What bumps were along your road?

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toto238
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What bumps were along your road?

Post by toto238 »

So we've all heard the narrative of the person who graduates college at 22, starts making $x per year, saves x% of it for 45 years every year, and then retires at age 67 with $xmil. We all know the story, and I'm sure there are individuals who's lives actually worked that way. They started one job right after college with a steady paycheck, never had an extended period of unemployment, never had a large dip in income, got an inflation-beating raise every year, and were always able to save consistently every single year. That guy is out there.

But of course you're not that person. You had bumps along the road. Maybe you went back to graduate school and spent a few years thereafter making less money than you did before. Maybe you stopped to raise a kid, then rejoined later. Maybe you had a few years where you just couldn't find work. Maybe the company you dedicated your life to folded ten years before you were planning on retiring.

What bumps did you hit along the way, and if you've recovered from them, how did you?
TFinator
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Re: What bumps were along your road?

Post by TFinator »

'Bumping' this because it's a good topic and I am hitting my first bump at 26. I am a little nervous and would like to hear some stories for some perspective.
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toto238
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Re: What bumps were along your road?

Post by toto238 »

TFinator wrote:'Bumping' this because it's a good topic and I am hitting my first bump at 26. I am a little nervous and would like to hear some stories for some perspective.
I'm a little younger than you, but my first "bump" in my road has been me and my wife's student loans. Right now, between the two of us, we have close to 100k in student debt. She's going to be a music teacher :?

I'll be sure to update Bogleheads when we work our way through that bump. In the meantime, I'm blessed to have an employer that provides a generous 401k match so my retirement savings aren't 0.
travellight
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Re: What bumps were along your road?

Post by travellight »

Divorce, very costly.... and I am female.
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rec7
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Re: What bumps were along your road?

Post by rec7 »

Having bad grades in school no matter how hard I tried. I just had a learning disability. In other areas in life I shined but a lot of those areas are not tested. So at times that would get me down.
Last edited by rec7 on Thu Oct 02, 2014 2:06 pm, edited 2 times in total.
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FelixTheCat
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Re: What bumps were along your road?

Post by FelixTheCat »

Wife became angry ex-wife. 8 years of court battles. The good news is the family law attorneys and ex-wife increased their net worth. :oops:
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red5
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Re: What bumps were along your road?

Post by red5 »

Currently trying to get over the bump in the road consisting of finding a good job to begin a career.
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toto238
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Re: What bumps were along your road?

Post by toto238 »

Does anyone have a story other than divorce?

Surely some people on this forum were laid off and without a steady job for a long time. Surely this forum doesn't consist solely of those that made it by having few to no financial shocks, and those suffering from financial shocks.

It sorta gives the impression that the only real way to be financially successful is to not get hit by any surprise financial shocks. If you do, just by luck, your chances of being financially successfully are pretty much over.

Anyone have any stories that could restore my optimism?
MP1233
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Re: What bumps were along your road?

Post by MP1233 »

Didn't have a real job until I was 34. A lost decade of graduate school and postdoctoral training.
2015
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Re: What bumps were along your road?

Post by 2015 »

Good God, all I've had were bumps along the road. So much so that I've come to expect them. Since 20, I've died and turned into someone new about every 11 years. I'm 60 now, and it's happening again (and I'm loving it this time).

I like to say I was thinking differently/reinventing before Apple was even thought of. Then again, I also say I've failed at absolutely everything there is to fail at in life. But here's the rub: I never stayed down. I always got back up, and each time I came out better than before. My unintentional motto in life has turned out to be "too stupid to stay down".

Yes, when I was 20, 31, and even 42/43 these changes traumatized me. Now, not at all. In fact, I look forward to them. So if you're 26 and getting nervous, just know from someone whose been there and back many times, it all works out. In fact, it all just keeps getting better and better. Really.
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SkierMom
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Re: What bumps were along your road?

