The Final (?) Countdown

Where are you and where are you going?
Salathor
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Re: The Final (?) Countdown

Post by Salathor »

Western Red Cedar wrote:
Sat Aug 07, 2021 6:44 pm
Hi WRC, my plan has been to use a roth conversion ladder for the IRAs while living off the dividends from taxable accounts, pulling however much I can to minimize taxes while keeping myself out of the Medicaid gap. I probably won't convert the 401k right away because it's a solo-401k that my wife funds through her internet work (a business writer)--but we may start contributing to a Roth 401k instead going forward, unless we need that income.

My thought has been to save the 457 for last since it's so flexible with RE to withdrawals. I can always withdraw it penalty free in a year if something unexpected comes up that I can't fund from my regular investment accounts. I'd prefer not to have to, but it's certainly better than having to pull money out of a real IRA early. We've about 25% of our NW in the 457, so there's quite a few years of savings in there if it came down to it. I haven't considered the 457 in relation to social security at all. Do they conflict in some way? SS is so far off it hasn't played much into my planning, except insofar as it's 'free' life insurance for the wife and kids if I die early.

My thoughts on the conversion ladder were the same as yours, but now that we're getting closer I'm not sure we're going to have as many years of true/near zero income to convert as I had thought. I'll probably end up having to pay SOME taxes at least on the conversions, but hopefully not much.

Western Red Cedar
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Re: The Final (?) Countdown

Post by Western Red Cedar »

Thanks for the detailed response. No issues with the 457 and SS. I'm just trying to limit the amount in my 457 by the time I'm in my 60's when my pension and SS kick in, so I can limit the taxes on my withdrawals/supplemental income. Ideally, I'd like to drain that account without paying taxes in the next 20-25 years.

I'm planning on using geoarbitrage to deal with the health care situation immediately after leaving work, but also like the flexibility of the 457 to generate income to optimize health care options if/when we are back in the US.

I have a slight concern with tying up funds with a 457 to Roth IRA conversion when I could have otherwise just accessed those in another tax year. But, I'll likely have over 100k even if I did 5 straight years of Roth conversions, which is somewhat unlikely. I suspect that the actual number of years ripe for zero income conversions will be small, so I should probably move forward with Roth conversions in future years.

The more I think about it, the more likely it is that our FI, post-career lives will include some hobby income or side gigs. DW will probably pick up paid work as well.

AxelHeyst
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Re: The Final (?) Countdown

Post by AxelHeyst »

Salathor wrote:
Thu Aug 05, 2021 11:22 am
Hey Salathor, I'm just catching up on your journal. I'm really glad you've started it, I'm keen to see how you navigate post-FI life and rural-but-mindful living. Is the rural land you're RE'ing to in CA as well?

I feel like I've been wrestling with your point number five, how to make a difference, for a long time. I don't have it figured out by a long shot, but here are some thoughts that have helped me out here and there, maybe one of them will kick something loose for you?
  • Introspecting your way to The Answer is probably impossible. Try to think about experimentation and iteration, and give yourself the slack to try some of this and some of that on your path to something that's a good fit for you. Epstein's Range is relevant here.
  • Do start with self-awareness. Rob Greenfield had solid marketing chops when he had his Road to Damascus about-face and is either extroverted or at least very good with people and social capital. He took the elements he already had and did something with that. Play to your strengths is probably a better strategy then copying someone who is very different from you. (Similarly, Jacob is good at being incredibly strategic and thoughtful, and packing dense information covering multiple domains at once, so he did that. Jacob would make a terrible Rob.)
  • My experience going from full time to part time to funemployment over the past year underscored the "you can't introspect your way to the answer", or at least I can't. I had all sorts of ideas for what I'd do when I got gobs of free time, and most of those ideas were either just silly or still so colored by my FT employment modes of thinking that they were useless once I left FT employment. You'll probably have to give yourself a lot of mental slack to drop in to what being RE'd is like before you'll be able to productively ideate about how to spend your time.
  • Seek inspiring stories, the more the better, with an eye out for people who have similar strengths as you. e.g. I think Beau Miles is awesome, but he and I are *such* different people there's not much there for me in terms of figuring out what to do with my life. I'll never be a yt personality. I can just cross that off the list. Mike Reynolds, Sunray Kelley, the New Alchemy Institute folks, and all the people on youtube who build cool stuff in their shops and post how-tos? Hm, now that maybe fits (mostly introverts or *trovert agnostic, like to build cool stuff, sustainable/natural shelter, etc) and I can start to examine some elements from those people for possibly combining into what I do.
  • +1 the "raising kids" as a big part of how you can make a difference. I was homeschooled, and sort of want to have kids just so I could take a crack at homeschooling my own in a unique way.

Salathor
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Re: The Final (?) Countdown

Post by Salathor »

AxelHeyst wrote:
Tue Aug 10, 2021 12:04 pm
Thanks for reading Axel.

