How much do you save/invest every year?

[eyeeye_captain]

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The concept of early retirement baffles me.

I simultaneously believe in spending time with loved ones, and we work too hard here in the US. My goal is to work "hard" (40-50hrs/week--I'm in PM&R...) a few more years. Then maybe back down to "sort of part-time," with the goal of working maybe 20-30hrs/week and having lots of free time with family on a regular basis.

These two points are sort of incongruous. We work too hard but retiring so you don’t have to work and can spend even more time with family is bad?

You’re probably not going to like the next generation. A recruiter is a relatively frequent poster on the eye board, and apparently he gets a good number of requests for 4 day/32 hour weeks from new grads. If you’re already asking to be part-time, it’s not like you’re going to ramp up - it will be slowing down more.

 

[RangerBob]

These two points are sort of incongruous. We work too hard but retiring so you don’t have to work and can spend even more time with family is bad?

You’re probably not going to like the next generation. A recruiter is a relatively frequent poster on the eye board, and apparently he gets a good number of requests for 4 day/32 hour weeks from new grads. If you’re already asking to be part-time, it’s not like you’re going to ramp up - it will be slowing down more.

My plan isn't to retire early. It's just to work less. I think there's value to work and there's clearly value in spending time with family. We can afford to do both in medicine.

The next generation seems to have it right. Work sustainable hours. Burnout is one of the biggest threats to our potential wealth, and certainly one of the biggest threats to our happiness. Divorce is the other biggest (bigger) threat. Biggest risk factor for divorce? Working too much/skipping date night.

 

[Saddleshoes]

My plan isn't to retire early. It's just to work less. I think there's value to work and there's clearly value in spending time with family. We can afford to do both in medicine.

The next generation seems to have it right. Work sustainable hours. Burnout is one of the biggest threats to our potential wealth, and certainly one of the biggest threats to our happiness. Divorce is the other biggest (bigger) threat. Biggest risk factor for divorce? Working too much/skipping date night.

Amen Brother!
---I am working a 3 day week (and still enjoying it), while most of my peers have retired. HOWEVER when my peers were slaving away at 5 day weeks, I was working a 4 day week and enjoying my family.
---Also there are extreme tax advantages to working beyond the the standard retirement age.
---I also want to support the value of "Date Night"!

 

[gutonc]

My plan isn't to retire early. It's just to work less. I think there's value to work and there's clearly value in spending time with family. We can afford to do both in medicine.

The next generation seems to have it right. Work sustainable hours. Burnout is one of the biggest threats to our potential wealth, and certainly one of the biggest threats to our happiness. Divorce is the other biggest (bigger) threat. Biggest risk factor for divorce? Working too much/skipping date night.

Amen Brother!
---I am working a 3 day week (and still enjoying it), while most of my peers have retired. HOWEVER when my peers were slaving away at 5 day weeks, I was working a 4 day week and enjoying my family.
---Also there are extreme tax advantages to working beyond the the standard retirement age.
---I also want to support the value of "Date Night"!

This is 100% my plan. And while I do have some concerns about the general work ethic of the next generation, it's not the number of hours they want to work that worries me, more the work they do when they are working.

That said, I love the work I do and don't really think about leaving it completely for many years. But I definitely won't keep working FT for more than another 5 years or so.

I too worked less than FT early in my career because I wanted to have more time to spend with my daughter while she was young. Once she had a car and her own job, I went to FT. I'll probably stick with this until she's out of college and then start to taper my schedule over the next 10 years or so.

 

[RangerBob]

This is 100% my plan. And while I do have some concerns about the general work ethic of the next generation, it's not the number of hours they want to work that worries me, more the work they do when they are working.

That said, I love the work I do and don't really think about leaving it completely for many years. But I definitely won't keep working FT for more than another 5 years or so.

