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Exiting the rat race

binary visions

binary visions

The voice of reason
Jun 13, 2002
22,202
1,390
NC
Side note about credit reports... mint.com currently offers a free Equifax credit score, and creditkarma.com offers both Equifax and TransUnion credit scores for free.

Still good to check the report but you can regularly get free credit scores now, too, without having to subscribe to temporary trial periods or whatever.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
Yup. They all use slightly different algorithms:

- as mentioned, Mint and Credit Karma
- credit.com
- creditsesame.com
- quizzle.com
- wisepiggy.com

While on the broader topic of "financial sites that I like" there's Betterment. I don't see the value in having them manage tax-deferred IRAs, which they can do, but if you have run out of tax-deferred retirement saving space and are interested in a taxable investment account then I think they're a great option. They do tax loss harvesting automagically once you hit $50k balance--this is a Good Thing.

https://www.betterment.com/resources/research/tax-loss-harvesting-white-paper/
 
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Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
If my projections are correct I will be on track to retire in 20 years. This is a very inaccurate projection (no new cars or kids' college costs allotted for, but also no investment gains, either!) but is enlightening.

I'm not sure what I'd do in retirement. Perhaps I should figure that out.
 
Pesqueeb

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
42,339
19,846
Riding past the morgue.
Ride your bicycle? I meet a guy yesterday in Ute Valley, rocking a brand new Santa Cruz, said he loved the full suspension because it made things easier on his "67 year old back". I'd be happy to be doing anything when I'm 67. To still be out mountain biking would be pretty fucking awesome.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
Traveling would be nice, not that I won't travel on allotted vacations up to that point. Fast cars and jumping bikes off lofty things doesn't excite me as they once did--although that Tesla P85D is pretty amazing. (But what would I do with a toy like that? Launch 0-60 all day, every day? :D)

Getting back to my old dream of flying could also be cool, and would certainly be a way to sop up all excess money should that ever become a #1%erproblem.
 
jimmydean

jimmydean

The Official Meat of Ridemonkey
Sep 10, 2001
43,497
15,699
Portland, OR
One of the guys at Intel that works with my nephew went to truck driving school while on his 8 week sabbatical and Intel paid for it. :rofl:

The Karl Malone approach to retirement?
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
That is true. Left with infinite time I might go fully loopy!
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
Toshi said:
While on the broader topic of "financial sites that I like" there's Betterment. I don't see the value in having them manage tax-deferred IRAs, which they can do, but if you have run out of tax-deferred retirement saving space and are interested in a taxable investment account then I think they're a great option. They do tax loss harvesting automagically once you hit $50k balance--this is a Good Thing.

https://www.betterment.com/resources/research/tax-loss-harvesting-white-paper/
Click to expand...
More from my harried brain today, on why Betterment is awesome:



Once one hits a $50k balance with Betterment then their overall expense ratio is 0.15%. This simulation here shows that for a sample 70% stock portfolio (as taken from their own portfolio page) the expense ratio of the underlying funds (ETFs in this particular case) is 0.113%! This means that for under 0.04% Betterment is handling the website front end, the backend trading platform, the automatic rebalancing, and the tax loss harvesting.

The other columns are for my attempt to replicate the Betterment portfolio via their mutual fund equivalents. All are direct equivalents except for the US corporate bonds category--that's how "my" portfolio is a tiny smidge cheaper than Betterment's once all funds are switched to Admiral shares, that and the emerging markets bonds Admiral shares being 0.01 cheaper than the ETF for some odd reason.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
tl;dr

No, seriously, that's a long-ass article.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
That's the idea. Buying one's freedom is the ultimate life experience.

I'm thinking maybe 20 years from now. I'm definitely in for ~10 due to student loans at the least.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
http://www.mrmoneymustache.com/2015/04/15/great-news-early-retirement-doesnt-mean-youll-stop-working/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+MrMoneyMustache+(Mr.+Money+Mustache)

Early retirement, according to this new definition, does not mean quitting work, even while it may well mean quitting your job. It means opting out of the bullshit portion of your work. The commuting, the politics, the production of inferior products just because your boss has found a profitable niche to exploit.

