We didn’t contribute to Roth accounts when we were under the income limit, and for years didn’t think it was a big deal. But now we’re filled with Roth remorse. Here’s why.
For a long time, I let myself go down the magical thinking rabbit hole, convincing myself that early retirement would cure everything in my life that needed fixing. And even after I recognized that magical thinking for what it was, I still assumed that early retirement would fix a lot for us, especially things related to work stress and limited time. So how has that actually turned out so far? Let’s take a look.
Thoughts On Early Retirement and Post-FIRE Life From the Non-Blogging Partner // Q&A With Mark, Part 1
Today we’ve got a special treat! For the first time ever, Mark is here on the blog to share his thoughts on a whole range of questions we’ve gotten, from his thoughts on life as an early retiree to topics on which he has a different perspective from mine.
If we know we can’t achieve something the way someone else did, or the way we might have originally have envisioned for ourselves, it’s easy to throw up our hands and decide that it’s not even worth trying. Here’s how I let go of the idea of perfection to get on a better financial path, and some tips for how you can stop letting notions of perfection and imperfection hold you back.
The title of this one says it all. ;-) I’m writing a book, you guys! And I’m stoked to tell you all about it — where the dream originated, how it happened that it’s getting published and when you can get your hands on it.
It may seem like an odd thing to say, but as focused as I was on retiring early for so many years, I’m actually glad that I didn’t retire even earlier than I did. “Why’s that, you crazy person?” you might be wondering. Well read on, because there are a bunch of reasons that just might help others feel better about the work you do en route to early retirement.
You might be surprised to know when I truly felt financially independent, and it had nothing to do with leaving behind my career or being able to sleep until noon every day if I feel like it. (Though those are pretty great, too.) Instead, it was when I knew that Mark and I would both be okay financially whether we stay together or not.
Nearly everyone who achieves financial independence feels some level of impatience at some point, and that’s normal. But it’s especially easy these days to cross the line from normal impatience to borderline obsession, which only magnifies and worsens that impatience. Here’s some of what we did — and what we WISH we’d done — to get through the middle saving years slog.
I recently screwed something up, in part because I went the cheap route instead of spending money to do it right. And it was expensive to fix. But in the end, it was exactly the nudge I needed to grab ahold of my freedom in a different way. Sounds deep, right? It’s not. Or is it? (It is.)
I’ve written a bunch of times over the years about how important it is to branch out socially and make new friends in early retirement, especially if your work was particularly social and its absence will leave a void. We wasted no time in our hustle for new friends. Come see the results.
Even though we’re not in the savings phase of our early retirement journey, we often talk about what we’d do differently if we were just now starting to save at this point in time. Here’s a rundown on what we’d change about our approach, and what we’d do the same.
I get that there are plenty of folks who see early retirement as a selfish, lazy act that will ultimately make us drains on society. But those folks are ignoring the social good that each of us can do simply by quitting our jobs, as well as the incredible potential that early retirement offers each of us to do so much more.
Building on the recent post on simple living, we’re working on going to the next level and living more slowly, which is as much a mindset as anything that anyone could see. The only problem? We don’t actually know how to live slowly, because we’ve never done it! But we’re not afraid to put in the effort to learn how. After all, we’ve never been retired before, so it’s bonkers to think we’d be great at every aspect of it right off the bat.
We’re diving deep into the geekiness today, friends! We’re talking gaming (the video game kind, not gambling) and all the lessons we can apply from gaming to level up our finances on the epic quest to FIRE. Plus a giveaway of Kristin Wong’s new book Get Money, which is all about gamification!
My old career involved rebranding organizations, and that was one of my favorite parts of the job. Now, every time I hear someone debate what retirement is or isn’t, I think, “There is no one common understanding of retirement, so it’s definitely ripe for a rebrand.” Well, let’s do it. Let’s rebrand retirement. Come weigh in on what you want the new brand to reflect.
I love our financial independence/early retirement blog community like crazy, but there are some things we can all be doing to serve readers better. Some of them are simple, and some aren’t. But we owe it to our readers to be more transparent and to be more in touch with what our readers are up against.
It’s easy to observe that a lot of people — not just bloggers — end up working more than they expect to in early retirement, in large part because work feels very different when it’s by choice than when it’s by necessity. So why not plan for that and make your first year of early retirement a side hustle year? The benefits of doing so are potentially huge.
Some recent home organizing brought me to a bit of an archaeological find: a snapshot of my finances almost exactly 10 years ago, before Mark and I got married. I’ll bet they’re not what you expect, but what’s more, they show why it’s so important not to get discouraged if your financial progress feels slow in the beginning, or even for years!
You know all the math. You’re saving at a high rate. You’re optimizing your spending and avoiding investments with high fees. But do you REALLY have what it takes to achieve early retirement? Come find out.
While the online financial independence community is fantastic for inspiration and support, having a real life circle of friends who are like-minded on money comes with enormous benefits. Let’s talk about what those benefits are, and how you can build or strengthen a frugal friend group in real life.
“Simple living” is a term that I resisted for a long time because it felt so prescriptive and unachievable. Maybe it’s all Instagram’s fault, but it felt like there was a way living simply was supposed to look, and that wasn’t for us. But I finally saw that it’s up to each of us to define what simple living feels like, and that there’s tremendous value in doing so. (Plus, enter to win Mrs. Frugalwoods’ new book!)
Aligning your spending with your values with one of the first bits of advice many of us here when we get on the path to financial independence. But that advice usually goes on to talk about value — specifically what you get most value from — and not really about values at all. This is my case for why it serves you better to think about both what you value and your personal values when it comes to your spending and economic power.
Maybe it’s because I was confined to the couch all last week with a migraine, and maybe it was because there was recently a fresh wave of “Early retirement will kill you!” headlines, but I decided to really dig into this question of whether early retirement could actually be bad for us. Here’s what I found.
Our lives lately have looked slightly less than, er, adult. Some days we wonder why there are no grownups here to tell us what to do, instead just leaving us alone to do as we please with no structure whatsoever. It’s marvelous, of course, or at least marvelous for now, but we’re certainly wondering: At some point are we actually going to adapt to this new unstructured life?
The biggest non-financial question we’ve been getting lately, now that folks know we’ve retired, is “Aren’t you scared?!” And you might assume that people who’ve made the big leap and given up the big paychecks would say, “Nope!” But that’s not true. We are scared. Just as anyone doing something big and at least a little bit risky should be. But we didn’t let that fear hold us back, and that’s what actually matters.
Do the roller coastering markets have you concerned about the your early retirement plan? Sequence risk is by far the biggest risk early retirees face, and that risk can come from market crashes, long-term mediocre returns and even rising health care costs. Fortunately, though, we can all put ourselves in a good position to head off that risk, without lengthening the timeline to early retirement, by making some smart choices with asset allocation and behavior.
We’ve had a strange and completely unexpected realization already, though we’re still new at this early retirement thing. Time isn’t what we thought — days, specifically, aren’t what we thought. Let’s talk all about it, including how the zombie apocalypse is suddenly relevant to our lives.
I’m taking it on, you guys! 3000 words on why we aren’t fans of Bitcoin, and don’t think you should be either, if your goal is to build stable financial security or financial independence. There’s tons of research here, so come dig in!
Here’s something we never considered in all the years of planning to leave our careers and saving for financial independence: Early retirement is a form of time travel. And not just to one point in time, but to many! Sounds wacky, right? But it’s true. Here’s how.
We think we did this wrong in starting out our early retirement with too many things, including three trips, a long to do list, and a mad scramble to get out the door to our first big international trip to Taiwan. Or maybe we did it exactly right by accident?
We achieved early retirement and financial independence as DINKs (dual income, no kids), and of course having kids would change a bunch of things. Here’s our reflection on what we think kids would change. So tell us, what did we miss?
After we realized that we would work in early retirement, we also realized that we needed an easy way to decide if an opportunity that came along was actually work we wanted to do. And we created what we call the “high school rule.” Here’s what that is.
A year ago, I issued the Use It Up Challenge, and lots of you took it on. (Tell me how it went!) But there was part of the challenge that we took on specifically — the nothing new year — that we didn’t fully live up to. So we’re leveling up this year. Also, it’s a big time for my friend Cait Flanders, and to celebrate, I’m giving away a copy of her book. Come enter!
Contrary to popular lore, there are lots of early retirees and aspirants who are like us — NOT naturally frugal, and not naturally the most disciplined about money. But does that mean we can’t achieve financial independence and thrive in early retirement? Hell no it doesn’t! Today, a love letter to the atypical ones among us.
We are officially covered by an Affordable Care Act (ACA) / Obamacare health insurance plan. Though getting covered was not as easy as we’d expected, and there were some big lessons we learned that all early retirees should know. Plus we talk about the challenge of projecting our income and revisit the benefits of keeping income low for health care purposes.
As total newbs to this whole early retirement thing, though admittedly newbs who’ve thought about this stuff a ton, we find ourselves now wrestling with a very practical question: Should we spend what we budgeted for this year, or aim to spend less, maybe a lot less? There are good reasons for either approach, so let’s talk about what those are.
Our early retirement savings journey has come to an end, and now it’s time for our very last financial update! This time, I share a lot more story behind the numbers than we could in the past, and provide all new detail on just how much we’ve saved.
Sooo you know the goal we’ve been working toward and blogging about for years, of retiring at 38 and 41? Well, we did it! We retired early! And as we slowly adjust to our next life, here’s all the stuff we’re planning.
