@Jacob,
I try to focus more and more on my twelve-month moving average of dividend+interest income versus the twelve-month moving average of spending in order to keep sane.
Otherwise when I look at our net worth going down I tend to get depressed. Focusing on income reminds me of the opportunity to buy dividend income at a lower price.
Calling it quits, when and why?
I plan to quit after two things happen:
1) my SWR passes my expenses for a few months in a row
2) I don't feel like working anymore
It sounds like 2) has already happened for you, and probably 1) as well. So quit! (Better yet: make an outrageous demand of your employer and see what they say. How about letting your employer choose between these options: you quit OR you work 10 hours a week from home for 25% of old salary + full benefits).
I see lots of people worrying about quitting too soon (and needing more money in the future) but few people worried about quitting too late (and having wasted important years of their lives). If anything, I'm more worried about quitting too late than quitting too early.
1) my SWR passes my expenses for a few months in a row
2) I don't feel like working anymore
It sounds like 2) has already happened for you, and probably 1) as well. So quit! (Better yet: make an outrageous demand of your employer and see what they say. How about letting your employer choose between these options: you quit OR you work 10 hours a week from home for 25% of old salary + full benefits).
I see lots of people worrying about quitting too soon (and needing more money in the future) but few people worried about quitting too late (and having wasted important years of their lives). If anything, I'm more worried about quitting too late than quitting too early.
Like Jacob, I have a 5-10 year attention span. Law has lasted longer than chemistry or theology; but I am fairly bored with most au currant legal topics. I've overstayed my tenure at the non-profit from a misguided hope that I'd be able to crown my career with a stint as Executive Director. But that isn't likely to happen. And the ERE philosophy has helped teach me that such a goal is ultimately illusory and counterproductive.
When I was younger, I had no fear about leaving a job that no longer held my interest. In my experience, another gig was always mine for the asking. But in the past five years I've actually failed to get offers after the interview (that never happened in my thirties). And the present economic malaise makes any job hunting a dreadful prospect.
So, I will quit the MINUTE I have my ER capital nailed down. I might transition into part-time self-employment, but only as the training wheels to full-time joblessness and the pursuit of my own interests.
@Akratic
I like your idea about the outrageous demand. I may try that this coming January.
When I was younger, I had no fear about leaving a job that no longer held my interest. In my experience, another gig was always mine for the asking. But in the past five years I've actually failed to get offers after the interview (that never happened in my thirties). And the present economic malaise makes any job hunting a dreadful prospect.
So, I will quit the MINUTE I have my ER capital nailed down. I might transition into part-time self-employment, but only as the training wheels to full-time joblessness and the pursuit of my own interests.
@Akratic
I like your idea about the outrageous demand. I may try that this coming January.
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LiquidSapphire
- Posts: 510
- Joined: Thu Jul 28, 2011 6:40 pm
@ Akratic -
That is an interesting thought, but it would take a LOT for the job unpleasantness to outweigh the stress of wondering if I really screwed myself by quitting early!
Getting a similar position back would be very difficult. I am pretty sure I will end up overshooting my ERE target by at tens of thousands just to shift the balance here. But I'm sorta chicken like that
That is an interesting thought, but it would take a LOT for the job unpleasantness to outweigh the stress of wondering if I really screwed myself by quitting early!
Getting a similar position back would be very difficult. I am pretty sure I will end up overshooting my ERE target by at tens of thousands just to shift the balance here. But I'm sorta chicken like that This has been the most difficult decision I can remember making. Many thanks for all the input...
See this flowchart for my decision process:
http://dl.dropbox.com/u/91156/work.jpg
Ha, just noticed getting a roommate is the same as not, but I would accept a smaller raise if my expenses were less.
I think I can quit with confidence. Although I wish I felt more confident!
*4% withdrawal covers my basic post retirement expenses.
*Dividends and interest are close to covering them.
*Rental income covers expenses.
*I plan to work a 20hr/wk job I enjoy, just for new experiences and social interaction.
*I will continue to consult in my field and attempt to build a business around this.
*I will continue with rental property real estate.
+I might have seasonal employment that would be several multiples annual expenses.
+I might take a FT job again, only I will require either more money, or fewer expenses.
+I will never spend the saved capital.
I have felt a tremendous loss of enthusiasm over the last 2 years. I can only hope I can recover my former self. Not following my plan and continuing to mindlessly work would be an act of cowardice.
@HSpencer: No, no deductions from this job.
