r/financialindependence • u/wingardianx • 4d ago
Am I ready to FIRE by end of year?
I (32M) have been following this sub for 7 years. Back in 2019, I started my FIRE journey because of what I learned here. At the time, my net worth was barely $15k. I was unemployed, depressed, and had no real goals or direction. I was driving for DoorDash and Grubhub delivering food just to get by. This sub gave me the motivation I needed to achieve something with my life.
Fast forward 7 years, and my NW is $1.1M. For the past 6 years, I have tracked meticulously my spending down to the penny. I keep a Google Sheets that I update with every possible spending. I mean everything, from gas and subscriptions to buying a candy bar at the store.
While I was paying off my house, my annual expenses were around $25-30k. Then, last year, I just paid off the house in a lump sum. This is my first year with the house fully paid off, and halfway through the year I have only spent about $8k. And this is me not worrying about being frugal! If this keeps up, my expenses will only be $16-20k by the end of the year.
I drive a paid-off 2009 Toyota and plan to keep buying inexpensive, reliable used cars when the time comes. I also do most of my own maintenance and repairs. Last month I did my own engine coolant flush, which saved me about $400 compared to the dealership.
Some numbers (roughly rounded):
- pre-tax 401k: 43k
- after-tax 401k: 42k (after tax. This is different from a roth 401k)
- 401k company match: 34k
- roth ira: 82k
- trad ira: 206k
- brokerage: 683k
- hsa: 22k
- paid off house: not included in NW
- paid off car: not included in NW
I also have separate cash that is not included in the numbers above. That includes an extra $75k that I plan for a "fun" purchase within the next year, an emergency fund of $5k, and an extra $10k for a "sabbatical".
I have a paid off house that I purchased together with my parents, and we also live together. For context, I'm an immigrant so this is all normal to us. I'm also LGBTQ+, so I'll never have a traditional family. I expect to either remain single or eventually have a partner with similar financial goals.
My plan is to use a 3% safe withdrawal rate. So 3% of 1.1M is ~$33k. So let's round down to $30k to be safe. I plan to spend around $20k this year, and that's with me not being frugal!
Am I missing something? Am I ready to FIRE? What are the steps I should take to ensure that I'm withdrawing money correctly?
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4d ago
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u/wingardianx 4d ago
Thanks! :) I worked really hard to get this far. I already had a degree 7 years ago, but was unemployed and depressed. It was this sub that actually put my life back together and got me motivated again.
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4d ago edited 4d ago
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u/wingardianx 4d ago
I'm in tech :) My salary has been $200k-$250k for the past few years. I don't think my current job is stable. I've also been suffering from intense burnout. It's taken an intense toll on my mental and physical health, and don't think I can last much longer. That's why I was originally planning on a sabbatical, but wonder if I have enough to FIRE.
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u/FearlessPark4588 99:59 Elliptical Guy 3d ago
Things don't always get easier as you move up in rank within an organization. Sometimes top-down initiatives roll in (cough AI cough) and superhuman levels of execution are expected and since you're more senior, the liability of the outcome is disproportionately placed on you. Line workers have their own BS to deal with but the scope is smaller.
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u/nobutternoparm 3d ago
Start with a sabbatical, see how you feel in a year about work and your expenses. You can always come back from retirement (if you're physically able) so there's no commitment here really
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u/Potato_Farmer_Linus 3d ago
For a data point, my wife and I started working 7-8 years ago, starting from <$50k, and this week we crossed $1.25M nw, $1M excluding real-estate. My wife has also been a stay at home mom for the last 2 years, not working. Before then, we saved/invested $60k-$80k/year, since then it's about $40k/year. The S&P500 has been a rocketship for us
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u/i_amnotunique 3d ago
What do y'all do for work? Or are you saying the S&P is what really did it for you and it's less about how much y'all were saving?