I too worked less than FT early in my career because I wanted to have more time to spend with my daughter while she was young. Once she had a car and her own job, I went to FT. I'll probably stick with this until she's out of college and then start to taper my schedule over the next 10 years or so.

That's a good point. When our son goes to college (and perhaps sooner like your case) perhaps I'll increase my hours. Certainly once the kids are moved out every night is date night.

 

[Monocles]

You’re probably not going to like the next generation. A recruiter is a relatively frequent poster on the eye board, and apparently he gets a good number of requests for 4 day/32 hour weeks from new grads. If you’re already asking to be part-time, it’s not like you’re going to ramp up - it will be slowing down more.

Part time is incredible and I would recommend anyone who is not already PT to try it.

In fellowship we had a facilitator who said she never worked a single day of full time after training.

I was like "YOU CAN DO THAT??" 🤯

She laughed and said yes. Apparently she did a few hours of teaching/supervision each week and then ran a fancy cash only psychoanalysis practice two days a week.

I thought about what she said and lasted a year full time before burning out and cutting back to PT at age 31. It was such an incredible decision. My original goal was to stack a couple of high stress high pay locums jobs and then get out of medicine in 4 years. But instead going the slow route has significantly increased the longevity of my career and I'll probably coast for a while longer.

Being part time is also good because it's easy to set boundaries for life/work balance. It's easy to exceed expectations if you just do what your job description entails, but also a perfect excuse to turn down leadership positions, teaching committees, research groups, aPD etc.

 

[worthless]

I’ve had a fun path.

Just started my 10th year of being an attending and my NW is just over $8M. That’s after hitting NW 0 around 11 years ago (while still in training).

This year my total income (revenue, pre-tax) is over $3M. I made some early investments starting with real estate and then branching into others like construction, rentals of various kinds, and my own clinics. It’s been a ride. I make a lot more from my non-medical work than my medical work. I save more than 85% simply because I don’t have time to spend much more than that.

5M seemed like a dream a short while ago and now I’m aiming for 1M passive (33M NW), although realistically I’ll probably burn out before then lol. My shorter-term goal is just to save up 2M cash and that’ll be enough runway to slowly liquidate while I’m no longer working.

 

[Nocturnist]

That's a good point. When our son goes to college (and perhaps sooner like your case) perhaps I'll increase my hours. Certainly once the kids are moved out every night is date night.

Just be careful- 70% of your current income in retirement may not cover 365 date nights a year 😉

I’ve had a fun path.

Just started my 10th year of being an attending and my NW is just over $8M. That’s after hitting NW 0 around 11 years ago (while still in training).

This year my total income (revenue, pre-tax) is over $3M. I made some early investments starting with real estate and then branching into others like construction, rentals of various kinds, and my own clinics. It’s been a ride. I make a lot more from my non-medical work than my medical work. I save more than 85% simply because I don’t have time to spend much more than that.

5M seemed like a dream a short while ago and now I’m aiming for 1M passive (33M NW), although realistically I’ll probably burn out before then lol. My shorter-term goal is just to save up 2M cash and that’ll be enough runway to slowly liquidate while I’m no longer working.

Incredible.
I love that your name is worthless and you're a 10+ year member so when you made your account you were just being factually (financially) accurate. Look at you now!

Youll be at 33M in 15 years even if you don't save another penny again and just make enough to cover your 450k living expenses...or, 100M in 26 years.

 

[eyeeye_captain]

Part time is incredible and I would recommend anyone who is not already PT to try it..

I don’t disagree. My full time works out to <35 hours and I anticipate <30 in the next few years. Obviously it’s nice from a lifestyle perspective and can let you do other things (holy crap, @worthless).

Since a lot of this thread is talking about goals, I don’t think it’s a wise financial move for someone just starting out to immediately go part time. Yes, you can play the long game, but you start running the risk of being the <$1M at retirement doc. That’s too risky for me, but everyone has different tolerances.

It also limits your job options significantly. Fair or not, it leads to questions about your work ethic, especially if you’re soon out of training.

