybe 2% of the time and effort. The other 98% is meaningless b.s., and it feels like I'm wasting my talents and my life in this job.
The org is facing a lot of obstacles with budgets, hiring freezes, and so-on, and it makes my job impossible to do well because I don't have the resources, neither human nor fiscal, to run the dept as a fully staffed, fully funded entity. Couple that with my best employee leaving for another job, and being half-staffed with increasing responsibilities and programs...it's a nightmare. Instead of being pro-active, planning well, etc, we are constantly in reactionary, putting-out-fire mode because of the lack of resources. It increases the stress of the job by 10x.
I would actually enjoy the job more than any other I've worked, if I had the resources to do it well (and if I had a different boss). But the way forward is clear in this org, it will face a constant pressure on resources and is not handling the boomer retirement transition well. So while I know that my job stress will decrease a bit in another 4-6mo, once I get a couple more staff on board, it will only last until someone else leaves/retires, or more budget cuts occur. That path is clear to me: stay in this job until meeting my ERE goals, then walk away and work part time in another field where I feel the work is worthy and meaningful to society.
I have many passions outside work, mostly revolving around outdoor recreation...fly fishing, biking, climbing, some gardening, landscape photography. Also love to read, watch european soccer, cook, and putter around the yard doing xeriscape type landscaping. So the idea of "what do I do once I retire" was never a question to me. I've taken years off from working a few times just to pursue my outdoor rec hobbies, so I'm not too concerned with how to fill my days.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Housing:
In early 2010, in the depths of the post-bubble crash, I quit my job due to funding for my position being cut which meant a re-assignment with a 45% paycut, (which had nothing to do with my job performance). Being tenured, I couldn't be laid off, but the laws/rules allowed them to put me in another position. Screwy situation, better than getting laid off, I guess, but no way I was staying there working at a level way below where I'd been, doing basic boring work outside my specialty, and making half as much money. I made more right out of school.
So although I had little cash, I quit anyway. Took enough out of my 401k (paid the 10% penalty) to buy a very cheap house near a beautiful wilderness area. I'd been following the housing bubble very closely for the 5 years prior, and knew this was about the bottom. I found a small place that was super cheap, $44k incl closing costs, with enough acreage to have privacy and great views of the mountains. It also meant I could take the FTHB tax credit the following month, which meant 4k cash... a quick 9% return and liquid cash I needed for living expenses, and which almost offset the early withdrawal penalty.
It was a 2.5acre, ~1000 sq ft, 1 br house, with a detached four-car sized garage that is setup as a two-car garage + mother-in-law suite with a full bath, and large bedroom/living room area with woodstove. Built in the 50s, the place was trashed, had been a repo and sat unoccupied for a couple years, had been broken into and boarded up. Everything was outdated and broken. Tons of work was needed, basically gutting the entire inside down to studs, and bare concrete slab, then starting anew. I mean, this place didn't even have sheetrock or plaster walls, they were that bad old cheap wooden paneling right on the studs, even on the ceilings of all but one room. Who puts freakin' paneling on a ceiling?
It was going to be the remodel project from hell (and continues to be), but I wasn't working just looking for jobs, and needed a place to live anyway so I had time and motivation. The garage apt was in good enough shape that with a few days of labor cleaning, patching walls, and painting, I could in live there while working on the main house. No kitchen in the garage suite, but I just setup my coleman propane stove and a dorm-fridge in the garage itself (garage is sufficiently vented, don't worry!).
So over the next year, I did a lot of the demo work, got the roofs sorted out, hung a house full of sheetrock (solo..what a PITA, the walls were just shy of 8' high, and stud spacing was all wacky in places, so I had to cut almost every piece of rock twice..cutting sheetrock sux), put tongue and groove planking on the ceilings, and eventually found a job. The job was 75mi from my house, and I hate to commute. Two and half hours in the car, everyday? No thanks.
Once the job started, I rented a place near work, and continue to slowly remodel the owned house while using it as a weekend getaway. This means I can walk or bike to work, which I do most of the time. I often go home for lunch, and enjoy other perks of being nearby. What this means is when accounting for the money I save not commuting, the net cost of renting the place is ~7k/year. I did the math at one point, and considering gas, maintenance, and the amortized cost of the car itself, it would essentially pay me $15hr for the driving time if I commuted from the owned-home instead.
That 7k/yr is still quite a bit of money to leave on the table, especially when you find yourself scrutinizing the cost-per-ounce tags in the grocery store. And once I have a firm ERE date, I will probably drop the rental and make the commute for the last year of work. But you know, I don't want to work more, I want to work less! Commuting means and extra 2.5hr per day of work, at a low pay rate.
Until I have a hard retirement date, I will continue to rent this place. It's in a good neighborhood, and I'm paying $1100/mo for a 1000sqf craftsman bungalow style home that is very energy efficient, and includes gas and water. It the best deal in my town, by a wide margin. And being about 1mi from my office is unbeatable.
My housing costs per month breakdown as:
$1100 rent/(water/gas included)
$80 property taxes for owned home
$100 electricity (includes both homes, varied from $35-$110/mo last year)
$40 water for owned home (varies from simple connection fee of ~$25 in winter, to ~$60 mid summer when I'm watering landscaping).
This does not account for home improvement costs, which vary wildly depending on what project I'm working on, and how motivated I am to spend weekends working on the house). I figure I need to put about another $10-15k into the house to have it in a more or less "finished" condition where I could envision living there without an endless list of projects.
Part of the reason I bought this house was that I needed a place to live, right then, and the timing would probably never be better in my lifetime. But I also wanted a first home, and a cheap one at that, to really figure out whether I wanted to be a homeowner at all, and to be able to learn construction type skills on the job without worrying about screwing up an expensive house. Basically, a practice house. I'd always be able to get my money back out of it, because I bought it so cheaply.
In early 2010, in the depths of the post-bubble crash, I quit my job due to funding for my position being cut which meant a re-assignment with a 45% paycut, (which had nothing to do with my job performance). Being tenured, I couldn't be laid off, but the laws/rules allowed them to put me in another position. Screwy situation, better than getting laid off, I guess, but no way I was staying there working at a level way below where I'd been, doing basic boring work outside my specialty, and making half as much money. I made more right out of school.
So although I had little cash, I quit anyway. Took enough out of my 401k (paid the 10% penalty) to buy a very cheap house near a beautiful wilderness area. I'd been following the housing bubble very closely for the 5 years prior, and knew this was about the bottom. I found a small place that was super cheap, $44k incl closing costs, with enough acreage to have privacy and great views of the mountains. It also meant I could take the FTHB tax credit the following month, which meant 4k cash... a quick 9% return and liquid cash I needed for living expenses, and which almost offset the early withdrawal penalty.
It was a 2.5acre, ~1000 sq ft, 1 br house, with a detached four-car sized garage that is setup as a two-car garage + mother-in-law suite with a full bath, and large bedroom/living room area with woodstove. Built in the 50s, the place was trashed, had been a repo and sat unoccupied for a couple years, had been broken into and boarded up. Everything was outdated and broken. Tons of work was needed, basically gutting the entire inside down to studs, and bare concrete slab, then starting anew. I mean, this place didn't even have sheetrock or plaster walls, they were that bad old cheap wooden paneling right on the studs, even on the ceilings of all but one room. Who puts freakin' paneling on a ceiling?
It was going to be the remodel project from hell (and continues to be), but I wasn't working just looking for jobs, and needed a place to live anyway so I had time and motivation. The garage apt was in good enough shape that with a few days of labor cleaning, patching walls, and painting, I could in live there while working on the main house. No kitchen in the garage suite, but I just setup my coleman propane stove and a dorm-fridge in the garage itself (garage is sufficiently vented, don't worry!).
So over the next year, I did a lot of the demo work, got the roofs sorted out, hung a house full of sheetrock (solo..what a PITA, the walls were just shy of 8' high, and stud spacing was all wacky in places, so I had to cut almost every piece of rock twice..cutting sheetrock sux), put tongue and groove planking on the ceilings, and eventually found a job. The job was 75mi from my house, and I hate to commute. Two and half hours in the car, everyday? No thanks.
Once the job started, I rented a place near work, and continue to slowly remodel the owned house while using it as a weekend getaway. This means I can walk or bike to work, which I do most of the time. I often go home for lunch, and enjoy other perks of being nearby. What this means is when accounting for the money I save not commuting, the net cost of renting the place is ~7k/year. I did the math at one point, and considering gas, maintenance, and the amortized cost of the car itself, it would essentially pay me $15hr for the driving time if I commuted from the owned-home instead.
That 7k/yr is still quite a bit of money to leave on the table, especially when you find yourself scrutinizing the cost-per-ounce tags in the grocery store. And once I have a firm ERE date, I will probably drop the rental and make the commute for the last year of work. But you know, I don't want to work more, I want to work less! Commuting means and extra 2.5hr per day of work, at a low pay rate.