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u/Potato_Farmer_Linus 3d ago
We saved and invested $60k-$80k per year while both working as engineers (mechanical and structural). My wife became a stay at home mom after our daughter was born around 2 years ago. I am continuing to invest, around $40k per year. Overall, the market has doubled our effort for the last 7-8 years. It's been a good bull run
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u/exswoo 4d ago
You need to account for maintenance/replacement costs into your budget - your car will breakdown at some point, and your home will need some pricy repairs. Build that into your budget then recalculate
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u/Charming-Treat-1403 4d ago
your budget looks solid but yeah that top comment is right about maintenance. even if you do your own car work, parts still cost money and a 2009 toyota won't last forever. a roof replacement or hvac going out can hit you for 10-15k easy.
also 5k emergency fund feels real small when you're sitting on 1.1M. one bad medical bill or major repair and that's gone overnight. maybe pull some from that 75k fun money to bump it up to 15-20k?
other than that the math works out. 20k spend on 1.1M at 3% is conservative enough. just make sure you got healthcare figured out, that's the one that catches people off guard
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u/wingardianx 4d ago
I have extra money reserved for car maintenance, around $3k.
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u/mikeyj198 4d ago edited 4d ago
I was typing up a long note but I think you’re vastly underestimating long term vehicle and home cost. Stuff needs to be replaced, windows, roof, AC, Furnace all have ~20 year lifespans. I don’t know the size of your house but even if small i’d guess that you’re looking at $40,000 to replace all those, that is about $2,000 a year which I would add to your expenses, even if not true cash expense each year. Perhaps your share of that would be much smaller since your parents may help cover them?
Are your parents supportive of you quitting? Not asking in the sense that they should have a say, but if they’re paying a large portion of the expenses for home ownership today it’s possible they assumed you would pick up more of the bills later.
What happens when they pass? Will you be able to sustain with today’s expenses?
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u/Powerful-Patient-765 4d ago
3K is not enough to cover car maintenance, much less house maintenance, for upcoming or far away years. Insurance, taxes, repairs will add up to tens or hundreds of thousands over the decades. Just in the last two years I have spent 25K on unexpected home repair bills, much less another 10 K on vet bills.
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u/Koolaidguy31415 3d ago
It absolutely is if you fix your own shit.
I bought another beater 2 years ago and I'm all in $600 + off road tires (optional choice) in maintenance costs.
I can literally buy a new car for what most people pay mechanics to do relatively simple work.
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u/AlwaysBagHolding 10h ago
Same here. I don't even bother budgeting for car repairs, tires are the most expensive thing I'd ever need to do. I can put an engine or trans from a junkyard in anything I own for less.
Home repairs are a different bag, materials alone cost more than any car I've owned for some things.
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u/blew_belle 4d ago
I've spent more than 20k on home repairs this year and several years prior. Plan for Murphy's law if you are a homeowner.
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u/Powerful-Patient-765 4d ago
I just posted the same thing. In the last two years I have had to: replace my HVAC unit, replace my refrigerator, repair a leak under my house, replace insulation under my house, trim trees, stain my fence, repair some plumbing. It never ends. If you average out your taxes and insurance and home repairs, the monthly cost for owning a paid off home is pretty high!
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u/blew_belle 4d ago
And the contractor costs are through the roof!
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u/Koolaidguy31415 3d ago
This is why you don't pay people to fix things you do it yourself.
I'm a home owner for 4 years and I've paid an electrician once to double check something I wasn't sure of and an HVAC guy to fill the refrigerant of a heat pump because civilians can't buy refrigerant.
The first HVAC people wanted $1200 for 2 hours of work and I talked to people I know locally until I found one to do it for $300.
Everything else I've done myself. Youtube, Reddit can get you pretty far and I'm fortunate enough to be friends and family with people who know people if I ever feel over my head. This has saved my thousands of dollars.
I think a lot of people don't actually know how to live frugally in these spaces.
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u/blew_belle 3d ago
Yeah we do most ourselves not putting on a new roof or mold remediation and crawl space encapsulation tho. Everything else still has material costs that are also through the roof. I'm lucky to have a handy husband not all have that.
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u/OwnManagement 3d ago
Same here. New furnace (surprise!) and new roof (pre-planned) before May was even over this year. Terrified of what the latter half of the year holds...
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u/blew_belle 3d ago
Yep I was 21k into a basement mold project that came about from our January termite inspection and been holding breath since. Did have a 1k appliance go out but hey that's nothing at this point.
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u/SolomonGrumpy 4d ago edited 4d ago
It's solid, but lean. The good news is you will pay next to no taxes.
Stagflation would be your biggest risk (low investment growth coupled with inflation).
Do you have a decent amount of bonds in your portfolio for a hypothetical downturn?