It’s actually here! The very last Monday of our working careers. We’re still feeling a lot, but it feels like something has changed in the last week. And while we have a lot of gratitude we want to express in this last week, we’ve surprised ourselves big time by actually feeling completely ready to make this leap.
We’re 10 work days from early retirement, and are now starting to consider new opportunities that look to the untrained eye a whole lot like work. The whole point of our early retirement was to be able to say yes more, and some of the things we really want to be able to say yes to, money aside. But there’s peril in that — taking on too much, and making it not really early retirement after all. Here’s how we’re thinking about setting new boundaries.
We’re less than three weeks from our early retirement, and still have a few things to do, mostly on the health care front. Plus we’re noticing that the scarcity thinking in these final weeks is strong — even stronger than we’d guessed it would be. See how we’re coping and help us make sure we’re not forgetting anything!
The question, “What do you want to be when you grow up?” has never been far from my consciousness at any point in my life. I asked it of myself constantly as a kid, and I never really stopped even as an adult in a career. Which might partially explain how I got on an early retirement path. But answering that question — and separating “be” from “do” — is really what financial independence is all about.
We officially have so few work days left that we can count them on our fingers and toes. Which means we’re 100 percent fired up, right? Um, yeah, about that. Turns out even though I knew the feelings at this stage would be complicated, they’re even more conflicting that I expected. And that’s not to mention how I feel physically. How this point in time feels so different from what I expected.
When we first moved to Tahoe, we ran the heat at what seemed like a reasonable cool temperature, 62 or 63 or so, but then got a three-digit natural gas bill that started with a 4. So began our quest to reduce our heating bill and to find how low we could go, but this isn’t about keeping your house cold. It’s about finding your version of “selectively harcore” and all the non-financial lessons that come from being strict with yourself in one way of your choice.
We’re about to go through a life and financial transition as big as graduating from college or getting married — and that’s switching from earning plenty while working to earning very little in early retirement. Which means that we need a new set of systems to ensure our financial success, especially given our status as anti-budgeters. But it also means that we’re bringing back a tool we gave up years ago: the personal allowance.
Just as we have a mission in early retirement to figure out what we want to do when we grow up, and to adventure more, we also have a mission to be more charitable, both by volunteering and by giving money directly to important causes. Which may seem harder when we have less cash flow coming in. But there are some good ways to build charitable giving into your retirement financial plan, including with a donor advised fund. What’s your charitable mission?
The most common question we got after revealing where we live was “But… California?! It’s such a high-tax state!” So let’s take a look at why we think California can be a great place to retire, as can many high tax states. Because there’s so much more to total cost and overall lifestyle than just income taxes, especially given that income taxes are far less relevant to early retirees.
It’s time, you guys! For nearly three years, and 300 posts, I’ve written as “Ms. ONL,” and referred to my partner in crime as “Mr. ONL.” We’ve obscured where we live, what we do for work, and a bunch of other identifying details. But that all ends now! Come meet the real humans behind Our Next Life.
So many of us, upon learning about early retirement, dive in headfirst, and discover this community full of people working toward the same goal. And along the way, we adjust our baseline based on the people we meet here, and we might even forget that we are the outliers, not the normal ones. Recently, we were reminded just how not normal this goal is, and that’s made us all the more grateful.
In just two short months, we’ll be retired and living on a constrained income for the first time in ages. But we’re not worried, because we have a whole bunch of ways to live beyond that budget, especially once we have time to invest in research and deal-finding. (Plus, we can live a pretty sweet life for not a lot of money, so it doesn’t take much budget stretching to feel like we’re living a life of luxury.) Check out our plan for living beyond our budget — and then let us know what we missed!
It’s official. We’ve given notice at work, and now we’re starting to tell our teams and clients. We expected this to be an emotionally complicated time (no disappointment there), but we didn’t realize that the weight of keeping this all to ourselves had been quite so heavy. Click and I’ll tell you all about it.
Today we’re continuing the mini-series on Social Security and Medicare by looking at whether or not you should build Social Security into your retirement plan. We’re not counting on it, in part because we don’t need to, but also for some big reasons that are worth considering for everyone who wants a secure financial future. Give it a read and then let us know what you think!
The question of whether 4 percent is a safe withdrawal rate, as the “4 percent rule” suggests has been — and will continue to be — debated endlessly. Fortunately, this isn’t more of that debate. Instead, let’s look at whether the fundamental underlying assumption of the 4 percent rule — level spending every year — is actually realistic and safe to plan around. (Spoiler: it’s not.)
Holy moly — it’s our *very last* quarterly financial update before we retire early in a little over two months from now! (Can I just keep typing exclamation points and have that count as an intro?) !!!!!! The third quarter was a good one for us, and it’s looking like we have a good chance of hitting our stretch “magic number” goal. Come see where we are, and then share your Q3 progress with all of us!
When we first formulated a real early retirement plan, it was based on the rigid belief that we’d never, ever work again. Or at least never *have* to work again. And while that’s still true — we haven’t expedited our plan by forcing ourselves to earn income in the future — we now expect to get a much more diversified set of income streams in early retirement. In part because life happens and we’ve made some different choices along the way. And in part because that recession hasn’t hit yet, health care is still up in the air, and it makes sense to keep hedging against sequence risk and health insurance uncertainty.
It’s a two-for-one post today! First up, an examination of the joint urges among FIers to DIY our lives and finances, but also to optimize as much as we can. Let’s discuss how compatible those joint impulses really are, and the joy that comes from embracing the suboptimal. And then, it’s pre-reveal contest time! Check out the DIY swag I made just for the lucky winners, and enter your guesses for where we live, what we do for work, and any other fun facts you want to throw out there. Good luck!
I know you’ve heard this one before: the narrative of “working a job you hate to buy things you don’t need to impress people you don’t like.” It’s what I’ve come to call the Fight Club narrative, a distinct strand of the FI movement that posits consumerism as public enemy number 1. And while it’s a compelling narrative, here’s my case for why it’s harmful, and what we should be talking about instead.
The financial aspects of the early retirement journey are well trod at this point: reduce your expenses, save at a high rate, invest in assets that create passive income, blah blah blah. What’s less talked about is the emotional journey, which means that a lot of us are stepping off the map, and heading into uncharted territory. But it doesn’t have to be that way. Here’s our take on navigating those emotions, and why the unexpected ones are so valuable in guiding your financial plans.
Index investing, early retirement and financial independence in their most commonly discussed forms all rely on one simple principle: They only work if most people don’t do them. (Don’t believe me on indexing? Read on for plenty of evidence.) Let’s dig into this idea, specifically the thought exercise on what a universal aspiration for early retirement would mean for market valuations, and talk about what would make early retirement more accessible to more people.
We’re getting into the home stretch! With only about three months left to work — forever! — we’re feeling good about all that we’ve checked off our to do list. But we also wonder, what are we forgetting? And that’s where you come in. We’d love your help to tell us what else belongs on our final pre-retirement to do list. Come chime in!
Vicki Robin’s book Your Money or Your Life had a huge impact on how I view money, asking us to equate money we might spend with the life force it represents, in other words, the time it took to earn it. And while that’s a great starting point for shifting our thinking about money and spending, I have a different proposal for how we should think of that money to speed our progress toward financial independence, focusing not on how long the money took to earn, but on how much time it buys us back.
There is plenty of financial advice out there, including some very prescriptive advice about how to achieve financial independence or virtually any big goal you can think of. The only problem is: that advice, while great for some, is guaranteed to be bad advice for others. Rather than trying to follow advice to the letter — or give it out in a prescriptive way — let’s focus on the formula instead, a formula with three key ingredients that can get anyone in nearly any life circumstances to achieve big goals.
If you’d told me at the beginning of our early retirement journey that we’d be on the verge of retiring only six years later, and that we wouldn’t be miserable or feel like we’d lived a life of sacrifice to make it possible, I wouldn’t have believed you. But it’s true. And not because we haven’t dramatically cut our spending. We have. But because sacrifice is a perception, not an absolute, and we’ve managed to balance out cuts to our spending with additions to other parts of our lives. Here’s how.
Today I’m (finally) sharing something that I’ve wanted to write about for a long time, but haven’t tackled because there is no easy formula: how to determine what is “enough” to save for early retirement. “Enough” is perhaps the centrally important concept to early retirement, but it can feel overwhelming to quantify your own. Here’s a breakdown on how we calculated ours, and how you can do the same for your own circumstances.
Those of us on the FI path who are still working have an incredible freedom that most of the working world doesn’t enjoy: the freedom to push for the change in our companies or industries that others might get penalized for pushing for. Better pay, more empowering conditions, parity, diversity, you name it. If we get labeled difficult or squeaky wheels, it doesn’t matter, because we’re on our way out. Here’s how — and why! — to use that power, both for the greater good and for your own legacy.
We know — the excitement of the *early* part of early retirement is powerful. So much so that it’s easy to focus our retirement planning mostly on those early years. The later years are also so much harder to predict — more variables, a longer time horizon, more unknown unknowns. But as we’ve seen in our own planning, it’s easy to have an inadvertent early phase bias built in — here’s how to suss that out and ensure that you’re planning for both your early retirement and traditional retirement.
Early retirement and financial independence are such huge goals that most of us can’t help but build them up in our minds, and that often leads to the totally normal tendency to get into magical thinking: believing early retirement will make us happier, or better people, or cure whatever else ails us. Today we get into why it’s worth countering that magical thinking, and how to do it.