Post by SkierMom »

My Bump was basically, three years of my life:

Laid off from my professional engineering position in 1998 with a very generous severance package (including an additional one month salary if I chose NOT to use their employment "placement" service. I didn't.) Decided to use savings to travel extensively through the world, Europe, trekking in Andes and riding my bike around China, Vietnam, Thailand and Laos. Ended up on beach in Thailand eating fabulous food, sailing and swimming every day.

Bummed around another year working as a bike guide making minimum wage but travelling extensively in American southwest and British Columbia, Alaska and Hawaii.

Got married 2000. Cashed in remaining IRA from previous employment (see 1998) to uses as a down payment for a starter home. Had Kid #1 with no retirement savings or health insurance.

Fast forward 14 years: Saving almost 20% into retirement accounts (457 and Roth) as well as 529 college accounts. We also sold our starter home and have a larger one with almost 50% equity.

Looking back, I would never trade those three years for anything.
Wagnerjb
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Re: What bumps were along your road?

Post by Wagnerjb »

Quit my job (with an accounting firm) in my early 20's to get an MBA. Went deep into debt for the MBA, which was at a private University. "Recovered" by finding a decent job post graduation and adjusting my spending so that I could pay off the student loans within five or six years. My wife phased out of working outside the home in her late 30's. First she went to working half time and we "recovered" by adjusting our spending to deal with the lower income. Then she stayed home full time, and we "recovered" by adjusting our spending to deal with the lower income. During the time that she was phasing out of paid work I got a promotion or two, but the extra income certainly didn't offset her loss of salary. It just made the adjustment a little less impactful.

In my case, these "bumps" were all anticipated and planned for....so the impact was spread out. The impact wasn't any less than somebody being suddenly laid off but in both cases the impact was spread out. With quitting for an MBA, the impact was felt while paying back the student loans. With my wife leaving the work force, we adjusted our spending gradually so the changes were not so sudden.

Best wishes.
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stoptothink
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Re: What bumps were along your road?

Post by stoptothink »

imgritz wrote:Wife became angry ex-wife. 8 years of court battles. The good news is the family law attorneys and ex-wife increased their net worth. :oops:
I got into real estate development during the boom. Made a lot of money really young (early 20's), to the point where I genuinely was expecting to retire in my 30's and even told my mother that she'd never have to work again. Then came the crash. Luckily I wasn't overleveraged like almost everybody else in the industry (including both my partners) and I was saving some money, so I didn't lose everything and wasn't forced into bankruptcy. Nonetheless, at 26 I had to pretty much start over with little to show for the past 5yrs. I got a 9-5 job and started working on a masters degree, then PhD.

I did though still have enough to pay off my wife's undergrad loans and put her through dental school without taking out any loans...we separated during her final semester. 11-months of battling in court, she got $150k+ in education paid for, all her other debt covered, and half of everything I had saved during our marriage (she was in school and did not earn a penny during the course of our marriage), and I got to pretty much start all over again at 28. Luckily, when she went after the retirement savings I had stashed prior to our marriage, her lawyer was literally laughed out of court.

Now at 33, finally feel like I have learned enough life lessons and am finally headed in the right direction.
technovelist
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Re: What bumps were along your road?

Post by technovelist »

I got laid off in 2001 at the age of 52. My wife and I thought I might never get another job.

I wrote a program that sent out copies of my resume to every job that listed my main programming language skill on Monster, Dice, and one other board that I don't recall at present.

After about 3 months doing this a couple of times a week, I got a job offer from it, in Florida. So with two weeks' preparation, we packed up a U-Haul trailer with some clothes and other personal stuff and drove from to Florida, leaving our East Texas house behind.

After changing jobs once more, again in Florida, as a delayed result of my previous "resume blasts", I got laid
off again in 2004, and moved back to Texas. I collected unemployment while continuing a job search.
Then I got a temp job west of Dallas, so we commuted weekly to that job while I continued to look for a longer-term job.

Next I got a "perm" job at a tech company, where I stayed for 3.5 years before being recruited by another tech company during layoffs at the one where I was working.