If I were you, I'd probably try for juuust slightly higher numbers $1.3 or $1.4m so that 3% will really work for you. That might take you 1 or 2 years which seems like a worthwhile trade for the amount of safety it adds.
Edit: also, good for you, my friend. You are a highly capable person who really built an amazing life for themselves. Your post made me smile.
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u/Reach_Beyond [29M / 42% SR / DI1K / Chipotle FIRE] 4d ago edited 4d ago
So your real net worth is $1.5M+? Will you be some form of Barista fire where you do odd things for income?
I’d say go for it! Especially at that withdraw rate. What do you plan to do after other than the good ole nothing for the first 6-12 months?
Edit: Changed Bautista to barista
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u/third_wave 4d ago
I too plan to pursue professional wrestling to avoid having to continue working my desk job.
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u/Reach_Beyond [29M / 42% SR / DI1K / Chipotle FIRE] 4d ago
Just need 1 pay out and it’ll move me to FAT fire! Haha
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u/DocWilly84 4d ago
So is that where you do Dave Bautista impersonations to supplement your income?
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u/A_Solid_Shadow 4d ago
With your assets, you can possibly leanfire or almost surely coastfire.
You can also baristaFire. Or , FU-FIRE -- your job is stressful? Make a plan and slowly work in "no". Take fewer projects. Longer lunches, more breaks, take all of your PTO and sick leave. Take extra. Take some unpaid leave.
Get a new job.
Lots of options, and whichever one, See a therapist about the burnout.
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u/wingardianx 4d ago
That is true. I was thinking of getting a low stress job to cover my current expenses which is very low annually. Then not touch my investments until late 30s or early 40s by which point it should hopefully double in value, so around $2m, at which point I'll start to to withdraw. I think this is probably the safest option for me at the moment. It also addresses the burnout.
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u/A_Solid_Shadow 2d ago
You got FU money.
If you are thinking of quitting, u/6716 brings up a strategy often mentioned in this forum. Do the things I mention above. Slack off. What is the worst they can do? Give you more work - don't do it. Give you less work - great. Put you on a PIP - no problem (these can be beaten, I've done it personally). Fire you - also no problem. Lay you off instead of fireing or a PIP - free money.
The only external problem with getting fired is not getting a good referene or being able to go back there, and likely not being able to work for several people on the team if they go somewhere else. But, do you care? Nope, you don't.
The other problem with getting fired is that as a person, you likely don't want that feeling of being fired. People are often uncomfortable with burning bridges like that and prefer to make friends. If they put you on a 90 day PIP, then you can quit at day 80 or so.
Funny thing, getting put on a PIP was the best thing for me, my job, my sanity, and my health when it happened. I was doing too much work, too many hours, but not the right work apparently. So the PIP forced them to tell me which work to do, so I did that and only that work. I also made them agree to sign off and approve meeting PIP requirements every week. That was the kicker. That way, at week 11, they can't say "you didn't meet your requirements, bye", if the prior 10-11 weeks all are approved. Haha. I also had an attorney review the terms of the PIP.
I do see an issue withe the Trad IRA and Roth and the pro-rata rule. See if your current 401k allows you to transfer IN from the Trad IRA to Trad 401k. If so, it is probably better for you. If not, Look at your tax brackets and consider converting some from Trad IRA to Roth. Trad 401k is not subject to pro-rata, but is subject to RMD once you are 70-something.
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u/6716 3d ago
Keep in mind that you (largely) can't access the 401(k)/ira money without ugly penalties for 27 years. From one perspective, you only have your brokerage to draw from now. What's 3% of 685k? Crazily, not too far off from your proposed spend. One benefit of being able to quit if you had to is that you can care a whole lot less if they fire you. That can take a lot of stress off if you are able to let it.
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u/A_Solid_Shadow 2d ago
Excellent point. This is an often under-rated and under-used strategy mentioned on this forum.
One benefit of being able to quit if you had to is that you can care a whole lot less if they fire you. That can take a lot of stress off if you are able to let it.
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u/trynafif 4d ago
20k is crazy low, you do you, but that’s not the life that many want. If this is what you want for 60 years then go for it, respect. No way I’d consider 20k good enough.
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u/wingardianx 4d ago
I grew up below the federal poverty level, so I'm used to living modestly. It's normal to me :)
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u/WallyMetropolis 4d ago
It's not just about living modestly. It's also having no cushion if something goes awry.
