Financial Independence Thread

[Chrish]

How far are you from reaching financial independence? Meaning the point where you can do without working if you don’t want to.

I am in mid-thirties and if I can keep my current job for next 15 years; I should be able to retire (around age of 50).

Now it won’t be luxurious retirement by any means. But it will be comfortable enough where I can maintain my current lifestyle.

How far are you from meeting your financial goal?

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[Splenda88]

Still very far. Got into medicine late, but should be able to be FI in ~8 years when I am in my early 50s if things go according to plan. Net worth right now is 850k+. Will need 2-2.5 mil plus a paid off home to feel comfortable.

 

[Pronounce Doxazosin]

Mid 30s
Probably could FIRE right now, but would require me to be single, frugal, and not living beyond my 80s
Might consider doing it once I’m in my 40s

 

[WVUPharm2007]

Just crossed $1 mil at 40. Going until I'm at $3 mil.

 

[Chrish]

Yeah 2.5-3 mil after everything paid off sounds like a good number. Luckily in our case, both of have professional jobs and not really expensive lifestyle. We don’t drink and rarely eat out (not because of money; we just don’t enjoy it).

Traveling is the only expensive hobby we have.

 

[PharmDBro2017]

Will need 2-2.5 mil plus a paid off home to feel comfortable.

That's my goal as well. Hope to be retired by 50 - about 15 years out currently.

In addition to FI, dedicating lots of time to healthspan and lifespan. Eating right, exercising to zone 2-3 for 60-90min consistently 5-7x/week, nailing sleep. No alcohol unless special occasion.

 

[RxPreceptor]

Mid-late thirties…yeah probably 55 at an absolute minimum (later than most in pharmacy starting career)
I’m honestly not looking forward to retirement being a work a holic…and would prefer to at least work part time in old age.
I’m pretty much done with expensive hobbies (home gym mostly) but very frugal and (key) consistent…no financial vampirism from SOs, children, pets, etc….non breeder lifestyle

https://www.youtube.com/@CalebHammer

if you ever want to feel like a financial genius by comparison, watch some of these videos…a good handful a people with inflated lifestyle expenses, dog **** or inconsistent income, suffocating monthly payments, stupid car debt, slow death by credit card balance interest, will end up being in debt forever, etc. Entertaining AF. Definitely check out this channel if you’re into personal finance; you’ll be hooked

 

[owlegrad]

I just saw Caleb Hammer the other day for the first time. I agree that it is quite entertaining and even eye opening.

 

[TheBlaah]

Mid-thirties.

I'm at 2.2m net worth, no debt. I'll probably want to retire when we hit 3m though I could probably retire now.

I definitely want to work at least another 3 years to reach the minimum to qualify for social security. Then maybe drop down to part-time for another 5 years.

 

[RN2RPh]

I'll probably work until at least my kids can give me a monthly stipend hehe (and they are not even in kindergarten yet lol). Well, after seeing many people die or get terminal illness in their 50s-60s, I dont focus much on growing my saving anymore. If I want somethings and I can afford it now then I rather not "wait until blah blah". Life is full of uncertainty, I just try to enjoy it when I still can.

 

[sunnyandseventytwo]

Mid-thirties.

I'm at 2.2m net worth, no debt. I'll probably want to retire when we hit 3m though I could probably retire now.

I definitely want to work at least another 3 years to reach the minimum to qualify for social security. Then maybe drop down to part-time for another 5 years.

Curious why you want to work until you qualify for social security. The benefit will be tiny with only 10 years of work...and of course you won't be able to claim for 30 years anyway. Is it so that you'll be medicare eligible in 30 years and you actually don't care about social security?

Note: you don't need to work full time for a social security credit anyway. This year, you need to earn $1640 per quarter.

 

[PharmDBro2017]

Mid-thirties.

I'm at 2.2m net worth, no debt. I'll probably want to retire when we hit 3m though I could probably retire now.

I definitely want to work at least another 3 years to reach the minimum to qualify for social security. Then maybe drop down to part-time for another 5 years.

How did you accelerate the process so much? High-earning spouse? You're young to have that net worth - even for a pharmacist.