 

[Nocturnist]

I don’t disagree. My full time works out to <35 hours and I anticipate <30 in the next few years. Obviously it’s nice from a lifestyle perspective and can let you do other things (holy crap, @worthless).

Since a lot of this thread is talking about goals, I don’t think it’s a wise financial move for someone just starting out to immediately go part time. Yes, you can play the long game, but you start running the risk of being the <$1M at retirement doc. That’s too risky for me, but everyone has different tolerances.

It also limits your job options significantly. Fair or not, it leads to questions about your work ethic, especially if you’re soon out of training.

Completely agree. After working 80 or more hours in residency- guess what? 50 or even 60 hours should FEEL like part time, especially now that you have some say in when those hours are.
It's alot psychologically easier to go from 80 to 60 to 40 hours then to part time (and make hay when compound interest is on your side) than to start out part time only to realize a decade or two later you're behind.

 

[Splenda88]

Completely agree. After working 80 or more hours in residency- guess what? 50 or even 60 hours should FEEL like part time, especially now that you have some say in when those hours are.
It's alot psychologically easier to go from 80 to 60 to 40 hours then to part time (and make hay when compound interest is on your side) than to start out part time only to realize a decade or two later you're behind.

Also, compound interest works in your favor. Why not front load in your first 10 yrs, then slow down while you don't have to worry about money anymore.

 

[eyeeye_captain]

Completely agree. After working 80 or more hours in residency- guess what? 50 or even 60 hours should FEEL like part time, especially now that you have some say in when those hours are.
It's alot psychologically easier to go from 80 to 60 to 40 hours then to part time (and make hay when compound interest is on your side) than to start out part time only to realize a decade or two later you're behind.

Also completely agree. 40-60 after residency should be cruising. I won’t belittle burnout, but attending life is easier than training even outside of the better hours.

I’ve told this story before, but I have a coresident who tried to make some extra dough early on covering a Level 1 call that their group operated at. Nearly went insane after one week, so I told them to find someone who needed the money more to take their call. Apparently they found some near end of career, low volume doc putting multiple kids through school who was desperate for it.

Moral of the story, don’t be the age 50-60+ doc taking trauma call/trying to ramp up because you’re behind.

 

[finalpsychyear]

Completely agree. After working 80 or more hours in residency- guess what? 50 or even 60 hours should FEEL like part time, especially now that you have some say in when those hours are.
It's alot psychologically easier to go from 80 to 60 to 40 hours then to part time (and make hay when compound interest is on your side) than to start out part time only to realize a decade or two later you're behind.

Esp the first 5 years.

 

[mmmcdowe]

Financial Independence Recreational Employment is my philosophy. May not always be medical, but I can't see myself willingly ever stopping doing something, even if it is charity work, as long as I am able.

 

[finalpsychyear]

Also, compound interest works in your favor. Why not front load in your first 10 yrs, then slow down while you don't have to worry about money anymore.

For those that finish and earn attending pay in their early 30s its such a critical fork in the road moment/decade. Ur energy, work ethic, recovery are at their attending peak esp if u can combine it with heavy investing and avoiding too many finanicial mistakes.

I consider it the final boss battle.

 

[Monocles]

Since a lot of this thread is talking about goals, I don’t think it’s a wise financial move for someone just starting out to immediately go part time. Yes, you can play the long game, but you start running the risk of being the <$1M at retirement doc. That’s too risky for me, but everyone has different tolerances.

When I first was deciding to go part time I made a massive excel sheet running monte carlo simulations on various 0.x FTEs vs time to retire.

I remember 0.3 FTE was what I needed to maintain my lifestyle at the time, and then I ran the numbers all the way up to 1.5 FTEs (basically considering taking on additional part time locums work etc). Surprisingly from a mathematical perspective there was a TON of diminishing returns with additional hours worked - as so much of it was determined by market fluctuations outside my control so I decided to work the most number of hours I could tolerate and be frugal and save lots.

