How to Retire in Your 30's with $1 Million in the Bank

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How to Retire in Your 30's with $1 Million in the Bank

Post by mlebuf » Sun Sep 02, 2018 3:10 pm

That is the title of a Sept. 1, "NY Times" article. While some may believe that $1 million is a low number, the article is more about how young people become disenchanted with the rat race of work, live below their means, save, invest and leave the work force decades before most of us do. Many Bogleheads have done/would like to do this. If so, please post your thoughts.


https://www.nytimes.com/2018/09/01/styl ... ctionfront
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by software » Sun Sep 02, 2018 3:19 pm

I don’t think many bogle heads fall into this category. This is more of the Mr. Money Mustache crew. I would say bogleheads tend to err on the more conservative side as far as amount of assets before retiring, atleast from what I have seen.

In any case, I think this is one of those things that sounds better in theory than it actually is. “Retiring” with 1 million would significantly limit your ability to enjoy that retirement. To each their own I guess.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by HEDGEFUNDIE » Sun Sep 02, 2018 3:23 pm

$4M in my 40s for me

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by JBTX » Sun Sep 02, 2018 3:27 pm

There is so little room for error. I posted this in another thread.
JBTX wrote:
Tue Aug 28, 2018 7:56 pm
If everything works out absolutely perfectly you get the privilege of living at poverty level for the rest of your life. Best of luck.

Things that could go wrong:

- out of pocket medical expenses
- ACA policies become more expensive (I'm not sure how you live on $20k per year including ACA policy when you are 50. )
- God forbid you decide / need to buy something
- social security changes.
- prolonged market crash
- inflation
- Consumption tax - everything becomes more expensive.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by CedarWaxWing » Sun Sep 02, 2018 3:28 pm

I seldom see much in the way of monetization of the skills or tasks that these early retirees have.

They are seldom truly retired, but are instead doing something other than their full time prior occupation on a part time basis.

That is a change in occupation, not retiring, which is great but the real message I get is to get your working conditions under control, even if you need to change occupations, or actually become self employed in a low overhead situation.

These folks appear to often have subsidized health insurance for the family. IF something really bad happens to the politics of health insurance subsidies the family finance plan would be too close to the edge for my comfort zone.

And the long term SS earnings record may be something to consider. If you like your occupation, but not your working conditions, working part time may be a more secure and in some ways more financially stable situation than "early retirement'.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by beardsworth » Sun Sep 02, 2018 3:36 pm

There was already a lengthy thread in progress, based on the same New York Times article linked in the original post here, but it seems to have disappeared. I no longer see it listed in any of the recent forum topics.

If I saved the right URL, it was this:

viewtopic.php?t=257992

Anybody know what gives, i.e., where it went?

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by tfb » Sun Sep 02, 2018 3:54 pm

There is little room for error only if you don't have any earned income. Those featured in the article aren't in that situation. There's plenty room for error when one spouse still works and when they have self-employed businesses.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by StevieG72 » Sun Sep 02, 2018 4:31 pm

I agree with Bogleheads not falling in to this category.

Personally I would feel like I would be taking opportunity away from my child if I chose to retire in my 40's. Of course some will argue that I am taking quality time away by working. The latter being true because the stresses of work overflow into the evenings and weekends.

I find this article interesting because the guy works in IT, which in my mind is a dream job. Working on a computer for 7 to 8 hours a day and nobody bothers me is how I envision this job. I am sure reality is quite different and people get burnt out at many different types of jobs.

Retail for 25+ years has me longing for lazy days in retirement.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by texasdiver » Sun Sep 02, 2018 4:33 pm

Back in my day we called these guys "stay home dads" During my parent's time in the 60s and 70s they were called "dropouts" Now they are retired?

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by jharkin » Sun Sep 02, 2018 4:52 pm

The job was high-pressure: He had to document every step for the Food and Drug Administration
Wah wah wah.

Sounds like he was working for a medical device company and their products had to be 21 CFR part 11 compliant. Its an auditing standard and to pass you have to prove traceability of customer requirements to delivered code and document what quality standards are employed and show evidence of internal enforcement.

I used to work for a software company that served a lot of FDA compliant customers and we got audited under this standard. For a short time I was even the compliance coordinator and had to pull together reports for them. I never pulled all nighters or felt any "massive pressure".... Its just documenting that you follow what are mostly industry best practices anyway... if you are loosing sleep or having a nervous breakdown over that then software development isn't the right career for you, period.