 

[Dred Pirate]

mid 40's - 1.6 million- not great- but I spend a lot of money on travel - kiddo starts school in the fall so will have more money with no daycare and less travel spending - on plan to retire at 60 - could do earlier if we cut back on travel, but that is important to me. Recently cut back FTE hours as well.

 

[TheBlaah]

Curious why you want to work until you qualify for social security. The benefit will be tiny with only 10 years of work...and of course you won't be able to claim for 30 years anyway. Is it so that you'll be medicare eligible in 30 years and you actually don't care about social security?

Note: you don't need to work full time for a social security credit anyway. This year, you need to earn $1640 per quarter.

Yeah, I want the Medicare without any more hassle than it needs to be. The social security income would be a nice little bonus.
I didn't mention that each additional year I work, either full-time or part-time, also increases my pension from work. So I have a little more incentive to work awhile longer.

How did you accelerate the process so much? High-earning spouse? You're young to have that net worth - even for a pharmacist.

I was pretty fortunate in that I started obtaining rental properties right after the housing crash in 2010.

 

[confettiflyer]

I thought I had an easy answer to this, but there are so many moving asset parts (family properties, future dispo TBD), and an ever changing view of what “retirement” will look like (full stop? Consulting remote prn? Work part time/prn in person? Live abroad?), that I can’t pinpoint it.

I think the earliest I can transition to some semblance of quasi financial independence is 50, which would be something like working 20hrs/week, mortgage paid off, not touching retirement funds, and having all needs/wants met.

I’m operating as if I am unable to work past 55, so goal of $2-3M, and I’m about halfway there (I’m late-30s).

 

[RxPreceptor]

I just saw Caleb Hammer the other day for the first time. I agree that it is quite entertaining and even eye opening.

Love this guy,s videos…they are so motivating for keeping finances in check. Hell, I feel bad on my occasional modest splurging on buying coffee, energy drinks. Zero eating out for like the past decade!

 

[mentos]

Mid-thirties.

I'm at 2.2m net worth, no debt. I'll probably want to retire when we hit 3m though I could probably retire now.

I definitely want to work at least another 3 years to reach the minimum to qualify for social security. Then maybe drop down to part-time for another 5 years.

How many properties do you think you'll need to retire?

 

[RXDOC1986]

So, here is my retirement plan, lottery tickets, I am bound to hit the jackpot one of these days, don't need much, maybe $150 million😎🙂😎

I have been working as a pharmacist since 1986, paying into SS, the max amount for over 37 years. At 65.5, I should be getting the MAX, around $4000/month, my wife about $2000, until the well (SSA) runs dry. Keep telling all the 20-30 somethings at work to keep on paying into SS (as if it's a choice) because I will be spending it, and they will never see it!

I have never been one to live frugal, my wife and I like nice things, and living large. My hobby was expensive German Automobiles and tracking, used to track a Porsche 996TT modified to 600HP. Every track weekend would cost over $1000. Lost big money on lots automobiles!
Net worth about $2.75, including a house, paid off, worth about $1.5 million and a managed 401K.

I don't see how you guys plan ahead so easily. You must not have kids. Kids are so damn expensive. Already put two of them through college, one more to go. It takes a good $200-$300K to raise each kid, through college. This would mean I am in the hole for about $1 million, when done.

Here is some free advise (you get what you pay for): As a senior citizen. Don't live frugal, or give up on the good things in life, just to get to a $amount. None of us are guaranteed retirement years, we might not even see next year. Enjoy life, do everything you wanted to do! don't worry about money. Life is absolutely too short! Future Financial Independance would mean that you are now in a Financial Subjugation state!
No thank you.

 

[TheBlaah]

How many properties do you think you'll need to retire?

To live off rent income completely?

Well, I have 4 rental properties, and 5 tenants (1 duplex). My annual profit after taxes/repairs/property manager fees are ~30k (this is what I estimated a few years ago; I don't have a mortgage on any of them). Our annual expenditures are ~65k.

So I guess I'd need at about 8 or 9 properties/tenants.

 

[Chrish]

I always thought that house shouldn’t be counted in your net worth? Because if you sell your current one, you will have to buy a new one which would probably cost just as much.