How would you run your own life, with a continuing desire to create but no immediate need to make the next mortgage payment?
Click to expand...
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
Relevant to the earlier bickering in this thread, if I read it right ericstr6 will no longer be driving paratransit. Hopefully better hours with that?

I'm still figuring out my long-term plan. Job is stable. Outside of striving to get promoted from Assistant Professor (my current rank) to Associate and then full Professor I don't really have much focused ambition. Each rank bump comes with $25k more per year but that at this point is far from life-changing money. I'm going to be in the workforce for 15 years minimum, realistically, and I'm ok with that at this point since I get adequate decompression time (30% time dedicated to research) and the day to day hours aren't bad.

I have decided I don't want more than my current 2 kids, at least. Although I still lack my teenage passion for scaring myself on a bike I don't think I'll use extra free time once the kids are older to get up into the mountains on a dentist-bike. Similarly I don't see myself dedicating weekend days to working on some ///M like Stoney, or even tearing up the cones with a working machine at autocross.

Maybe I need to pick up that perennial thought of getting a private pilot's license...

#firstworldproblems
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
StiHacka said:
Y

Sounds like you are already retired from anything fun.
Click to expand...
Heh. That's the thing: I used to love that stuff, but I honestly don't now.

I was autocrossing one day, did the math on how much tires cost (about $20 worth of wear per run for V710s) and it was clear to me that it wasn't worth it. I listed the car and the extra set of tires/wheels for sale that very day, iirc.

For mountain biking it wasn't such a clear transition, but spending 15 months without any car of my own (this being the 15 months after listing that same autocrossing RX-8 for sale) highlighted the absurdity of driving hours in order to ride a bike... unless one really enjoys that. I've jumped off of plenty of things. I've cased and made road gaps. I've ridden the famous bridges of the North Shore, albeit not the death-if-you-fall-off height ones. I don't feel the need to do that any more.
 
stoney

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
22,023
7,928
Colorado
Toshi said:
Heh. That's the thing: I used to love that stuff, but I honestly don't now.

I was autocrossing one day, did the math on how much tires cost (about $20 worth of wear per run for V710s) and it was clear to me that it wasn't worth it. I listed the car and the extra set of tires/wheels for sale that very day, iirc.

For mountain biking it wasn't such a clear transition, but spending 15 months without any car of my own (this being the 15 months after listing that same autocrossing RX-8 for sale) highlighted the absurdity of driving hours in order to ride a bike... unless one really enjoys that. I've jumped off of plenty of things. I've cased and made road gaps. I've ridden the famous bridges of the North Shore, albeit not the death-if-you-fall-off height ones. I don't feel the need to do that any more.
Click to expand...
Just get a trail bike and ride local. I'm done w/ DH and can find ways to keep myself riding without the risk of DH. You could start doing 14'ers too...
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
stoney said:
Just get a trail bike and ride local. I'm done w/ DH and can find ways to keep myself riding without the risk of DH. You could start doing 14'ers too...
Click to expand...
It comes down to time + kids. This is why I want to be done at 2 kids, so that I can get time to myself more regularly. Whether I spend that on a dentist bike or, say, at the controls of a Cessna remains to be seen.

(I'll make sure to stay away from Beechcraft, though, given my profession.)

Jessica did have a proto-interview with the principal of a new elementary school opening up in the fall in our very own neighborhood. If that or another teaching job pans out that'll make the choice to stop breeding very easy, and that would please me.
 
stoney

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
22,023
7,928
Colorado
Toshi said:
It comes down to time + kids. This is why I want to be done at 2 kids, so that I can get time to myself more regularly. Whether I spend that on a dentist bike or, say, at the controls of a Cessna remains to be seen.

(I'll make sure to stay away from Beechcraft, though, given my profession.)

Jessica did have a proto-interview with the principal of a new elementary school opening up in the fall in our very own neighborhood. If that or another teaching job pans out that'll make the choice to stop breeding very easy, and that would please me.
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Breeding is expensive. Wifey wants to go rd 2, which I've got no issues with, but that means the idea of getting a bigger house, continuing our current vacation/.leisure levels, current savings level, etc will be severely curtailed. Assuming just daycare and 529 saving, we would have another $1800/m going to kids.That basically means the idea of a new house is gone. If we have rd. 2, Wifey wants to get a larger car (Highlander), so again payments. It just adds up to another $2k+ per month that we either put into savings or leisure.