Sorry, we cant just all do whatever we feel like however we feel like it at work. That's why its called work, not a hobby.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by cdu7 » Sun Sep 02, 2018 4:58 pm

What happened to the old thread on this? Deleted? Mod deleted? Don’t mods simply lock it and move on?

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by jebmke » Sun Sep 02, 2018 5:01 pm

cdu7 wrote:
Sun Sep 02, 2018 4:58 pm
What happened to the old thread on this? Deleted? Mod deleted? Don’t mods simply lock it and move on?
It was deleted. Many of the posts were off topic rants.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by CedarWaxWing » Sun Sep 02, 2018 5:02 pm

Actionable point: Don't just quit. Save like crazy, negotiate a part time position doing the work you like, the amount that you like doing it, and spend more time with the kids/family. That is more likely to be a successful strategy and still give you the benefits of FIRE imho. That is what I did for years.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by samsoes » Sun Sep 02, 2018 5:09 pm

Quit if you can. The only risk is your epitaph reading, "If only I spent more time at the office." That's my fear. Not.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by cdu7 » Sun Sep 02, 2018 5:14 pm

Just wanted to post my families story on here before it gets locked and/or deleted. Someone in the last thread had mentioned that they couldn’t leave their big time job until they had enough saved for FIRE, then gave a rundown of why other jobs wouldn’t work etc. I just wanted to say that it isn’t true, you really can switch careers to be happy and still do just fine financially (not early retirement in my mind).

My wife and I are millennials in our 30s and did a big career change not too long ago after our first kid. We both had high stress high hour jobs and were making roughly 300k combined. After our first kid we both were like this won’t work; I changed careers and became a teacher (btw this is still a lot of work so you have to love doing it), she is working at a less demanding job (i.e. lower hour/pay) in her same field. Well guess what, we still make 130k plus combined! Now maybe that isn’t enough money for you, but it’s plenty for us and we are both happy and fulfilled in our careers and home life.

Did we FIRE? I certainly wouldn’t call it that, but I feel like we are both doing a lot more than watching Netflix all day. And you don’t need millions in savings to do what we did. There is more than one way to change your life for the better.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by livesoft » Sun Sep 02, 2018 5:21 pm

The other thread did have a lot of resentment going on. But to put some context on things, I wanted to note that half of all households in the US make less than about $62,000 annually. That is, quite a few (lots!) of households survive and possibly thrive on much less than the numbers tossed around here.

So more power to folks who can figure out what they don't like to do and those that can thrive on doing something they love whether it is a job or a having fun.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by cdu7 » Sun Sep 02, 2018 5:25 pm

I do want to emphasize however that similar to the FIRE crowd, my wife and I were comparatively privledged (I.e. no student loan debt).

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by investingdad » Sun Sep 02, 2018 5:27 pm

jharkin wrote:
Sun Sep 02, 2018 4:52 pm
The job was high-pressure: He had to document every step for the Food and Drug Administration
Wah wah wah.

Your post reminded me of my reaction to this article while thinking about my experience trying to earn my chemical engineering degree from State U.

It was stressful and high pressure from the word go. You either gut it out or give up. I sucked it up and graduated in four years while listening to other students in less stressful majors tell their tales of woe.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by Sandtrap » Sun Sep 02, 2018 5:28 pm

Actionably:
Reinventing oneself and one's career, and lifestyle, throughout life, while accumulating assets, might be a good middle ground between return, retirement, and fulfillment.
j

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by JoMoney » Sun Sep 02, 2018 5:29 pm

I think it's great to be "financially independent" and have the security knowing that you're not dependent on your employer to get by, and to hopefully figure out what is "enough" when it comes to $ and focus ones time and energy to something more meaningful personally whether that is raising family or a job one finds more fulfilling in ways that don't have a $ figure. I think moving from a full-time job to something else that maybe doesn't pay as well is fine, but it's good to have some sort of structured routine working towards something. I also kind of wonder if/how this impacts couples spending all their time together, I've heard some concerning stories about older retirees going through marital problems when the bread-winner is suddenly around the house all day interrupting the routine a homemaker had become accustomed to.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by madbrain » Sun Sep 02, 2018 6:17 pm

cdu7 wrote:
Sun Sep 02, 2018 5:14 pm
Just wanted to post my families story on here before it gets locked and/or deleted. Someone in the last thread had mentioned that they couldn’t leave their big time job until they had enough saved for FIRE, then gave a rundown of why other jobs wouldn’t work etc. I just wanted to say that it isn’t true, you really can switch careers to be happy and still do just fine financially (not early retirement in my mind).

