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So you retired at 42 with a $1M portfolio? How many years now? That is impressive and you should be congratulated on taking such control over your life. I sometimes think that those who retired young and chose a life of relative freedom even if it meant a somewhat more austere lifestyle are better off as they have proven their concept at a time when they are still young enough to change their mind or recover if things go south. If I was single, I think I would find it much easier to pull the trigger. It is definitely a set of emotional hurdles that I am dealing with, though as of this moment in time, I have to stay working for at least another year in order to qualify for a mortgage on the new home before I sell this one to avoid 2 moves. The fact that I felt distinct relief at being “forced” to stay working tells me I’m not ready to retire yet.
And as you said, a career I enjoy and am well compensated for doesn’t help the “have to retire” side of the equation. But the “you only have maybe 15 years of do whatever you want time left” camp is louder than ever.
I am in largely the same situation. I not only like my job, but, at least from time to time, I do think I help improve the American situation, and have been proud of that. Example - remember Beslan in Russia, the theater takeover by suicide bombers? (I have heard) that these people looked at a certain nuclear installation nearby that theater, that was their "Plan A" target, but, a project I worked on helped harden it, and apparently they decided it was too hard a target to take on. I certainly didn't do the upgrades myself, I was not even the main designer, but I did play a small part. I'll take that over golf any day, and over a below-average day of fishing or hunting...but not a really great day of either, LOL.
But, yeah, I do hear you that every year I spend on the job, is one less year "doing whatever I want to do". And that you can borrow money, but not time.
You have a CPA to advise you and you come here for financial advice on your budget?
Your budget is pretty big, you have to know (being adults and all) whether that will cover you expenses.
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There is reverse budgeting in retirement where monthly savings and investments are fixed and your budget. Every thing after that is fair game for spending. What is left at designated points gets dumped into savings/investing in addition to what is fixed.
I guess that is a budget now that I think about it.
That's kind of how I do it. The Roth 401(k) part is on autopilot since I never see the money land in my bank account. $24,500 gets invested without me doing anything other than avoiding getting fired from my job. The after-tax savings/investment part is a goal I establish every year taking into account known big ticket things that are going to get in the way of saving. I just spend the rest.
I was unemployed for 10 1/2 months recently so I'm still spending money on things I deferred for those 10 1/2 months. The after tax savings & investing isn't going to stabilize for another 9 months or so.
$10,000 a month, $6,000 a month budgets? I retired from the wrong career.
My TOTAL monthly income is $2,500 a month with retirement and social security. Rent, utilities, car insurance same every month, what's left over I use to buy food, dog food and gas. I might have $5 left at the end of the month.
I get $1100. I have all the bills on auto pay and cross them off the list when they pay, then total the rest and subtract it from the account to see how much is really there. Food I've been getting online since I find its better to buy what I have on my list with NO temptations, mostly with amazon and walmart. It varies, based on what didn't get used but I buy based on replacing the larder. The phones, internet, tv stuff autopay, but its reasonable, and sufficent. And with no car, makes getting needed things easy. Property taxes have to get paid too, but they are low. Why I picked here.
What's left depends on what has to be gotten which is not a part of the above, like things needing replacement. Or the vet. What's left is saved. Sometimes it seems like a lot. Sometimes its not much, depending on last minute needs.
Then I start a new page and write it out and start recording again.
I wish I didn't feel the need to know exactly how much is there, always, but then I wouldn't grasp the true value any of it has or doesn't.
Naturally, the lower your income, (assuming small or no savings) the more important following the budget has to be in order to survive. I’ve read the shoestring threads and honestly know I could not handle trying to live on something like $1100/mo. Or even $2500/mo. I see it done all the time, as we take care of a 90yo relative that lives quite happily on $2k/mo, with over $1k to spare every month. But she owns her own home, and gets plenty of state support with free meals, very low taxes etc. She is surrounded by immigrant friends she has known for 30+ years that have always lived in small rental efficiencies in a large neighborhood where no english is ever spoken. Compared to where they grew up, they live in luxury. My 79 yo immigrant father now lives on $1700/mo easily, but he has a relatively large savings for his self insured very old age and splits costs with a roommate that has a bit more income. He would be the first to say that he is living better than he thought he would most of his life, but not as well as he thought he would in his 50s. Both of them have never had or follow any budget. They now always comfortably spend as little as possible, knowing it is always less than their income is.
Like M3Mitch, I chose a technical career as an engineer, from day one, specializing in a field that I thought would be (it was and still will be for a long time) in demand. Lets just say that everyone pretty much takes for granted that the lights are on 99.9% of the time, and that it must be pretty easy, since many peoples electric bills are less than their cable or cell phone bills. What I do helps keep the rates low and the lights on. It is not easy for most people and sometimes it is potentially dangerous (steam at 1200F and 2200psi kills instantly).
But I chose work that is always steady, and had great benefits, including a healthy pension, while living in average COL areas. I also made well above average in sweat equity renovating each home Inhave lived in and sold. While I would never get rich, my choices fit my personality and demeanor, and I am much better off than the vast majority of my relatives, and most friends I grew up with, (except the friends that became engineers, doctors and lawyers and successful entrepreneurs) regardless of all the financial and personal faux pas I made through my 30s that caused me to reset finances to zero. Twice.
So you retired at 42 with a $1M portfolio? How many years now? That is impressive and you should be congratulated on taking such control over your life. I sometimes think that those who retired young and chose a life of relative freedom even if it meant a somewhat more austere lifestyle are better off as they have proven their concept at a time when they are still young enough to change their mind or recover if things go south. If I was single, I think I would find it much easier to pull the trigger. It is definitely a set of emotional hurdles that I am dealing with, though as of this moment in time, I have to stay working for at least another year in order to qualify for a mortgage on the new home before I sell this one to avoid 2 moves. The fact that I felt distinct relief at being “forced” to stay working tells me I’m not ready to retire yet.
And as you said, a career I enjoy and am well compensated for doesn’t help the “have to retire” side of the equation. But the “you only have maybe 15 years of do whatever you want time left” camp is louder than ever.
Yes, retired at 42 with $1M liquid. Don’t really know what my expenses were, but I had assets I could have liquidated had things gone bad. That was 13 years ago. That $1m is now about $1.5m, I no longer have a mortgage and expenses have tracked around 35k a year since 2014.
So 13 years later, I’m in better shape financially.
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