Same goes for cars.

 

[Chrish]

So, here is my retirement plan, lottery tickets, I am bound to hit the jackpot one of these days, don't need much, maybe $150 million😎🙂😎

I have been working as a pharmacist since 1986, paying into SS, the max amount for over 37 years. At 65.5, I should be getting the MAX, around $4000/month, my wife about $2000, until the well (SSA) runs dry. Keep telling all the 20-30 somethings at work to keep on paying into SS (as if it's a choice) because I will be spending it, and they will never see it!

I have never been one to live frugal, my wife and I like nice things, and living large. My hobby was expensive German Automobiles and tracking, used to track a Porsche 996TT modified to 600HP. Every track weekend would cost over $1000. Lost big money on lots automobiles!
Net worth about $2.75, including a house, paid off, worth about $1.5 million and a managed 401K.

I don't see how you guys plan ahead so easily. You must not have kids. Kids are so damn expensive. Already put two of them through college, one more to go. It takes a good $200-$300K to raise each kid, through college. This would mean I am in the hole for about $1 million, when done.

Here is some free advise (you get what you pay for): As a senior citizen. Don't live frugal, or give up on the good things in life, just to get to a $amount. None of us are guaranteed retirement years, we might not even see next year. Enjoy life, do everything you wanted to do! don't worry about money. Life is absolutely too short! Future Financial Independance would mean that you are now in a Financial Subjugation state!
No thank you.

While I admire the philosophy of living the life, you probably had better work conditions for most part of your career than now. We are constantly asked to do more with less as time went on.

When I started the job in my 20s, I could drive 4 hours and then work my 9 hour shift. No problem. But after 10 years, I can definitely see the effect on my knee/ joints especially when I work consecutive days while standing up for 9 hours. There is no way I want to do this in my 60s.

 

[RXDOC1986]

While I admire the philosophy of living the life, you probably had better work conditions for most part of your career than now. We are constantly asked to do more with less as time went on.

When I started the job in my 20s, I could drive 4 hours and then work my 9 hour shift. No problem. But after 10 years, I can definitely see the effect on my knee/ joints especially when I work consecutive days while standing up for 9 hours. There is no way I want to do this in my 60s.

Your take is absolutely correct, our profession has taken a turn for the worse. I should have mentioned that. But, even way back when, our job wasn't easy, maybe more rewarding, but certainly not easy.
They say, if you love what you do, you will never work a day in your life. Well, that's not us!

 

[PrincessSnow]

when people on here mention there FI number is this per person or as a couple if you are married? People I work with have a goal of 3 million and one single guy has a goal of 6 million. Not sure if I should include my spouse numbers in this goal.

 

[sunnyandseventytwo]

when people on here mention there FI number is this per person or as a couple if you are married? People I work with have a goal of 3 million and one single guy has a goal of 6 million. Not sure if I should include my spouse numbers in this goal.

My father used to say: Two people can live as cheaply as one...as long as only one of them eats.

 

[mentos]

I always thought that house shouldn’t be counted in your net worth? Because if you sell your current one, you will have to buy a new one which would probably cost just as much.

Same goes for cars.

This doesn't make sense to me. Say you have 500k cash and want to buy a house.

1) You buy a 500k house with $0 down and 500k mortgage. You have 500k in the bank.

2) You buy a 500k house with cash. You have $0 in the bank.

What difference does it make when calculating net worth? If you pay off your 500k mortgage, you're suddenly 500k poorer?

Someone with a paid off house can sell their house, get an influx of 500k and rent.

 

[Chrish]

This doesn't make sense to me. Say you have 500k cash and want to buy a house.

1) You buy a 500k house with $0 down and 500k mortgage. You have 500k in the bank.

2) You buy a 500k house with cash. You have $0 in the bank.

What difference does it make when calculating net worth? If you pay off your 500k mortgage, you're suddenly 500k poorer?

Someone with a paid off house can sell their house, get an influx of 500k and rent.

Point is either you rent (which will cost you monthly fees ie. increase your debt) or sell your current home and buy a new one (which will cost you as much assuming it’s in similar neighborhood and same size).