@ToFi: Yes, I am considering expenses. The thing is my expenses could be 25% of what I'm paying here if I moved elsewhere.
@Akratic: Excellent point. At this point, I feel the year is worth more than I will save... I feel I am running out of years as a young man.
@bigaot: I felt % more accurately described the situation. The actual $ numbers are deceiving. 10k, 20k, 50k are all large numbers to look at, but as a percentage of the whole they are put into context. And yes, I'm trying to avoid real numbers. It's always seemed crass to me.
I had an epiphany when I started looking at % of net, rather than large numbers that are hard to get over.
Also, by not working my tax burden will likely drop to insignificant levels! Atlas Shrugged.
See this flowchart for my decision process:
http://dl.dropbox.com/u/91156/work.jpg
Ha, just noticed getting a roommate is the same as not, but I would accept a smaller raise if my expenses were less.
I think I can quit with confidence. Although I wish I felt more confident!
*4% withdrawal covers my basic post retirement expenses.
*Dividends and interest are close to covering them.
*Rental income covers expenses.
*I plan to work a 20hr/wk job I enjoy, just for new experiences and social interaction.
*I will continue to consult in my field and attempt to build a business around this.
*I will continue with rental property real estate.
+I might have seasonal employment that would be several multiples annual expenses.
+I might take a FT job again, only I will require either more money, or fewer expenses.
+I will never spend the saved capital.
I have felt a tremendous loss of enthusiasm over the last 2 years. I can only hope I can recover my former self. Not following my plan and continuing to mindlessly work would be an act of cowardice.
@HSpencer: No, no deductions from this job.
@ToFi: Yes, I am considering expenses. The thing is my expenses could be 25% of what I'm paying here if I moved elsewhere.
@Akratic: Excellent point. At this point, I feel the year is worth more than I will save... I feel I am running out of years as a young man.
@bigaot: I felt % more accurately described the situation. The actual $ numbers are deceiving. 10k, 20k, 50k are all large numbers to look at, but as a percentage of the whole they are put into context. And yes, I'm trying to avoid real numbers. It's always seemed crass to me.
I had an epiphany when I started looking at % of net, rather than large numbers that are hard to get over.
Also, by not working my tax burden will likely drop to insignificant levels! Atlas Shrugged.
@JohnnyH, it sounds like we are at similar crossroads.
"I have felt a tremendous loss of enthusiasm over the last 2 years. I can only hope I can recover my former self."
If there isn't something else in your life that is dragging you down (I struggle with this myself... will things actually be better when I retire?), then the fact that you are asking this question makes me think it may be time for you. Your posts and questions make me think you are thorough, intelligent and conservative in your planning (no freewheeling wingnut makes a flowchart like that ). If you think you are even close, then again, I think we are in similar boats, and it may just be time to take the risk because the downsides are just too big in the long term scope of things.
Not to make it about me... but I'm in the 95%+ range conservatively in firecalc. I'd like to peg it at 100%, but I think i've decided that I'm going to pose the part-time question with my employer this winter (I believe it's unlikely to be agreed upon)... then this spring, when my lease is up, I may just do it. I'll be following you're posts for inspiration!
"I have felt a tremendous loss of enthusiasm over the last 2 years. I can only hope I can recover my former self."
If there isn't something else in your life that is dragging you down (I struggle with this myself... will things actually be better when I retire?), then the fact that you are asking this question makes me think it may be time for you. Your posts and questions make me think you are thorough, intelligent and conservative in your planning (no freewheeling wingnut makes a flowchart like that
). If you think you are even close, then again, I think we are in similar boats, and it may just be time to take the risk because the downsides are just too big in the long term scope of things.Not to make it about me... but I'm in the 95%+ range conservatively in firecalc. I'd like to peg it at 100%, but I think i've decided that I'm going to pose the part-time question with my employer this winter (I believe it's unlikely to be agreed upon)... then this spring, when my lease is up, I may just do it. I'll be following you're posts for inspiration!
@LiquidSapphire: I feel like the chicken you describe.
I'm close and one of the things about getting close to ERE for me, is a change of residence. I've stayed in my 4 bedroom house for now because it is so close to work, there are no cheaper homes to own within walking distance, and there are no cheap rentals either.
I have a plan and the next step in it is to downsize the house. I'm less than a year away from my ERE target, but I'm chicken.
However, I do think it's a good idea to buy a 2 bedroom condo before the Baby Boomers start snatching them up anyway.