I got hosed at the new company due to their :annoyed review policy, so I quit there and again thought I was "retired". This time, though, we had enough saved that we could survive at more than the "cat food" level if I never got another job.

Then a few years later I was discussing programming with my son-in-law and got the notion that his company might need some more programmers. I asked him and he said "Sure, give me a copy of your resume." They hired me, and I worked there for two years.

Now I'm on a short-term contract position and keep getting calls from recruiters, but when I get done with this contract I think I'm going to go into business for myself with a new software product I'm working on.

Does this story have a moral, other than that one shouldn't give up? Maybe that grey hair isn't as much of a hindrance to getting hired in software as it used to be! :moneybag
In theory, theory and practice are identical. In practice, they often differ.
anonforthis
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Re: What bumps were along your road?

Post by anonforthis »

3 laid offs in 7 years.
letsgobobby
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Re: What bumps were along your road?

Post by letsgobobby »

toto238 wrote:Does anyone have a story other than divorce?

Surely some people on this forum were laid off and without a steady job for a long time. Surely this forum doesn't consist solely of those that made it by having few to no financial shocks, and those suffering from financial shocks.

It sorta gives the impression that the only real way to be financially successful is to not get hit by any surprise financial shocks. If you do, just by luck, your chances of being financially successfully are pretty much over.

Anyone have any stories that could restore my optimism?
The issue is not not having shocks. The issue is only saving as if your life will not have shocks. In other words, if you save 10% per year expecting 8% real returns and then you get laid off and the markets only return 5%, is that a shock (meaning, surprise)? I wouldn't count that as a shock, but maybe some would.

What I'm saying is that while I have had good fortune and good instincts, and a good result financially thus far, it hasn't been a straight line. I just wouldn't call any of my non-linear moments "shocks." They're just what I call "life."
bhsince87
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Re: What bumps were along your road?

Post by bhsince87 »

I started out on a nice path: good engineering job right out of school, started investing after my 4th or 5th paycheck, had an awesome career path, etc. Was at the same company for around 12 years. Had a dream job opening come up in another division that required relocating, but I took it.

Sold our house at a bit of a loss (after 7 years in it), and we stretched a bit for our new house. I sold about 80% of my outside investments to gather up the 20% down payment. I was left with about 3 months cash emergency fund, and another 2-3 months in equities. Then to "celebrate", I bought a new BMW (3 year loan).

All along the way, I was putting 10% into the 401k where I worked. However, about 70% of that went into company stock. It was one of the "Nifty Fifty firms of the 70's, so it seemed like a safe bet.

During my move, the company got bought out. But I had faith in the new management team. I even put some money in a new IPO they spun out, since I had an "insiders deal".

After about 9 months into my new job, a huge scandal broke (just google Dennis Kozlowski). In a matter of weeks, my 401k lost more than 50%. My investment in the IPO lost 90%.

And then I got laid off.....

So there I was, a large portion of my investments gone, in debt for a new car and a new house. Fortunately, my wife had just found a decent job, and she could cover about 40% of our expenses, if we stopped her 401k contributions. And if push came to shove, I had about a years worth of expenses still in my 401k.

Fortunately, I got a 90 day notice of the layoff, and that gave me a jump on finding a new job. I was unemployed for less than a month. The new job was horrible (80% travel, which I despise), and the company was of sketchy ethics. But you do what you have to do.

I put in a claim for a severance package, and I eventually received almost a half years pay. But it took a year for that to come through. I used that to pay off my car loan, and I've never taken out a car loan again.

A few years later, I found an even better job, and I've been working in the same role for almost 15 years. My salary is hugely bonus based, but it has been very lucrative for me through the years. Since my layoff scare, I've saved and invested like a mad man, and we've never ratcheted up our lifestyle. Well, there was that $20k I threw away on an RV....But that was another lesson learned.