I'm right there with you on 'youtube or gram star' probably not being the future for me. I'm just feeling like having a significant amount of doubt about how to productively use my time. If you're up on your parables, I don't want to be the servant from the Parable of the Talents who just buries his gold and leaves it (in this case, my talent being the free time I've got). I'm not sure how that works into my own future, but I feel like I don't want to squander the chance to do some good (even if it's just at a local level) with that opportunity. I think I could easily fall into a trap of playing too many video games/puttering around in the garden/idling my life away, and I don't want to do that.

I didn't mean to imply that I want to be a social media influencer ala Rob (I haven't had social media since 2013 or so!), but rather than I wanted to multiply the effects of FIRE/sustainable living rather than making a change only in my own life.

Yes indeed, the rural property's in CA too. A couple of acres close enough to the beach that I'm hoping to fish/learn to surf, but not so close that I feel awesome about making the drive more than a couple times a week (hence thinking about an electric car). Looks like we'd be looking at about 7,100 miles per year in driving too/from the beach if we went twice a week. That's a little more than we drive per year now due to our long road trips, but not as bad as I was initially fearing. If we cluster shopping/library/etc. in there it may be okay. Still not idea. We both really want to be in Florida or somewhere, bike or electric golf-cart distance from the beach.

We're really looking forward to homeschooling, other than the worry about making sure our girls get enough interactions with other kids. That's going to be something we're really going to have to think about. The oldest is in kindergarten right now and we're in an area where she's got friends nearby, so it isn't a concern, but going forward it might be. Both girls are super social (unlike us) and it could be an issue.

AxelHeyst
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Re: The Final (?) Countdown

Post by AxelHeyst »

Salathor wrote:
Tue Aug 10, 2021 1:33 pm
I didn't mean to imply that I want to be a social media influencer ala Rob ....
No, you didn't, I just grabbed him as an example. The fact that you lurked here for years, quietly getting your family down to $1,100/mo somewhere in CA (!), was clear implication that you probably don't go in for splashing your life across the internet.

I'm sure you're thinking about it thoroughly, but for my brother and I, sports were a huge aspect of getting us socialized. There was a tiny local private school that let homeschoolers play on their varsity teams (without homeschoolers, they wouldn't have had enough kids to take the field), and being able to do efficient and high-quality academic work in the mornings and then go to practice 2hrs/day M-F with 10-15 other kids our age, and occasional games we had to travel for and such, was a ton of high quality socialization (along with all the other benefits of team sports).

mooretrees
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Re: The Final (?) Countdown

Post by mooretrees »

Do you know the area where you're planning on moving pretty well? I ask because one way to make a difference is to dig into what your local community needs. For example, maybe you could start some sort of carpool to the beach? Save a little bit of gas and increase connections with other local folks. Once you deeply know an area, then it becomes easier to see places to put your energy and talents to help. I know this might feel too small scale, but it can be more satisfying to help locally then to send money to a huge non-profit that is doing good work.

Salathor
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Location: California, USA

Re: The Final (?) Countdown

Post by Salathor »

mooretrees wrote:
Thu Aug 12, 2021 8:26 am
These are good ideas. No, I don't know it THAT well although it's the same property my wife grew up on. It's ultra-rural ag land, so neighbors are uncommon, but things like you're talking about are good ideas. Small changes that I can make with my own life, etc. I like it!

Salathor
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Spending Update -- July 2021

Post by Salathor »

We've finally balanced our accounts to see real spending for July 2021. These are disappointing numbers compared to last year when our house was paid off, but still reasonable I think.

Monthly Bills
Rent: 2,200
Internet: 35
Power: 67
Water: 71
Total: 2,374

Everyday Expenses
Groceries: 202
Gas: 108 (drove 300+ miles to visit family)
Restaurants: 88
Household Goods: 30
Fun Money: 6
Alcohol: 74
Gardening: 19
Total: 527

Irregular Expenses
Medical: 175 (I had an ear infection that took 3 different sets of medication to cure)
Clothing: 61 (I bought a new bike helmet. This will be totally reimbursed through work, so it will actually cost me 0)
Car expenses: 220 (transmission service)
Business: 12 (mailing costs for selling stuff on facebook)
Total: 469

Total Spending: 3,370

Disappointingly high for us, but cutting out the 2,200 in rent will get us back to our ~1,100 that I'm shooting for.

Salathor
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Re: The Final (?) Countdown

Post by Salathor »

I spent the morning watching my youngest daughter today as my wife took the older one to an appointment. We walked through a neighborhood, watched bees and examined flowers, etc., with the enthusiasm of a two and a half year old. The weather was perfect--low seventies and sunny, not smoky--and I reflected on the fact that I was going to have to be heading into the office for work soon.

I'm not sure how much longer I'll be working. I'd initially thought Jan 1, but now I'm realizing that the point of that date can easily be replaced by December 1, when my insurance would then carry me through the end of the year and I could switch onto the health exchange. Further, I can't really work until the 1st because we need to be out of our rental by then, so...? It's possible that I've got as little as six week of work left here.