We don’t walk around in the world feeling like some financial masters of the universe. I blog about money, of course, so I think about it a fair amount – though less than when I was more obsessive in checking our balances and updating the spreadsheets. But I […]
A few weeks back, we asked you guys to complete a reader survey — and now we’re back with those results! Best of all, there are definitely some big picture conclusions that apply to all FI bloggers. Whether you blog or not, come check out what we learned about you guys. (Bonus: more charts and pictures than ever before!)
There’s a principle in medicine that the dose makes the poison. Which means, very few substances are good or bad for us no matter what. Instead, what matters is how much of them we take. And it’s exactly the same with money. It’s easy to make symbols of things like buying lattes or paying for cable, but those behaviors aren’t objectively a problem. What might be the problem, however, is the dose. Why we’re big believers in focusing on the dose, in context, and embracing a sense of radical moderation.
Today we’re tackling a question that I know a lot of people ponder before retiring early: whether or not to try to negotiate a layoff or severance on your way out, to soften the landing. We’ve given it tons of thought, and have decided that approach isn’t for us — but it very well might be for you. Let’s examine both sides.
Over the past two and half years of blogging about our early retirement journey, we’ve had the pleasure of meeting and hearing from several dozen of people who’ve achieved financial independence. All the while, we’ve been going along on our journey, and noticing what spurs us along more than anything. Turns out our journey and those of others’ have one key ingredient in common.
Today is officially day 100 in our countdown of workdays left before we pull the ripcord and end our careers. Which is exciting! But excitement isn’t our overwhelming emotion right now — what we’re feeling instead is a pretty big surprise. How things finally got real, and the unexpected feelings that came with that.
Things have been moving quickly in the health care debate, which many of us on the verge of early retirement have been eyeing closely. Just this week, the latest Senate proposals to reform the Affordable Care Act and the later proposal to repeal it altogether were withdrawn. So where does that leave us all? What do we know? And more importantly, what do we still not know about health care and costs for early retirement? Let’s take a close look.
We’re coming up on six years of living in our soon-to-be-divulged mountain town, and we feel lucky every day that we get to call this place home. But it’s not perfect, of course. The place we call home is a place lots of other people call their vacation destination, and that makes for some interesting dynamics. We’d tried to look at it in terms of what lessons we can learn from those visitors that we can apply to our own life and early retirement, and it turns out there’s plenty to take away from it all.
It’s time for our second quarter early retirement progress report — our second to last! — complete with charts galore. This quarter we hit another milestone that’s both wonderful and a relief, and we’re setting our sights on building up a sizable cushion by year’s end for future health care unknowns. Plus: we’ve launched a reader survey and we’d LOVE your input.
The most recent debates on health care reform have brought out a sentiment that has reared its ugly head before: the idea that health is totally within our control, and therefore anyone who’s not entirely healthy is somehow at fault. Why that’s both false and bonkers, and why it matters.
Today we’re talking options, and keeping them open. Early retirement isn’t an ending, after all — it’s a beginning. And if we go into that beginning with a limited set of options, and no ability to change our course, we could be setting ourselves up for a less-than-ideal future. Here’s why it’s so important to have an exit plan from your exit plan, which really just means you’re giving yourself the financial and logistical resources to change your mind.
I spend a lot of time talking about the nobler aspects of early retirement like how it will give us time to do more volunteering. But can we all be honest? We can do noble things in retirement, but the reason doesn’t have to be noble at all. For us, it’s all about what is most fun, and the answer is: not working. We want to retire early so that we can go back to being kids, but the paradox is that we’ve had to grow up big time to avoid growing up.
Our early retirement might be right around the corner, but we still have a lot to do before the year is up to make sure that we’re truly ready to make the big leap. Then after we pull the plug, we have a different set of things to do. Here are our big lists of things to do before we retire early, and right after, as well as things we’ve already checked off the list this year. Are we missing anything? Let us know!
I definitely fell into magical thinking for years of our retirement planning, thinking I’d have time to do everything I’d ever dreamed of after we quit: travel the world, write novels, learn a gazillion languages, solve world hunger — you get the idea. But after talking to many early retirees, I’ve had to accept: Time will always be limited. And if I care about accomplishing goals or living a life of meaning, it’s crucial to go into retirement with an eye toward making time for what’s important, and ruthlessly cutting out what’s not.
Lately we’ve been mulling over a question: Is it a win or a fail to die with money leftover? Of course we can’t know how long we have, but if we could, would we prefer to spend our assets down before we die, or to be able to leave a big legacy behind? There’s a lot behind this question, and today we dig into all of it!
It is a natural thing to want to save money, and those of us pursuing huge financial goals innately find the idea of saving even more powerful. The problem comes when marketers deliberately blur the line between saving and spending, convincing us we’re doing one when really we’re doing the other. Today, recognizing when saving money is actually spending money, and how to keep the focus on the saving itself.
We love that more and more people are talking about prenups these days (more financial transparency between partners is great!), but for those of us considering early retirement, we think a pre-FIRE agreement is even more important. After all, early retirement comes with its own set of major risks, some of which we’re insulated from to some extent as a couple, but others which become bigger risks for those who are married. Here’s how we’re navigating this.
We’re huge believers in pacing ourselves on the way to early retirement — both finding ways to manage the impatience, and creating boundaries and self care habits that keep us healthy along the way. But as we get close to that finish line, it’s getting harder and harder not to break out into a full sprint.
Today we’re exploring a single question — Are some people predisposed to embrace the FI mindset? — through some personal stories, including a spending confession so out there I almost couldn’t hit publish. But most of all, we want to hear from you guys on this one — what do you think all FIers have in common, and can anyone become an FIer? Come weigh in!
Some possible fighting words today, as we delve into the question of whether it makes sense to think of both taxable funds and tax-advantaged retirement funds as one big pool of money. Why does it matter? Because there are a bunch of potentially huge downsides to withdrawing traditional retirement funds early through Roth conversions or rule 72t distributions (or different approaches that exist in other countries). Fortunately, there’s another great option if you’re willing to do a little more math.
For years, I labored under the cozy illusion that there were “safe” choices in life and “risky” choices. And of course I was drawn to the ones that felt safer. Until I saw with my own eyes, in my own finances and my own life, that sometimes the safest choice of all is actually the most risky. And that realization changed everything.
We’re all getting conflicting signals right now: From financial analysts predicting lousy returns for the foreseeable future, and from early retirees reporting how they’re beating their projections every quarter. We could take away two very different lessons from this dissonance: that we need to make sure our plan is extra solid and based on low projected returns, or that we’re probably overthinking it all and working longer than we need to. We have an opinion on this (always do!), and share why we’re taking the more conservative approach, because: recency bias.
In the last several months of contemplating leaving work, while doing a better job of saying no and setting boundaries (woot!), I’ve come to realize something: I truly love what I do. Bad news for a soon-to-be early retiree, right? Not at all! You can definitely love your job and still want to retire early — no insanity required! Here’s why.
I’m sharing a personal story today about why the oft-used term “financial freedom” has always meant something totally different to me. (Spoiler: You’re almost certainly already financially free.) Let’s talk about freedom!
Today we’re talking mission statements, something that most companies have, but which few individuals or families do — which is a shame, because they can be super helpful in keeping you on-track to reach your biggest life goals. Think of your mission statement like a compass or GPS that helps you find your way if you ever start to wander off the path.
I just can’t help it. I feel compelled to keep poking the bear that is the retirement police, those folks who feel the need to tell us if we are or aren’t “retired,” according to whatever their definition happens to be. Today that means talking through the evolution of our personal definition of retirement, encouraging you to create your own, and taking a deeper look at what actually constitutes “work.” Come join the discussion!
Maybe this is true for most of us, but we tend to focus on what’s right in front of our faces. On the journey to early retirement, that means thinking about how we treat our money now, and not always thinking back about how we used to relate to it. But today we’re taking a little look back to see what has surprised us most about pursuing financial independence, both financially, and in terms of our mindset.
A question we ask ourselves all the time is: Do we just want to retire early because deep down we feel bad at working? Even though we’re nothing close to bad at our jobs — we’ve very good at them — we’ve never quite been able to muster the right attitude to do them with total commitment. Which makes us wonder: for those special few who are seriously incredible at their jobs, would early retirement even enter their minds? Come share your theories!
We’ve been lucky in many ways, but one of those ways is that we’ve been almost completely supported in our early retirement plans by our friends and family (at least the ones who know!). But we know that many aspiring early retirees aren’t so lucky, and today we hear from lots of them about how they handle that lack of support!
It’s nothing new to say that our collective digital life has made many of us focus too much on signs of external digital validation such as likes and comments. I’ve so far been okay at avoiding that trap, but after we leave our careers, the work I do will be more digital than ever. And given my gold star-seeking tendencies, how can I redefine my self worth post-career without falling into the digital stats trap?
Though we’ve been thinking about all the questions that go with the end of work for months now, we’re late in realizing that we need to be ready to respond if our companies lay on the hard sell to try to get us to stay. We’ve given it some thought, and here’s what it would take for us. What would it take for you?
We’ve talked a lot about health care lately, given the political climate, but not health itself. And health is super important to us. Why bother planning for a long retirement if we aren’t going to stay healthy enough to enjoy it? Here’s everything we’re doing and thinking about to increase our chances of reaching a ripe old age in good health.