Reading the posts here does help ease my anxiety somewhat. And I am just about ready for the next chapter of my life.
Gah! I wish I was better for coping with change!
I'm close and one of the things about getting close to ERE for me, is a change of residence. I've stayed in my 4 bedroom house for now because it is so close to work, there are no cheaper homes to own within walking distance, and there are no cheap rentals either.
I have a plan and the next step in it is to downsize the house. I'm less than a year away from my ERE target, but I'm chicken.
However, I do think it's a good idea to buy a 2 bedroom condo before the Baby Boomers start snatching them up anyway.
Reading the posts here does help ease my anxiety somewhat. And I am just about ready for the next chapter of my life.
Gah! I wish I was better for coping with change!
I was going to propose part time with my current employer, but after going through the manuals I see that with only 30 hours employment I would still qualify for health insurance and 6% retirement matching.
So I will be proposing a weekly hour reduction from 40 to 30. And 10 of those 30 will be worked from home. Ideally, I will work 40 hours straight in the office then take the next week off. If this works well, I'll stretch it to 80 hours at work, then 2 weeks at home.
It's a nice position to be in because I am fairly neutral on the outcome, I'm happy to keep working under these terms and also happy to quit.
If they say no, I'll list my house for sale and start liquidating many of my possessions. Once I have an acceptable offer in hand for my house, I'll re-present the proposal saying the alternative is my 2 weeks notice.
So I will be proposing a weekly hour reduction from 40 to 30. And 10 of those 30 will be worked from home. Ideally, I will work 40 hours straight in the office then take the next week off. If this works well, I'll stretch it to 80 hours at work, then 2 weeks at home.
It's a nice position to be in because I am fairly neutral on the outcome, I'm happy to keep working under these terms and also happy to quit.
If they say no, I'll list my house for sale and start liquidating many of my possessions. Once I have an acceptable offer in hand for my house, I'll re-present the proposal saying the alternative is my 2 weeks notice.
I've pitched telecommute! I really hope they say no, which will make it very easy to put my 2 week notice in... I'll probably continue working for another 5 months, selling off house and many possessions, making plans, taking advantage of health insurance.
The last 6 months > 70% of my gains have come from investments and activities outside work. Meanwhile 76% of expenses are costs associated with working this job (I'm including various taxes in this figure).
Continuing work seems almost foolish, but I would continue with an hour reduction for another year or two... Getting close!
The last 6 months > 70% of my gains have come from investments and activities outside work. Meanwhile 76% of expenses are costs associated with working this job (I'm including various taxes in this figure).
Continuing work seems almost foolish, but I would continue with an hour reduction for another year or two... Getting close!
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ICouldBeTheWalrus
- Posts: 130
- Joined: Tue May 31, 2011 3:00 am
Thanks for reviving this thread I am still about 8-10 years away from retirement (according to my spread sheets/estimates.) -- but I have been giving this a lot of thought lately. (In reality, if I were to accept a truly extreme retirement, I am probably only 4 or 5 years away..) I'm wondering if I'll be able to pull the trigger when it is time, or if I will decide to keep working that additional year or two years, etc. Knowing full-well that my standard of living will be increasing for the rest of my life with every extra pay-check I earn.... however, also knowing that I'll be spending more of my youthful time slaving away (rotting?) in a cubicle.
I am always very conservative in my estimates and spread sheets.
I don't assume stellar market performance, and I assume an annual average CPI increase of 2.5% or 3%. I also probably over-planning for large and unexpected expenses. For retirement, I would like to passively generate $2500 of after-tax income per month to cover living expenses (with the assumption of living in a home with a paid off mortgage.) Looking at my past expense tracking, I usually spend around $1800 per month or less (unless I have a moment of weakness, like this past month when I bought an iPad
I am still about 8-10 years away from retirement (according to my spread sheets/estimates.) -- but I have been giving this a lot of thought lately. (In reality, if I were to accept a truly extreme retirement, I am probably only 4 or 5 years away..) I'm wondering if I'll be able to pull the trigger when it is time, or if I will decide to keep working that additional year or two years, etc. Knowing full-well that my standard of living will be increasing for the rest of my life with every extra pay-check I earn.... however, also knowing that I'll be spending more of my youthful time slaving away (rotting?) in a cubicle. I am always very conservative in my estimates and spread sheets.