My wife and I are millennials in our 30s and did a big career change not too long ago after our first kid. We both had high stress high hour jobs and were making roughly 300k combined. After our first kid we both were like this won’t work; I changed careers and became a teacher (btw this is still a lot of work so you have to love doing it), she is working at a less demanding job (i.e. lower hour/pay) in her same field. Well guess what, we still make 130k plus combined! Now maybe that isn’t enough money for you, but it’s plenty for us and we are both happy and fulfilled in our careers and home life.

Did we FIRE? I certainly wouldn’t call it that, but I feel like we are both doing a lot more than watching Netflix all day. And you don’t need millions in savings to do what we did. There is more than one way to change your life for the better.
I can totally understand working less stressful jobs with lower income as a choice. But I don't understand what this has to do with FIRE. Sure you will admit that neither of you are retired. Whether you are actually financially independent is arguable.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by cdu7 » Sun Sep 02, 2018 6:20 pm

Lol my whole point was that it isn’t FIRE! We have no blog.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by LadyGeek » Sun Sep 02, 2018 6:33 pm

jebmke wrote:
Sun Sep 02, 2018 5:01 pm
cdu7 wrote:
Sun Sep 02, 2018 4:58 pm
What happened to the old thread on this? Deleted? Mod deleted? Don’t mods simply lock it and move on?
It was deleted. Many of the posts were off topic rants.
Yes, it was deleted due to the off-topic rants. The OP was notified.
===========

To keep this discussion actionable, please state how this article applies to your own situation.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by camillus » Sun Sep 02, 2018 6:40 pm

One thing I appreciate about MMM is a philosophical focus on joy apart from hedonistic consumption. I also personally appreciate his emphasis on conservationism.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by H-Town » Sun Sep 02, 2018 6:52 pm

mlebuf wrote:
Sun Sep 02, 2018 3:10 pm
That is the title of a Sept. 1, "NY Times" article. While some may believe that $1 million is a low number, the article is more about how young people become disenchanted with the rat race of work, live below their means, save, invest and leave the work force decades before most of us do. Many Bogleheads have done/would like to do this. If so, please post your thoughts.


https://www.nytimes.com/2018/09/01/styl ... ctionfront
I'd consider it as the right direction instead of the final destination. When you have the money, you have options. Life is full of surprise (good and bad). When you have $1M, then you can ask yourself: "Alright! Where do I go from here." You work on your own terms and you play by your own rules.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by FIREchief » Sun Sep 02, 2018 7:00 pm

“The worker in this economy has very little sense of control over their existence. People are expendable. You’re a young person and you look ahead and you say, ‘What’s there for me?’”
How is this any different from how things have always been? I believe that people have always been expendable (and I have ample data points to prove it!). My answer for "what's there for me?" was always "well, at a minimum a paycheck every two weeks; anything else is gravy."

If your job is killing you, then either find another job (not always easy) or just do a more crappy job where you are. In my decades at Megacorp, I figured out that those who were "killing themselves" were mostly suffering from self inflicted wounds. Did I get the fastest promos? No. Did I outperform everybody else? No. Did I always get the best new opportunities? H*ll no! But I did make it out alive and FIREd on my own terms. :beer
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by FIREchief » Sun Sep 02, 2018 7:02 pm

texasdiver wrote:
Sun Sep 02, 2018 4:33 pm
Back in my day we called these guys "stay home dads" During my parent's time in the 60s and 70s they were called "dropouts" Now they are retired?
My favorite post of this thread! :sharebeer
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by HomerJ » Sun Sep 02, 2018 7:05 pm

livesoft wrote:
Sun Sep 02, 2018 5:21 pm
The other thread did have a lot of resentment going on. But to put some context on things, I wanted to note that half of all households in the US make less than about $62,000 annually. That is, quite a few (lots!) of households survive and possibly thrive on much less than the numbers tossed around here.
They survive but many are not thriving.

40% of Americans can't come up with $400 to cover an emergency.