This year has been flying by, and we can’t believe it’s already time for our first quarter update. And it’s not just numbers on our minds — getting this close to retirement has us feeling all kinds of contradictory feelings, and the recent market boom has us in a state of disbelief.
Monday’s post spurred so much great discussion around what constitutes “retirement,” so I thought we could take it a step further, and do some exercises around what actually constitutes retirement, and what that’s based on. There’s no right or wrong answer, so come weigh in!
An interesting thing happens with a lot of financial independence bloggers. As your audience grows, you suddenly have this incredibly opportunity not only to reach more readers, but to earn more from the blog. Which is wonderful! Except when it means you’re only telling part of the story. Here’s why this matters, and what we should all keep in mind as we read FI blogs.
Reaching financial independence is, more than anything, a waiting game. Especially for those who follow a passive investment strategy like indexing, there’s very little thinking to do once you set your plan in motion. But, the journey still takes years, often many years. Here’s why it’s so critical to pace yourself on that journey.
The fact that we are retiring at the end of this year is getting more and more real for us, and some of that feels scary. But it also feels crazy exciting for obvious reasons, and for less obvious ones like the forthcoming opportunity to re-engineer our lives to reinforce better habits and avoid triggering the bad ones associated with our current work lives.
Here’s a crazy thought: It feels great to be good at things. And if there are things you’re good at in your current work — even if it’s not obvious now that you get joy from them — you might miss out on future joy if you subtract those tasks from your life when you retire early. Today we’re honing in on the things we’re best at, that bring us the most joy, and figuring out how to magnify that joy in FIRE.
The best thing the Affordable Care Act did for early retirees was introduce some level of predictability about health care costs, and all indications are that that predictability is about to go away, no matter where things land with a new health care law. And that’s a big deal for early retirees. Here are some things you should be thinking about, especially if you’re planning to retire soon.
Something we’re starting to realize is: What we all call retirement planning isn’t really true retirement planning. Money is only a tiny piece of this, and not what most of us will be thinking about daily once we stop working. Real retirement planning is planning for all the rest of life that comes post-career, and for us, a big part of that is travel. So we’re shifting now into *real* retirement planning, and thinking through those big travel questions like how long to stay out, and where to go first.
Today I’m on the Mad Fientist podcast! To celebrate the occasion, we’ve got a monster post with the full rundown on every aspect of our financial plan and financial philosophy, so new readers can get a better sense of us, and long-time followers can see everything all in one place.
Though early retirement feels like a big goal in and of itself (and it is!), it’s not an endpoint. For most of us, it’s just the beginning, and it’s worth thinking in advance about what your next big audacious goal will be after FIRE. We offer some suggestions here!
For a community that’s so into freedom, the financial independence blogosphere can be an awfully strict place with tons of rules. It can be hard to believe that we have the right to do some things just because we feel like it. Today, we give you permission to do exactly that, and share some of our most bratty financial decisions.
Blogging is a hugely time-consuming endeavor, and anyone who tells you otherwise is selling something. But we wouldn’t trade this blog or the time it takes to write it because of how much it has done for us. Today, a closer look at how blogging has sped our progress to financial independence and early retirement.
I think of myself as a naturally curious person, and that means that the list of things I want to do in retirement is longer than I’ll ever be able to get through. But even for the naturally curious, it’s worth cultivating both more curiosity and conscientiousness — to achieve success, however we define it, and to give a longer, healthier life.
Right now, nearly everything in my work life is set up to remind me that I’m (deliberately in quotes) “important.” How will our egos handle early retirement, when all of that goes away? Will we feel invisible? How can we let go of the fake importance and focus on replacing what truly matters to us? Let’s dive into all of that.
The question of when to retire this year — Work the full year? Retire sooner if we hit our numbers? — has been on our minds big time for many months, ever since we realized how ahead of schedule we are on our savings plan. But we’ve made peace with working the full year, and here’s why.
Today is our second blogiversary! In some ways, nothing has changed — we’re still slogging toward that big goal. But in other, more important ways, SO MUCH has changed in our lives, driven in large part by this blog and the awesome people who read it. Today we take a look at where we’ve been, a look at where ONL is headed, and we answer your questions.
Thanks to some recurring power outages, we’ve had a lot of time lately to talk about what’s on our minds. And something that keeps coming up a lot is anxiety about what it will be like when we quit — not our post-work life, but the actual act of quitting itself. We know this feels tougher to us because we’ve been in our jobs a long time and are invested in them. Today: When loyalists contemplate quitting.
I never took a break between high school and college, or between college and starting my career. And so for years, I thought I’d missed my chance to do something awesome, as though that’s something only young 20-somethings can do. But seeing people in our mountain town piecing together lives of adventure in all different ways made us realize: we haven’t missed out on anything. In fact, we’re probably doing this the better way, because our life of adventure will be built on solid financial footing.
Today’s post is more philosophical, looking at what has happened (at least for us) as our numbers have grown over time. It has been wonderful to celebrate a steady string of financial milestones over the years, but outside of those moments of celebration, it all actually feels less real, not more real. Is it just us? Let’s discuss!
Paying off our mortgage last week has gotten us thinking a lot about debt, and how differently we all think about it — but also how we *feel* about it. Today we’re diving into those thoughts and feelings, and — because we got so many questions about it — diving into why we did pay off the mortgage on our house but why we’re not paying off the mortgage on our rental anytime soon.
Today, an amazing thing happened. We woke up in a house that is completely ours. We’ve always planned to pay off the house before we retired, but we’d never imagined we’d hit this goal so soon, nor could we have expected how incredible it would feel. Here’s why we did it, and what it means for our home stretch to early retirement.
Happy new year! The last year of work was super stressful for us, and we’ve been mulling the question of whether we should or even can care less at work — and whether that would solve the problem. But, we’ve come to a different conclusion about the root of the problem, and it’s giving us a new directive for this year. Welcome to our 2017, the Year of No, preamble to our retired Life of Yes.
Today’s a biggie: the culmination of so many discussions and decisions! Will we pay down the mortgage or pad our taxable accounts? How did our 2016 look in the end? When will we retire in 2017? It’s all here! (Plus, happy holidays! Sending lots of holiday love!)
Anyone aspiring to retire early can list off a million reasons why we want to quit working, but what’s interesting is that most of those reasons have to do with work culture, not with work itself. On some level, we all crave the meaning and satisfaction that come with work, but the realities of modern work are very different from that work ideal. Learning to recognize the difference between work itself and work culture — and likewise the difference between job burnout and a true dead end career — can help us zero in on why we want to retire early to begin with.
We’re thinking a lot lately about asking for more — asking for the compensation we deserve at work, and asking more of ourselves. And now, it’s official: in 2016, we successfully did both. Today, the story of how I negotiated for more money at work, and how we rose to the higher challenges we’d set for ourselves this year. Do we consider 2016 an unqualified success? Read on!
Lately I’ve been making it sound like we both want to retire as soon as humanly possible, but that’s not true. I’m the one who wants out ASAP, while Mr. ONL is playing the role of the financially prudent one and trying to keep us working for one more year, as we’d always planned. But that’s not where we started — he used to be the one who wanted to quit ASAP, while I wanted to be sure we were prepared times ten. Today: the story of our retirement timing role reversal.
It’s year-end bonus time! And ordinarily we’d be following the plan: allocating part of our bonuses to paying down the mortgage and part to our investments. But this year, with retirement on the horizon, and our savings ahead of schedule for the year, we have some tougher decisions to make.
Today we’re reflecting on comparison — when it can be good, when it crosses the line, and if it’s even possible to know when you’ve crossed that line. We work hard to share our story in a positive way that encourages others, but lately we’ve been wondering if some of what we share inadvertently creates an arbitrary standard that begs comparison.
This is both an exciting time and an anxious time for us — exciting because we’re so close to achieving our biggest life goal, and anxious because of all the uncertainty the election put on early retirees. Add to that our ongoing work stress, and it all has us wondering what would happen if we retired today. Today, we explore that thought experiment.
Subsidies are in the air right now, with them likely disappearing for health care under the next administration. But “subsidy” is just one word for a concept that most of us embrace openly and unquestioningly: the idea of incentives for things that provide a social good. Think tax credits and deductions, and public services across the spectrum. Today, how subsidies have made my success in life possible, and how they are making our early retirement possible, even without the ACA.
Though a lot is still unknown about what policies we’ll see under a Trump presidency, this much is clear: a lot is going to change. From health care, to taxes to economics, here’s what we know so far about the election’s impact on early retirees.
This is a non-political post at a politically charged time. When the news conflicts with our world view, it’s all too easy to avoid clicking on those stories, or to unfollow or ignore the people sharing their perspective. And while that may seem harmless, it’s a slippery slope from “unfollow” to unknowingly creating our own echo chambers. Here’s why that’s so consequential in retirement.
Today we’re sharing stories we haven’t talked about before: the early retirees we’ve known in our lives, and how their experiences retiring shaped their retirements. Spoiler: Though all of them retired early, none of them retired completely on their own terms — and stats show that that’s the norm. The majority of people are forced to retire before they want to. Here’s what we’ve learned from seeing their experiences.
Something that’s on our minds lately — especially when I’m traveling for work — is all of the perks that we’re going to lose when we quit our jobs in 2017. For us, an upgraded level of travel is chief among those, but the perks we enjoy from work are different for each of us. What perks do you get now that you’ll miss when you retire?