I don't assume stellar market performance, and I assume an annual average CPI increase of 2.5% or 3%. I also probably over-planning for large and unexpected expenses. For retirement, I would like to passively generate $2500 of after-tax income per month to cover living expenses (with the assumption of living in a home with a paid off mortgage.) Looking at my past expense tracking, I usually spend around $1800 per month or less (unless I have a moment of weakness, like this past month when I bought an iPad
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Spartan_Warrior
- Posts: 1659
- Joined: Fri Dec 02, 2011 1:24 am
@Chicago81: your timeframe and situation sound similar to mine. Right now I've got another 9 years and 8 months according to my spreadsheets, but I could cut this in half if I wanted to be more extreme and/or less conservative. I have a feeling my dilemma will be the opposite of yours--that I'll want out as soon as it's even slightly feasible rather than wanting to stay on to reduce risk/extremeness. Psychologically, emotionally, and pretty much every way but financially, I've been ready to call it quits since last year...
We never really did the math. We just decided it was time. We were in our early thirties. Now in our mid-forties we do things that we find interesting and engaging. Not so much for the money as for the life-experience.
The most important aspect for me was control.... but at the time I didn't know it. I've since read about the Whitehall Study where they found that lower-level employees have higher death rates than their supposedly stress-out supervisors because the grunt-workers have much less control over their day. High stress + control is much more manageable than Low stress - control.
While I had a good deal of control over my work-day I still yearned for more. I want to spend my day thinking about the things I wanted to think about, not what I was being paid to think about.
Today I do several different things for money. The simple knowledge that I do not HAVE to do any of them gives me peace of mind.
The most important aspect for me was control.... but at the time I didn't know it. I've since read about the Whitehall Study where they found that lower-level employees have higher death rates than their supposedly stress-out supervisors because the grunt-workers have much less control over their day. High stress + control is much more manageable than Low stress - control.
While I had a good deal of control over my work-day I still yearned for more. I want to spend my day thinking about the things I wanted to think about, not what I was being paid to think about.
Today I do several different things for money. The simple knowledge that I do not HAVE to do any of them gives me peace of mind.
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jacob
- Site Admin
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I'd recommend getting to the point of resilience/diversification where the concept of a discontinuous transition---quitting---is no longer considered material.
A point where one no longer "quits" but just "stops a certain project", which just happened to be one's former dayjob although it's no longer thought of as such.
A point where one no longer "quits" but just "stops a certain project", which just happened to be one's former dayjob although it's no longer thought of as such.
@Johnny H -- My employer has a formal plan to allow workers to reduce their work hours along with a proportional reduction in pay. Must have a minimum 30-hour per week schedule to qualify for full benefits.
I just became the third employee in the past four years (out of a workforce of 900) to take advantage of the opportunity. Though, I only take every other Friday afternoon off (1:00 - 5:00), so it's just a reduction of four hours out of eighty work hours, or 5%. Since about 25% of my gross wage goes to income tax and FICA, I'm only losing three hours of take-home pay (but getting four hours off).
It's really quite delightful. Several of my coworkers tell me they wish they could do the same thing; of course, they can, they just don't want to lose some pay. Also, they can't hide their jealousy.
I just became the third employee in the past four years (out of a workforce of 900) to take advantage of the opportunity. Though, I only take every other Friday afternoon off (1:00 - 5:00), so it's just a reduction of four hours out of eighty work hours, or 5%. Since about 25% of my gross wage goes to income tax and FICA, I'm only losing three hours of take-home pay (but getting four hours off).
It's really quite delightful. Several of my coworkers tell me they wish they could do the same thing; of course, they can, they just don't want to lose some pay. Also, they can't hide their jealousy.
@Andre900
My work created a similar voluntary furlough day system to address cash flow problems associated with payroll. I surrendered 10% of salary in exchange for 26 days off each year. So every other week, I take a Friday or a Monday and enjoy a longer weekend. When this can be combined with a paid holiday, the four-day stretch is even better.
The only drawback to this system is that I am constantly bumping up on the vacation-hour cap maximum, since I hardly use vacation days anymore. It is getting to the point where I could take a day off each week and maintain the maximum vacation hours available to me. Last month, the company announced that it is reducing the cap by 80 hours in one year; but they also allowed a one-time cashout of 40 hours. I promptly took them up on that offer to relieve some of the pressure.
So many other employees (there are only about 45 total) have taken similar furloughs that I am waiting for the day the company rescinds the program due to losses of productivity.