I'm guessing there's a lot of overlap there between the 50% that make less than $62,000 and the 40% that can't scrap up $400 if needed.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by cdu7 » Sun Sep 02, 2018 7:09 pm

madbrain wrote:
Sun Sep 02, 2018 6:17 pm
cdu7 wrote:
Sun Sep 02, 2018 5:14 pm
Just wanted to post my families story on here before it gets locked and/or deleted. Someone in the last thread had mentioned that they couldn’t leave their big time job until they had enough saved for FIRE, then gave a rundown of why other jobs wouldn’t work etc. I just wanted to say that it isn’t true, you really can switch careers to be happy and still do just fine financially (not early retirement in my mind).

My wife and I are millennials in our 30s and did a big career change not too long ago after our first kid. We both had high stress high hour jobs and were making roughly 300k combined. After our first kid we both were like this won’t work; I changed careers and became a teacher (btw this is still a lot of work so you have to love doing it), she is working at a less demanding job (i.e. lower hour/pay) in her same field. Well guess what, we still make 130k plus combined! Now maybe that isn’t enough money for you, but it’s plenty for us and we are both happy and fulfilled in our careers and home life.

Did we FIRE? I certainly wouldn’t call it that, but I feel like we are both doing a lot more than watching Netflix all day. And you don’t need millions in savings to do what we did. There is more than one way to change your life for the better.
I can totally understand working less stressful jobs with lower income as a choice. But I don't understand what this has to do with FIRE. Sure you will admit that neither of you are retired. Whether you are actually financially independent is arguable.
Sorry if I gave the wrong impression, we aren’t financially independent at all, my point was simply that there are way better options out there for people unhappy with their jobs that don’t require radical lifestyle changes and millions of savings.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by HomerJ » Sun Sep 02, 2018 7:15 pm

No one should "retire" in their 30s with $1 million in the Bank.

One can certainly change careers, and/or work part-time, or take a sabbitical for a year or three with $1 million in your 30s (or your 40s).

Note I'm NOT one of those people who think people need $5 million to retire.

I think retiring on $40,000 a year (4% of $1 million) with a paid-off house in a LCOL area is very doable... Especially with Social Security (another $10,000-$40,000) coming soon. I think that can be a very good lifestyle. Rich, even.

But people who say they are "retiring" in their 30s with $1 million are just stupid or lying.

At that age, 3% is the max withdrawal one can make to ensure the money lasts 50-60 years ($30,000 a year), and Social Security is a long ways away, and I'm not sure we can even assume they have a paid-off house. That is some tight living. For 30 years before SS (which will be less than normal)

Now most of those people make it work by making some extra money on the side. That's great. But that's not retired.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by AlohaJoe » Sun Sep 02, 2018 7:19 pm

software wrote:
Sun Sep 02, 2018 3:19 pm
I don’t think many bogle heads fall into this category. This is more of the Mr. Money Mustache crew.
What exactly are they investing in that makes them "not Bogleheads"? Which of the 10 Bogleheads principles are they violating?
1 Develop a workable plan
2 Invest early and often
3 Never bear too much or too little risk
4 Diversify
5 Never try to time the market
6 Use index funds when possible
7 Keep costs low
8 Minimize taxes
9 Invest with simplicity
10 Stay the course
On the contrary, I'd say the overwhelming majority of people who do this are Bogleheads. To the point where FIRE forums & blogs often have arguments with the pro-real estate minority complaining about how FIRE bloggers/posters always & only talk about low cost diversified index funds.

If you look at the sidebar on https://www.reddit.com/r/financialindependence/ the list of recommended books is:
The Bogleheads Guide to Investing
A Random Walk Down Wallstreet
If You Can: How Millenials Can Get Rich Slowly
The Four Pillars of Investing
The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns
Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School -- Suggestion - Ignore Rule 9 regarding individual stock picking.
The Intelligent Investor -- Caution - Embark on individual stock ownership at your own risk.
The Simple Path to Wealth

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by Sandtrap » Sun Sep 02, 2018 7:20 pm

HomerJ wrote:
Sun Sep 02, 2018 7:15 pm
No one should "retire" in their 30s with $1 million in the Bank.

One can certainly change careers, and/or work part-time, or take a sabbitical for a year or three with $1 million in your 30s (or your 40s).

Note I'm NOT one of those people who think people need $5 million to retire.

I think retiring on $40,000 a year (4% of $1 million) with a paid-off house in a LCOL area is very doable... Especially with Social Security (another $10,000-$40,000) coming soon. I think that can be a very good lifestyle. Rich, even.