Today, a post about the under-recognized benefits of spending less in early retirement, because spending less means earning less, and earning less means a whole bunch of benefits. (Psst: the biggest one is insulation from Obamacare price hikes.) Let’s take a deep dive into the many benefits that come with earning a low income in your early retirement years.
Almost a year ago, we realized that we’d reached financial independence. And reaching it hasn’t been anything like what we might have expected. Our FI life is still life, with all the usual ups and downs. Some things are better, but most things are the same. This year has taught us: Financial independence is a good goal, but a bad goalpost.
Our early retirement plan has gone through a lot of iterations, but one thing has remained constant: our insistence that we never want to have to work again. But we’re starting to realize that we’ve been thinking about this the wrong way. Come join us as we trace our journey to our recent epiphany that we will earn money in the future, even after we retire.
We love bringing you guys lessons from people who’ve actually crossed the Rubicon and retired early. Today we’re sharing lessons from Jim Wang of WalletHacks.com. Jim retired at age 30 after selling his massively successful blog, Bargaineering. But what he learned after retiring early wasn’t what he expected.
We get the question a lot: “How do you stay patient en route to early retirement?” But we’ve realized that’s the wrong question we should all be asking. The biggest predictor of happiness in the journey to early retirement isn’t how patient or impatient we are, it’s whether we stay engaged or let ourselves disengage at work. That’s why we now say: Don’t check out early.
We don’t pretend to know whether what we do with our money will work just as well for other couples, but today we’re talking about something we do know for sure: We are going to be able to retire earlier because we have fully combined finances. We’ll also trace our history of money management as a couple, and look at the money-related feelings that give us extra momentum toward FIRE.
We could only daydream about our future life and how different it will be from our current one for so long before we had to accept: Life won’t just be different. We will be different, too. For the first time, we’ll get to know the well rested versions of ourselves, and the less stressed versions. And it has us wondering: How well do we really know our post-retirement selves? And how well do we know post-retirement us, as a married couple? Let’s discuss!
The good financial news keeps rolling in over here at the Our Next Life house. We hinted at it recently, but today we’re sharing loads more detail about our ahead-of-schedule progress toward early retirement, with charts galore. It’s starting to feel downright magical around here!
One of my favorite parts of FinCon was getting the chance to talk to bloggers who are ahead of us on their FIRE journeys, including several who are already retired. I asked them all if their last year of work was harder, and answers were mixed. It all seemed to come down to how much they cared about work in the home stretch, and it has gotten us wondering whether we can care less to make our last year less stressful.
I’ve just returned from FinCon16, my first time at the financial bloggers conference, and I’m completely brimming with excitement about it all. My vision for this blog is a lot more clear, but most of all, I was continually floored by the warmth, openness and generosity of the entire community there. It all got me thinking about communities we create, and how we can all connect — and I don’t just mean bloggers!
Creating a vision for early retirement isn’t just important so you have cool stories to share — it’s crucially important to make sure you have a smooth transition into retirement, avoiding the declines in physical and mental health that many people experience, even in early retirement! Bonus: An update on our progress, and lots of graphics on creating a next life vision based on presence of awesomeness, not absence of work.
Today we’re talking about hustling — both of the generating business variety (ever-present in our careers) and the oft-discussed side hustle. We’ve done a lot of both, and will share what we’ve learned along the way — including giving you permission if you want it to stop side hustling altogether.
We’re realizing that we’re starting to do things for the last time — especially things related to work and work travel — which is bringing out unexpected urges in us. Can you relate?
As early retirement gets closer, something that we find ourselves getting especially impatient about is the arbitrary nature of deadlines. The notion of being free from deadlines can be extremely appealing, especially for procrastinators like us. But is a deadline-free life really a good thing?
As we promised in our recent pre-retirement to do list post, we’re dedicating a whole post to the question of what we’ll do with our 401(k) accounts after we retire next year. Our 401(k) accounts make up a major part of our portfolio — and up to 100% of what we’ll live on after age 60 — so we want to be sure they’re taken care of.
This Labor Day, we’re reflecting on the ever-speeding progress of labor and productivity in the developed world, and looking at our own longing to slow things way, way down. Can you relate? We bet you can! (Bonus: lots of geek-worthy charts and graphs!)
Today we’re sharing the story of our rental property, but we wouldn’t recommend that others follow our lead on this one. The decisions that went into it were about a lot more than the bottom line.
We feel lucky every day to wake up a place we love, but it’s not all perfect either. Mountain towns come with their own set of challenges, and today we’re sharing ours.
As we get closer and closer to our retirement date, the idea that we are actually going to retire early is becoming real. And as we get closer, we’re creating a different kind of to do list — one less focused on saving, and more focused on mapping out everything we need to do before we pull the plug on our careers next year.
We like to plan for pretty much every possible eventuality, and given that we’ve already put about as many contingency plans in place as we can, we’re still thinking about the question, What if things don’t go as planned? But now we’re on to the more metaphysical answers, not the financial ones, like: What are our early retirement deal-breakers?
We’ve talked a little bit about upping our savings game, but we’ve only talked about it in general terms. Today, we’re going to get specific about how exactly we’re raising the bar, and especially what that looks like for non-budgeters like us.
Right now we’re living a life of no. Work is sucking up almost all of our time, and we’re turning down invitations to do all the things we’d rather be doing than working. Our aspiration: switch to a life of yes very soon.
Thanks to thinking about early retirement pretty much all the time, reading lots of thought-provoking blogs about it, and of course writing about it in a few thousand words a week, our thinking has continued to evolve. Today we’re diving into how we’re now thinking about our time, money and purpose in early retirement.
Something we need to plan for better is how we’ll get social interaction after we leave the workforce. In other words: We need more friends! Soon, we’ll have our best free time when our current friends are at work, so need friends whose time aligns with ours. Plus, having good friends does wonders for mental and physical health, especially as we age.
We have said from our second post ever that our vision for early retirement has never included mandatory work. And we’ve been more vigilant about this fact than probably any other in our early retirement plan. We’ve shifted our investments, we’ve changed our timelines, we’ve debated when to give notice, but we’ve never wavered on the no mandatory work idea. But… that might be changing.
Today we’re kicking off a new periodic series called The Retirement Lie. We recognize every day how lucky/fortunate/privileged/rare we are for being able to pursue early retirement, primarily because we also recognize that just being able to retire at all is becoming increasingly unlikely for a large majority of people. In this series, we’re delving into the forces that are keeping people from retiring confidently and securely, beginning with the way media talk about retirement savings.
Get ready, because we’ve unleashed the excitement in today’s update! 2016 has been good to us financially, and we’re even farther ahead of schedule toward early retirement than we were at the end of the first quarter. This is a big one!
Though we weren’t personally all that impacted by the 2008 financial crisis, we learned a lot of lessons from it second-hand. As we get closer to early retirement, we’re reminded of the biggest one: We can’t always bank on being able to go back to work if we need to.
If you’ve been reading here, it will come as no surprise that we care a lot more about happiness than we do about money. And happiness doesn’t happen by accident. For us, happiness right now means not waiting to become our best selves. Here’s how we’re doing that.
I am definitely a planner by nature, which means that we have all kinds of contingency plans, emergency preparedness plans, you name it. But I recently realized that I tend to plan for the worst only, and not for the almost worst. Today we’re talking about what happens if any of those not-quite-worst-case scenarios happen.
Though we’re world-class in exactly nothing, and are in our late 30s, we actually have a lot in common with pro athletes. And we bet you do too! Let’s talk about the best way to enjoy a life filled to the brim with outdoor adventures or whatever you’re passionate about… even naps!
It’s not my favorite thing about myself, but I have come to accept that I am heavily motivated by the idea of getting gold stars, i.e. some form of recognition for my work. Today I’m contemplating what it will look like when work, my primary source of gold stars, is gone.
We’re issuing a challenge, you guys! Instead of focusing on what we’re all doing to get to early retirement that’s the same (4% rule, high savings rate, etc.), let’s celebrate what each of us is doing that’s unique!
I recently had a realization that I now think has been influencing the entire direction of my life without me realizing it. And it’s completely related to our plans to retire early. Turns out I have always resisted mixing creativity and money — here’s why.
Today is a “clip show” post of sorts, putting together for the first time all of our money beliefs and actions that have gotten us where we are today. We spend a lot of time looking forward, and projecting future health care needs, where our income could come from and of course all the feelings. Today we’re sharing the master list, the grand compendium of everything that’s helped us get this far in our journey to early retirement.
Lately I’ve been trying this experiment where I treat weekends like mini early retirements, instead of like days to get a bunch of stuff done. I decided to take this one step farther to test the theory that we crave unstructured time in retirement. Come see what we learned!
We’ve spent more than a decade building up our savings and investments, all the while granting them a special status by not touching them. Even shelling out $8,000 for our tax bill this year felt painful. The pain of paying that bill made me wonder if I have “special occasion thinking” around our investments. And if, when it comes time for it next year, we’ll actually be able to spend our investments. Let’s explore…
We all know that tomorrow is not a guarantee, but let’s be practical. We simply can’t do everything. But sometimes we let that fact be the source of extra excuses — excuses not to focus enough on fitness, or not to spend time with family. But that ends soon!