Until I have a hard retirement date, I will continue to rent this place. It's in a good neighborhood, and I'm paying $1100/mo for a 1000sqf craftsman bungalow style home that is very energy efficient, and includes gas and water. It the best deal in my town, by a wide margin. And being about 1mi from my office is unbeatable.
My housing costs per month breakdown as:
$1100 rent/(water/gas included)
$80 property taxes for owned home
$100 electricity (includes both homes, varied from $35-$110/mo last year)
$40 water for owned home (varies from simple connection fee of ~$25 in winter, to ~$60 mid summer when I'm watering landscaping).
This does not account for home improvement costs, which vary wildly depending on what project I'm working on, and how motivated I am to spend weekends working on the house). I figure I need to put about another $10-15k into the house to have it in a more or less "finished" condition where I could envision living there without an endless list of projects.
Part of the reason I bought this house was that I needed a place to live, right then, and the timing would probably never be better in my lifetime. But I also wanted a first home, and a cheap one at that, to really figure out whether I wanted to be a homeowner at all, and to be able to learn construction type skills on the job without worrying about screwing up an expensive house. Basically, a practice house. I'd always be able to get my money back out of it, because I bought it so cheaply.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Food:
I typically spend about $230/mo on food, bev, and supplements/protein powder. Probably eat about one restaurant meal per week, and those are always cheap. We have fantastic local hole-in-the-wall joints - mexican, thai, pho and others where my typical check is ~$6-9. I'm not really looking to save money in this category. I am very happy with my diet and feel I'm getting a very high quality healthy diet by shopping in the right places, buying in bulk when possible (for example, my main grocery store of choice has a large bulk-foods section and the quinoa is about 1/3 the cost of the other local markets), cooking my own meals, and avoiding processed foods.
Fresh and healthy is my theme. The diet doesn't vary a lot in the mainstay foods. I may prepare them different ways, but most weeks in the grocery cart it's:
apples
baby carrots
50/50 mixed spinach/baby salad greens
head of kale or mustard greens
broccoli crowns
yams
green onions, garlic, and ginger
salmon, sardines, herring (canned or frozen)
very, very dark chocolate
decaf green tea
100% cherry or grape juice
spicy V8
whole wheat thin sandwich rounds
almonds
quinoa
occasionally I will buy a dozen eggs or pint of yogurt or some olive or coconut oil. I haven't bought a cut of meat that wasn't fish in over 5 years (might have a steak or something once a year at a restaurant or visiting relatives).
The protein powder is whey, and is typically my breakfast and/or workout shake. It accounts for about half my total protein intake per day. It's pretty important for the athletic endeavors, and whey is a very high quality source with a beneficial profile heavy on BCAAs. It's also very convenient. And a pretty cheap way to get a complete protein, much cheaper per gram than most meat sources. I'm performing at a pretty high level in my athletic activities, what would amount to, say AA baseball level, so my diet and workout routine dominate a lot of my life. Reading C40's journal, I felt a lot of kinship, knowing what it's like to work a full time job while fanatically pursuing a sport at a high level where your entire existence is centered around that activity.
I quit drinking alcohol over 3 years ago. It was becoming a dependence, and a crutch for stressful times. It was also affecting my athletics, recovering from hard workouts at 40 is tough enough without adding to the problem. That saved me about $300/mo, because I was drinking about a bottle of single malt scotch @$25-$40, many craft beers @ $1-$2/bottle, and 3-4 bottles of red wine @ $6-$10/bottle, per week. Holy smokes, that sounds like a lot of booze in retrospect. Seemed pretty normal at the time, as my housemates drank a lot too. I was never sloshed, drunk, slurring or stumbling, just pleasantly numbed out on a daily basis from the time I got home from the gym until bedtime. If there was no alcohol in the house, I'd drive to the store and buy something because I couldn't sleep well without it. That was the last straw for me, the second time I had to make a trip out at 8 or 9pm because I knew I wouldn't get to sleep without drinking something first. It was difficult for a couple weeks, and every now and then it's tough to resist, but mostly I don't even think about it or miss it. I just fear the slippery slope of the first one, so I don't indulge at all. Once the athletic performance issue isn't an issue (say 50? 52?) I'll probably start enjoying a glass of wine now and again. I am confident in myself that I can quit if I want to, as I've now proven to myself.
I keep a very low bodyfat % most of the year, in the 4%-12% range, and while I have all kinds of alignment and wear and tear issues from playing certain sports and asking a lot of my body, my overall health is very good for my age. Resting HR high 40s to low 50s, blood pressure 110/70 , no known allergies, strength levels are at or above what they were in my 20s. Recovery takes longer, for sure, and there are more nagging things that flare up on occasion, but I'm expecting a very active lifestyle post-retirement (big part of the motivation of ERE...get out of the rat race while young enough to do these things I love).
I've read about some ERE folks who ditch their microwave. Not me, I use that thing every day. Same one I've had since college that grandma gave me. Cooking for one person means leftovers, partially by design so I don't have to cook so many times per week. But heating leftovers...or even cooking in general...would be a big pain without the microwave. All my veggie steaming is done in there, reheating, making cups of tea. It gets used 3x as much as the stove. I'd sooner go without a regular oven than a microwave oven. All I really need in a kitchen is 2 burners, a microwave, a fridge, a pot, skillet, a chef's knife and a paring knife.
In my 30s, when I finally zeroed out all my debt...a total of 52k student loans and CC debt, paid off in 2.5yrs, I invested in some tools that seemed spendy at the time, but I knew would last the rest of my life and be a joy to use during that time. Some of these were kitchen tools...three Wusthof knives - chef, paring, and santoku, one of which came with a sharpener (bought these at a store-closing sale), and some tri-ply all-clad type stainless cookware. Lots of research and a willing importer got me the cookware for 1/5th what the All-Clad brand equivalent would cost and the quality is on par with the All-Clad cousin. I use at least one of those knives every single day, they stay sharp and have superb ergonomics (Wusthof Classic Icon series, best knives I've ever held if you prefer german to japanese style knives).
I ended up paying 4x the cost of a cheap equivalent knives, but man it was so worth it. After too many years of cheap knives, and with me cooking every day, I really appreciate these tools.
I typically spend about $230/mo on food, bev, and supplements/protein powder. Probably eat about one restaurant meal per week, and those are always cheap. We have fantastic local hole-in-the-wall joints - mexican, thai, pho and others where my typical check is ~$6-9. I'm not really looking to save money in this category. I am very happy with my diet and feel I'm getting a very high quality healthy diet by shopping in the right places, buying in bulk when possible (for example, my main grocery store of choice has a large bulk-foods section and the quinoa is about 1/3 the cost of the other local markets), cooking my own meals, and avoiding processed foods.
Fresh and healthy is my theme. The diet doesn't vary a lot in the mainstay foods. I may prepare them different ways, but most weeks in the grocery cart it's:
apples
baby carrots
50/50 mixed spinach/baby salad greens
head of kale or mustard greens
broccoli crowns
yams
green onions, garlic, and ginger
salmon, sardines, herring (canned or frozen)
very, very dark chocolate
decaf green tea
100% cherry or grape juice
spicy V8
whole wheat thin sandwich rounds
almonds
quinoa
occasionally I will buy a dozen eggs or pint of yogurt or some olive or coconut oil. I haven't bought a cut of meat that wasn't fish in over 5 years (might have a steak or something once a year at a restaurant or visiting relatives).
The protein powder is whey, and is typically my breakfast and/or workout shake. It accounts for about half my total protein intake per day. It's pretty important for the athletic endeavors, and whey is a very high quality source with a beneficial profile heavy on BCAAs. It's also very convenient. And a pretty cheap way to get a complete protein, much cheaper per gram than most meat sources. I'm performing at a pretty high level in my athletic activities, what would amount to, say AA baseball level, so my diet and workout routine dominate a lot of my life. Reading C40's journal, I felt a lot of kinship, knowing what it's like to work a full time job while fanatically pursuing a sport at a high level where your entire existence is centered around that activity.
I quit drinking alcohol over 3 years ago. It was becoming a dependence, and a crutch for stressful times. It was also affecting my athletics, recovering from hard workouts at 40 is tough enough without adding to the problem. That saved me about $300/mo, because I was drinking about a bottle of single malt scotch @$25-$40, many craft beers @ $1-$2/bottle, and 3-4 bottles of red wine @ $6-$10/bottle, per week. Holy smokes, that sounds like a lot of booze in retrospect. Seemed pretty normal at the time, as my housemates drank a lot too. I was never sloshed, drunk, slurring or stumbling, just pleasantly numbed out on a daily basis from the time I got home from the gym until bedtime. If there was no alcohol in the house, I'd drive to the store and buy something because I couldn't sleep well without it. That was the last straw for me, the second time I had to make a trip out at 8 or 9pm because I knew I wouldn't get to sleep without drinking something first. It was difficult for a couple weeks, and every now and then it's tough to resist, but mostly I don't even think about it or miss it. I just fear the slippery slope of the first one, so I don't indulge at all. Once the athletic performance issue isn't an issue (say 50? 52?) I'll probably start enjoying a glass of wine now and again. I am confident in myself that I can quit if I want to, as I've now proven to myself.
