I am an American therapist who lives in Mexico. Is it too late to fire? – Millennial Revolution

Firecrackers were early retirees in the world travel. She once lived in one of Canada’s most expensive cities, but instead of drowning her debts, she refused home ownership. The result is a 7-figure portfolio that allows her and her husband to retire and travel the world at the age of 31. Their stories have been published on CBC, Huffington Post, CNBC, BNN, Business Insider and Yahoo Finance. By far, this is the most shared story in CBC history, with their viral videos about money on CBC earning 4.5 million views.

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I hope you all have a happy summer and don’t drown your sweat like we do. When we weren’t chasing our kids in the community pool or chasing our children on the playground, we managed to find time to browse the reader’s case, and this case jumped out. It’s about our favorite Americans in Mexico. If you’ve never been there, I highly recommend it because people are so cold and laid back. In addition, it is not only rated as the safest city in Mexico, but also the second safest city in North America. Our readers are able to take advantage of the low prices there, and therefore, get her expenses to a small percentage of the United States, so even if she describes herself as a fire game “late”, this kind of expat life may be just a cheat sheet she catches up. Can she do it? Let’s find out:

“Hi. I am 46 years old and currently live in Merida, Mexico. I left the United States for a full-time trip in 2014 and am now a licensed therapist, meeting clients three days a week.

income

My monthly income ranges from about $7,600 to $13,000 per month depending on customer volume and other business factors. I’m considering raising interest rates or expanding my product further.

expenditure

My monthly expenses are relatively modest: rent is $750, food average $800, utility about $150, other recurring expenses (such as WiFi ($33), phone ($9), medical ($150), transportation ($50) and professional expenses ($300)

Debt and fixed assets

I have no debts, nor fixed assets such as houses or cars.

Savings/Investment:

My current savings and investments include $33,000 in a high interest savings account of 3.85%, checking $2,300, $66,000 in a 2035 Fidelity account, and a distribution of $50,000 between Vanguard VTI and VTSAX (average return of about 8.5% over 5 years). I also have $281,000 in my Surs State retirement account and earn about 7.5%. Technically, I didn’t fully belong to Surs until 2040 (61.5 years old, although I could take it early at 52), but I would love to retire if possible, or retire as soon as possible. Fully affiliated, I qualify for a monthly annuity of $4,970 or a one-time $865,000. I’m looking for guidance on how to actually achieve a fire among middle-aged people: how best to distribute my current income, how to actively save and invest, and how to assess whether a one-time payment vs. a monthly pension will give me the most long-term flexibility. I really have no plans to take advantage of your help.

The night fire

Summary:

The annual fee is only $26,904 per year (Gotta Love Expat Living!), and she only needs a $672,000 portfolio to reach financial independence. Using a conservative 6% average rate of return, currently has a net worth of $151,3000 and a savings rate of at least $64,296 or 71%, she will reach:

A little more than 6 years!

She is now 46 years old, so if she can maintain her current financial trajectory, she will be only 53 by the end of these 6 years. She said she wanted to retire before she was 56, so she was expected to be three years ahead of expectations. OK!

What about her pension?

What’s more interesting is that her national pension is worth as much as $4970/month, at the time of age of $61.50. It is nearly 60,000 yuan a year, more than twice what is her spending! She also has the option to make it a one-time payment of $865,000, but that will only give her a passive income of $34,600 a year. Therefore, she should definitely use her pension as a monthly annuity. Paying at one time is almost twice as much as you get.

So if we pour that money into Firecalc at 61.5, we can see that she has a safer and more effective way to get her on fire. We can see her retirement in two stages. The first phase is to let her rely on her portfolio to generate enough passive income to pay for her until she is 61.5 years old. After that, phase 2 begins, the pension annuity covers all her expenses.

By playing with Firecalc, I found that the portfolio size is $515,000, which gives her a 100% chance of not running out of money in 15 years when her pension starts.

With her current savings rate, this is how long it will take her to reach a net worth of $515,000:

In less than 5 years!

So she can retire in less than 5 years, to age 50, withdraw 4% by 4% per year for 15 years, then receive a monthly pension of SUR pension and get a 100% success rate!

That is the power of the geographical arc. By greatly reducing her expenses, she was able to arrive in the United States in half the time if she was in the United States.

My other advice, looking at her situation, is to consolidate her portfolio, she either invests in VTI or VTSAX. They are basically the same thing, so there is no need to have both. VTSAX is just a mutual fund version of ETFs.

What do you think? Can Latefire retire before her ideal age of 56?

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