Only time house is part of of your net worth is when it’s an investment (rental property) or you are significantly downsizing it or moving from HCOL to LCOL area (selling $3 mil home in SF and buying a new one for $1 mil in Austin in which case you made a profit).

So, under normal circumstances house is an expense, not an investment. I always subtract my mortgage from the value of my current investments to calculate net worth.

 

[mentos]

Point is either you rent (which will cost you monthly fees ie. increase your debt) or sell your current home and buy a new one (which will cost you as much assuming it’s in similar neighborhood and same size).

Only time house is part of of your net worth is when it’s an investment (rental property) or you are significantly downsizing it or moving from HCOL to LCOL area (selling $3 mil home in SF and buying a new one for $1 mil in Austin in which case you made a profit).

So, under normal circumstances house is an expense, not an investment. I always subtract my mortgage from the value of my current investments to calculate net worth.

So if I decide to pay off my 500k mortgage, then I subtract 500k from my net worth? But if I keep the mortgage, I'm 500k richer?

 

[Chrish]

So if I decide to pay off my 500k mortgage, then I subtract 500k from my net worth? But if I keep the mortgage, I'm 500k richer?

No.

If you have 401k worth $1 mil and paid off home of $500k, your net worth will be $1 mil (house price won’t be counted).

In second example, you have $1 mil 401k. Then you also have a home for which you owe $500k worth of mortgage. In that case, your net worth will be $500k because you have a debt of $500k which needs to be subtracted from the value of your current investment.

 

[Z-Qualizer]

No.

If you have 401k worth $1 mil and paid off home of $500k, your net worth will be $1 mil (house price won’t be counted).

In second example, you have $1 mil 401k. Then you also have a home for which you owe $500k worth of mortgage. In that case, your net worth will be $500k because you have a debt of $500k which needs to be subtracted from the value of your current investment.

I think you’re confusing net worth and *liquid* net worth?

Any real estate you own, or have positive net equity in, counts towards overall net worth.

 

[mentos]

No.

If you have 401k worth $1 mil and paid off home of $500k, your net worth will be $1 mil (house price won’t be counted).

In second example, you have $1 mil 401k. Then you also have a home for which you owe $500k worth of mortgage. In that case, your net worth will be $500k because you have a debt of $500k which needs to be subtracted from the value of your current investment.

I'm not sure what you're saying but it sounds wrong.

If you get a divorce or get sued, you bet your bum your house is counted towards net worth. Otherwise everyone would just buy a new house before getting sued.

 

[Sunshine98*]

1.3 million. (retirement/savings only) Im pulling the plug at 55 (or sooner) no matter what! We are not guaranteed anything. I want to be able to enjoy the fruits of my labor.

 

[mentos]

1.3 million. Im pulling the plug at 55 (or sooner) no matter what! We are not guaranteed anything. I want to be able to enjoy the fruits of my labor.

So true. I know people who have died as children, as teens, in their 20s, 30s, 40s and so on. Tomorrow is never guaranteed.

 

[newdoctobe]

Are the numbers y’all giving include primary property equity?

 

[Sunshine98*]

So true. I know people who have died as children, as teens, in their 20s, 30s, 40s and so on. Tomorrow is never guaranteed.

No amount of money has bought a second of time. (Howard Stark)

 

[Lexington2012]

I'm not sure what you're saying but it sounds wrong.

If you get a divorce or get sued, you bet your bum your house is counted towards net worth. Otherwise everyone would just buy a new house before getting sued.

In some states, such as Florida, equity in your primary residence is not counted towards net worth for many purposes. And yes, people buy big houses in Florida if they think they will be sued. OJ Simpson did this to preserve his wealth from the wrongful death lawsuit.

 

[mentos]

In some states, such as Florida, equity in your primary residence is not counted towards net worth for many purposes. And yes, people buy big houses in Florida if they think they will be sued. OJ Simpson did this to preserve his wealth from the wrongful death lawsuit.

Noted. If you think you'll get sued, buy the most expensive house you can afford in Florida.

 

[Pharmacy Kid]

mid-30's. Planning to just coast-fire and work part time.

 

[confettiflyer]

Noted. If you think you'll get sued, buy the most expensive house you can afford in Florida.