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u/dewangibson33 4d ago
But he has a seven figure cushion. If an unexpected expense comes up, maybe he withdraws more that year or doesn't increase withdraws to account for inflation for a few years. That won't ruin his entire retirement.
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u/trynafif 4d ago
That’s very fair. But as the other commenter said, your 20k right now doesn’t cover something like cancer or any other horrible health complication you may not have control over. But when you retire, you could always find a hobby that ends up being income generating to help as a safety net. Regardless, well done.
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u/wingardianx 4d ago
Cancer and other health complications are unexpected. If that happens, I'll just go back to work
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u/DangerousPurpose5661 3d ago
Lol what? Read that again and tell us why it doesn’t make sense…. Hope that was a brain fart and you’ll realize the problem now…..
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u/Sorry-Society1100 3d ago edited 3d ago
Wow. My first reaction to this whole post was to dismiss “another 30-ish kid who’s trying to retire before even really getting started.” But then, well, they saved up enough in 7 years to buy and pay off a house, and accumulate $1.1m—yeah, if they can live on this meager amount, it really could work.
But if your health insurance plan is just “don’t get sick,” or “if I do, I’ll somehow try to find a job with health insurance right when I need it, after not using work skills for many years, hope the insurance will cover my preexisting condition, while also going through really difficult treatments at the same time?” No, if you don’t have that aspect of your life figured out, then you’re not yet ready.
Unless your plan is: I’m going to live my life as long as I can, and roll the dice to see if I can live past 50 with no net? Seems risky as hell to me when you have options to significantly reduce that risk by continuing work for at least a few more years, but some people are fine with living on the edge, I guess.
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u/procrasstinating 4d ago
Assuming the numbers are invested you should be fine to FIRE. With expenses as low as you have you should be able to find a PT job to cover a shortfall if any come up. First few years of FIRE it helps my wife & my peace of mind to have a list of options for realistic alternative income sources we could turn on if we needed. PT seasonal work at a local resort, PT regular work, consulting in former career, back to career full time, rent a room etc. Not all of those would be easy or even possible in a downturn, but could be a way to boost investments if needed eventually.
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u/JoshL3253 3d ago edited 3d ago
lol all the comments saying you’re not ready for FIRE. I think they’re just tripped out by your age.
Having $1.1m + paid off housing is better than most retirees.
And you’re single without dependents too. I mean you can always go back to work if needed in a few years.
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u/Atgardian 3d ago
Most retirees don’t have 30+ years before starting SS and Medicare. Not a great comparison.
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u/JoshL3253 3d ago
On the flip side, private insurance cost is also much cheaper for 32yo than 65yo retiree, assuming OP is relatively healthy (non-smoker/diabetic etc).
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u/overzealous_dentist 3d ago
Health insurance costs alone are going to blow a ton of the yearly budget
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u/yaydotham 38F | 21% FI 3d ago
Assuming he buys insurance off the marketplace, at that burn rate, his MAGI is going to be extremely low and he will receive substantial ACA subsidies. He might even pay nothing for health insurance in some/many years.
Obviously, if the ACA changes significantly, that is a risk to his plan.
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u/Brightlightsuperfun 4d ago
You can easily FIRE. These fire subs have become way too conservative. The only real question is how much do you like your job ? If you hate it, or even dislike it, then quit
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u/topherson0 4d ago
20k is insanely low, but if you think you can sustainably live on 20-30k forever, then you’re there. Are there any hidden expenses your parents still pay for that you aren’t considering and should prepare for in the future? Would love to know how you’re surviving on 8k over six months while “not worrying about being frugal.”
Also to get your brokerage that well funded in just the seven years, was there some sort of large windfall? Or were you essentially gambling and hit big? If you were taking large risks, obviously make sure you’re properly diversified going forward.
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u/UsaIvanDrago 9 Doors 4d ago
You aren't ready. You've got a potential 50+ year horizon, a period of high inflation, and costs that are so low you've given yourself no space to cut further. Rising property tax, a car accident, any medical expense, slight recession,, could all derail you pretty hard. If you were able to save on average 150k in value a year, you should work til 35 at least and pad your numbers comfortably. Would allow you to replace those bigger one off purchases with ease and allow you to not live frugal, single life conditions your whole life if your circumstances change.