There’s an issue that we’ve struggled to get our heads around, which we’ll call our optimal retirement income: a level at which we get a big Obamacare/ACA subsidy on our health insurance, we pay low taxes and we enjoy a comfortable standard of living. But calculating that number is not as straightforward as it seems. Enter the income vs. cashflow discrepancy!
We value our health pretty much above everything. If we had a such thing as a “health portfolio,” it’s safe to say we’d value that above its financial counterpart. Something we are thinking a lot about is how we’ll ensure that we always have access to good quality medical care at every stage of our lives. Here’s the rundown of options we’re currently considering as the landscape keeps shifting.
One of the funny things that happens when you’re open about FIRE plans is you get some questions that might seem ridiculous on their face, especially from people who haven’t yet had their minds blown by how achievable some form of early retirement is for plenty of folks, or who have never allowed themselves to dream about a life without the necessity of work. Rather than dismiss those questions out of hand, let’s actually dig into them.
The current debate in the ONL house is when to quit our jobs. Barring a major market correction, we feel pretty good that we’ll hit our magic numbers ahead of schedule next year, possibly as early as Q2 of 2017. But of course before we can quit, we have to give notice. And that brings with it a whole bunch of other questions. Here’s how we’re thinking about them.
While we’re making fast progress toward FIRE, it’s not because we are especially gifted in the discipline department. We still slip up and make occasional impulse purchases, even now, multiple years into our FIRE journey. But, we’ve found a way to fake discipline, through the motivating power of streaks.
It’s easy to think of early retirement as all about the escape. But then what? We don’t want any part of our life to be defined solely by absence, by its lack of something, in our case the lack of work. We want our lives to be defined by presence, to be lived in the affirmative, the ultimate opt-in to what fires us up and makes us launch out of bed in the morning. That’s why we’re busy crafting a life that keeps the stoke high.
Something we get asked about semi-regularly is our two-tiered retirement plan, and why we aren’t thinking of our taxable and tax-deferred funds as all one pool. Here’s a breakdown of why.
Thinking about how we want to be remembered, we always come back to this idea of leaving the world in better shape than we found it, even if it’s only in little ways. And as early retirees, we’ll be in a unique position to do that, because we’ll be able to spend most of our time on projects that are important to us, that help our community, instead of focusing solely on earning a living. Here’s why we think everyone should build some joyful generosity into their life plan.
We all tend to talk about saving money and reducing needs in ways that make us focus on the aspiration to be income-poor. But there are some important times when we should instead think like a rich person, since any aspiring FIer eventually becomes one!
We constantly come across new tips on how to get to “optimal frugality,” and while we think it’s great to continually try to optimize your spending, something that we now know to be true is that there’s never a point of ultimate optimization, a point when we have everything figured out perfectly. Rather, it’s an ongoing process of dropping habits and adding new ones. Here are some we’re happy we’ve dropped.
For a long time, we were big fans of dollar cost averaging, the notion that you hedge against market losses by not buying a whole bunch of shares at one time, but rather in smaller increments over time. There’s only one problem: Mathematically, it turns out dollar cost averaging is not that great a strategy after all.
We’d all love it to be otherwise, but getting to big financial goals is mostly a matter of letting time pass. Rather than sit around feeling impatient all the time, and let that suck the joy out of the journey, we’ve found some strategies that help us pass the time without getting quite so antsy.
It’s that time again — when we share our quarterly stats and progress on the road to early retirement. Also in this update, something that’s got us so flipping excited — like party confetti emoji excited, you guys. Come check it out!
Do you think there is a meaningful difference between the terms financial independence and early retirement? Let’s dive into this distinction without a difference, and what it means for the personal finance community.
When you’re saving like crazy for early retirement, any money not going into the savings pool can feel like a setback. But there’s more to life than just future goals, and those goals should never trump your values or your joy in the present.
A lot of what we talk about here is specific to people on the early retirement path, but today’s topic is something every single one of us should have as an important part of our financial plan: an emergency fund. We think of our emergency fund not as a one-and-done kinda thing, but as something that has evolved upward and downward over time. And now, as we’re approaching early retirement, we’re once again rethinking how much we need to have saved in our e-fund when we hit our magical date.
As we get closer and closer to early retirement, we get more excited. But it’s not all puppies and ice cream sundaes, either. There are some definite ups and downs that have come along with our journey, and sometimes we each handle them differently. Here’s how we navigate that as a couple.
Lately we’ve been wondering: How many of us who are saving for early retirement would happily spend more if we had more to spend? If spending more wouldn’t derail our plans?
Early retirement will give us the incredible privilege of getting to dream big — and actually bring some of those dreams into the realm of the possible, the doable, the done. It’s not just about not working, although that’s a lovely thought all on its own – it’s about getting to do the things that most people only dream of, that can’t be done with three weeks of vacation a year, that can’t be done as just a side hustle. Let’s dream in maximum bigness!
We’ve noticed something surprising. We’re super happy to talk in detail about finances and our retirement plans with strangers… but we don’t do the same thing with people we know in real life. Why is it so much easier to spread the word about FIRE with strangers?
I have a super visceral memory related to taxes that I still carry around with me. My parents divorced when I was in high school. The divorce itself was fine, but what was not fine was watching them get audited post-divorce for a year in which they had been married. It was the worst I ever saw of my parents, but it was also an important lesson in dealing with accountants and the IRS.
We are often most afraid of what we don’t understand. Whether it’s fearing flying because we don’t really know how it works, or fearing investing because the markets feel like a mystery to us, the solution is simple: Learn all you can.
We really aren’t frugal by any reasonable definition of the word. We never consider forgoing things we need. But I decided to look at our lives and see if there was any area in which we truly are frugal, and ask what that means for us. And there is one example: the thermostat. Here’s what keeping our house cold has taught us.
We love the small mountain town where we live, but the reality is that we’re not actually here all that much because of work travel. What happens when we stop getting our fill of city time, courtesy of work? Are we cut out for small town living for the long haul?
A tension we notice a lot in PF blogland is the question of whether to prepay the mortgage, or sink as much money as possible into market funds, and it’s a question we struggle with, too. In some imaginary world in which we could see into the future and see how the markets will perform, it would be an easy decision to make. Let’s dig into how we answer this question in reality.
it’s the most math ever! today we’re talking about how we calculated what we need to save for early retirement, since the 4 percent rule doesn’t exactly work as planned for all early retirees.
in honor of valentine’s day, we got to talking about how we’ve grown as a couple financially. neither of us started out as a financial role model. instead, we let ourselves figure out the money stuff together as we went along.
today we’re tackling two topics: the question of how to define financial independence (and whether we’ve already reached that milestone without noticing), and sharing the contents of our already-full life bucket!
the last time we talked finances, we were riding the crest of a high and beautiful wave at the end of 2015, back when it appeared that we were ahead of schedule on our early retirement goals. but now we are now experiencing the financial hangover, the realization that actual reality may shake out differently than we’d hoped. all the more reason to keep our goals fluid!
if you watched yesterday’s super bowl, you couldn’t miss all the speculation that peyton manning is going to retire after this season. what’s incredible is that peyton has the rare privilege of choosing to go out on top, on his own terms. not many people, in sports and in regular working life, get that choice.
we’ve had that mythical first year of freedom on our minds in a big way lately. like any aspiring early retirees worth our salt, we spend lots of time thinking about everything we want to do when we have more time on our hands, but we’ve been getting more specific, and thinking about the things we’ll do as we adjust to our post-work era, and some of the big life goals that we want to tackle right away.
we’ve mentioned several times over the past few months that we’ve been working on a monster post on health care, obamacare/aca coverage and how the subsidy limits are affecting our retirement budget projections. but we’ve realized that the more interesting topic is the moral catch-22 of the affordable care act subsidies.
tomorrow is the one-year anniversary of our first ever post here, and as the tradition goes, we’re going to reflect a little about our first year of blogging here at our next life, as well as take a big look forward… and share some totally goofy facts about ourselves. but most of all, we want your feedback! we’d love to hear from you about how we can keep improving in year #2. so please chime in in the comments!
while it’s easy to paint a pretty picture here in blogland, the truth is that, despite all that counseling, and reading that book and others, and even despite being in complete and total lockstep with regard to our early retirement and life goals, we aren’t always on the same page about every aspect of our finances. we think it’s important to acknowledge that. here’s how we’re dealing with our current disagreement.
we have felt for years that, if something tragic happened and we died unexpectedly, we wouldn’t have a whole lot to show for our lives, or at least not the things that we’d want to be remembered for. rather than lament whether or not our accomplishments match our aspirations at this point in our lives, we decided to be the empowered authors of our own purpose. here’s what we mapped out.
we’re super excited for today’s post. we have been dreaming of early retirement for years, but didn’t really know how to plan out what we conceptually knew we wanted. so we vaguely “saved money” and daydreamed about how great it would be not to work until we’re old. […]
we think it’s easy to feel a bit hopeless in the face of financial hurdles if you’re not a person for whom financial virtues comes easily. if you’re not a natural saver, you’re not doomed to a life of financial misery. but, you have to know what your weaknesses are, and develop a system to work around them. here’s how we’ve built a system that doesn’t rely on willpower at all.
we’re not really new year’s resolution people, but we have definitely been on a journey to see the best in situations — from appreciating beauty more of the time, to looking on the bright side at work, to enjoying the journey of early retirement instead of always focusing on the end goal. so we’re determined to ride that wave into 2016.