I keep a very low bodyfat % most of the year, in the 4%-12% range, and while I have all kinds of alignment and wear and tear issues from playing certain sports and asking a lot of my body, my overall health is very good for my age. Resting HR high 40s to low 50s, blood pressure 110/70 , no known allergies, strength levels are at or above what they were in my 20s. Recovery takes longer, for sure, and there are more nagging things that flare up on occasion, but I'm expecting a very active lifestyle post-retirement (big part of the motivation of ERE...get out of the rat race while young enough to do these things I love).
I've read about some ERE folks who ditch their microwave. Not me, I use that thing every day. Same one I've had since college that grandma gave me. Cooking for one person means leftovers, partially by design so I don't have to cook so many times per week. But heating leftovers...or even cooking in general...would be a big pain without the microwave. All my veggie steaming is done in there, reheating, making cups of tea. It gets used 3x as much as the stove. I'd sooner go without a regular oven than a microwave oven. All I really need in a kitchen is 2 burners, a microwave, a fridge, a pot, skillet, a chef's knife and a paring knife.
In my 30s, when I finally zeroed out all my debt...a total of 52k student loans and CC debt, paid off in 2.5yrs, I invested in some tools that seemed spendy at the time, but I knew would last the rest of my life and be a joy to use during that time. Some of these were kitchen tools...three Wusthof knives - chef, paring, and santoku, one of which came with a sharpener (bought these at a store-closing sale), and some tri-ply all-clad type stainless cookware. Lots of research and a willing importer got me the cookware for 1/5th what the All-Clad brand equivalent would cost and the quality is on par with the All-Clad cousin. I use at least one of those knives every single day, they stay sharp and have superb ergonomics (Wusthof Classic Icon series, best knives I've ever held if you prefer german to japanese style knives).
I ended up paying 4x the cost of a cheap equivalent knives, but man it was so worth it. After too many years of cheap knives, and with me cooking every day, I really appreciate these tools.
-
SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Entertainment:
This mostly revolves around outdoor sports: travel, training, and equipment; guitar/music: no cost really, been playing the same guitars for 20 years and have a huge collection of cds/mp3/vinyl (many were inherited) with no intention nor desire to buy many more; a few books per year; and a few movie rentals or purchases. I don't have cable or satellite (or even an antenna, only watch DVDs or play xBox on the tv) nor do I have internet (poach an open wireless signal). lt's easier to compute this stuff on an annual basis, so I reckon about $750 travel, $750 sports equipment, $350 gym, $100 dvds, $200 computer amortization, $250 gardening and landscaping supplies and plants.
Total entertainment annually ~$2200, call it $185/mo.
Again, this is a category where I'm not really looking to cut costs. I may actually add $50-80/mo for a cable/net connection because while my poached signal is pretty reliable, it is also slow. I support a certain european soccer team, and typically watch the games via live streaming (not often available on US tv).
I've lived so cheaply, for so long, that further cutting to the bone isn't really on my agenda. After living from a backpack, car, van, and having spent years in tiny apts or shared old rental houses and onward to sharing McMansions with roomates, I think I've seen the full extent of possible degrees of simplicity and know that my prefered comfort level is somewhere above monk/spartan, but waaaayyy below what modern america considers normal.
I've examined where the money is going, and have a general mindset where I seek to accumulate assets and don't shop as entertainment, always seek the best deal, buy used, buy in bulk, out of season, etc. I don't have expensive tastes in anything that's actually expensive: i.e. I drive a car that only cost $11k at 2 years old and gets 52mpg combined, and own a house/property only worth about $65k, but I have no issues with paying $3/lb for honeycrisp apples or $10/lb for Peet's coffee. My expensive tastes are in the simple things that aren't actually expensive. Pinching pennies there in those simple things has a greater negative effect on my quality of life than pinching hundreds or thousands by driving cheaper, efficient used cars).
In retirement, I will budget for quite a bit more than my current expense level in this category. I expect a lot more travel and hobby expenses.
This mostly revolves around outdoor sports: travel, training, and equipment; guitar/music: no cost really, been playing the same guitars for 20 years and have a huge collection of cds/mp3/vinyl (many were inherited) with no intention nor desire to buy many more; a few books per year; and a few movie rentals or purchases. I don't have cable or satellite (or even an antenna, only watch DVDs or play xBox on the tv) nor do I have internet (poach an open wireless signal). lt's easier to compute this stuff on an annual basis, so I reckon about $750 travel, $750 sports equipment, $350 gym, $100 dvds, $200 computer amortization, $250 gardening and landscaping supplies and plants.
Total entertainment annually ~$2200, call it $185/mo.
Again, this is a category where I'm not really looking to cut costs. I may actually add $50-80/mo for a cable/net connection because while my poached signal is pretty reliable, it is also slow. I support a certain european soccer team, and typically watch the games via live streaming (not often available on US tv).
I've lived so cheaply, for so long, that further cutting to the bone isn't really on my agenda. After living from a backpack, car, van, and having spent years in tiny apts or shared old rental houses and onward to sharing McMansions with roomates, I think I've seen the full extent of possible degrees of simplicity and know that my prefered comfort level is somewhere above monk/spartan, but waaaayyy below what modern america considers normal.
I've examined where the money is going, and have a general mindset where I seek to accumulate assets and don't shop as entertainment, always seek the best deal, buy used, buy in bulk, out of season, etc. I don't have expensive tastes in anything that's actually expensive: i.e. I drive a car that only cost $11k at 2 years old and gets 52mpg combined, and own a house/property only worth about $65k, but I have no issues with paying $3/lb for honeycrisp apples or $10/lb for Peet's coffee. My expensive tastes are in the simple things that aren't actually expensive. Pinching pennies there in those simple things has a greater negative effect on my quality of life than pinching hundreds or thousands by driving cheaper, efficient used cars).
In retirement, I will budget for quite a bit more than my current expense level in this category. I expect a lot more travel and hobby expenses.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Phone:
$50/mo cell plan, no contract, unlimited talk/text/data. Doesn't get much cheaper, and I do require text/data for work purposes. It's also very nice to be able to get map/directions from anywhere to anywhere. No landline, so this is another category where I feel I've maximized the cost/benefit.
My vision of the ERE way is heavy on maximizing value for price. I'm not looking for the most spartan existence and very quickest FI date, I'm looking for the most rewarding way to get there, but still do so quickly. Some comforts are worth the costs, and that is something I see too many ERE folks lose sight of. The mind is focused on a continual optimization of the system (there's the INTJ coming out), and once you've picked the low-hanging fruit, the mind is still in that mode while the value-returns of that optimization are getting smaller and smaller. At some point, the effect of further tinkering/cost cutting is the value-return becoming negative, and further cutting doesn't add value to your life, even if it means a quicker path to FI.
Most people's biggest expenses are homes and cars. But those things don't bring me a lot of inherent satisfaction, so it's an easy and effective way to really attack the expenses side of the FI equation without going overboard on the spartan thing.
$50/mo cell plan, no contract, unlimited talk/text/data. Doesn't get much cheaper, and I do require text/data for work purposes. It's also very nice to be able to get map/directions from anywhere to anywhere. No landline, so this is another category where I feel I've maximized the cost/benefit.
My vision of the ERE way is heavy on maximizing value for price. I'm not looking for the most spartan existence and very quickest FI date, I'm looking for the most rewarding way to get there, but still do so quickly. Some comforts are worth the costs, and that is something I see too many ERE folks lose sight of. The mind is focused on a continual optimization of the system (there's the INTJ coming out), and once you've picked the low-hanging fruit, the mind is still in that mode while the value-returns of that optimization are getting smaller and smaller. At some point, the effect of further tinkering/cost cutting is the value-return becoming negative, and further cutting doesn't add value to your life, even if it means a quicker path to FI.
Most people's biggest expenses are homes and cars. But those things don't bring me a lot of inherent satisfaction, so it's an easy and effective way to really attack the expenses side of the FI equation without going overboard on the spartan thing.