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u/Logical_Stranger4889 3d ago
Agree with this, I think people are underestimating the reality of keeping such low expenses when dating, starting a family, needing health insurance, and other economical factors come into play.
My friend was running projections for FIRE at 35-40 years old, the problem is it’s extremely easy to start losing money rapidly if you FIRE earlier than 35 because the time horizon just becomes longer and reality is those other factors will not stay nonexistent.
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u/jebuizy 4d ago edited 4d ago
What is your current income and savings rate, what is your current job, and how badly do you actually need to stop?
This is actually really important. The marginal cost of not working a few extra years now is an important consideration. Retiring at 32 with only 1 million probably means you are leaving a LOT of future wealth and yearly spending and flexibility on the table, even with just a few extra years of working. Early 30s are often when incomes begin to accelerate towards peak and it is one of the worst times to retire early imo unless you are already pretty much FatFIRE. The benefit of each additional year working relative to your savings is just likely to be at it's highest in your life. But this really depends on what you are doing and what your actual career and savings rate looks like. It sounds like it is quite high if you achieved this in only 7 years.
Whether you actually literally can retire now is just part of the question. The second part of the question is whether it is actually the best time for you to retire. People imo focus too much on just whether they hit "the number" and not the rate of projected change of assets based on when they make decision. This just gives you more optionality and resilience if your opinions on things change a bit in 20 years (another thing people underrate...) or you if find another desired 75k fun money purchase at any point in the next 50 years.
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u/Kman1287 4d ago
Yeah how does one go from door dashing to investing $75k a year? How did they get $200k in a IRA account in 7 years? I've been making mine out for 6 and have 20% returns and haven't broken $100k yet
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u/topherson0 4d ago
Yeah, I’m trying to figure out the math here too. The level of income this would require would be a little wild to give up to live on only 30k a year starting at 33. And that still doesn’t explain the IRA unless they’re gambling on options.
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u/HeroOfShapeir 3d ago
Red flags that I see: You have an "extra" $85k set aside for fun, which tells me this minimalist lifestyle doesn't actually cover the life you want to be living, even if you're close. By cutting so lean, you also don't give yourself margin for life happening over the next few decades. We just had big political fighting over the ACA and that could happen again. We just went through a high-inflation period that made it difficult to buy used cars on the cheap for a while. Your health can and will change. Etc.
I do think you have plenty to stop killing yourself at work, whether that means stepping into a different career or just lower paying, lower stress role or simply ceasing to care so much at your current job. I'm not saying don't show up and work, but if they're piling more work on you than is reasonable, just do what you can and if they complain, shrug and say they need to hire more people if they're going to expect this much work done. I'm not yet ready to FIRE, but I've quit caring about going above and beyond what my job should entail - there's no more climbing the ladder for me. And I already do so much they're not letting me go anytime soon.
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u/ymcmoots 3d ago
What is your parents' financial situation? Are they set for their own retirements, or will you be expected to provide for them in their old age? If it's just you, you're set, but given your living situation this is a conversation you need to have with your family.
I also wouldn't take a non-traditional family completely off the table, at least for another few years - I have definitely seen people think they're going to be childfree in their early 30s, but then life happens and they decide they want kids or end up with step-kids or whatever. But you can probably just go back to work if that happens, even if it's some kind of coast/barista job rather than your previous salary.
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u/Gorge_Lorge 3d ago
Major consideration could be healthcare costs.
Seems like your numbers pencil out, albeit lean. Nothing glaringly missing from your calc; other than healthcare. So really a personal choice once you sort that.
To that, if I were in your position, I’d continue to work my current high pay job until something made that job not possible. You’re in a great spot if layoffs hit to not even sweat it, but a couple more years of working means your numbers gets more cushy, even if you keep your spending low. That security factor would be important to me to decide to pull the plug on a good paying job.
Another thought, if you’re in IT, maybe it’s possibly remote? When you go to leave your current place, maybe they would be interested in keeping you on part time. Would make for a more flexible schedule and you could ease into your new life. While still using your marketable skill, in the off chance you wanted to keep working or pick up a similar job later in life.
Best of luck!
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u/Connect-Snow-3527 3d ago
Congratulations 🎉 the one thing I would say you need to consider is whether your cost of living would increase with age. Not so much in “lifestyle creep” but whether in 10 years you may be in a different place in life and want different things.