We still live in the "stretch" house. It's worth about 2X what we paid for it, and I paid off the mortgage this year. So that worked out in the end. I'm nearing age 50, and we've got 45-50X our annual living expenses already saved. Early retirement looks very doable. And I have no fear of another layoff!
Time is what we want most, but what we use worst. William Penn
irishbear99
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Re: What bumps were along your road?

Post by irishbear99 »

Bumps? Oh sure. My road has more potholes than H1. (Those who have been to Oahu will get that). A couple of the biggies...

Several years ago the hubby decided to separate from the military after 10 years. We were overseas and, due to the DoD's permanent change of station (PCS) rules, we couldn't move back to the States before his separation date. So we prepared and saved as best we could, but it was still pretty scary moving back to the US with no jobs, no roots, no home, and no health insurance. It took about four months for me to find a job, and it was just in time, too. After we paid the security deposit on our new place, the savings we'd worked hard to set aside specifically to cover the transition was in the three figures.

The first job I found back in the US was not a permanent job, and we lived some time with the threat of a layoff over our heads. A couple of years later I switched career fields and moved into a permanent position. Just when I thought our instability and uncertainty was a thing of the past, HR told my boss that they had hired incorrectly (they should have hired someone off the priority placement list instead of me and they had to give my job to that person instead). Several more months of uncertainty ensued, where I had to fight with the organization for a good placement (they wanted to keep me employed, but move me from a technical specialist position to admin). It was a pretty scary time for me professionally, but I ended up being promoted into a job that served as a great launching point for my career.

I'm kind of in a bump right now - nothing nearly as dramatic as the previous stories. I make good money in a job I feel pretty *meh* about. However, having been through the previous bumps, I know this too shall pass. That knowledge helps me get through the days that are more *aaaaarrrggghhh* than *meh*.
Skiffy
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Re: What bumps were along your road?

Post by Skiffy »

We're on year 6 of paying for one of the kids bachelors' degree. So I guess that is a smallish speed bump, not a complete axle breaker.
new2bogle
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Re: What bumps were along your road?

Post by new2bogle »

My kids will go to college starting in 15 years. There is no doubt in my mind that this will be a significant bump, especially with how tuition is rising.
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Crimsontide
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Re: What bumps were along your road?

Post by Crimsontide »

We have been blessed to have been steadily employed for the past 30 years. We have dodged our share of layoffs and plant closures, somehow managing to stay with our respective companies. I have personally survived 5 separate company mergers and DW was actually laid off for 3 months. Sounds pretty good huh? Well it was until we hit the mother of all speed bumps in 2010 when DW was diagnosed with stage 3C endometrial cancer. What followed has been 4 years of medical hell, in and out of treatments, multiple surgeries, more PET and CT scans than we can count, extended hospital stays due to bouts of pneumonia, hair loss, memory loss, chemo brain, permanent neuropathy... Thank goodness for our excellent healthcare insurance and reasonable out of pocket maximums, that is the only thing that kept us from certain bankruptcy or worse...
Taboose
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Re: What bumps were along your road?

Post by Taboose »

We have had a couple bumps, but nothing to get us off track from our goal. A family member has had some medical issues and we have had to help with that. I figure it is money well spent. Job wise my wonderful wife and I quit one career after approx 18 years and went to grad school and began another career which has worked out well. I am ending my second career with a mild bump. I will retire about a year earlier than planned, but we are in a good spot financially. We have 4 pensions with COLAs between us and have saved a fair amount. I can't complain.
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obgyn65
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Re: What bumps were along your road?

Post by obgyn65 »

Buying a condo at the very peak of the real estate bubble in 2008. Working many years in Europe when I made a fifth of what I make now. I am 49 years old.
"The two most important days in someone's life are the day that they are born and the day they discover why." -John Maxwell
john94549
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Re: What bumps were along your road?

