One of the reasons why I started the Financial Samurai Forum was to extend the number of wonderful discussions we have on this site. Instead of letting me dictate what we talk about on any particular day, the community gets to decide what it wants, whenever it wants.

The FSF is like reaching financial independence for your inquisitive mind!

For example, a Financial Samurai Forum member David is wondering whether it’s possible to have too much in his family’s 401(k) account. Here’s what he writes:

My wife and I are both around 50 years old. We want to be able to retire at 55. We max our 401(k) contributions each year and have a pretty good chunk in 401Ks – approximately $2.5M currently.

We are in the max tax bracket, so reducing our income with 401(k) contributions is appealing.

We have about $700K in after-tax accounts and $100K in Roth IRAs.

My current thoughts are to convert at least some of the 401(k)s to rollover IRAs, then to Roth IRAs over time after we retire and have lower income.

For now – are we better to continue to max the 401(k)s, or stop making 401(k) contributions and start making Roth 401(k) contributions (which will cost us 37% tax on $52,000 of extra taxable income), but may benefit us in the future?

The Financial Independence Retire Early (FIRE) movement is hot! With a bull market since 2009, many people in America and around the world have gotten wealthy by owning stocks, real estate, and other risk assets.

As a result of our massive increase in wealth during a relatively short period, many people are warming up to the FIRE movement where they retire in their 30s, 40s, or 50s to live the good life supported by their investments.

I define being financially independent as having enough investment income to cover your desired life’s living expenses.

Some people go the Lean FIRE route by living relatively frugally. While others strive to go the Fat FIRE route because of their desire to live it up. Only you can decide whether you’re truly comfortable with your finances.

For us, we’re still about $50,000 a year short in passive income to feel completely independent financially. That’s what happens when you have kids. Therefore, our FIRE journey continues.

Instead of glorifying financial independence and those who are financially independent, let’s have a more difficult conversation. I’m sure some of you find it nauseating to read about some FIRE folk’s fabulous lives.

Not all is sunshine and samurai swords in the land of FIRE. In fact, one could argue that most FIRE folks are maladjusted misfits who’ve never been able to fit in.

It hit me the other day that I’ve got to get my act together if I plan to retire a second time soon.

The first attempt at retirement lasted for just under a year until I started feeling too sheepish telling anyone I was retired at 34. Although my retirement portfolio was generating about $80,000 a year in passive income at the time, I started itching for more.

Seven years later, I’m running out of steam. I’ve already conducted multiple calls with boutique investment banks, private equity shops, and larger media companies on the potential sale of Financial Samurai after its 10-year anniversary mark in July 2019.

I’ve also tentatively convinced my wife to go back to work once our son turns two years and five months old this Fall. Spending 29 months as a stay at home parent should be long enough to feel like a parent did the best he or she could without feeling too guilty chasing money instead. But we shall see when the time comes.

The final thing I need to do is make sure our after-tax retirement portfolios are generating enough income to cover our desired lifestyle just in case Financial Samurai is sold and my wife can’t get a reasonable job in a field of interest.

I feel blessed to be able to do all the things I love since leaving full-time work in 2012 – coaching high school tennis for the past three years, writing almost daily on Financial Samurai, traveling around the world, and spending time being a stay at home dad since early 2017.

But all good things come to an end. We must frequently adjust in order to keep the good times going for longer.

The main reason why I’ve gotten more conservative with my investments is not because valuation for the S&P 500 is near an all-time high and earnings growth is decelerating.

Nor have I gotten more defensive because housing inventory has shot up across major parts of the country and prices are clearly declining.

No. The main reason why I’ve gotten more conservative with my investments is because I’m very close to retiring for a second time.

Let me recap my background and share some retirement preparation plans if you’re also planning on retiring soon.

In 2009, I made myself two promises when I started Financial Samurai: 1) write 3X a week on average for 10 years and 2) never lose money again.

We had just gone through a financial beating where my net worth got slashed by 35% – 40% in just six months. The pain was too much to bear, so I decided to take up writing instead of drugs and alcohol.

I knew that worst case, if I stayed committed with Financial Samurai, in 10 years I’d have the option to escape full-time work. When you spend at least 10,000 hours on your craft, you will have opportunities.

Further, I knew that if I never lost money again, in 10 years by simply earning a conservative 5% rate of return plus annual savings, I’d surpass the net worth that I once had before the financial crisis by at least 2X.

Achieving financial independence takes discipline and patience. But once you get there, you’ll realize all your effort was well worth it.