But people who say they are "retiring" in their 30s with $1 million are just stupid or lying.

At that age, 3% is the max withdrawal one can make to ensure the money lasts 50-60 years ($30,000 a year), and Social Security is a long ways away, and I'm not sure we can even assume they have a paid-off house. That is some tight living. For 30 years before SS (which will be less than normal)

Now most of those people make it work by making some extra money on the side. That's great. But that's not retired.
+1
Well said.
Also, there's a lot of life fulfillment, and contribution, to be had through one's skillset and career.
As an aside, the majority of folks I've known to be "retired" as in not employed yet living comfortably and "securely" on their own at age 30 and beyond were trust fund . . funded. There are many others as MM is a testament to, but these are the only one's I've personally known that had consistent wealth early on.
j

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by 47Percent » Sun Sep 02, 2018 7:28 pm

I think all the stories mostly relate to not having any debt. Once all you are working for is for your own comfort and are not a slave (indebted) to anyone else, suddenly the options open up.

You can choose to live anywhere in the continuum of $25k to $100k per year, if you can get your housing and medicals under control.

That is well known in theory -- but the trick is to actually get the debts to zero in practice.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by bradshaw1965 » Sun Sep 02, 2018 7:33 pm

Bogleheads in general has become much less tolerant of anything but a high-paying long career with every I dotted and every T crossed. I think the Boglehead principles work in all kinds of situations and are especially helpful in situations where you can't afford to make big mistakes. A lot of these articles do sound like career burnout and maybe these folks are back at it with a fresh attack in a few years, but I find it much more interesting to realize something is wrong and reassess.

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by tfb » Sun Sep 02, 2018 7:37 pm

How this article applies to my own situation:

My wife quit her job three years ago. I still worked. The income from my job more than covered our expenses. That was the same situation as the lead person in the article. This is not unusual at all. A large percentage of married households have just one earner. It works without $1 million saved.

I left my job this year and became 100% self-employed. This again is the same situation as several other people in the article. The income from self-employment covers not 100% but a large percentage of our expenses. This again isn't unusual. Many people are self-employed in this country. Many startup businesses don't generate enough income to cover the owners' household expenses in the early years.

As a self-employed person, I don't have a preset schedule, but I don't consider myself retired. I changed careers. I don't use "retired" as a branding play to generate more business.
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by market timer » Sun Sep 02, 2018 7:51 pm

I wonder if we are seeing a rising trend in the very early retiree demographic, or if there are just some vocal outliers who make for good headlines. Every one of these articles is little more than a blog advertisement.

If there is a trend, I'd point to the rise of commoditized high-IQ jobs (tech, law, banking, consulting), where smart people uproot themselves to live in expensive cities, serve as replaceable cogs in a machine, attain no real ownership stake in their employer or house, and have no sense of community with their neighbors. They left school with a lot of hope, but after 7-10 years pass, they haven't created anything noteworthy, and can't point to anything that's arguably theirs, aside from a seven-figure investment account. This account offers the opportunity to try again in middle age to achieve the sort of self-actualization they thought would be theirs not so long ago. But time is moving quickly now, much faster than it was in college.

Anyhow, just a guess.
Last edited by market timer on Sun Sep 02, 2018 7:54 pm, edited 1 time in total.

47Percent
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by 47Percent » Sun Sep 02, 2018 7:52 pm

tfb wrote:
Sun Sep 02, 2018 7:37 pm
As a self-employed person, I don't have a preset schedule, but I don't consider myself retired. I changed careers. I don't use "retired" as a branding play to generate more business.
I was taking consulting contracts for 4-5 years and gradually tapered off to being completely FIRE'ed. But among all my friends and relatives I used to put up a façade of still consulting/self-employed for years. This is because it was beyond the realm of imagination for them and I didn't want to spook them. Only recently I broke it to some of them that this was the case. They still have a hard time as in most gatherings every discussion is tied to what someone does 8-5 :oops:, and not about the individual as a person.