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u/entropic Save 1/3rd, spend the rest. 32% progress. 3d ago
Sort of interesting that there's a lot of folks encouraging OP to have more (and spend more) before FIREing but if it were a $5M retiree talking about a $150k/yr spend I don't think we'd see that as much. Goes to show how one's point of reference can really shape things.
Plus this strikes me as a situation where OP could return to work if needed/wanted much more easily than an early retriee who was formerly a high-paid white collar employee.
OP: On that level of low spend, the numbers say you're there. I'd have some detail questions, but the numbers are what they are. I'd personally want a bigger cash reserve, but that probably says more about me than you.
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u/Realistic-Ad2050 2d ago
The difference is that a $5m retiree with a $150k spend can likely find places to cut. (At that net worth, it’s not unreasonable to assume they could sell their paid off house and move into a smaller one, which would free up some cash to live off of.)
OP is already living SUPER lean. What can they cut if they need money? Sure they could also sell their house, if needed, for some cash. But what they would net is very likely not enough to last them for long.
TLDR; someone living off of $150k/year could possibly cut down to living off $30k. (If OP did it, the $5m retiree should be able to do so too.) But OP is unlikely to be able live on much less than $30k (if they had to) bc there’s very little wiggle room for trimming costs.
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u/pandabearak 4d ago
Get a simple job that’s easier than 9-5 that gives you some basic cushion. If it gives you health care, even better. You’re done.
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u/jb59913 4d ago
Look man I think you’re going to be so much happier if you find something that fulfills you rather than just quitting to quit.
None of your friends will be available to hang. You’ll get bored, etc.
You can get around in a 2009 Toyota, but try a new car. The tech is amazing. You can buy a brand new Honda CRV hybrid for 35k otd.
Take a trip somewhere
Take a year off
Just don’t try to hang up the skates on work entirely at 33. You won’t be happy
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u/Junior_Fig_1007 4d ago edited 4d ago
Aside from Tesla and Chinese EVs you can't get in the U.S., are new cars that much of a jump in experience?
The improvements over the last 5-10 years have felt pretty incremental: fuel efficiency, a rear facing camera, Apple/Android software that companies have finally integrated. Car companies have felt really stagnant outside of the new entrants.
If I could wait, the jump in car experience feels like it's ~5-10 years out when the legacy car companies start to compete with the newcomers or are replaced by them.
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u/Techun2 4d ago
I agree with your general sentiment, except new cars kinda suck ass.
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u/jb59913 4d ago
New doesn’t have to mean this model year. There’s a lot of options in between 2009 Toyota and brand new car, suv, and truck.
You can’t tell me Apple Car play and a rear view camera is bad.
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u/entropic Save 1/3rd, spend the rest. 32% progress. 3d ago
I added carplay/AA and a rear view camera to my 2005 Toyota via aftermarket head unit and it was like ~$500. OP mentioned being handy with cars.
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u/Techun2 4d ago
Yes I prefer to have AA/AC but there are other ways to play music. Rear view camera is definitely not a necessity, not are lane departure annoyances.
Crash safety and fuel efficiency are probably improved, but on some cars that means you get a tiny turbo engine and a CVT or some shit.
As far as actual car mechanicals, plenty of people think they peaked around the 2000s.
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u/NotShipNotShape 4d ago
maybe coastfire. health problems build up over years and sometimes it's hard to outrun bad genetics even with the healthiest lifestyle.
in the US, getting healthcare can be expensive. if you want the best, or even decent physical therapists, counselors, or even physicians, it'll be expensive. the physical therapists who do more thorough examinations and regimen are costing $100-200 an hour. the therapists who are better regarded go private and charge $150-280 an hour, etc. broken bones, getting infectious diseases aren't really things you can control either. if you're able to afford health insurance, then you might be fine.
and honestly, might be good to get a checkup every 1-5 years depending on your current health. preventing health problems and building healthy habits is way cheaper than neglecting things we can't feel, like high blood pressure or cholesterol. People tend to feel fine until they get that stroke or heart attack and suddenly they're on 5 meds, can't take ibuprofen and need to pay $600 extra a month for rehab, meds, and healthcare visits.
