It’s been a while since our reader cases are piled up, so without further ado, it’s time to get another reader case!
Greetings FC and W!
I’m usually the “Living quietly in the crowd!” type of guy, but I finally have to reach out and say something, ask for your advice.
I want to claim that I was fire before it was cool, but I will make you a judge. I started reading Big Fool at the beginning, about the same time the currency mustache. I picked you up when you were in the Supreme Court and have been following your journey ever since. It’s so kind of you! You rule! One thing I like about the fire community is that not necessarily everyone has to agree on everything, but overlap is > difference and you can accept suggestions that work for you. There are a lot of bad guys to solve! !
One thing I want to thank you is to let your vision separate the original portfolio from blog/book/sider gallery income/investment to keep the experiment pure. Most firefighters are not bloggers or writers and may not plan other sources of income, which really helps us!
With this fully voluntary strike (VSU), I want to tell you something about my situation and seek your advice.
I got married to my child. We live in the Greater Toronto area and are usually happy. My wife is great. However, she has a job she likes, has a government pension and has no plans to retire before starting 15 years later. I want to retire freely when choosing. Like tomorrow or from now or 15 years between or anywhere in between. Again, I work in a profitable but turbulent industry and I want to be free to quit if I scale back or fire at the same time.
My wife is naturally frugal and pays the proportion of her family’s spending without hesitation, so for the sake of analysis, let’s assume she’s been working, but even if I stop working, I need to assume my contribution to the family. For all analysis, we will completely ignore her savings and investments as she received a $60,000 pension at retirement and plans to continue working during this period.
Here is my number:
My total revenue: $2 million (can be up and down)
My Net Income: $120K
My current spending: $35K (up to $67K – see below)
No debt at all
$500,000 paid off townhouses (even if I love them, I refuse to consider a car as an asset)
invest:
DCPP $450K – Currently locked, when I leave, it will become RRSP/LIRA
RRSP $255K
TFSA $242K
Non-registered: $753K
Total investment assets: US$1.7 million
Current Fee (My Part): $2895/month ($35,000 per year).
We had a paid townhouse worth about $500,000 that we snatched away before the real estate (more) madness.
I suspect that based on these numbers, you might be screaming at me “retired!”, but this is the kicker…
Whether I retire now or in a few years, I hope to be able to move to the independent SFH, which is about $400,000 more than our paid location. I know I can take it out of the portfolio, but my intention is to “rende” $400,000 by mortgage and let the portfolio earnings/earnings pay for the mortgage (first! Real estate! Second). I also need to increase my mortgage payments of $2400/month and add other expenses to account for the increase in other housing costs. This brought me around $67,000 to my annual spending from $35K.
Please don’t tell me to sell townhouses, invest for income and rent a separate SFH. I do understand why this is a good/effective strategy. It will never fly with my spouse and, frankly, it is not my preference either.
Can I be bailed tomorrow and still achieve that? If I don’t get fired or retired, I can get around $80,000 to $80k per year for the foreseeable future (depending on company performance).
how do you say?
You are all inspiration. Thank you in advance for your time to reply or use this question. If you post anything, feel free to remove hell from parts you don’t use or want to include (e.g., citing other bloggers?). I will also accept a short short answer if you don’t want to use it (which is totally understandable).
Keep living your best life and haters!
Mrfirenerd
When we have all the free time around the world to conduct a fire retreat spontaneously, we discover a common fire spouse called “drag along the spouse.”
This type of spouse is not interested in fire, there are no two stimulations about who Mr. Money Mustache or JL Collins are, and will likely be happy to have their partner’s Quit copy like a millionaire as a roller coaster.
They usually like their jobs, don’t worry about layoffs, and don’t understand why you want to hang out with a bunch of financial nerds. That’s why their partner drags them to these financial retreats, secretly hoping that these nerd energy can be wiped off and finally get them onto the fire.
Interestingly, within a day of meeting with the fire community, “along with” the spouse’s struggle with safe evacuation rates was not fundamentally discussed, but rather topics involving life after the fire, passion programs and couple therapy. After a week, they will feel like a real person, not just a LinkedIn profile
It seems that something is going on here. One spouse tried desperately to open the fire, but the other spouse was not interested. They have split the numbers so that the fire nerd spouse can build his own portfolio to pay for his expenses. And since they are teams, they want to go to a single-family home, too.
Should a fire nerd spouse retire? Do they have enough money to pay for their own expenses and a new mortgage? But the most important thing is how will it affect their relationship if one person continues to work while another putt is in the boxer, watching the white lotus replay and stuffed with his face?
Well, as we keep saying on this blog, let’s do math!
|
Summary |
quantity |
|---|---|
|
Income (net) |
$120K |
|
expenditure |
$35,000-$67,000 |
|
Investable assets |
1.7 million |
At first glance, you can see that using the 4% rule, the annual expenditure is $35,000, and he only needs $875,000 to pay for his expenses. In this sense, his needs are twice as high.
But it was his current expenses without buying another single-family home, which they seemed desperately trying to.
If they succumb to their home purchase, part of his expenses will increase from $35,000 a year to $67,000 a year, which will require a portfolio size of $1,674,000 to be paid.
Often this will double the size of your portfolio requirements for decades, but because Mr. Firenerd is such a fat fire, he is enough to cover this rash spending scenario. Therefore, in this sense, he all started from a financial perspective.
But one of the key things is their relationship. I saw enough couples quarrel over the fire as the two rowed in the opposite direction, and it was easy to see mines at this point.
Maybe one spouse will continue to work and another will hang out around the house and be totally happy. Maybe the fire spouse will find a passionate project and a new friend and everything will be fine.
But the cruel honest fact is that when one person continues to work and another person quits and falls into the home, there are some problems that can arise:
- Working spouses may be jealous and resentful of retired spouses’ free time
- Retired spouses may feel bored and upset, and end up with an identity crisis if they cannot find other purposes and friends outside of work. They may see their spouse rising to the company ladder and lose confidence.
To avoid these types of conflicts, it makes sense for Mr. Firenerd to establish another identity through passion projects, volunteering, etc. before resigning. It’s not impossible, but it’s hard to do it is that you’re working while you’re sitting at home, they’re working in a place, they’re sitting at home, and they don’t feel like it works. When both spouses are on board, they can travel together and meet new people, have new experiences and work on passion projects together, retirement becomes even more fun. Or, if neither of you are home and don’t travel and just put your time together, it will also be even more fun because you won’t feel so lonely that everyone else is working.
Another spouse sits at home and one spouse is not easy to work. Even the choice. You need to find a way to fill your time, which will be difficult to do if you don’t have a spouse to stay company or have the flexibility to find new firefighting friends.
I think this is something Mr. Firenerd and his wife need to discuss before quitting Rat Race. I recommend going to the local FI party to see if you can meet with some firefighters before pulling the trigger.
What do you think? Should Mr. Firenerd retire while his spouse continues to work? Should they buy a single family home? Do you have a spouse and have resistance? Share your experience to help them cope with this situation.
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