Post by john94549 »

Back in 1968, I had enough credits to graduate early, but the Winter Quarter offerings were awful. So I "stopped out" and notified the school I would complete during Spring Quarter. By return mail, it seemed, I got my draft notice. In full panic mode, I took the OQT (Navy), passed, and raised my arm the following week. The Navy recruiter said he would contact the draft board on my behalf. He did.

Our wedding plans went forward (December 14, 1968), we both graduated, spent a nice summer in Europe, delivered our first-born and a commission the same month (January, 1970).

Those were interesting times.
reisner
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Re: What bumps were along your road?

Post by reisner »

Personally it's another story. But financially, after a poor and insecure childhood I always wanted security. Timing and luck have been on my side. I got my Ph.D. in classics from Stanford when I was twenty-five, 1970, taught for 35 years at San Diego State, bought into the SD real estate market when I was 27, for 33K, and sold out (a later house) when I retired in 2005 for 1.235. We were a single-, humanities-professor'sincome, household, with a couple of small inheritances, but never had kids or spent wildly, though we managed to travel about 2 years total out of the 35. The first paycheck came October 1, 1970, for $660 take-home, and they haven't stopped coming since. And CalPers blesses us with great medical coverage. I did make one big financial mistake, I bought $2200 worth of windmill stock in the wrong company in 1981. Also a pair of custom-made shoes in Florence; have worn them twice. I'm waiting for the anvil to drop on my head out of a clear blue sky.

Nowadays, such tranquility and prosperity, even in academia, would be impossible. That 33K house I first bought would now cost 800K-plus, and my starting salary would be maybe 60K and I'd have a huge college loan, and I probably wouldn't get the job anyway since there would be so many applicants. I was working in a kind of golden age, and haze at my own good luck.
john94549
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Re: What bumps were along your road?

Post by john94549 »

Reisner, too funny. You might have been one of the TA's left behind in that horrid Winter Quarter of 68-69* at Stanford. It just seemed like everyone either went on sabbatical or thought they might melt in the rain. My wife (to be) and I were Poli Sci.

Course offerings: as they say, "pickins were slim".

*Technically, it starts in the year before, but classes begin the year after. Don't ask; Stanford folks know.
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Re: What bumps were along your road?

Post by dumbbunny »

For me the bump was the over-confidence feeling when everything is going well. You may think you have "arrived" and begin to say, "No," to more hours at work. The bossman prefers otherwise and will get someone to take your place. I missed out contributing to my 401(k) during the 2008 downturn. Drats.
“It’s the curse of old men to realize that in the end we control nothing." "Homeland" episode, "Gerontion"
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ofcmetz
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Re: What bumps were along your road?

Post by ofcmetz »

I've been at the same job for over 15.5 years since I was 19 years old. Both serious bumps have come in the last three and a half years. First was when the most horrible bosses I've ever dealt with was hired straight into the number 2 position at my department and began to make our department miserable. He continues to do his best to frustrate all of the middle management at my job. In my profession, you end up having golden handcuffs after a few promotions and a decade or so of years, and it's actually worth putting up with a bunch of crap to stay where you are.

The second was an unexpected health condition I came down with just before turning 33 in June, 2012. After two years of wondering if I would need to change careers due to this condition, the drug Humari seems to be keeping it under control. This was a big motivator in me purchasing an extra 5 years credit in my pension system.

We've been able to save through it all and still feel blessed. Personal finance is about finding that balance between saving for tomorrow and enjoying today.
Never underestimate the power of the force of low cost index funds.
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cheese_breath
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Re: What bumps were along your road?

Post by cheese_breath »

travellight wrote:Divorce, very costly.... and I am female.
Remarriage, very costly. Inherited three more kids to support bringing total to five.
The surest way to know the future is when it becomes the past.
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ofcmetz
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Re: What bumps were along your road?

Post by ofcmetz »

cheese_breath wrote:
travellight wrote:Divorce, very costly.... and I am female.
Remarriage, very costly. Inherited three more kids to support bringing total to five.
I'm amazed that anyone wants to marry someone with such funny breath. :sharebeer
Never underestimate the power of the force of low cost index funds.
Hug401k
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Re: What bumps were along your road?