I learned this from an episode of Punk’d with Justin Timberlake, hahaha

 

[RXDOC1986]

So true. I know people who have died as children, as teens, in their 20s, 30s, 40s and so on. Tomorrow is never guaranteed.

I still don't see "enjoying the fruits of my labor" to early retirement. I am enjoying my life, taking vacations, spending money as quickly as possible, spending money on my kids, and also going to work. These don't need to be mutually exclusive.

 

[CetiAlphaFive]

Yeah 2.5-3 mil after everything paid off sounds like a good number. Luckily in our case, both of have professional jobs and not really expensive lifestyle. We don’t drink and rarely eat out (not because of money; we just don’t enjoy it).

Traveling is the only expensive hobby we have.

Traveling without enjoying eating or drinking sounds miserable from my point of view

 

[Chrish]

Traveling without enjoying eating or drinking sounds miserable from my point of view

I don’t travel to eat food. Got plenty of options where I am at for that.

My whole purpose of traveling is sight-seeing. Unless a food place is truly famous for something, it is never my priority.

 

[WorthlessOxygen]

I don’t travel to eat food. Got plenty of options where I am at for that.

My whole purpose of traveling is sight-seeing. Unless a food place is truly famous for something, it is never my priority.

My favorite part of traveling might be finding local favorite spots for regional dishes. Sightseeing is an added perk.

 

[sunnyandseventytwo]

My favorite part of traveling might be finding local favorite spots for regional dishes. Sightseeing is an added perk.

I'm with you, Worthless O2. Vacation highlights for me are an exemplary dinner where the chef came out to tell us about each course, sitting at a bar with a chatty bartender, or drinking espresso on a busy pedestrian thoroughfare. Everything else just becomes a postcard that I might as well have bought at the airport.

 

[Rockinacoustic]

I don’t travel to eat food. Got plenty of options where I am at for that.

My whole purpose of traveling is sight-seeing. Unless a food place is truly famous for something, it is never my priority.

So you're the reason New York has an pizza hut...

 

[confettiflyer]

That’s so weird to me, I travel to eat. I’ve had whole trips centered around food, sight seeing is secondary.

Seoul is still my favorite city to just eat through.

Different strokes, I suppose. Maybe I should be happy some people like to sight see and not eat, that’s fewer people trying to crowd in at the food stalls, lol.

 

[RxPreceptor]

Yeah I don’t understand travel, eating out/food…my time, energy, and money is better spent elsewhere (home, self hobbies/interests, further building/growing)

 

[deleted1162863]

That’s so weird to me, I travel to eat. I’ve had whole trips centered around food, sight seeing is secondary.

Seoul is still my favorite city to just eat through.

Different strokes, I suppose. Maybe I should be happy some people like to sight see and not eat, that’s fewer people trying to crowd in at the food stalls, lol.

I totally agree. Food is one of the best things about travel, although I do also like sightseeing.

 

[sunnyandseventytwo]

I don’t travel to eat food. Got plenty of options where I am at for that.

My whole purpose of traveling is sight-seeing. Unless a food place is truly famous for something, it is never my priority.

Sorry this is behind a paywall, it's pretty easy to circumvent the New Yorker, though: The Case Against Travel

This article made me want to take up falconing.

 

[mentos]

Guess I'm in the minority but I'm not crazy about food. I see my family and friends dropping hundreds or thousands on eating out, stuffing their faces all day while on vacation and gaining 10 pounds by the time they get back home. I like to eat out every now and then, but not 3 times a day everyday.

 

[RXDOC1986]

Guess I'm in the minority but I'm not crazy about food. I see my family and friends dropping hundreds or thousands on eating out, stuffing their faces all day while on vacation and gaining 10 pounds by the time they get back home. I like to eat out every now and then, but not 3 times a day everyday.

You must be single. As a family man, our only form of entertainment was and continues to be, eating out. First, it was the establishments with a playground, then we evolved.

I remember a time, before kids, my wife and I, checked our bank balance, it was $18, we withdrew the money and went straight to Sizzler or was it Western Sizzlin. That was just enough for two meals and tip. True story, it was 1985-86.