I really need to write another financial plan for ourselves, just to lay it out again. I have hard goals of being done working and completely financial independent by 60. Getting there will be hard, but I would like to be able to walk away from work then and enjoy our life.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
It's not even the money so much as the extra time that kid 2 requires, at least for me. Most of the kid-infrastructure, if you will, carries over so there's less crap to buy. This is assuming you truly don't need to get a bigger house, though–whatever happened to the finish the basement idea?
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
I just voted myself a $24k increase in annual base pay. The flip side is that the maximum possible bonus will get smaller (promised to be smaller by less than the salary increased, for what that's worth) and the bonus criteria got changed such that getting the last 10% of it will be effectively impossible.

This will make month to month budgeting somewhat easier but will give less unbudgeted cash for, say, extra solar panels. It's probably a good thing but won't let me retire any sooner.
 
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Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
My exit from the rat race is in sight... but only barely. Cross-posted from my thread:

>>>>>

Financial milestones I have to look forward to, now that I'm settled down and secure at work and am closing on a house (in 7 weeks!):

October of every year: Bonus time. Future bonuses per our new formula are likely to be smaller than this and next year's that are/were under the old formula, but it should remain non-negligible, probably on the order of $30-50k. I'm treating the bonus separately from my monthly budget and am basically assuming it'll be spent instead of saved each year on stuff like more solar for the house, etc.

2016-2017: Wife may go back to work. Negligible net increase in income due to increased preschool/aftercare costs.

2017-2019: Up for promotion around this time. + ~$1000/mo post-tax increase.

2018-2019: Older kid into kindergarten then first grade. + ~$500-700/mo (half day kindergarten is free but full day has a small cost that disappears when first grade is hit).

2020: Both car notes gone. + $964/mo.

2020-2021: Younger kid into kindergarten then first grade. + ~$500-700/mo.

2023: Done with my student loans (PSLF, effective ~0.4% rate). + $1588/mo.

2026: Done with wife's student loans, assuming I refinance to a new 10 year term this winter @ 2.8-3.5%. + ~$1000-1200/mo.

2030: Technically able to retire? I'll still have 15 years left on the mortgage, assuming I haven't been paying it down early...
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I'll have to weigh retirement timing carefully against FAFSA and the like, as my oldest kid will be entering college around this time, with the younger two years behind. Perhaps I will try to retire early so as to maximize my kid's chances for grants? Either that or just put my head down, accept that she'll get only loans if that, and work through the period.

Meanwhile if I drop off the planet unexpectedly or get disabled I'm adequately insured. It's somewhat depressing to think that my existing debts will require me to work until my 2.5 year old kid is a freshman in college (barring unforeseen great returns from the market), but I really can't complain too much.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
On the other hand, if I keep consumption basically constant and roll all of these net increases in take-home pay towards investments (if markets are bearish) or towards the principal of my highest effective rate debt at each time then I could potentially move the retirement timeline forward quite a bit. Hmm.

It'd be like my own Dave Ramsey Debt Snowball, only done in a mathematically correct way.
 
Toshi

Toshi

butthole powerwashing evangelist
Oct 23, 2001
40,204
9,096
Gah. For a second I thought I had a positive net worth. Nope: accounting fluke because I refinanced my wife's student loans and they disappeared in Mint through artifact.
 
Serial Midget

Serial Midget

Al Bundy
Jun 25, 2002
13,053
1,897
Fort of Rio Grande
I didn't see a positive net worth until I was 40 mainly due to selling homes in a down market, once you do hit break even the assets add up more quickly than you would think.

I have no advice but what worked for us was paying off the cars and not getting new ones, not spending more on a house than we gross in a year and cutting back on bike bits.

The other interesting thing I have learned is that older I get the more satisfied I am with my job so, because I have qualified pension with cash value and 401K match, I could retire at 55. Sticking out to 62 nearly doubles my benefit, sticking it out to 67 triples it... as long as I continue to like my job I will continue to work.

What will stop me from tetiring early is the high cost of health insurance, my dad retired at 60 and paid nearly 3K a month for 2 years and $1800 for another year until my mom turned 62. He hated his job so it was worth it to him.
 
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