Post by Hug401k »

Let's see...bumps..In the middle of the tech boom I moved to a small tech company for something different than my years in financial services. 6 months later, the tech crash occurred and I was laid off. 3 months after that, I was back at the financial services firm. For about the next 5 years, they transferred my role to Kentucky 2x offering to send me with it. No thanks, but I was lucky enough to find new jobs in the company. Finally, in 2010, I have 2 small kids and giant daycare bills and a spouse who commutes 1.25 hours each way into the city for his job. I start to hear rumors of relocation (again) but this time, it's just to the city (even though I had relocated to the suburbs with them). Who gets relocated into the DOWNTOWN CITY from a big suburban office park? Me. My options are to join the 2.5 hours of commuting with my husband each day and 2 toddlers and giant day care bills, leave, or find a new job. This time however, they are shutting the building, leaving 3000 people looking for jobs. I take the severance and we let go of a 6 figure job for a SAHM role. We ease into one salary, but since we had kept our cost of living pretty low, it's not that bad. I get really good at lowering expenses. I become a SAHM after 16 years in financial services. 4 years later, I'm putting my youngest on the bus to Kindergarten and I get a call. Consulting work. And then another firm offers Full time. And here I am again after 4 years off, making what I was making, working again, saving for colleges. It's only been 6 months and to be honest, I can't tell if the SAHM years are the bump or if working again is the bump, but it's change. Also,during those years, my mother died of cancer and my husband was very ill for a short time. Bought a house at the peak of the market- almost upside down but not quite since we put down 20%. Lost a $100k -$200K of investments in 2008 crash. Better now, but my husband is still scared of the stock market.
LeeMKE
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Re: What bumps were along your road?

Post by LeeMKE »

I've had many of the 37 flavors already mentioned. But one unique one I can mention:

Remarried a man who had been married twice before, with 2 children. Put in place a 20 page prenup, and when that sunsets I'm considering putting my separate assets in trust to keep them away from the step kids and ex-wives who already sued us trying to reach my assets (no luck there, as I had a 20 page prenup).

Straight line analysis is always flawed. Thankfully I never saved to pro-forma, but saved as if my life depended on it, and so it has. When I was in my 20s, a straight line analysis said I was in great shape, but Malcolm Forbes wrote cautionary tales about presuming nothing will rock your boat, so I saved as if my life depended on it.
The mightiest Oak is just a nut who stayed the course.
gator15
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Re: What bumps were along your road?

Post by gator15 »

In June 2008, I quit a good job because I wanted to complete my master's degree and travel the world for a year. I wanted to travel and visit friends and family. I also wanted to do something different regarding my job and figured I would explore new job opportunities after I was done completing the requirements to get my master's degree and done traveling. At the time, I was 28. After 10 years of saving, I figured I had enough money to take a break and travel. The plan was to finish up my master's degree in December 2008 and start traveling a few days after graduation. As many of you experienced, my portfolio lost nearly 50% of it's value and I was crushed. It seemed as though 10 years of hard work and saving evaporated in a matter of months. By December 2008, I knew it was no longer feasible for me to travel like I wanted. I did complete my master's degree in December and I took a vacation that month because I already put a deposit on the trip several months earlier. I went back to work in February 2009 at an undesirable job with an undesirable income because I needed the income and didn't have the time to wait for a job I really wanted. It was a difficult time in my life, but I learned a lot about myself. Six years later, things are going well in my life. I sometimes reflect back to 2008 for lessons learned.
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LowER
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Re: What bumps were along your road?

Post by LowER »

travellight wrote:Divorce, very costly.... and I am female.
Yes though I am male.
scrabbler1
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Re: What bumps were along your road?