HEDGEFUNDIE
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by HEDGEFUNDIE » Sun Sep 02, 2018 8:38 pm

market timer wrote:
Sun Sep 02, 2018 7:51 pm
If there is a trend, I'd point to the rise of commoditized high-IQ jobs (tech, law, banking, consulting), where smart people uproot themselves to live in expensive cities, serve as replaceable cogs in a machine, attain no real ownership stake in their employer or house, and have no sense of community with their neighbors. They left school with a lot of hope, but after 7-10 years pass, they haven't created anything noteworthy, and can't point to anything that's arguably theirs, aside from a seven-figure investment account.
And how many people in previous generations can truly say they've "created anything noteworthy"?

I'd argue that the rise of high-IQ jobs means more potential for wealth generation and intellectually-driven labor than has ever existed in the past, with an unprecedented number of people able to even consider "FIRE-ing". And that is an unalloyed positive.

am
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by am » Sun Sep 02, 2018 8:41 pm

1 mil, paid off house, aca subsidized insurance and some part time income doing what you like is close to as good as it gets. Many people will never have 1 million, a paid off house or do what they like. Happiness doesn’t require expensive travel, cars or houses.

AlohaJoe
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by AlohaJoe » Sun Sep 02, 2018 9:01 pm

HEDGEFUNDIE wrote:
Sun Sep 02, 2018 8:38 pm
market timer wrote:
Sun Sep 02, 2018 7:51 pm
If there is a trend, I'd point to the rise of commoditized high-IQ jobs (tech, law, banking, consulting), where smart people uproot themselves to live in expensive cities, serve as replaceable cogs in a machine, attain no real ownership stake in their employer or house, and have no sense of community with their neighbors. They left school with a lot of hope, but after 7-10 years pass, they haven't created anything noteworthy, and can't point to anything that's arguably theirs, aside from a seven-figure investment account.
And how many people in previous generations can truly say they've "created anything noteworthy"?
I totally agree with this. However, I think market timer has the kernel of something there. Maybe the difference is that previous generations were never fed the lie of "do what you love" What Color Is Your Parachute kind of stuff? Without that disappointment/disillusionment I wonder if FIRE would be as big as it is (keeping in mind that "big" still means totally minuscule in the real world). But also note that market timer is explicitly talking about having a seven-figure investment account, which for a variety of reasons -- no 401k, no discount brokers, no mutual funds, more pensions, etc -- previous generations had little chance of accumulating. So maybe everything is the same as before except by moving to employee-controlled defined contribution plans we're (gradually, slowly) seeing this shift towards a FIRE-mindset (at least for some).

On the other hand, my impression (as someone who has lived in several countries) is that FIRE, small as it is inside the US, is virtually non-existent outside of the US. Why is that? I'm not totally sure, since at least in some places all the factors would seem to be in place. Take Singapore for instance, which has had defined contribution programs for decades, has national healthcare, etc. Or Australia, which is similar. And I'm doubtful that the American working conditions are worse than Singaporean, so it can't just be "working in America sucks so much".

Another thing to keep in mind is that -- based on my subjective view of watching /r/financialindependence for many years -- there are a lot of 20 somethings who are relatively new to the working world, low man on the totem pole, realise work isn't as fun as college, learn about FIRE, and make that their goal. They're also almost universally single. Fast forward a decade and they're married, with kids, and a mortgage. But they've also been promoted, have more autonomy at work, or just switched jobs to something that they like better. So I think there's a lot more talk about FIRE than actual doing of FIRE.

I'm not really sure, but it is interesting to think about what specific factors are causing the apparent rise of FIRE.

London
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by London » Sun Sep 02, 2018 9:10 pm

To each their own. I rarely consider people in these types of articles retired, but if they do, it doesn't bother me.

I also don't consider working to be "wasting" your life. But if they do, it doesn't bother me.

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telemark
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by telemark » Sun Sep 02, 2018 9:13 pm

As some people have noticed, the quickest way to get to the requisite multiple of your expenses is to work on the denominator :)

Also, software development (a.k.a. "tech") is prone to burnout, partly because of constant deadline pressure but mostly because everything is critical path. If you're an E.R. doc and you want to take a month off, you can find someone to cover that spot in the calendar and everything is fine. Try that in software and the whole project is likely to come to a halt while someone else gets up to speed on what you were working on. And the fun never stops: by the time the current project is finished, usually long past its original unrealistic schedule, there are several new ones waiting in the pipeline. So you see people working crazy hours and eventually deciding "I don't need the money this much."

Personally, I enjoy designing and writing code, but I also take pride in doing it well and was finding fewer opportunities to do that. Sure, I could "just do a crappier job" but why?