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jacob
- Site Admin
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Re: SoCal Will Journal
Focusing on saving a few bucks on small details without considering the big items is primarily a rookie mistake coming from standard "tips and tricks"-style frugality advice. At least we try to discourage it:SoCal Will wrote:... I'm looking for the most rewarding way to get there, but still do so quickly. Some comforts are worth the costs, and that is something I see too many ERE folks lose sight of.
http://earlyretirementextreme.com/wiki/ ... .28LBYM.29
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Projected F.I. and Retirement Date:
My pension can be drawn as early as 57 with a 25% penalty (5% per year under 62), and SS starts at 62. Unlike many in my generation, I have full faith that SS will still exist when my time comes to collect. It may pay slightly less than current levels, but the long term actuarial outlook for SS is quite good...it could pay something like 76% of the current level of benefits in perpetuity. Once the greedy baby boomer bulge gets through the system (and we get those boomer morons out of elected office), things will come around.
My goal is a minimum after-tax income of $17k (in 2014 dollars) from retirement to age 57, and rising thereafter to approximately $36k/yr (2014 dollars) by age 62. The "raise" I give myself will come from the addition of the pension, and then SS.
Pre-tax salary is currently 91k/yr.
Expenses are currently 29k/yr.
Net worth is growing by approx 56k/yr.
The net worth growth is a combo of 401k contributions + employer matching, after-tax cash savings (invested in equities), npv gains in pension, and investment income.
The expenses include renting a home close to work and a few other work-related costs. When I remove those, and add my employer's share of health insurance, it comes down to 14,400/yr. Because I expect to spend more in retirement, have higher health ins costs, have cable/net, and want a slight cushion, 17k/yr is my figure. So, a nest egg of about $425k will do it.
Now, this is where it gets complicated. Much of my net worth will in non-income producing assets/"locked up" in 401k/pension. This would mean drawing down my taxable account between retirement and 59.5, or using one of the other early withdrawal methods like a SEPP/72t exemption.
I am not totally clear on the 72t rules. I know you must take the payments for at least 5 years, but am not sure if I could choose the "required minimum distribution" method , then stop after 5 years (or is it a case where once I start on the required minimum distribution method, I'm stuck with it for good?). Something to research.
I am willing to cut back on that 17k figure a bit down to say 15, by deferring some expenses, but only for a couple of years.
Anyway, in computing my FI date it's simple enough because I can just use my net worth figure. Retirement date is trickier. Projecting a 5% return on assets, and continuing with the current savings rate of approx $4100/mo, with a current net worth of 240k:
Net worth at 42yo ~300k, at 43yo ~365k, at 44 ~430k = F.I.
3 years. I can do that. And that will be the point where I have a tough decision to make. Continue in my relatively high salary job to grow the nest egg, knowing I can walk away at any time (which would make the stress level much, much lower...feeling trapped is very stressful), or retire.
For me retirement will probably involve taking the first two years to travel and play, then going back to work in a part-time job doing something I actually enjoy. Of course the pay will be much less, but as long as I cover my living expenses and don't have to draw on the nest egg or take the pension early, that will be plenty of income.
I really wish that second-career teaching credential programs were more flexible. Some states are very accommodating for STEM career changers who want to teach math/science. Utah, IIRC, has a good program. California, on the other hand, does not. It would involve years of more schooling, and that's not something I'm willing to do. Shame, because while I am INTJ, I do love to teach. Might be worth looking into getting credentialed in Utah through their career changer program, then transferring to CA (many states will accept credentials from other states).
Bottom line: 3 years to FI (on my 44th b-day, yay!), 4-5 years to retirement, age 46 at the latest.
My pension can be drawn as early as 57 with a 25% penalty (5% per year under 62), and SS starts at 62. Unlike many in my generation, I have full faith that SS will still exist when my time comes to collect. It may pay slightly less than current levels, but the long term actuarial outlook for SS is quite good...it could pay something like 76% of the current level of benefits in perpetuity. Once the greedy baby boomer bulge gets through the system (and we get those boomer morons out of elected office), things will come around.
My goal is a minimum after-tax income of $17k (in 2014 dollars) from retirement to age 57, and rising thereafter to approximately $36k/yr (2014 dollars) by age 62. The "raise" I give myself will come from the addition of the pension, and then SS.
Pre-tax salary is currently 91k/yr.
Expenses are currently 29k/yr.
Net worth is growing by approx 56k/yr.
The net worth growth is a combo of 401k contributions + employer matching, after-tax cash savings (invested in equities), npv gains in pension, and investment income.
The expenses include renting a home close to work and a few other work-related costs. When I remove those, and add my employer's share of health insurance, it comes down to 14,400/yr. Because I expect to spend more in retirement, have higher health ins costs, have cable/net, and want a slight cushion, 17k/yr is my figure. So, a nest egg of about $425k will do it.
Now, this is where it gets complicated. Much of my net worth will in non-income producing assets/"locked up" in 401k/pension. This would mean drawing down my taxable account between retirement and 59.5, or using one of the other early withdrawal methods like a SEPP/72t exemption.
I am not totally clear on the 72t rules. I know you must take the payments for at least 5 years, but am not sure if I could choose the "required minimum distribution" method , then stop after 5 years (or is it a case where once I start on the required minimum distribution method, I'm stuck with it for good?). Something to research.
I am willing to cut back on that 17k figure a bit down to say 15, by deferring some expenses, but only for a couple of years.
Anyway, in computing my FI date it's simple enough because I can just use my net worth figure. Retirement date is trickier. Projecting a 5% return on assets, and continuing with the current savings rate of approx $4100/mo, with a current net worth of 240k:
Net worth at 42yo ~300k, at 43yo ~365k, at 44 ~430k = F.I.
3 years. I can do that. And that will be the point where I have a tough decision to make. Continue in my relatively high salary job to grow the nest egg, knowing I can walk away at any time (which would make the stress level much, much lower...feeling trapped is very stressful), or retire.
For me retirement will probably involve taking the first two years to travel and play, then going back to work in a part-time job doing something I actually enjoy. Of course the pay will be much less, but as long as I cover my living expenses and don't have to draw on the nest egg or take the pension early, that will be plenty of income.
I really wish that second-career teaching credential programs were more flexible. Some states are very accommodating for STEM career changers who want to teach math/science. Utah, IIRC, has a good program. California, on the other hand, does not. It would involve years of more schooling, and that's not something I'm willing to do. Shame, because while I am INTJ, I do love to teach. Might be worth looking into getting credentialed in Utah through their career changer program, then transferring to CA (many states will accept credentials from other states).
Bottom line: 3 years to FI (on my 44th b-day, yay!), 4-5 years to retirement, age 46 at the latest.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Internal Crisis?
Things are spinning out of control, and depression taking hold. Gaining weight, eating poorly, unmotivated even by my favorite activities, work stress, stress around my property/house. Anxiety, irritability, and feeling like I've wasted a lot of my life. Feeling like my job and my life don't really matter (not suicidal, at all), just depressed at what my life has become. Not married, no kids, poor social life. No intrinsic satisfaction from work, and wondering if this is it? Is this as good as it gets for me? I've been reasonably content for the last several years under similar circumstances, why is the depression taking hold?
I was pretty depressed through most of my 20s. In my 30s, it was gone. No reason I can point to, it just faded and I was content. And even now I am mostly content (until the last few months), but trying to figure out what I need to change. It feels like the demands on my time are mostly the issue. Even when I have time to pursue my passions, it feels so rushed to pack, coordinate with partners, go do the thing, come back, unpack, deal with all the chores and stuff I should have done before. Etc, etc.
The property I own outright, a cabin near desert wilderness, has been a long term project. Which I have done almost exclusively solo, everything from floors to tongue and groove ceilings, new sheetrock, etc. But now the project is about halfway done, and I just want out of this property.
I want out of it mostly because I had a friend living there for a couple of years while he was in poor health and having hard times financially (and I am renting a different place close to work, so I'm not there anyway). He is since deceased, and everytime I am there all I can think of is my dead friend. I will take a beating on the sweat equity I have in this place if I sell it in "project" condition (I ran he numbers at some point, and my work would be compensated at about $5/hr...lolz).
Basically need to get it into a state I can sell it, which means either more sweat and time, or hiring out some work...which seems silly when most of it is within my skillset...but I don't have the time or energy (well, I do, but if I spend all my free time doing that shit...like I have for a couple of years now, I will be really really depressed...part of why this feels like an albatross is that it eats my too much of my free time...it also becomes a collection place for junk, truly amazing what has accumulated within 3 years).
I don't know. There is a thick cloud of melancholy descending over everything and I am wallowing in self pity...well, not really pity. Like I said - I don't know. It's hard to get a grasp on what it is really.
I also want that chunk of my asset base that is in the property in something more liquid. This property was sort of a "practice" house for me, my first owned property and very cheap. But I really am not sold on being a homeowners (at least not for an older home) and still want that 60k or so into an income producing asset, rather than a depreciating one. I could rent the house at about a 10% ROI/ROE, but not am not all that interested in being a landlord.