Post by scrabbler1 »

I turned the bumps in my road into something good. I hit that "wall" of working full-time in the late 1990s so by 2001 (before the 9/11 attacks), combined with my company relocating from lower Manhattan to Jersey City, New Jersey, I was able to use every ounce of leverage I had into working part-time. Then when that was too much by 2007, I arranged to work less, leading to my eventual early retirement in 2008 at age 45.
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FrugalInvestor
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Re: What bumps were along your road?

Post by FrugalInvestor »

I worked my way through college. It took be nine years to secure by B.S. degree but I got it and an lot of good experience in the process. Five years later I saw the handwriting on the wall and left a good paying job due to a severe regional economic downturn. I had just finished building a new custom home. I moved to 1,500 miles away and took a substantial (33+%) pay cut while supporting the house which was now severely underwater and for which rental income came short of covering the mortgage and expenses. About a year and one-half later I got a divorce. I literally started over personally and financially at the age of 36.

My outlook at the time was to not worry about those things I could not control and to do the very best I could do at my job. That resulted in my moving up within my company fairly quickly. I took the Boglehead approach of living (well) beneath my means as my salary and bonuses increased. I was not a Boglehead at the time, but due to my upbringing and life experiences was very conservative financially. I also always dreamed of retiring early because both my father and his father only lived to their late 50's so were never able to enjoy retirement.

By increasing my earnings through promotions and very aggressive saving I was able to retire just before my 51st birthday. I was very, very fortunate but also sacrificed for a number of years. It would never have happened without my wife who has always had faith in me and provided the motivation I needed to make it through challenging times. She was and is the best thing that ever happened in my life and has always been on the same page when it comes to money, even though we seldom discussed finances. For many years we didn't have the kinds of things that many of our counterparts had but we never missed those things - and we did allow ourselves a treat from time to time. In the end it has paid off for us.
Last edited by FrugalInvestor on Fri Oct 03, 2014 9:56 am, edited 3 times in total.
Have a plan, stay the course and simplify. Then ignore the noise!
basspond
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Re: What bumps were along your road?

Post by basspond »

Not all medical expenses are covered by insurance. You can plan your life but sometimes "Some One" else has other plans.
heyyou
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Re: What bumps were along your road?

Post by heyyou »

Working what I thought was a lifetime job at Mega Corp, I was laid off for six weeks within a year of getting my first mortgage. Didn't lose the house, but vowed that I would not get caught short on money ever again. Became a serious saver and skeptical about job longevity.

A few years later, my first financial advisor put my savings (less commission) into a real estate limited partnership. It closed out at 50% gain the next year, so I put it all and my inheritance (about two multiples of my annual income) into the second one, that failed in two years. I was left with two weeks pay in my checking account. That cured me of commission based advice, and of being greedy for high returns. Soon after that, in 1982 or '83, my employer offered 401k accounts using index funds.

Without those earlier failures, I would not have embraced LBMM, index investing, and maxing all tax deferred accounts for the next 20+ years, that allowed me to retire at age 55.
blastoff
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Re: What bumps were along your road?

Post by blastoff »

MP1233 wrote:Didn't have a real job until I was 34. A lost decade of graduate school and postdoctoral training.
Describe more... Just finished a PhD.
Grt2bOutdoors
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Re: What bumps were along your road?

Post by Grt2bOutdoors »

Graduated school into a pretty bad recession.
Recession took years to dissipate, following grad school took a job in a gas station. (ate lots of humble pie).
Found full time employment in an start-up that went bust after 12 months.
Found and lost employment after internet-bust but quickly found employment again within 6 weeks.
Employer had a sweet defined benefit retirement benefit but no 401k plan, that subsequently soured when they eliminated it after 4 years. The moral of that story is don't be dependent on anyone as things can change on a dime, thankfully I was funding a Roth all the while and saving in taxable - that put me ahead instead of being behind.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
BogleBoogie
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Re: What bumps were along your road?

Post by BogleBoogie »

toto238 wrote:Does anyone have a story other than divorce?

Surely some people on this forum were laid off and without a steady job for a long time. Surely this forum doesn't consist solely of those that made it by having few to no financial shocks, and those suffering from financial shocks.