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teen persuasion
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by teen persuasion » Sun Sep 02, 2018 9:19 pm

AlohaJoe wrote:
Sun Sep 02, 2018 7:19 pm
software wrote:
Sun Sep 02, 2018 3:19 pm
I don’t think many bogle heads fall into this category. This is more of the Mr. Money Mustache crew.
What exactly are they investing in that makes them "not Bogleheads"? Which of the 10 Bogleheads principles are they violating?
1 Develop a workable plan
2 Invest early and often
3 Never bear too much or too little risk
4 Diversify
5 Never try to time the market
6 Use index funds when possible
7 Keep costs low
8 Minimize taxes
9 Invest with simplicity
10 Stay the course
On the contrary, I'd say the overwhelming majority of people who do this are Bogleheads. To the point where FIRE forums & blogs often have arguments with the pro-real estate minority complaining about how FIRE bloggers/posters always & only talk about low cost diversified index funds.

If you look at the sidebar on https://www.reddit.com/r/financialindependence/ the list of recommended books is:
The Bogleheads Guide to Investing
A Random Walk Down Wallstreet
If You Can: How Millenials Can Get Rich Slowly
The Four Pillars of Investing
The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns
Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School -- Suggestion - Ignore Rule 9 regarding individual stock picking.
The Intelligent Investor -- Caution - Embark on individual stock ownership at your own risk.
The Simple Path to Wealth
Bogleheads and Mustachians are not mutually exclusive at all. I'd guess most on the MMM forums are also Bogleheads, like me.


Clearest difference between the non-overlapping sections of the Venn diagram: spending money vs time. Bogleheads can't fathom how to live on only $40k/yr, and feel work is necessary. Mustachians would feel $40k/yr was well more than needed (worked longer than necessary), and have many things they'd like to do instead of paid work.

In our personal circumstances, I find the whole binary work/retire debate ridiculous. It's not binary, it's a continuum over a lifetime that is hopefully long and varied. I have supported myself, shared living expenses with my spouse, been a SAHM for nearly 20 years while DH was the sole earner, had a small part-time income, and now earn nearly enough that we can live on my income while saving most of DH's income. We consider swapping in the future - DH stops earning while I continue as sole earner, or he goes to a low income "fun" job. Or we both quit and see what plays out in the future. Striving and eventually reaching FI gives you options, lots of options, among them the option to change your mind.

I didn't learn of the FIRE concept until I was in my early 40s, but it was immediately clear that that was what we wanted, despite our modest income. We had the frugal mindset in place, and were already knocking our student loans and mortgage down rapidly, just had to ramp up the tax advantaged savings and take better advantage of tax credits. So we had a late start, and slower path with less disposable income and a large family, but we should still hit FIRE ~age 55. I'm trying to explain it to the kids, so they can start early if they want, but they aren't as enamored of number crunching and taxes as I am, so it's a slow sell. DD3 was just married, so once things settle back down I'll talk to them both about their new tax situation to hopefully head off any nasty tax surprises, and explore options for them going forward.

Slacker
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by Slacker » Sun Sep 02, 2018 9:32 pm

telemark wrote:
Sun Sep 02, 2018 9:13 pm
As some people have noticed, the quickest way to get to the requisite multiple of your expenses is to work on the denominator :)

Also, software development (a.k.a. "tech") is prone to burnout, partly because of constant deadline pressure but mostly because everything is critical path. If you're an E.R. doc and you want to take a month off, you can find someone to cover that spot in the calendar and everything is fine. Try that in software and the whole project is likely to come to a halt while someone else gets up to speed on what you were working on. And the fun never stops: by the time the current project is finished, usually long past its original unrealistic schedule, there are several new ones waiting in the pipeline. So you see people working crazy hours and eventually deciding "I don't need the money this much."

Personally, I enjoy designing and writing code, but I also take pride in doing it well and was finding fewer opportunities to do that. Sure, I could "just do a crappier job" but why?
I used to enjoy developing my own software projects (even though I am educated as an Electrical Engineer, the software/firmware portion was most enjoyable for me). Then I worked in my first software engineering role... I haven't compiled anything in more than a decade now since I left that role. Actually "working" in software really turned me off of software - maybe it was the manager, maybe the team that worked on the code base before me and left about a billion silly errors nested within, but I never want to work on software again. If I had known boglehead principles from when I first started working, I would have definitely worked only to achieve FIRE after my 3yr experience in that software engineer role.

