I’m a big advocate of following various FIRE blogs and communities. Reddit has a big FIRE community with people sharing their stories. I was touched by the story from TiberiusCaesar717. You can read more stories on here: https://www.reddit.com/r/financialindependence/comments/mthp8x/my_lessons_toward_fire_hit_23m_net_worth_at_52/
The story:
I learned about FIRE in later 2018 (when I was 50). I was usually maxing out my 401k, but I was not very intentional about my goals. I’m 52M married to a 53F with two adult kids (one finished graduate school the other will graduate college in 2022 with no debt). My FIRE number is about 3.5M which I hope to hit by 2027 or sooner. I’m interested in FI (financial independence) but not the RE (Retire Early) part as much. I might be “retire earlier” at 59 instead of 67. My wife currently doesn’t work outside the home (she retired early, later we had kids, and she went full-time mom).
Background:
High income in MCOL area. First in my family to graduate college. My initial career was focused on public service, working for a local government agency. I didn’t like this work, and after college, I transitioned into technology as a programmer still in my early 20s. I worked crazy hours at startups and Fortune 500 companies for many years. A few years ago, I pivoted to a new industry but remained in technology. The new company is lower stress and more sustainable. Recently I took an internal transfer out of technology into a business role after earning another advanced degree.
No debts except mortgage (340K) and about 300K in equity. On pace to pay off the mortgage in 11 years with a 2.375% rate. I could pay it off even faster, but that interest rate is so low…
Breakdown of investments:
– IRA = 920K
– Spouse IRA = 200K
– 401k traditional = 445K
– 401K Roth = 12K
– 457b = 80K
– Brokerage = 260K
– Cash = 90K
Things I’ve learned on my FIRE journey – and things that have made me appreciate the FIRE community:
- I’m not as interested in retiring early because my family doesn’t have a strong generic track record of longevity. I need to have fun along the way, and no one is promised tomorrow. I do save money, but I also spend money on things that have meaning to me including a lot of travel. (well at least before the pandemic). I like having a top-tier health insurance plan from work.
- FIRE taught me about travel hacking. I was able to get a companion pass on Southwest for my wife, and now we travel together even on business trips. This has been life-changing, and we go visit our kids.
- FIRE inspired me to explore a side hustle. Not so much for the extra money, but more for pursuing a part-time role that I might transition into instead of an abrupt retirement. I now teach two college classes online. I’ve met new people, and I’m helping others. It has done a lot to reinvigorate my mental health after a year+ pandemic and working from home. It’s also helped me avoid tech job burnout that seems to be common by giving me other interesting problems to consider while helping others. I save 100% of this extra income compared to about 25% of my regular income.
- FIRE helped me to understand other options beyond just 401k retirement savings. That’s all I used to do. When I became eligible to also participate in a 457b, I ramped that and I started making catch-up contributions the year I turned 50. In 2020, I maxed out on the 457b. I’m now also making contributions to a Roth 401K with a generous match.
- FIRE taught me to save outside of retirement accounts too. I now have an emergency fund and a sizable brokerage account focused on index funds. This has given me TREMENDOUS freedom that I hadn’t imagined before. I now think of it as my Financial Independence money (I find the term F U money to be a bit vulgar for my tastes). If something happened, or if I couldn’t cope with the stress of my employment, I could make a change, and everything would be OK. A few years ago, that would have been stressful. I would always adapt to whatever insane deadline my employer would demand. I’ve intentionally moved to a better company, and less demanding role – and I’m happier! I have improved work/life balance and sufficient vacation to have fun with my family.
- FIRE helped me to understand that I don’t have to wait until I’ve 59 to access retirement accounts! The rule of 55 was a revelation to me that will give me new options in just a couple of years.
- FIRE taught me to use the Personal Capital app to calculate my FIRE number and monitor expenses. All of my investments are basically low-cost index mutual funds from Vanguard or Fidelity – except my wife’s IRA. She’s paying high fees for an investment advisor on her 200K. I’ve encouraged her to consider my strategies, and we will continue to revisit.
- I mostly buy used cars or occasionally a new one and drive it into the ground. I bought my kids late-model used cars as gifts, and I drive a used 2017, and my wife drives a used 2015. All paid for at this point. I will admit that as I have gotten older and I’ve managed to achieve financial goals – I’m tempted to buy a new 2022 Corvette when my youngest kid finishes college next spring.
- My kids have read “Simple Path to Wealth” at my request, and they are applying these principles now. I wish I had learned them in my 20s! My older kid already has an emergency fund and brokerage account. FIRE has taught me how to better prepare and teach my kids.
- I could work to lower my expenses and retire earlier; I’m just choosing not to pursue this right now. I have made some changes inspired by this forum, like switching to T-Mobile, keeping my iPhone for 4 years, and extending the life of my laptop to 5 years. Before FIRE, I would splurge on tech frequently. I still buy incredibly cool tech; I just now have a disciplined schedule of tech refresh that is not frequent.
Photo by Suzy Hazelwood from Pexels