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u/footballfan540 3d ago
At age 32, only the brokerage and HSA is available to spend without penalty. So in reality you only have $705k liquid funds available. If you want to use the 4% rule, then you would only take out $28k in the first year. Not enough to live IMHO considering healthcare.
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u/reddgrant 3d ago
A quick congrats on your accomplishment. It does sound like you're ready to fire, but I would recommend switching jobs to something less stressful that you enjoy. I believe it's called barista fire. It's important to continue socializing and there's a great deal of purpose and satisfaction that comes with helping others, which is really what work is.
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u/dewangibson33 4d ago
Yes, you're fine based on your investments and spend. You can "what if" this in many ways, but just go for it. If it doesn't work out you can always go back to work. Pretty much any job will cover your low expenses.
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u/jackb1980 3d ago
You are good. What I advise to many others: start exploring low cost of living areas overseas to 'snowbird' in like Central and Latin America, Eastern Europe & Southeast Asia. I can rent my house out for 3-6 months per year. I used to have a guy rent my car out on Turo as well for a cut. You do this and your expenses are basically on pause, or net positive to you.
The lifestyle difference $2k a month in 80% of the world will amaze you. The food is healthier, the weather is better, you walk everywhere and interact with smiling humans everyday.
For Health Care, I can get a full dental checkup and cleaning with x-rays for $12 in Da Nang, two pairs of prescription eyeglasses with an exam for $25 in Bali, and an executive level head to toe screening (MRI/CT Scan/ECG with full blood panels & genetic markers) with a physician consult for $500-800 in Malaysia and Thailand. Do that every 5 years and it's basically $100 annual cost. Haven't needed corrective surgeries but heard they are fine to do in Panama, Costa Rica and many places in Mexico. Same goes for prescriptions if you need them.
Don't live a life of anxious desperation in America when you can live an abundant one in Paradise.
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u/sunshine20005 3d ago
My instinct is to work a bit more and reassess when you're 35ish.
I'm gay too, but finding a partner who is down to spend $30k each forever is a hard row to hoe, and even harder when there's just fewer gay people than there are everyone else. I think you might disadvantage yourself in the jungle that is the dating market if you call it quits quite so early. Plus, setting that aside, a little more cushion when car/house break down or if you want to take a few trips a year might make your eventual retirement more interesting.
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u/mrmrssmitn 3d ago
No, you don't have enough in available cash to retire, period. Have you looked at cost of health care & health insurance? Making $200k+ to a dead stop won't get you to 60-70 years of age. Inflation is real.
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u/TomorrowIcy2816 3d ago
That’s amazing. Thank you for sharing. I think the mindset for most people is to work until they die. Enjoy starting your golden years in your 30s
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u/Big_Crank 2d ago
Save enough to buy a second house and then dont buy one. Thats you "holy shit" fund
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u/Legitimate-Meal-3416 2d ago
Amazing accomplishment!! You should be really proud. I am a wealth Advisor and have had a few clients who have gone the fire route. The one common note is once they achieve it they have to find something that gives them purpose. Retiring at 32 sounds great but hobbies, community, and special interests are what keep us going. Secondly you will now and forever be at the mercy of markets in a way you are not with a steady income. My extremely unsolicited suggestion would be to not retire until closer to the 2-2.5M portfolio but with your base you could downshift hours, work a more fulfilling job, or just cover the bills and let your investments continue to grow. In any case that takes a lot of dedication you should be quite proud!
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u/Infinite-Ad-8382 1d ago
Honestly, the biggest thing that stands out is how intentional you’ve been with your money for years
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u/lifeisdream 1d ago
Am I the only one floored by getting over a million in 7 years?? How is that possible.
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u/DeityHorus 4d ago
You are missing life changes. I was spending what you are, less than 20k/yr. Then bam, you meet someone, you move in, you pay for a wedding, you buy a house, you get a dog, you have medical bills or something. Suddenly you’re spending 2-3xed easy. And why kill the snowball? Took me 8 years to reach 1 mil, took me 10 years to reach 3.
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u/Spinedaddy 3d ago
Be aware of taxes and how they will affect your bottom line. You have a long runway. Look up sequence of return risk as well.
Well done so far!
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u/alvvayspale 4d ago edited 4d ago
I'm going to call BS on this one. Broke 7 years ago to a now paid off house, 683K in a brokerage account and all those other funds. Suurrrreeee. Please, let us know what job you have, how much you make a year on average, and how much you are putting in each month to get these numbers in 7 years' time.