NextMil
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by NextMil » Sun Sep 02, 2018 9:34 pm

London wrote:
Sun Sep 02, 2018 9:10 pm
To each their own. I rarely consider people in these types of articles retired, but if they do, it doesn't bother me.

I also don't consider working to be "wasting" your life. But if they do, it doesn't bother me.
+1 couldn’t agree more. Also, after you get through the hard years it starts to get so much easier and way more fun. I couldn’t imagine viewing work every day as nothing more than a means to an end. That sounds like it would just reinforce ill feelings toward working. Plus, I cannot imagine what i would do all day. We still have weekends, and I already get so bored after the second day of being sick.

triyoda
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by triyoda » Sun Sep 02, 2018 9:49 pm

Interesting article. I think it's great it can work for these people. I did find it funny that someone moved to Bend, OR because it was more affordable. Housing costs have about doubled there in the last 6 years and it is one of the most expensive places to live in OR. Great place to live, but transplants from even more expensive CA are jacking up the cost of living there and at this point, median housing price in Bend is about double the national median and it is continuing to escalate.

Certainly being nearly 10 years into an almost monotonically increasing stock market make this a lot more achievable, but I think this is a fluke. As others have suggested, any kind of market downturn, which should be expected at some point in the next 5-10 years will expose the major risks with this scheme. Also healthcare, it seems when you actually read the article, these are all couples and it sounds like one still works and that covers the healthcare. That is a big caveat and why someone like me (single, early 40s) couldn't even dream about doing this, because I would expect to pay close to $10K per year for heathcare.

youdiditr2
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by youdiditr2 » Sun Sep 02, 2018 9:56 pm

FIREchief wrote:
Sun Sep 02, 2018 7:00 pm
“The worker in this economy has very little sense of control over their existence. People are expendable. You’re a young person and you look ahead and you say, ‘What’s there for me?’”
How is this any different from how things have always been? I believe that people have always been expendable (and I have ample data points to prove it!). My answer for "what's there for me?" was always "well, at a minimum a paycheck every two weeks; anything else is gravy."

If your job is killing you, then either find another job (not always easy) or just do a more crappy job where you are. In my decades at Megacorp, I figured out that those who were "killing themselves" were mostly suffering from self inflicted wounds. Did I get the fastest promos? No. Did I outperform everybody else? No. Did I always get the best new opportunities? H*ll no! But I did make it out alive and FIREd on my own terms. :beer
I like that. That's what I'm doing now. Doing a crappy job where I am at instead of quitting. Easy money and no more worrying about dying on the job!

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by AlphaLess » Sun Sep 02, 2018 10:02 pm

software wrote:
Sun Sep 02, 2018 3:19 pm
I don’t think many bogle heads fall into this category. This is more of the Mr. Money Mustache crew. I would say bogleheads tend to err on the more conservative side as far as amount of assets before retiring, atleast from what I have seen.

In any case, I think this is one of those things that sounds better in theory than it actually is. “Retiring” with 1 million would significantly limit your ability to enjoy that retirement. To each their own I guess.
Yup. Plus, you don't want to forgo working in your best years. IMHO, those are 35-45.
"You can get more with a kind word and a gun than with just a kind word." George Washington

2pedals
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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by 2pedals » Sun Sep 02, 2018 10:25 pm

I don't like the term "retire in your 30's". Financially independent or even FIRE is a more fitting description. Although a person may retire at whatever age they please, someone "retired" in their 30s still has a good 25-30 years of active working years left and at some point that person may want to improve their standard of living and return to the labor force. Retirement to me implies to withdrawal from one's position or occupation or from one's active working life. Old school retirement starts at about age 65-70 when SS benefits are available, when you have a defined pension benefit after about 25-45 years of working or you have enough saved to cover expenses to SS. Government statistics have 50 year old age limit before you can be classified "not in the labor force—retired".

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Re: How to Retire in Your 30's with $1 Million in the Bank

Post by lostdog » Sun Sep 02, 2018 10:29 pm

CedarWaxWing wrote:
Sun Sep 02, 2018 5:02 pm
Actionable point: Don't just quit. Save like crazy, negotiate a part time position doing the work you like, the amount that you like doing it, and spend more time with the kids/family. That is more likely to be a successful strategy and still give you the benefits of FIRE imho. That is what I did for years.
+1000

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