(I ended up somewhere in the middle between 0.3 and 1.5 FTEs)

My point is life is short - I don't regret the hours I spent in the last couple of years NOT doing medicine. Could I have possibly hit FI already and retired? Possibly - but I think the physical and mental health improvements have been priceless!

 

[Nocturnist]

When I first was deciding to go part time I made a massive excel sheet running monte carlo simulations on various 0.x FTEs vs time to retire.

I remember 0.3 FTE was what I needed to maintain my lifestyle at the time, and then I ran the numbers all the way up to 1.5 FTEs (basically considering taking on additional part time locums work etc). Surprisingly from a mathematical perspective there was a TON of diminishing returns with additional hours worked - as so much of it was determined by market fluctuations outside my control so I decided to work the most number of hours I could tolerate and be frugal and save lots.

(I ended up somewhere in the middle between 0.3 and 1.5 FTEs)

My point is life is short - I don't regret the hours I spent in the last couple of years NOT doing medicine. Could I have possibly hit FI already and retired? Possibly - but I think the physical and mental health improvements have been priceless!

Interesting. Can you explain what you mean by market fluctuations outside of your control? I mean I understand that markets fluctuate outside of your control, but markets fluctuate to the same degree outside of your control regardless of your FTEs...how does working less affect this?

I admit I didn't run any simulations when I began working. And yeah, I agree that from a tax perspective there is a several percentage points of diminishing returns. That said, I found the opposite to be true- returns increased exponentially with increased FTE

If I as a full time hospitalist in the pricey northeast make 300k/clear 200k, and I need 10k a month to live, I'm able to save 80k a year.

Now let's say I moonlight upto 1.5 FTEs, making 450k and clearing 300k. Did my saving rate go up 50% like my FTEs? Nope. I'm now saving 180k a year which is 225% higher, for only 50% more hours. Combine saving two, three, or even four times the rate of your colleagues for a few years with the power of compound interest and you can get ahead really quickly.

The way I'm looking at it: 9 years after residency I've made around what a full time hospitalist maybe 15-18 years into their career has. But I've been able to work up to a net worth comparable to colleagues much closer to 30-35 years in under a decade... which put me in a position to easily go part time in the next 5 years when my house is paid off and kids out of day care (the silly wealthfront simulator tells me I can "comfortably retire" in 5-10 years). I'm not sure too many of my colleagues in their 30s/40s would be able to say the same.

 

[sloh]

If I as a full time hospitalist in the pricey northeast make 300k/clear 200k, and I need 10k a month to live, I'm able to save 80k a year.

Now let's say I moonlight upto 1.5 FTEs, making 450k and clearing 300k. Did my saving rate go up 50% like my FTEs? Nope. I'm now saving 180k a year which is 225% higher, for only 50% more hours. Combine saving two, three, or even four times the rate of your colleagues for a few years with the power of compound interest and you can get ahead really quickly.

The way I'm looking at it: 9 years after residency I've made around what a full time hospitalist maybe 15-18 years into their career has. But I've been able to work up to a net worth comparable to colleagues much closer to 30-35 years in under a decade... which put me in a position to easily go part time in the next 5 years when my house is paid off and kids out of day care (the silly wealthfront simulator tells me I can "comfortably retire" in 5-10 years). I'm not sure too many of my colleagues in their 30s/40s would be able to say the same.

Great post. You often hear people making incorrect assumptions about progressive taxation to justify not working more bc “the more you work, the more you get taxed,” when in reality marginal tax rates mean that you always keep more money by earning more, even at higher tax brackets — because only the additional dollars are taxed at the higher rate, not your entire income. With what you said above, that’s ANOTHER reason to work more/harder the first 10 years bc after a certain threshold of covering necessary expenses, additional income has exponentially more value because it can be invested instead of consumed, and that invested capital begins compounding at a far higher rate than earned income ever could.