I am really doubting my long term plan. Not about getting out of the workforce - although there is some of that too, but mostly about where do I want to settle that will allow me to live a day to day life that keeps me content and engaged. How will I realistically spend my days?
Finances continue to roll along, pretty much the same as usual. Still adding the max allowable to my 401k, started keeping all receipts from daily expenses, still investing most of after tax savings into equities, and watching the net worth slowly creep upwards. It all feels pretty hollow at the moment. I've had some days off lately where all I did was sip coffee in the sunroom while surfing the web or streaming euro soccer matches. That's not a life. I'm lost in so many ways.
Things are spinning out of control, and depression taking hold. Gaining weight, eating poorly, unmotivated even by my favorite activities, work stress, stress around my property/house. Anxiety, irritability, and feeling like I've wasted a lot of my life. Feeling like my job and my life don't really matter (not suicidal, at all), just depressed at what my life has become. Not married, no kids, poor social life. No intrinsic satisfaction from work, and wondering if this is it? Is this as good as it gets for me? I've been reasonably content for the last several years under similar circumstances, why is the depression taking hold?
I was pretty depressed through most of my 20s. In my 30s, it was gone. No reason I can point to, it just faded and I was content. And even now I am mostly content (until the last few months), but trying to figure out what I need to change. It feels like the demands on my time are mostly the issue. Even when I have time to pursue my passions, it feels so rushed to pack, coordinate with partners, go do the thing, come back, unpack, deal with all the chores and stuff I should have done before. Etc, etc.
The property I own outright, a cabin near desert wilderness, has been a long term project. Which I have done almost exclusively solo, everything from floors to tongue and groove ceilings, new sheetrock, etc. But now the project is about halfway done, and I just want out of this property.
I want out of it mostly because I had a friend living there for a couple of years while he was in poor health and having hard times financially (and I am renting a different place close to work, so I'm not there anyway). He is since deceased, and everytime I am there all I can think of is my dead friend. I will take a beating on the sweat equity I have in this place if I sell it in "project" condition (I ran he numbers at some point, and my work would be compensated at about $5/hr...lolz).
Basically need to get it into a state I can sell it, which means either more sweat and time, or hiring out some work...which seems silly when most of it is within my skillset...but I don't have the time or energy (well, I do, but if I spend all my free time doing that shit...like I have for a couple of years now, I will be really really depressed...part of why this feels like an albatross is that it eats my too much of my free time...it also becomes a collection place for junk, truly amazing what has accumulated within 3 years).
I don't know. There is a thick cloud of melancholy descending over everything and I am wallowing in self pity...well, not really pity. Like I said - I don't know. It's hard to get a grasp on what it is really.
I also want that chunk of my asset base that is in the property in something more liquid. This property was sort of a "practice" house for me, my first owned property and very cheap. But I really am not sold on being a homeowners (at least not for an older home) and still want that 60k or so into an income producing asset, rather than a depreciating one. I could rent the house at about a 10% ROI/ROE, but not am not all that interested in being a landlord.
I am really doubting my long term plan. Not about getting out of the workforce - although there is some of that too, but mostly about where do I want to settle that will allow me to live a day to day life that keeps me content and engaged. How will I realistically spend my days?
Finances continue to roll along, pretty much the same as usual. Still adding the max allowable to my 401k, started keeping all receipts from daily expenses, still investing most of after tax savings into equities, and watching the net worth slowly creep upwards. It all feels pretty hollow at the moment. I've had some days off lately where all I did was sip coffee in the sunroom while surfing the web or streaming euro soccer matches. That's not a life. I'm lost in so many ways.
Re: SoCal Will Journal
My life is not without depression or self pity: I just dont have the balls to post it like you just did. I have been through enough of it to know not to do anything destructive or stupid while in the state you reference. I do not have any magic tricks other than a clean diet or exercise to make you feel better but writing it down is a good cathartic and sharing it with others jumps ups the ante.
PS with what you have mentioned above, I don't think you will have any problem with constructive ways to spend your days!
PS with what you have mentioned above, I don't think you will have any problem with constructive ways to spend your days!
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Well, it's been a while since my last entry, two years and 4 mo! Kind of like my hard-copy real life journal, there are year+ long gaps in those volumes.
Not a lot had changed from my last post, until now.
After several years of a terrible work situation (incompetent, hostile, micro-mismanager boss), I finally got a new job, located about 200 miles away. I'll be moving there and starting the new job early next month. The good: it's a promotion, it's in the same organization so I keep my seniority and generous benefits, and get about $1000/mo raise. It's located in a part of our state with THE best weather in the US, a relatively small town with no real traffic *(compared to SoCal where I am now), basically in the heart of the coastal California wine country in sight of the ocean. I can ride a bike to the beach on my lunch break, the weather is basically always 70deg and sunny with a light breeze.
I went up to the new town earlier this week and secured a place to live that costs the same as I'm currently paying in rent (which was a feat, cost of housing there averages about 25% more than here). Got a place in the exact neighborhood I wanted to be in, very quiet, close to work and walking distance to a little market and some restaurants, with all the std American big-box store crap about 4 miles away. It was beautiful, felt much more serene, and once I adjust to the change and new surroundings, I'm sure I'll be happy to be there. No more 102-107F all summer. The downside, it's 280 miles from the cabin I own in the desert. Going to have to pay someone to keep my landscaping alive through the summers, since I won't be able to go water things. Hopefully can pay my neighbor to do it, he's basically retired.
My last couple of years were just an ebb and flow version of the post before this. Slightly depressed, some intense anxiety at times, not participating in my hobbies as much because I'd be so worn out, or would get stoned and just sit around. One hobby I actually did a lot more of was playing guitar. I've played more in the last two years than in the eight years before combined. After 23 years of playing, I'm still in love with the instrument. One of the best time/self investments I made in my early college years was learning to play, it's brought me so much pleasure, and given an outlet for creativity and just expressing yourself whether angry, happy, depressed, whatever. Sometimes it's easier to get it out on the instrument rather than talking about it.
Net worth continues to inch upwards, F.I. draws closer. I'm within ~30 mo of reaching F.I. at my current spending rate. I don't track it that closely, because I think of the ol saying "life is what happens when you're making plans". Too much focus on the plan and the future doesn't allow me to live in the now. I made a rough plan and periodically review the plan and where I am relative to where I projected I should be at that age, but I don't have spreadsheets and endless receipts and such. My habits are pretty engrained with finances, I tend to buy big ticket items lightly used (cars, appliances, guitars), max my 401k, cook for myself, etc. Sticking with those sound habits will get me there soon enough (F.I. before 46yo).
One great thing about my job is the defined benefit pension plan, about 1/4 of my income in my later years will be coming from that, it will be roughly the same as what I'll get from social security. It also has a cost-of-living adjustment, much like SS, so will retain its relative worth. Then there is the 401k element, which should again provide as much as SS, and I hope to have a similar amount in more liquid assets like dividend paying equities.All tolled, that should have my income at 62 hitting about 60k/yr, about the equivalent of 40k/yr in today's dollars. One cool part about my plan is that the income I can access builds over time. By that I mean I can access my pension as early as 57, 401k at 59.5, and SS at 62 (with penalties on the pension and SS, of course). So if things get tight, I can tap enough to keep myself fed and housed.
How long to stay in this job after hitting F.I. will be something I get to focus on about two years from now. Good problem to have when it happens! I've always planned to ditch this career before 50 and go do something I enjoy after I've made the nest egg and can focus more on job satisfaction than salary range. I know that I will never make anywhere close to what I make now once I bail. And I'm sure that as that day of leaving approaches, I'll stick around in the job to allow indulgence in some luxury things (maybe a trip to europe and asia, the "dream" guitar, etc). That will be a nice situation - knowing I can quit at any time and that I'm only continuing to work there for a specific reason(s) like funding a trip or similar.
I've had several friends and acquaintances die in the last few years, all of them relatively young in their 50s. I'm a decade younger, early 40s, but it drives home that you never know when your number is up. If your whole life is about deprivation and a spartan existence chasing FI or a relentless focus on where you are in your chase of FI, what's the point? You're not living, you're just making plans. Then one day someone hits you head-on on the road and it's all over.
So I'm anxious and nervous about the new job and the move, but happy it finally happened. I'm using this big life change to "reboot" a lot of things. I've just quit caffeine again (headache is finally gone now on day 4, hallelujah!), getting down close to my best weight for my athletics, etc.