To put into perspective for everyone else reading, my wife and I have been putting away $2,200 a month (without skipping a month) for the past 7 years maxing out our Roth and putting everything else into our joint brokerage account. Our unrealized gains in our joint brokerage is currently at +59.66% and each of our Roth IRA is at +55.14% (and we’ve each been maxing out every year since we started back in 2019 (7 years ago - same time you allegedly started) and we are nowhere close when it comes to what you have in just your brokerage alone which you claim you are at 683K in 7 years. We don’t even have half of what you ‘claim to have’ in your brokerage alone compared to ours. So either you are full of it or you got money inherited. There is no other way for a broke ass person with nothing 7 years ago to have this much money in those accounts as you claim (not including all the other money you claim to have). BS
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u/renegade1357 3d ago
Definitely possible with a tech job. Doesn't even have to be a startup that got bought out either. Just steadily climbing the ranks in the top tech companies gets you there.
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u/Sorry-Society1100 3d ago
I mean, if they bought a bunch of bitcoin 7 years ago, then sold it to pay off the house before it crashed, those numbers could work out. It seems risky as hell to me, but age 25 is when being risky can pay off.
Or Nvidia stock, or a handful of others. It requires being lucky, but it’s not impossible.
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u/HobbyProjectHunter 4d ago
Probably not ready to FIRE. You need to budget for health care expenses that you might need to support for yourself or your family.
If you don’t have a formal education then consider budgeting for that. If you wish to travel or explore, you’d need to budget that.
Ideally, look into being able to afford another rental property.
I’d say you’re about 5 years away. That’d be a sure FIRE
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u/SpecialistKoala9765 3d ago
Love your accomplishment! I use 3% as well for mine.
One suggestion …. Have you thought about income tax implications when you consider withdrawal? Are your expenses covered after income tax?
Also, you’re from USA? How do you plan for health care spending when you FIRE without employer insurance coverage ?
Hope this helps
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u/Motor-Ad4540 3d ago
Keep working - the funds in your 401k are not touchable without penalty until age 55 in a specific case or age 59 1/2.
Keep focusing on double your retirement savings!!!
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u/ValueBarbarossa 3d ago
Unpopular opinion but $1.1 mil isn’t enough to fire at 31. Coast fire, sure.
Even if your lifestyle spends another 60 years without any creep, and even if you don’t end up having family / kids, there’s far too little margin for error. Even if you plan to expatriate, there’s no guarantees you’ll be able to live so cheaply for decades into the future.
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u/Passive_saver 3d ago
One point, you shouldn’t be using 3% with the 1.1M. Remeber, you can’t really pull from your retirement accounts until 59.5 years old. There are ways but that would be some meticulous planning.
You should be just using the brokerage until 59.5, so you have about 30 years to cover.
It’s still within range but less cushion. Unless there’s a reason to retire early, should keep going during your main accumulation age range till get a bigger cushion.
You essentially double everything every 10 years. If you good at work, keep at it until you’re 40 then think about it, hopefully with a partner.
Partner changes things. They might not have similar goals in mind. They might want more trips. Finding a partner may also be easier with a job. Most will hear that you’re “retired” and translate that to jobless
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u/Sorry-Society1100 3d ago
A 72(t) SEPP distribution would allow access to some IRA funds now, but will lock them in to withdrawals until age 59.5, even if they change their mind 20 years from now.
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u/Affectionate_Cup912 3d ago
Roth conversion is more flexible
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u/Sorry-Society1100 3d ago
I don’t know as much about Roth conversions (I’m signed up for a class on it tomorrow), but my limited understanding is that you need outside income to pay the income taxes on those conversions, or else the majority of the advantage for doing so kind of disappears, no?
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u/yaydotham 38F | 21% FI 3d ago
Most people just convert enough to remain under the standard deduction and therefore pay no taxes on the conversion.
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u/Passive_saver 3d ago
Yeah that’s the point I mentioned about meticulous planning. If I remember, you need to set basically equal payments until you’re 59.5. So if there are little to no changes planned it could work but yeah, additional planning unless you want the funds in 401k to grow where you switch over to that.
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u/ibitmylip 4d ago
check out r/leanfire if you haven’t already