Search Results for: early retirement

Although, after eight years, I failed to stay retired, my plan is to return to early retirement glory with two kids by September 1, 2022.

From now until September 1, 2022, our plan is to accumulate either $1,500,000 in new capital or figure out a way to consistently generate $5,000 a month in additional gross retirement income.

As of now, according to data provided by the California Association of Realtors, my family has a ~$60,000 a year income shortfall to live a middle-class lifestyle in San Francisco.

Based on the median home price of $1,600,000, one real estate group estimates that a household needs to earn at least $310,000 a year to comfortably afford a median-priced home. The calculation is based on a 20% downpayment and spending no more than 28% of monthly gross income on a mortgage.

Is there any wonder why I’ve been aggressively investing in heartland real estate since early 2016? Affordability is an issue here. But given I’m unwilling to move to a lower cost area of the country, I best hedge by making sure I benefit from the obvious demographic shift.

If we can accumulate an additional $1,500,000 in capital or consistently generate $60,000 a year in additional gross retirement income, then my family should have the means to stay in San Francisco after September 1, 2022.

If we fail at achieving either financial goal, then we will admit defeat and banish ourselves to Honolulu, Hawaii where the median home price is roughly 40% cheaper. Based on the lower cost of living in Honolulu, a family with two kids should be able to live a comfortable lifestyle off less than $200,000 a year. Further, I’ll also be able to more consistently tan my cheeks.

If you want to retire early, feel free to emulate my early retirement master plan to get things going.

Happy 2020! May this new decade be better than the last.

One of the things I enjoy about the Financial Samurai community is that you guys keep it real. After announcing that I plan to be more entrepreneurial and less focused on retirement, you guys gave an outpouring of support and encouragement. This means a lot.

When I was trying to survive the investment banking meat grinder in my 20s and early 30s, I always saved in a special folder personal thank you e-mails I got from colleagues or clients. Their words of encouragement were more valuable than money.

On the flip side, one of the realities of keeping things real is that I’ve also got to face hard truths. And the latest hard truth given to me by some regular readers and many casual observers is that I’m an early retirement failure.

In a previous article, I highlighted the negatives of early retirement nobody likes talking about. It might have seemed like the negatives of early retirement outweighed the positives, but I assure you that’s not the case at all.

Retiring early has by far been my “best career move.” Originally, I thought I would just live a frugal lifestyle off of roughly $80,000 a year in investment income in 2012.

My wife joined me three years later when she also turned 34 so we could both live free and frugal together. We thought we’d rent or buy a small two-bedroom, one-bathroom apartment near or on the beach in Hawaii and live out our remaining days.

Instead, our lives turned out a little differently. Let me share with you all of the surprising benefits of early retirement I never anticipated.

Surprisingly, I didn’t receive much pushback from my post, The Amount Of Money Needed To Retire Early And Live In Abject Poverty.

Almost everyone got the gist, which was to help you question whether the pursuit of early retirement is counterproductive if you have to live like a pauper. Instead, perhaps finding a job you actually enjoy doing would be a better use of your time.

Yes, a couple of readers jabbed at me using the words “coastal elite” as a pejorative term to say how out of touch I am that 200% of FPL is a near poverty wage. But come on, this isn’t politics. It wasn’t I who set the rules. If you find the FPL levels insulting, call your power-hungry Congressman or woman!

The government says that if you earn up to 400% of FPL, then you are considered poor enough to get healthcare subsidies versus paying extra to subsidize others. In general, it’s better to give than to receive. If we all become takers then our country is screwed.

I also acknowledge in the post that earning 300% to 400% of FPL seems totally fine in non-coastal cities.

In this post, I want to highlight some disconnects perhaps some of you who are thinking of living off 200% of FPL or less aren’t recognizing. Let me set the stage with one reader’s budget.

It’s been six years and three months since they took my paycheck away. I sometimes stay up all night and sleep all day. At least I can do whatever I want and see professionally whomever I choose.

Gourmet sushi at fancy restaurants tastes so good. But sitting alone mixing wasabi can’t take away those occasional blues. Because nothing compares, nothing compares to the camaraderie of you dear ex-colleagues!

For all the glamour of living an early retirement lifestyle, there are plenty of negatives I’ve come to discover since I permanently left my job in 2012. I know why we revert back to our baseline state of happiness, no matter how much freedom and money you have.

Let’s go through some of the negatives of retiring early now that I’m a grizzled veteran.