It sorta gives the impression that the only real way to be financially successful is to not get hit by any surprise financial shocks. If you do, just by luck, your chances of being financially successfully are pretty much over.

Anyone have any stories that could restore my optimism?
HOUSE PURCHASE
I scaled back my investing when we purchased a house that, in retrospect, is a bit beyond our means. At this point we are committed and have to make significant sacrifices to be able to A. Pay the mortgage and B. Invest heavily in our 401k's.
Traveler
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Re: What bumps were along your road?

Post by Traveler »

Age 25 decided to move to from Oregon to California without knowing anyone or having a job. Unemployed about 2 months. Not a major bump.
Age 27-29 - MBA degree - doubled salary and came out with only moderate student loan debt - well worth it
Age 29-36 - worked in a very volatile industry (airlines) and took two pay cuts - ended up with a lower base salary after 7 years than when I started - major bump but not one incident
Age 36 - decided to take a voluntary severance from my company thinking a 6 month or so break would be nice. Unemployed 18 months, never missed a mortgage payment, only had to dip into savings by <$10K, AND found a job that paid 75%+ more than what I previously made. Largest bump.
I'm 42 now and am able to save about 50% of my gross income so I'm doing pretty well financially although am likely a bit behind in retirement savings.

I live well below my means but don't feel that I go without much. I enjoy traveling and go on at least two international trips each year. I buy a car with cash and keep it at least 10 years. My condo is on a 5 year loan so it will be paid off in a couple years.
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GerryL
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Re: What bumps were along your road?

Post by GerryL »

Never worried about what I wanted to be "when I grew up" but I did have a strong savings habit. Lived in various countries, joined the Air Force, finished college and got a Masters and then again moved abroad. Eventually moved to Oregon in my early 40s, got a job and settled down by buying a house. About a year later I lost the job. It was during the early 90s when unemployment was high and being an out-of-work "mature" person was especially challenging. Serious concern that I might lose my house. After 18 stressful months and a lot of peanut butter and banana sandwiches, I finally found a job and -- miracle of miracles -- was actually making as much as before. And then came small but fairly steady raises, but my life style never really changed except that I rarely eat peanut butter and banana sandwiches anymore. I lived modestly but I never felt that I was depriving myself.

Fast forward 21 years: Survived job cuts and recessions. Paid off mortgage shortly before retiring this summer with a healthy portfolio. (Thanks in no small part to the high-tech go-go years and BH investing philosophy.)

Bumps are definitely scary, but overcoming/surviving them gives you some added confidence about your ability to handle the inevitable next bumps.
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Zabar
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Re: What bumps were along your road?

Post by Zabar »

Unsuccessful foray into entrepreneurship at 27. Great idea. Lost everything. Luckily, there wasn't that much to lose, but it was everything. Learned a lot.

Wrong spouse first time around. Right spouse second time around.
dolphinsaremammals
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Re: What bumps were along your road?

Post by dolphinsaremammals »

toto238 wrote:Does anyone have a story other than divorce?

Surely some people on this forum were laid off and without a steady job for a long time. Surely this forum doesn't consist solely of those that made it by having few to no financial shocks, and those suffering from financial shocks.

It sorta gives the impression that the only real way to be financially successful is to not get hit by any surprise financial shocks. If you do, just by luck, your chances of being financially successfully are pretty much over.

Anyone have any stories that could restore my optimism?
Sorry about the optimism situation, but here's a story not about divorce:

I was lucky, and started out when jobs were plentiful. My first bump was getting laid off in my 50s and finding that older women are unemployable in tech, regardless of being up-to-date, educated, with an excellent job history. It's bad for men as well, but I think harder for women. So I wound up retiring about ten years earlier than I wanted to. That's obviously a large financial hit, but, having been squirreling away savings, I am okay, just not as okay as I had planned. Plus, it sucked to want to work and not be able to find a decent job.
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