Savings rate (including pension), is north of 60% gross income, and ~50% take-home is going into liquid assets. Within spitting distance of FI, and looking at being out of my current profession in the 30-48mo range. I like to view it as months, it seems to give me the right perspective that it's close but not so close I can get pre-occupied with it and not be focused on the job. I've built up and earn enough vacation time that I can take a week off every other month between now and leaving this job. That's pretty sweet when I think about it...six weeks paid time off a year, plus another 10 days paid holidays, 2 weeks paid sick leave, and now that I don't have to supervise people anymore I can work 9hr days and have every-other Fri off. All that time off will let me get through this drudgery with my sanity intact. It's like back in college when you knew you had to bust ass for 2-3 months, then would get a week or two off to recharge. I've not taken much real vacation in the last few years, going to remedy that in the next few.
Someone here sent me a PM a few months ago, sorry I never got back, things were crazy at the time. But it did remind me of this journal and spurred me to revisit, and re-engage on the ERE front.
Not a lot had changed from my last post, until now.
After several years of a terrible work situation (incompetent, hostile, micro-mismanager boss), I finally got a new job, located about 200 miles away. I'll be moving there and starting the new job early next month. The good: it's a promotion, it's in the same organization so I keep my seniority and generous benefits, and get about $1000/mo raise. It's located in a part of our state with THE best weather in the US, a relatively small town with no real traffic *(compared to SoCal where I am now), basically in the heart of the coastal California wine country in sight of the ocean. I can ride a bike to the beach on my lunch break, the weather is basically always 70deg and sunny with a light breeze.
I went up to the new town earlier this week and secured a place to live that costs the same as I'm currently paying in rent (which was a feat, cost of housing there averages about 25% more than here). Got a place in the exact neighborhood I wanted to be in, very quiet, close to work and walking distance to a little market and some restaurants, with all the std American big-box store crap about 4 miles away. It was beautiful, felt much more serene, and once I adjust to the change and new surroundings, I'm sure I'll be happy to be there. No more 102-107F all summer. The downside, it's 280 miles from the cabin I own in the desert. Going to have to pay someone to keep my landscaping alive through the summers, since I won't be able to go water things. Hopefully can pay my neighbor to do it, he's basically retired.
My last couple of years were just an ebb and flow version of the post before this. Slightly depressed, some intense anxiety at times, not participating in my hobbies as much because I'd be so worn out, or would get stoned and just sit around. One hobby I actually did a lot more of was playing guitar. I've played more in the last two years than in the eight years before combined. After 23 years of playing, I'm still in love with the instrument. One of the best time/self investments I made in my early college years was learning to play, it's brought me so much pleasure, and given an outlet for creativity and just expressing yourself whether angry, happy, depressed, whatever. Sometimes it's easier to get it out on the instrument rather than talking about it.
Net worth continues to inch upwards, F.I. draws closer. I'm within ~30 mo of reaching F.I. at my current spending rate. I don't track it that closely, because I think of the ol saying "life is what happens when you're making plans". Too much focus on the plan and the future doesn't allow me to live in the now. I made a rough plan and periodically review the plan and where I am relative to where I projected I should be at that age, but I don't have spreadsheets and endless receipts and such. My habits are pretty engrained with finances, I tend to buy big ticket items lightly used (cars, appliances, guitars), max my 401k, cook for myself, etc. Sticking with those sound habits will get me there soon enough (F.I. before 46yo).
One great thing about my job is the defined benefit pension plan, about 1/4 of my income in my later years will be coming from that, it will be roughly the same as what I'll get from social security. It also has a cost-of-living adjustment, much like SS, so will retain its relative worth. Then there is the 401k element, which should again provide as much as SS, and I hope to have a similar amount in more liquid assets like dividend paying equities.All tolled, that should have my income at 62 hitting about 60k/yr, about the equivalent of 40k/yr in today's dollars. One cool part about my plan is that the income I can access builds over time. By that I mean I can access my pension as early as 57, 401k at 59.5, and SS at 62 (with penalties on the pension and SS, of course). So if things get tight, I can tap enough to keep myself fed and housed.
How long to stay in this job after hitting F.I. will be something I get to focus on about two years from now. Good problem to have when it happens! I've always planned to ditch this career before 50 and go do something I enjoy after I've made the nest egg and can focus more on job satisfaction than salary range. I know that I will never make anywhere close to what I make now once I bail. And I'm sure that as that day of leaving approaches, I'll stick around in the job to allow indulgence in some luxury things (maybe a trip to europe and asia, the "dream" guitar, etc). That will be a nice situation - knowing I can quit at any time and that I'm only continuing to work there for a specific reason(s) like funding a trip or similar.
I've had several friends and acquaintances die in the last few years, all of them relatively young in their 50s. I'm a decade younger, early 40s, but it drives home that you never know when your number is up. If your whole life is about deprivation and a spartan existence chasing FI or a relentless focus on where you are in your chase of FI, what's the point? You're not living, you're just making plans. Then one day someone hits you head-on on the road and it's all over.
So I'm anxious and nervous about the new job and the move, but happy it finally happened. I'm using this big life change to "reboot" a lot of things. I've just quit caffeine again (headache is finally gone now on day 4, hallelujah!), getting down close to my best weight for my athletics, etc.
Savings rate (including pension), is north of 60% gross income, and ~50% take-home is going into liquid assets. Within spitting distance of FI, and looking at being out of my current profession in the 30-48mo range. I like to view it as months, it seems to give me the right perspective that it's close but not so close I can get pre-occupied with it and not be focused on the job. I've built up and earn enough vacation time that I can take a week off every other month between now and leaving this job. That's pretty sweet when I think about it...six weeks paid time off a year, plus another 10 days paid holidays, 2 weeks paid sick leave, and now that I don't have to supervise people anymore I can work 9hr days and have every-other Fri off. All that time off will let me get through this drudgery with my sanity intact. It's like back in college when you knew you had to bust ass for 2-3 months, then would get a week or two off to recharge. I've not taken much real vacation in the last few years, going to remedy that in the next few.
Someone here sent me a PM a few months ago, sorry I never got back, things were crazy at the time. But it did remind me of this journal and spurred me to revisit, and re-engage on the ERE front.
Re: SoCal Will Journal
Wow a long time between posts for you. Sounds like you have been going through some tough times. Sometimes the FI journey can be a dreary slog. I think treats sometimes help to move things along. Your upcoming move sounds exciting.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
And here we are, about six months since the last entry.
The good news: I'm less than a year away from reaching from F.I. at my current spending rate and about three years from exiting the workforce.
I'm slightly happier at my new job, but less happy overall.
The not so good: I've been at my new job long enough now to know it's no better than what I left, and in some ways is worse.
I've interviewed for a few jobs in the last month, and while I always make it to the final round of interviews, no offers yet. And the longer the job hunt goes on without an offer, the less sense it makes to actually take a different job and move (because I'm looking at exiting the professional white collar world by the end of 2019 and would almost certainly take a 10-20% paycut if I moved).
In some ways, I can't imagine another three years of misery at this job, and being isolated in my community (I have no family, friends, or other ties here, and left a tight-knit community where I coached youth teams and had many friends and some family). But I also know that those 3 years will blow by in no time and that I am unlikely to have equal benefits or make as much in salary if I leave. Can't beat the weather most of the year, there's no traffic, clean air. I'm just going to have to travel more, get out of the area on the long weekends, and get used to those 5hrs drives each way. I don't enjoy spending time in the car, but something has to give.
I have loads of vacation time, with six weeks on my leave balance, and earning five weeks per year. Add in the holidays, and my off days every other week (9day/80hr work schedule), and that means about 600 more days in the office, total. I think at about the 500 days remaining mark, I'm going to take a pair of "in-box/out-box" trays, open a new ream of paper, and stick the stack in one box. Then everyday I come to work, one sheet of paper goes from in-box to out-box, and I watch those days slowly but surely disappear. It will be a quiet reminder that this career of pushing paper in a ridiculous bureaucracy will be over soon.
The good news: I'm less than a year away from reaching from F.I. at my current spending rate and about three years from exiting the workforce.
I'm slightly happier at my new job, but less happy overall. The not so good: I've been at my new job long enough now to know it's no better than what I left, and in some ways is worse.
I've interviewed for a few jobs in the last month, and while I always make it to the final round of interviews, no offers yet. And the longer the job hunt goes on without an offer, the less sense it makes to actually take a different job and move (because I'm looking at exiting the professional white collar world by the end of 2019 and would almost certainly take a 10-20% paycut if I moved). In some ways, I can't imagine another three years of misery at this job, and being isolated in my community (I have no family, friends, or other ties here, and left a tight-knit community where I coached youth teams and had many friends and some family). But I also know that those 3 years will blow by in no time and that I am unlikely to have equal benefits or make as much in salary if I leave. Can't beat the weather most of the year, there's no traffic, clean air. I'm just going to have to travel more, get out of the area on the long weekends, and get used to those 5hrs drives each way. I don't enjoy spending time in the car, but something has to give.