we’re just a little over a week away from the end of the year, and now that we know how our bonuses shook out (mine: better than my low expectations. mr. onl’s: better than our fairly high expectations. wohoo!), it’s a good time to look at how we did this year, and look ahead to our goals for 2016.
today we’re telling the story of the city condo we once owned, and which we’ve struggled to define as a “good” investment or a “bad” one. it’s a reminder that it’s not always easy to tell good decisions from bad decisions — or good investments from bad investments — but rather it’s about what those decisions do to your trajectory, and what other decisions they influence.
today’s post is a short one to share three little tidbits: 1. we are up with an fi interview on even steven money. 2. we have a slightly epic money fail to share. 3. an update on my bonus.
we’ve been thinking about entitlement, and the ways in which being entitled is actually good when planning for early retirement, and the ways in which it can be detrimental. please help us add to the list!
this week and next are scary weeks for us. these are the weeks when we’ll find out if we’ll be doing a happy dance that we hit our year-end goals, or making sad puppy faces at each other for the next few weeks because we missed the mark. yep, it’s bonus time.
big news: we got the okay from the extended family to cut out gifts for adults this year, and give only homemade or secondhand gifts to the kiddos. we’re stoked about this shift, and hope it sticks in future years. gift-giving occasions are emotionally fraught for savers, but here’s how we convinced our families (slowly) to embrace the no-spend holidays.
one of the misconceptions we used to have about frugality was that frugal people were cheap at all costs. it’s easy to view frugality as all or nothing, or to see frugality as trumping other values. but it doesn’t have to. a breakthrough idea for us was reframing how we see frugality in terms of the business term triple bottom line.
we talk a lot here about redefining ourselves in early retirement, especially making sure that we consider before we actually leave our jobs how we’ll obtain self worth and fulfillment post-career. but we recently realized that redefining isn’t really the right word to use at all. in thinking about the life that we truly want to live, and how we will thrive within that, there’s truly no re. the right word is simply “define.”
wow, you guys. though time doesn’t fly when you’re trying hard to retire already, it feels like just yesterday that we started this little blog to chronicle our journey to early retirement (actually it was about 10 months ago), and here we are, 100 posts later! we thought we’d celebrate the day with a rundown on some of the other numbers we’ve racked up while writing these 100 posts.
we feel the sunday blues in a big way. and we know why: not only do we just not love having to work every day, we know that we’re in especially high pressure, stressful, occasionally soul-sucking jobs. but we didn’t just default into these golden handcuffs of ours, and we don’t stay in our jobs because we lack imagination. our choice to stay put in unsustainable jobs is a clear-eyed decision we’ve made, based on considering all of our options and deciding what’s most important to us. the most important thing? getting to our exit date as soon as we possibly can.
early retirement is a bfd. and it’s not for everyone. it’s a very different path from the one most people follow for a reason, and it’s not one we should go down without having our eyes wide open. early retirement won’t magically fix everything we wish was different about us or our lives, and it comes with its own set of pitfalls and stresses. to help sort this out, we’ve put together a list: the ten questions you should be able to answer before you retire early.
you know we love a good object lesson. recently we had one inexplicable morning when the fire just would. not. light. those days are a reminder that the definition of insanity is doing the same thing over and over but expecting different results. the answer: add kindling. the point of the kindling is not only to get us past those obstacles, and to get the fire going a little, but to get those flames to start spreading — and spreading fast.
we’ve both come across a seemingly frequent but also puzzling (to us) phenomenon while perusing new blogs. when aspiring early retirees are telling people in their lives about their plans to retire early, they’re getting negative responses. one of which has us utterly befuddled: the assertion that the accumulation of assets required to retire early constitutes pretty much the worst quality we can imagine: greed. here’s our response, in manifesto form.
so many of us have had the experience, before we got smart about our finances, of not knowing where our money went. as i was reading another blogger’s post about that last week, i had the thought: “where did the day go?” where did the money go? where did the time go? these are not such different questions. here’s how we’re changing our mindset around time, to see it as our most precious asset.
today we’re sharing the clearest glimpse yet into where we are on our journey toward early retirement in money terms, along with a detailed breakdown of how we plan to fund both our early retirement and our full retirement. we’re talking percentages instead of absolute numbers, but are going into a lot more detail than we ever have before. that’s right: it’s all the charts.
we are as guilty as anyone of upsizing our spending at various times, mainly on restaurants and travel, but are thankful that several key factors have kept us from permanently inflating our lifestyle, namely our anchors, named for the anchoring effect or anchoring bias in psychology.
last week on an early morning flight, i flew over a line of cars on a major commuting artery, already in bumper-to-bumper traffic before the sun was up. and i wondered: how many of those people, as kids, dreamed that, one day, after slaving away at school for more than a decade, going to college and doing all the right internships, their reward would be this: soul-crushing traffic? that they’d rise before the sun for the privilege? that this would be their destiny?
we’ve mentioned many times that we live in a small town, and very deliberately moved here as a part of our early retirement plans. while we for sure could have still saved for retirement in the expensive city we came from, it would have taken longer, and we wouldn’t have had the lifestyle we wanted. and we’re happy living in our small mountain town, though it’s not all sunshine and roses. here’s our breakdown of the pros and cons.
for early retirees, if our marriages don’t work out, there’s a high likelihood that our early retirements will fail as well. that’s why we should invest as much in our marriages as we do in our index funds or our dividend stock accounts — maybe more. we should see our marriages as our most important investments, and nurture them accordingly.
we have a clear vision for the life we want to lead when we retire, and that means living in the mountains and having a permanent home base, which don’t come cheap. we’re okay with those expenses, but have given up lots of other things to make our early retirement dreams a reality.
this weekend we visited mono lake, an ancient and super salty lake. all that salt means that swimmers in the lake float easily. which got us thinking: it’s easy to think that swimming is swimming, but it’s not. we can make swimming hard for ourselves or easy for ourselves, and the same goes for our finances.
one of the things that’s different about us, compared to lots of bloggers in the pf community, is that we are not frugal by nature. at some point, we realized that all of that spending, even if it wasn’t on stuff, was still locking us into needing our jobs, and needing them for a long, long time. and since we value time more than anything, and were in a position to make early retirement a reality, we knew we’d regret not changing our ways. but it hasn’t always been easy. here’s how we lived to tell the tale.
we’ve been tracking our numbers for years now, and have always set annual goals for ourselves in terms of savings and mortgage paydown. but crazy as it may sound for us to say this, we’ve never defined those goals in terms of strictly what we would contribute. we’ve only defined our goals in terms of total balance. but with only goals about total balances, we now feel like we’re failing in the current market landscape, when the truth is that we’re saving more than ever. here’s how we’re adjusting our goals.
one of our earliest posts on this blog was about how we don’t share our numbers. it’s mostly because, one day not too far off in the distance, we will drop this whole anonymous charade, and we don’t want all the details of our finances attached to our names and faces. in our culture, money comes with meaning and prejudgments. having x amount means you’re supposed to behave a certain way, dress a certain way, spend a certain way. we don’t want those expectations to precede us.
do you feel like a grown-up? if you’d asked us that question a year ago, we would have said no. in fact, it was a guiding a principle of our lives that most people never grow up, they just learn to fake it. but recently, we realized that something has changed. we can’t put our fingers on exactly when it happened, but somehow, we started to feel like grown-ups.
today’s post continues the conversation about whether you should move to retire, and asks: should you downsize your home when you retire? we bought our house thinking it was our forever home, but now realize it’s more house than we need, and are pondering one last move when we quit our jobs in a few years.
it’s easy to get frustrated, wishing we’d figured out our early retirement plan at a younger age. but what would that get us? it sure wouldn’t make us retirees at this moment! we’d much rather go with the “better late than never” way of thinking, and be grateful that we found this path at all.
we feel super lucky to have somehow retained our spirit of curiosity, and we think it will serve us well in our (hopefully) very long retirement, since we think curiosity is a big part of what will keep us from getting old too fast. here’s our plan for fostering a spirit of lifelong curiosity to keep our minds nimble and active for decades to come.
just as we did for u.s. independence day, we want to take a moment to reflect on what the labor day holiday means, especially for those of us planning to leave the labor market as soon as we can!
looking at things big picture, we’re astonished at how far we’ve come in a short time, aided in large part by jobs that overpay us. since we bought the house four years ago, our net worth has tripled, and the year-over-year gains are pretty big, owing to us getting serious about saving and about paying off the house quickly, as well as growth in the markets since 2009.
it’s so easy to be blind to our own bad habits, and so to avoid forgetting about the bad ones we’ve recently identified, we’ve started making a list of what we want to change just as soon as work is in our rearview mirror. we’re calling the list our resolutions for retirement, and expect this list to grow over time.
sometimes, life forces us to sit up and pay attention. we recently had one of those experiences in a big way, on what would have seemed to be an ordinary flight for work.
we never hide that we are not frugal by nature, we’re not budgeters, and we’ve really only succeeded at retirement saving by employing a pay ourselves first approach that is essentially tricking ourselves into thinking we have far less to spend than we actually do. that is all well and good for now, but things will definitely have to change once we quit our jobs at the end of 2017.
today we’re continuing the about series started by think save retire. we love this idea, and hope you’ll do it too! the idea is to share details not covered by your “about” page.
when we think about early retirement in the abstract, the visions we each have revolve around getting out into the big wide world. our individual visions differ in the where, but not much in the what, the how or the why.