My work created a similar voluntary furlough day system to address cash flow problems associated with payroll. I surrendered 10% of salary in exchange for 26 days off each year. So every other week, I take a Friday or a Monday and enjoy a longer weekend. When this can be combined with a paid holiday, the four-day stretch is even better.
The only drawback to this system is that I am constantly bumping up on the vacation-hour cap maximum, since I hardly use vacation days anymore. It is getting to the point where I could take a day off each week and maintain the maximum vacation hours available to me. Last month, the company announced that it is reducing the cap by 80 hours in one year; but they also allowed a one-time cashout of 40 hours. I promptly took them up on that offer to relieve some of the pressure.
So many other employees (there are only about 45 total) have taken similar furloughs that I am waiting for the day the company rescinds the program due to losses of productivity.
@Maus -- Sounds similar to my company. The reduction-in-hours plan was initiated in 2008 to help lower payroll cost. I, too, find I'm carrying a a high number of vacation hours. I cashed out 40 hours in Dec. 2011 and 40 hours in Dec. 2010, and still carry 120 hours and growing by 9 hours per month!
I'm waiting for the day that sr. management cancels the program out of envy.
I'm waiting for the day that sr. management cancels the program out of envy.
I called it quits many years ago and went sailing for 3 years. After that, back to work but always planning to get out as soon as feasible. And feasible should be in about 10 months. Why then? Lots of things come together around that time. My son will graduate college in a few months and that expense will be gone. I will be eligible for health insurance at very little cost to me. I am really more than ready now. I could have left almost a year ago as I could have gotten on COBRA until the health insurance benefit kicks in. But when I looked at the numbers the extra 18 months of working results in about 100K in extra savings. Cobra expenses plus what I can save and what won't be taken out to live on all adds up.
But I am ready now so the time is really dragging. After my first retirement which was rather rushed due to unusual circumstances I kind of set in my mind that 2 years would be an optimal time to prepare so I keep busy working on getting rid of stuff, fixing up the house for sale and completing a long term project. I also started working a part time job/business about a year ago just to test the waters and it is working out well.
Ten more months . . .
But I am ready now so the time is really dragging. After my first retirement which was rather rushed due to unusual circumstances I kind of set in my mind that 2 years would be an optimal time to prepare so I keep busy working on getting rid of stuff, fixing up the house for sale and completing a long term project. I also started working a part time job/business about a year ago just to test the waters and it is working out well.
Ten more months . . .
Son of a [!]... Looks like they are going to agree to 90 day telecommute trial with 20% of hours at home (one day per week).
Only issue on their end is liability and destruction of my property liability. Both made me chuckle, I told them I would sign whatever to take away my ability to sue after falling at home... Or when my graphics card catches fire from playing video games during work hours.
I'll make sure the trial goes very well, finishing projects I've been sitting on for years. Once I'm sure they see the clear benefit to them, I'll pitch adding 1 additional day per pay period at home. Using a drop from 80 hrs per pay period to 70 as a bargaining chip... Once this is in place I will be 1 week in, 1 30 hour week out. Once this is standard, I'm going push to work 2 weeks in office, 2 weeks at home. Again offering an hour reduction to 60, all that is needed to keep benefits. Perhaps I'll attempt to sell them on full time telecommute, if they say no in 1-1.5 years, quit outright.
While disappointed I can't quit easily and not be guilty, it will be so nice and foreign to not have to sit here and pretend to be working (what I'm doing now)... Grrr and back on the wheel I go. But the wheel just got much more comfortable and hopefully even interesting.
Only issue on their end is liability and destruction of my property liability. Both made me chuckle, I told them I would sign whatever to take away my ability to sue after falling at home... Or when my graphics card catches fire from playing video games during work hours.
I'll make sure the trial goes very well, finishing projects I've been sitting on for years. Once I'm sure they see the clear benefit to them, I'll pitch adding 1 additional day per pay period at home. Using a drop from 80 hrs per pay period to 70 as a bargaining chip... Once this is in place I will be 1 week in, 1 30 hour week out. Once this is standard, I'm going push to work 2 weeks in office, 2 weeks at home. Again offering an hour reduction to 60, all that is needed to keep benefits. Perhaps I'll attempt to sell them on full time telecommute, if they say no in 1-1.5 years, quit outright.
While disappointed I can't quit easily and not be guilty, it will be so nice and foreign to not have to sit here and pretend to be working (what I'm doing now)... Grrr and back on the wheel I go. But the wheel just got much more comfortable and hopefully even interesting.