I have loads of vacation time, with six weeks on my leave balance, and earning five weeks per year. Add in the holidays, and my off days every other week (9day/80hr work schedule), and that means about 600 more days in the office, total. I think at about the 500 days remaining mark, I'm going to take a pair of "in-box/out-box" trays, open a new ream of paper, and stick the stack in one box. Then everyday I come to work, one sheet of paper goes from in-box to out-box, and I watch those days slowly but surely disappear. It will be a quiet reminder that this career of pushing paper in a ridiculous bureaucracy will be over soon.
Re: SoCal Will Journal
I'm wondering whether it would make sense for you to move back to your old place say 1.5 years from now, accept a lower-paying but nicer job (parttime or just a different environment than what you have now) and do that for a few years while you wait for your assets to grow. You don't need a lot of money to live on, so that could be covered easily by a fulltime but much easier job than you have now, or some parttime work (independent contractor for example).
Maybe see it as an option, if living/working where you live/work now really starts to suck, or if other life events happen.
Maybe see it as an option, if living/working where you live/work now really starts to suck, or if other life events happen.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Another 16 months have passed since the last journal entry. Another change of city (transferred locations, same job & boss).
Guess I don't spend much time on FIRE forums or sites these days, I've had it figured out since about 1998 and implementing my plan more or less ticking the big boxes I'd set as goals. Since my
Back in Oct 2013, I had these stats:
Net Worth = 245k
--------------
401k = 75k
NPV pension = 80k
Brokerage account = 40k
Home equity = 50k
4 years, 3mo later they look like:
Net Worth = 700k
---------------
401k = 230k
NPV pension = 180k
Brokerage account = 90k
Home equity(2 homes, w/~100k ea) = 200k
One of the two houses just sold last week, closes next month. That will shift 100k from home equity to the brokerage account and gives a nice liquidity boost. I'd originally planned to retire to that house, but in the last few years came to decide I could never really feel truly at home there for a multitude of reasons, so might as well get that money into more liquid assets earning a higher rate of return. It leaves me feeling rootless though, that was my first house and my home address for the last 8 years and where I considered "home".
The psychological impact of having 10years living expenses liquid is hard to overstate, it's tremendously comforting. I grew up on the margins of poverty, scraping along lower middle class, and that sort of engrained a fear of being poor. It's why my plan has me working another ~4 .5 years in my current job...to pad that nest egg large enough to feel comfortable that I'll never have to go back to work and can deal with any downturns or under performance in the market.
At this stage of career, even throwing 15k/yr down the drain in rent to be here where the job is (market is terrible, would never buy here or want to live here post-retirement, so i rent), I'm able to add about 80k/yr to NW from job-inputs (pension additions, 401k, post-tax savings) alone, and that rises about 5k/yr until the year I turn 50 when some one-time longevity bonuses kick it up to about 120k.
So I'm in a really weird position from a psych and motivation standpoint. I feel wealthy for once in my life. I know if things went terribly at work and I quit in fit of frustration or something, I would be ok. I'd survive and scrape by, even without working. With even a simple part-time job, I'd experience no drop in living standards. That feels like freedom, or something pretty close to it anyway.
But I have 4.5 years to grind in a job I dislike, yet in the grand scheme isn't that bad. The plan is to take a LOT of vacation over that time, about 7 weeks paid time off per year, and just watch the nest egg grow while feeling less and less stress, knowing there are only 1000 days left of being there in the office and everyday is one less. Do I hate my job? No. But I'd rather do a million other things with my time.
Guess I don't spend much time on FIRE forums or sites these days, I've had it figured out since about 1998 and implementing my plan more or less ticking the big boxes I'd set as goals. Since my
Back in Oct 2013, I had these stats:
Net Worth = 245k
--------------
401k = 75k
NPV pension = 80k
Brokerage account = 40k
Home equity = 50k
4 years, 3mo later they look like:
Net Worth = 700k
---------------
401k = 230k
NPV pension = 180k
Brokerage account = 90k
Home equity(2 homes, w/~100k ea) = 200k
One of the two houses just sold last week, closes next month. That will shift 100k from home equity to the brokerage account and gives a nice liquidity boost. I'd originally planned to retire to that house, but in the last few years came to decide I could never really feel truly at home there for a multitude of reasons, so might as well get that money into more liquid assets earning a higher rate of return. It leaves me feeling rootless though, that was my first house and my home address for the last 8 years and where I considered "home".
The psychological impact of having 10years living expenses liquid is hard to overstate, it's tremendously comforting. I grew up on the margins of poverty, scraping along lower middle class, and that sort of engrained a fear of being poor. It's why my plan has me working another ~4 .5 years in my current job...to pad that nest egg large enough to feel comfortable that I'll never have to go back to work and can deal with any downturns or under performance in the market.
At this stage of career, even throwing 15k/yr down the drain in rent to be here where the job is (market is terrible, would never buy here or want to live here post-retirement, so i rent), I'm able to add about 80k/yr to NW from job-inputs (pension additions, 401k, post-tax savings) alone, and that rises about 5k/yr until the year I turn 50 when some one-time longevity bonuses kick it up to about 120k.
So I'm in a really weird position from a psych and motivation standpoint. I feel wealthy for once in my life. I know if things went terribly at work and I quit in fit of frustration or something, I would be ok. I'd survive and scrape by, even without working. With even a simple part-time job, I'd experience no drop in living standards. That feels like freedom, or something pretty close to it anyway.
But I have 4.5 years to grind in a job I dislike, yet in the grand scheme isn't that bad. The plan is to take a LOT of vacation over that time, about 7 weeks paid time off per year, and just watch the nest egg grow while feeling less and less stress, knowing there are only 1000 days left of being there in the office and everyday is one less. Do I hate my job? No. But I'd rather do a million other things with my time.
Re: SoCal Will Journal
Good to see you back. Its been a long time. Sounds like things are going much better for you. And that is a pretty big stack of wealth you have now. Sounds like you are enjoying having FU Money.
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
Can't even remember the last time I posted here. I guess there's not a lot to say when you've been grinding along the FI track for many years and just continue with the grind.
But I crossed a milestone today ($900k net worth)
. So, fwiw, an update:
Closing in on 47yo, and have been gradually moving away from the harsh extremes of ERE. Since I turned 30 I've spent over 2 years living in my car and van. Another year living in a converted one-car garage behind someone's house. Another 5 years in tiny 1BR and studio apts, a few in housemate setups, then about 5 more in a 900sqft house. All while working white collar STEM type jobs, the last 10yr with the same company. I will likely will finish my career here, the benefits are really, really good including 6wks paid vacation and another 3wks sick leave, and pay is in line with my profession. There are a large number of advancement opportunities on the horizon and I expect to promote soon, probably requiring moving to the east coast (grew up there, no desire to return, west coast is the best coast).
I've moved several times for my job over the last 20yrs, and during the last move a couple of years ago, I finally said "enough of this deprivation, I make $120k/yr, have way above the median net worth for my age, and I'm not living in the #@%#ing ghetto anymore". So now it's $1200/mo 3/2 with an in-ground pool in a quiet neighborhood close to work.
I've bought several guitars in the last 10 years, always secondhand in like-new condition, and not high end. But otherwise, my spending habits have stayed very constrained, my shopping habits are instilled - the waiting for sales, not concerned about brand names, buying big ticket items like cars lightly used. All the std strategies you folks know and practice.
Still driving a 10yr old Prius, still eat most meals at home, still wearing the same work clothes I bought 10-15 yrs ago at outlet malls during season-end sales. Have never paid for cable TV, netflix, etc in my lifetime, don't even have an antenna on my TV - movies only and streaming a sports match every once in a while, rarely watch it at all and getting rid of TV when I was 20yo (literally unplugged it, walked it to the dumpster and chucked it in, and started back in on my thermodynamics homework) was one of the best decisions I ever made.
So, I've already hit FI at my "bare bones" level (i.e. if I cut expenses as much as practical) and will hit FI at my current annual burn rate (which includes luxuries like a too-big house, specialty gym membership, etc) within the next 6mo. Always thought I'd hang it up and retire as soon as possible. Now, as my body starts to age and visions of an early retirement filled with endless days of climbing, biking, and fishing doesn't seem completely realistic, I find that engaging, demanding professional work is more appealing that it used to be. The trick is keeping that engagement level up, which for me requires constant new learning and new/more/higher responsibility. If I'm in the same job for more than about 3yrs I get extremely bored and start to disengage. One of the few advantages of being a GenXer is that the next 5-10yrs will be full of high level professional opportunities as the boomers all retire.
I won't work past 60, regardless how engaging the job, at which point I'd have NW around $3.0-3.5M. Which seems like plenty for a single person with no kids. In the mean time, I guess I should celebrate these little accomplishments...having gone from being $55k in debt at 31yo to 900k NW at 47yo isn't a huge deal, but it does show that with some commitment you can achieve FI at a reasonable age.