 

[Monocles]

Interesting. Can you explain what you mean by market fluctuations outside of your control? I mean I understand that markets fluctuate outside of your control, but markets fluctuate to the same degree outside of your control regardless of your FTEs...how does working less affect this?

I admit I didn't run any simulations when I began working. And yeah, I agree that from a tax perspective there is a several percentage points of diminishing returns. That said, I found the opposite to be true- returns increased exponentially with increased FTE

If I as a full time hospitalist in the pricey northeast make 300k/clear 200k, and I need 10k a month to live, I'm able to save 80k a year.

Now let's say I moonlight upto 1.5 FTEs, making 450k and clearing 300k. Did my saving rate go up 50% like my FTEs? Nope. I'm now saving 180k a year which is 225% higher, for only 50% more hours. Combine saving two, three, or even four times the rate of your colleagues for a few years with the power of compound interest and you can get ahead really quickly.

The way I'm looking at it: 9 years after residency I've made around what a full time hospitalist maybe 15-18 years into their career has. But I've been able to work up to a net worth comparable to colleagues much closer to 30-35 years in under a decade... which put me in a position to easily go part time in the next 5 years when my house is paid off and kids out of day care (the silly wealthfront simulator tells me I can "comfortably retire" in 5-10 years). I'm not sure too many of my colleagues in their 30s/40s would be able to say the same.

Sure. So the premise of FIRE and reaching FI is primarily based on the magic of market compounding (multiplicative), whereas your principle contributions from working is additive.

When I was considering how many FTEs to cut back, I made an excel sheet to project 50th percentile Monte Carlo (average market conditions) and it was something like

0.3 FTEs (basically maintaining lifestyle, no contributions) -> hit FI in 30 years
0.6 FTEs -> FI in 10 years
0.9 FTEs -> FI in 7 years
1.2 FTEs -> FI in 6 years
1.5 FTEs -> FI in 5.5 years

(With FI goal defined as 2M invested)

And so on. (Apologies the numbers aren't exact as I'm doing this from memory) As you can see there was diminishing returns so it was basically finding the sweet spot on the graph, which practically translated to having a relatively cush part time lifestyle AND being able to retire in my late 30s, which is not bad at all!

Years later I'm at the point where my portfolio has snowballed and daily market changes are often greater than my monthly medicine salary. When I retire is now more affected by the market as opposed to how many more FTEs I work. I can quit tomorrow and if we have 3 back to back +25% years I'm there, or I can work three jobs and we hit a lost decade and I can't retire.

 

[Nocturnist]

Sure. So the premise of FIRE and reaching FI is primarily based on the magic of market compounding (multiplicative), whereas your principle contributions from working is additive.

When I was considering how many FTEs to cut back, I made an excel sheet to project 50th percentile Monte Carlo (average market conditions) and it was something like

0.3 FTEs (basically maintaining lifestyle, no contributions) -> hit FI in 30 years
0.6 FTEs -> FI in 10 years
0.9 FTEs -> FI in 7 years
1.2 FTEs -> FI in 6 years
1.5 FTEs -> FI in 5.5 years

(With FI goal defined as 2M invested)

And so on. (Apologies the numbers aren't exact as I'm doing this from memory) As you can see there was diminishing returns so it was basically finding the sweet spot on the graph, which practically translated to having a relatively cush part time lifestyle AND being able to retire in my late 30s, which is not bad at all!

Years later I'm at the point where my portfolio has snowballed and daily market changes are often greater than my monthly medicine salary. When I retire is now more affected by the market as opposed to how many more FTEs I work. I can quit tomorrow and if we have 3 back to back +25% years I'm there, or I can work three jobs and we hit a lost decade and I can't retire.

I guess I'll have to take your word for it with the numbers you plugged in at the time but something isn't adding up with your example.