I have two months of vacation saved up, so I could theoretically take off all of October and November, although I doubt my employers would allow it. Things have gotten strange here, with vacations being cancelled and new COVID restrictions coming into play and it bums me out that I may have to end a ten-year career on a low note.

It seems like the future is coming fast. We sold our house last year and thought, "We've got a year to figure this out," but the year has flown by and the end is coming soon and it feels like we're approaching a crossroads.

I'm frightened by what could go wrong and can tell I'm not emotionally valuing what could go right properly. Even in a bad case (market crashes the day we retire) we could easily survive on a part time job. Anything that's more of an emergency than that probably wouldn't be any better handled by me keeping a full time job.

Salathor
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Re: The Final (?) Countdown

Post by Salathor »

Today is my final day in the office. After this I am taking two months of vacation before ending employment in mid December. I'll be 'retired' just before my 35th birthday. I don't know what will come after that, but I'm excited. Work has gotten a lot better since I last wrote--I think less stress all around.

I'm looking forward to tomorrow, but Wednesday will probably be the first day that feels different. On Weds we take our older daughter to her in-school day and then we're going to go explore neighborhoods nearby on foot for a few hours. We did it a few weeks ago when I had a day off and it was wonderful. It will be strange to do it knowing that I can do the same thing every Wednesday from now on.

Western Red Cedar
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Re: The Final (?) Countdown

Post by Western Red Cedar »

That is great - congratulations!!! Please keep us posted as you transition. I'm always really interested in the changes after transitioning away from the traditional working world.

rube
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Re: The Final (?) Countdown

Post by rube »

Congratulations Salathor!

Dave
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Re: The Final (?) Countdown

Post by Dave »

Great stuff, congrats Salathor!

theanimal
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Re: The Final (?) Countdown

Post by theanimal »

Congratulations!! Looking forward to reading about all kinds of fun.

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Lemur
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Re: The Final (?) Countdown

Post by Lemur »

Am I reading it right that for a family of 4 you had groceries at $202 during July 2021? That is impressive! :)

Congratulations on leaving full-time work behind. I am also looking forward to how you handle the transition.

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mountainFrugal
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Re: The Final (?) Countdown

Post by mountainFrugal »

Congrats! Make sure to post here when you forget what day of the week it is and/or do something on the wrong day.... that is the day you will be officially free. :)

Tyler9000
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Re: The Final (?) Countdown

Post by Tyler9000 »

Savor the moment. You earned it!

Salathor
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Re: The Final (?) Countdown

Post by Salathor »

Thanks all! My daughter ended up getting sick this week so we ended up heading down to our in-laws where we'll be living early. Things are looking pretty good down here. Planning to use the time to scout the area, decide which things we can bring down/sell, etc. The old structure where we'll be living is in much better shape than I remember, which is a pleasant surprise. We may purchase one of those online mold tests though, just in case (nothing visibly moldy, but there was a leak in the past).
Lemur wrote:
Tue Oct 05, 2021 6:13 pm
Am I reading it right that for a family of 4 you had groceries at $202 during July 2021? That is impressive! :)
Hi Lemur, yes, that's right. We do a fair amount of dumpster diving and we have found a food bank that opens up to the general public after the area's needy folks have had a chance to sort through it, as a sort of 'rescue this stuff before it spoils' situation, so we've been doing that too. I'd never want to abuse charity but I'm happy to rescue the stuff from the trash after all the people who really need the food have checked it out. It's a really great program where the food is all donated by local grocery stores when it's messed up--open boxes, crushed things, etc., that are all still perfectly good but maybe unattractive or close to its expire date, so Trader Joes or whoever donates it instead of throwing it away.

I think this particular month was also fortunate in that we maybe bought some staples the month before. Our true average is closer to $275.

Salathor
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Re: The Final (?) Countdown

Post by Salathor »

Well, our plan to renovate the little trailer/house on the property is probably falling through. It's simply got too much water damage and will probably be a tear down. Unfortunately there's no way to get vehicles to where the house is (they ended up building around it). This means we're probably going to have to buy a trailer or a small RV and locate ourselves elsewhere on the property. I think this will still be okay money-wise as long as we can commit to staying for 2-4 years, which I think we can do once we get everything sorted. If we do that, we'll be shooting for relocating to our ideal home site (a .5+ acre small house within walk/biking distance of a mid-size city downtown) around the time our oldest daughter turns 10--which I'm hoping will still be young enough that it's easy for her to make friends.

2Birds1Stone
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Re: The Final (?) Countdown

Post by 2Birds1Stone »

A used travel trailer that needs some TLC might be a cost effective option since you won't be moving around with it. What is the electricity/water situation on the property?

What is preventing you from getting a jump on relocating to your ideal home site now?

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