Of course not everyone can or wants to work in STEM or other higher paying fields, so there is an element of luck in my case (lucky to be born with a facility for math/science). Hang in there kids, you'll get into a routine after some years, finding the "right" level of ERE tactics for you (we all probably go through the 'cut it all to the bone' phase before realizing we don't have to go full deprivation). Then it's just living your life and watching the $$$$ pile up in your accounts. The milestones tick by...1yr salary saved, 500k, FI, millionaire, etc.
Looking forward to having FU money. That should put work life in a totally new perspective, with the ability to say no to requests ("Can you work this Sat, we've got a deadline coming up?" Sorry Bob, can't do it, have other plans I can't break, good luck), and to pushback against things I'd normally just let go ("pick your battles" is very, very good advice).
And finally, in closing...I did my laundry in a laundromat today. Because I still don't own a washer and dryer (gave mine to my secretary, a struggling single mom, when I last promoted and moved a couple years back). Told myself I was probably moving within a year and don't want to have to move those appliances. But I did make a deal with myself, hit that $1M net worth figure and I'm allowed to buy washer/dryer....which is honestly kind of stupid, but those ingrained, ultra-thrifty habits are hard to break. Best of luck to you all.
But I crossed a milestone today ($900k net worth)
. So, fwiw, an update:Closing in on 47yo, and have been gradually moving away from the harsh extremes of ERE. Since I turned 30 I've spent over 2 years living in my car and van. Another year living in a converted one-car garage behind someone's house. Another 5 years in tiny 1BR and studio apts, a few in housemate setups, then about 5 more in a 900sqft house. All while working white collar STEM type jobs, the last 10yr with the same company. I will likely will finish my career here, the benefits are really, really good including 6wks paid vacation and another 3wks sick leave, and pay is in line with my profession. There are a large number of advancement opportunities on the horizon and I expect to promote soon, probably requiring moving to the east coast (grew up there, no desire to return, west coast is the best coast).
I've moved several times for my job over the last 20yrs, and during the last move a couple of years ago, I finally said "enough of this deprivation, I make $120k/yr, have way above the median net worth for my age, and I'm not living in the #@%#ing ghetto anymore". So now it's $1200/mo 3/2 with an in-ground pool in a quiet neighborhood close to work.
I've bought several guitars in the last 10 years, always secondhand in like-new condition, and not high end. But otherwise, my spending habits have stayed very constrained, my shopping habits are instilled - the waiting for sales, not concerned about brand names, buying big ticket items like cars lightly used. All the std strategies you folks know and practice.
Still driving a 10yr old Prius, still eat most meals at home, still wearing the same work clothes I bought 10-15 yrs ago at outlet malls during season-end sales. Have never paid for cable TV, netflix, etc in my lifetime, don't even have an antenna on my TV - movies only and streaming a sports match every once in a while, rarely watch it at all and getting rid of TV when I was 20yo (literally unplugged it, walked it to the dumpster and chucked it in, and started back in on my thermodynamics homework) was one of the best decisions I ever made.
So, I've already hit FI at my "bare bones" level (i.e. if I cut expenses as much as practical) and will hit FI at my current annual burn rate (which includes luxuries like a too-big house, specialty gym membership, etc) within the next 6mo. Always thought I'd hang it up and retire as soon as possible. Now, as my body starts to age and visions of an early retirement filled with endless days of climbing, biking, and fishing doesn't seem completely realistic, I find that engaging, demanding professional work is more appealing that it used to be. The trick is keeping that engagement level up, which for me requires constant new learning and new/more/higher responsibility. If I'm in the same job for more than about 3yrs I get extremely bored and start to disengage. One of the few advantages of being a GenXer is that the next 5-10yrs will be full of high level professional opportunities as the boomers all retire.
I won't work past 60, regardless how engaging the job, at which point I'd have NW around $3.0-3.5M. Which seems like plenty for a single person with no kids. In the mean time, I guess I should celebrate these little accomplishments...having gone from being $55k in debt at 31yo to 900k NW at 47yo isn't a huge deal, but it does show that with some commitment you can achieve FI at a reasonable age.
Of course not everyone can or wants to work in STEM or other higher paying fields, so there is an element of luck in my case (lucky to be born with a facility for math/science). Hang in there kids, you'll get into a routine after some years, finding the "right" level of ERE tactics for you (we all probably go through the 'cut it all to the bone' phase before realizing we don't have to go full deprivation). Then it's just living your life and watching the $$$$ pile up in your accounts. The milestones tick by...1yr salary saved, 500k, FI, millionaire, etc.
Looking forward to having FU money. That should put work life in a totally new perspective, with the ability to say no to requests ("Can you work this Sat, we've got a deadline coming up?" Sorry Bob, can't do it, have other plans I can't break, good luck), and to pushback against things I'd normally just let go ("pick your battles" is very, very good advice).
And finally, in closing...I did my laundry in a laundromat today. Because I still don't own a washer and dryer (gave mine to my secretary, a struggling single mom, when I last promoted and moved a couple years back). Told myself I was probably moving within a year and don't want to have to move those appliances. But I did make a deal with myself, hit that $1M net worth figure and I'm allowed to buy washer/dryer....which is honestly kind of stupid, but those ingrained, ultra-thrifty habits are hard to break. Best of luck to you all.
Re: SoCal Will Journal
WOW that's a shit tonne of money.
So you lived in a car and a van and a garage. Gosh, wish you were journaling at that stage. Would have been interesting to read. You pre-dated the rest of us with your extremity
So you lived in a car and a van and a garage. Gosh, wish you were journaling at that stage. Would have been interesting to read. You pre-dated the rest of us with your extremity
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SoCal Will
- Posts: 25
- Joined: Sat Oct 19, 2013 10:46 am
Re: SoCal Will Journal
It does seem like a lot of money in some ways, but it also feels pretty abstract to me, almost not real. Around 700k of that 900k is reasonably liquid, in after-tax brokerage, 401k, and some land. The remainder is from a NPV calc of my pension.
At 35, NW was only 40k, at 38 was 75k, 41 was 250k, 43 was 400k. Now, almost 4 years later, 900k. Between 43 and now, I flipped a house, and bought some land in a foreclosure, those two deals added about 150k to NW. The other 350k has come from additional savings, investment gains, and increase in pension value.
Believe it or not, the garage year wasn't that long ago, only 3yrs back. My mom was on the west coast for business mtg, came to visit when I was living there. I still remember sitting there chatting with mom saying "wtf am I doing with my life, I'm 43 years old and living in a garage". The kicker was, it cost me $1200/mo ! Calif coast is not cheap. Eventually told my boss housing was out of control and to transfer me or I was going to quit because I couldn't afford a normal home there and refuse to share walls with anyone again (last apt was a nightmare). So I moved back to the desert, and pay the same in rent for a 2000sqft, 3/2, with in ground pool and pool service included. It's mid Nov and I was in shorts and flip flops today. No mosquitoes, no humidity, not many people. I love the desert.
At 35, NW was only 40k, at 38 was 75k, 41 was 250k, 43 was 400k. Now, almost 4 years later, 900k. Between 43 and now, I flipped a house, and bought some land in a foreclosure, those two deals added about 150k to NW. The other 350k has come from additional savings, investment gains, and increase in pension value.
Believe it or not, the garage year wasn't that long ago, only 3yrs back. My mom was on the west coast for business mtg, came to visit when I was living there. I still remember sitting there chatting with mom saying "wtf am I doing with my life, I'm 43 years old and living in a garage". The kicker was, it cost me $1200/mo ! Calif coast is not cheap. Eventually told my boss housing was out of control and to transfer me or I was going to quit because I couldn't afford a normal home there and refuse to share walls with anyone again (last apt was a nightmare). So I moved back to the desert, and pay the same in rent for a 2000sqft, 3/2, with in ground pool and pool service included. It's mid Nov and I was in shorts and flip flops today. No mosquitoes, no humidity, not many people. I love the desert.
Re: SoCal Will Journal
Interesting, that's a massive increase in NW from $75k at 38 to $900k at 47 only 9 years later! Gives me more hope with things. Am at $250k NW at 37 and feels like I am making stuff all progress, too slow. $250k in NZD btw which is not like USD, maybe more like $190k USD atm because NZD has turned to shit lately.
I would like to live in van or garage, but I have a sleeping disorder so need to do my absolute best for sleep conditions. At the moment as far as I can go is living in a run down flat with flatmates. A dream at some point is to own a sail boat and live on that. I think it would make for a nice sleep, as opposed to a van where I don't think I would sleep very well.
I would like to live in van or garage, but I have a sleeping disorder so need to do my absolute best for sleep conditions. At the moment as far as I can go is living in a run down flat with flatmates. A dream at some point is to own a sail boat and live on that. I think it would make for a nice sleep, as opposed to a van where I don't think I would sleep very well.