don’t let any of our more philosophical posts fool you — we’re still total nerds, and we love tracking every possible aspect of our early retirement plan as much as the next guy. but, we don’t share our numbers here, which has sometimes made it tough to explain some of our more unique circumstances, like our need for a two-part retirement.
this is the best kind of chain letter. we answer some questions posed by those who tapped us, to share more personal info on ourselves, and then we pass it on and pose some new questions. fun!
last week we wrote about what we’ll lose when we stop working, which in our case includes a lot of perks. and today we’re sharing the flipside of that. what we most certainly will never ever ever miss about our careers.
this was our sliding doors weekend. you know the concept: you rush into a train station, and just barely catch the train. but then in an alternate reality or parallel universe, you rush for the same train, but the doors close before you can hop on. that triggers a sequence of events that leads you to a completely different future.
the movement to live simply is all around us. minimalism. tiny houses. the push to reject consumerism. the urban homesteading movement. slow food. we’re all in on simple living, but that doesn’t mean we’re minimalists.
another weekend gone, another week begun. we’re both the type of people who were never eager to grow up, who always wished time would slow down. one of us remembers turning eleven, and saying aloud to the assembled celebrants, “okay, i’m good now. i don’t need to get […]
we know we’re not the only ones who have thoughts like: after we retire, things will be so much easier. things will be less stressful. things will be simpler. and most likely things will be simpler. but the idea that we aren’t in control of our lives now, […]
lots of being healthy is absolutely free: getting outside to exercise in the fresh air, choosing not to smoke, maintaining a healthy weight, avoiding toxic people. and we do all of that stuff. but we also spend out on our health in some big ways, and plan to do even more when we’re retired. some of these expenditures may not seem health-related, but we see them that way, and that makes them worth it to us.
despite not following a budget, we have still learned how to trick ourselves into saving a ton and staying on track with our ambitious financial goals without much struggle, and today we’re sharing how we do that. our strategy: paying ourselves first.
today’s topic is one we wrestle with a lot, and which feels central to us as early retirement inches closer and closer: how will we define ourselves once our careers no longer define us?
we frequently read blog posts outlining people’s grocery spending and practically have to pick our jaws up off the floor afterward. you’re spending only $30 a week for groceries?!?! you’re feeding a family of four for $70 a week?!?! we even read one post talking about how the […]
we like the thought of doing something different, and bucking tradition. it makes us feel like we’ve figured out some secret. but we’re still down with tradition in some pretty big ways.
Today: our reasons for being optimistic about our vision for early retirement, and for making things work in spite of the inherent risks.
this independence day, we’re sending some gratitude out to all those in the history of this great nation who’ve made it possible for us to pursue our financial independence.
few things in our lives have ever excited us as much as the early retirement that we’re eagerly planning for. but we also feel something that not many people talk about: the ways in which we’re letting ourselves down by retiring early.
for years, we lived in one of the largest cities in the west, and had a very different lifestyle. a lifestyle we enjoyed. a lot. but which we knew wouldn’t be sustainable long-term, if we wanted to retire early. you already know how this story ends: we left the city for the small town, in part to fuel our early retirement aspirations.
Today we’re sending the love to those who inspire us. Happy Friday!
Today we have a guest post from Eat the Financial Elephant on the weight of your decisions — both in finances, and in backpacking.
we don’t really know what we want to do when we grow up. but we think early retirement will finally give us the time and breathing room to find out. and we know for sure that we’re about to get a lot more useful to society, not less.
that impulse buy was a reminder that, even if we’re living way below our means, we still have to improve our habits if we’re going to be able to live within our early retirement allocations in a very short two and a half years’ time.
Today we’re guest posting over at Eat the Financial Elephant about our dirtbag dreams, and how reaching the summit of a mountain is a lot like reaching financial independence.
it’s natural to be future-focused, when you’re spending a lot of your mental energy planning for something in the future. the only problem: the future is never guaranteed.
today we’re sharing the story of some very, very bad money decisions we made once upon a time. some very bad money decisions that we couldn’t be happier about.
bloggers working toward early retirement love to ponder the big questions: how will we spend our time once we’re no longer shackled to jobs we don’t love? what else will we do for fulfillment? where all will we travel? how long do we need our money to last? […]
people in the pf world talk a lot about the power of compounding over time, and we want to talk about how this power has been made evident to us most of all: in our incomes.
once we started planning in earnest for early retirement, we quickly realized: financial calculators all take a one-size-fits all approach. but what if your finances don’t fit neatly into this one-size-fits-all box?
the whole idea of early retirement of course feels like a risky proposition. but here’s the thing, to misquote the princess bride: life is risk. anyone who says differently is selling something.
we started this blog because we crave that connection with other folks who are doing what we’re doing. what we didn’t expect is how much blogging would change our finances, and our hearts.
for us, trying to follow a line-by-line budget feels both overly restrictive, and too much like a diet in which you’re tracking calories. it’s not sustainable. following a budget makes us constantly want to cheat, or wonder when the diet is over. but we’re doing just fine without a budget!
we have told some people our early retirement plan, but not others, and sometimes we feel like it’s exhausting living this double life, trying to keep straight who we’ve told and not told. it’s like trying to keep straight an elaborate lie.
the word “badass” gets thrown around a lot in personal finance/financial independence circles. that’s not the full story. all of us who are working toward or have achieved financial independence have one big thing in common. we’re lucky.
we frequently see articles about great places to retire based on cost of living, and we think to ourselves, “wow, if we sold our house and moved to one of those places, we could retire now.” but we decide again and again to stay put.
we like to remind ourselves that early retirement is a marathon, not a sprint, and the worst thing we could do is burn ourselves out early in the process by being too strict or restrictive. the key is knowing yourself, and what you need to be successful and stick with something.
in planning for our early retirement, we often think about the question of whether the best decision on paper is also the best decision for our souls, or whether the two might be different.
it’s pretty amazing how much motivation a goal can provide, and the chart is proof that having a goal — even if it was abstract back in 2011 — has worked mightily well for us.
fervent finance tapped us with a liebster award (thanks!) and asked us to answer some questions. here goes…
our marriage is the most important thing to both of us, and we have always believed that no job is worth jeopardizing that. so we made a decision: even if we hadn’t hit our goal numbers, we will retire in december 2017.
in retirement, our income will go way down. we’ve budgeted and planned and made a slew of spreadsheets, and in theory we are okay with that. but will money become something that stresses us out, or — worse — that gets between us?
we’re going to try to break through the anonymity barrier today, to share why this whole early retirement vision feels so crazy urgent to us. why we’ve already made some big sacrifices to make it a reality, and are prepared to make more.
we’ve noticed something: the higher up people get in their careers, they more they seem to embrace making themselves helpless. seeing that has helped cement our view that we need to act differently in our own lives.
some of the ways we’ve saved what is by any measure a lot of money. not enough to retire yet, even at the modest level we’re shooting for, but still objectively a lot.
one of our favorite personal finance sites keeps a running tally of bloggers’ net worths. while we love seeing how others are doing, we don’t share our numbers, and we have a few good reasons why we don’t.
maybe it’s how old we are, and how long we’ve worked without a break in demanding professions, but work-filled travel doesn’t sound like fun. fortunately, we believe that by working hard for a few more years, we’ll be in a position to make this dream happen in real life.
we’ll wake up on our own, with no alarm, when we feel rested. we’ll take our time sipping morning coffee, engaging with each other instead of staring at screens. we’ll happily get outside.
we’re going to live like cheapskates for the first 18 years of our retirement, and then if the markets cooperate, we’ll live a little larger in our later years, once we can tap our 401(k)s. for us, this plan is perfect. live cheaply when you’re young and resilient.
we have a very specific dream in mind: an end date for work, a place where we plan to live, and a plan for travel. but we didn’t just wake up with this dream, with the details filled in. it’s been an evolution.
we advocate taking a fanatical approach to banking airline miles. most airlines require five coast-to-coast roundtrips to earn a free domestic ticket. if you take those trips on different airlines, they add up to essentially nothing. it’s only by concentrating your travel on one airline that you get the benefit.
sometimes it feels like we are missing out on life in our town and the surrounding outdoors. we daydream about the adventures we imagine for ourselves in just a few years, when we can retire early.
if we really cared about achieving a lot in our jobs, wouldn’t we want to dress as nicely as possible? wouldn’t we want to look slick and pulled together all the time? instead, the casual world is the better fit for us.
like in the allegory of the cave, we used to see the shadows like everyone else, this illusion that work and earning and buying and accumulating are the only option. now we’ve seen that we can choose a different path for our future. except, for now, work is still our reality.
planning for early retirement forces you to do a lot of thinking about what you can and can’t live without. we’re willing to forgo most consumer culture in order to buy our free time.
at least one of us is not a gambler by nature, preferring things to be predictable, controllable and known (even if those concepts are themselves just illusions). but this is, for us, that rare thing in life that’s so worth doing that it’s also worth a pretty substantial risk.
we value time over money. we value people over money. we value experiences over things. we’re willing to live on a whole lot less than we currently earn.
we are never lacking for things to do, and that’s why we want more time to do things that are priorities to us, and less time (or no time) to do things that are priorities to our employers. here’s our list.
we are doing this so that our next life will be centered around everything but work. the outdoors, travel, adventure, time to live slowly… these are the new bosses we hope to have.
our next life is when we can decide how we want to spend our days, our weeks, our life energy. when we decide where we want to sleep each night. when we decide to get outdoors, away from screen after screen after screen.