Here is my real life example with the same assumptions of clearing 66% of my paycheck, needing 10k a month to live, 1fte=300k, and 10% returns-

0.3FTE=90K a year. I clear 60k. I'm able to save -60k a year. I'll never be able to retire.

0.6FTE=180k a year. I clear 120k. I'm able to save $0 per year. I'll never be able to retire.

0.9FTE=270K a year. I clear 180k. I'm able to save 60k per year. I'll hit 2M in 15.5 years.

1.2FTE=360K a year. I clear 240k. I'm able to save 120k a year. I'll hit 2M in 10.6 years.

1.5FTE=450K a year. I clear 300k. I'm able to save 180k per year. I'll hit 2M in 8 years.

and to extend your intervals out even further:

2 FTEs=600k a year. I clear 400k. I'm able to save 280k. I'll hit 2M in 5.5 years.

So as you can see, working 0.9 vs 2 FTEs I was able to retire in a third of the time despite working just twice as much.
More so, theres no interval where the returns were diminishing. I.e, working an additional .3 FTEs from 1.2 to 1.5 for 8 years equals an additional equivalent of 2.4 full time years, but still shaved off 2.6 working years to hit your FI goal.

Yes its a brute simplification since you're at a higher tax bracket at 2 FTEs than at 1, but I'm still not sure how you reached your conclusion?

 

[finalpsychyear]

I guess I'll have to take your word for it with the numbers you plugged in at the time but something isn't adding up with your example.

Here is my real life example with the same assumptions of clearing 66% of my paycheck, needing 10k a month to live, 1fte=300k, and 10% returns-

0.3FTE=90K a year. I clear 60k. I'm able to save -40k a year. I'll never be able to retire.

0.6FTE=180k a year. I clear 120k. I'm able to save $0 per year. I'll never be able to retire.

0.9FTE=270K a year. I clear 180k. I'm able to save 60k per year. I'll hit 2M in 15.5 years.

1.2FTE=360K a year. I clear 240k. I'm able to save 120k a year. I'll hit 2M in 10.6 years.

1.5FTE=450K a year. I clear 300k. I'm able to save 180k per year. I'll hit 2M in 8 years.

and to extend your intervals out even further:

2 FTEs=600k a year. I clear 400k. I'm able to save 280k. I'll hit 2M in 5.5 years.

So as you can see, working 0.9 vs 2 FTEs I was able to retire in a third of the time despite working just twice as much.
More so, theres no interval where the returns were diminishing. I.e, working an additional .3 FTEs from 1.2 to 1.5 for 8 years equals an additional equivalent of 2.4 full time years, but still shaved off 2.6 working years to hit your FI goal.

Yes its a brute simplification since you're at a higher tax bracket at 2 FTEs than at 1, but I'm still not sure how you reached your conclusion?

Also market does the heavy lifting earlier.

Ex: someone puts 200k in voo after killing it in year one enjoys 8-10% cagr growth for the next 4-5 years while guy #2 is putting 40k/yr for 5 years getting only a small portion to grow at same cagr rate.

Thats the biggest advantage of investing heavy early imo.

Not advocating to live poorly to get there but the idea above is the front loading benefits so market does heavy lifting.

 

[Nocturnist]

Also market does the heavy lifting earlier.

Ex: someone puts 200k in voo after killing it in year one enjoys 8-10% cagr growth for the next 4-5 years while guy #2 is putting 40k/yr for 5 years getting only a small portion to grow at same cagr rate.

Thats the biggest advantage of investing heavy early imo.

Not advocating to live poorly to get there but the idea above is the front loading benefits so market does heavy lifting.

Right.

Schwab did a research a year or two back that showed bolusing a lump sum at the beginning of any year into index funds (even at record highs) beats dollar cost averaging and both obviously beat day trading or investing in bonds.

Time in the market beats timing the market (though humans are more averse to losses than the dopamine hit from gains so it's psychologically gentler to DCI)

 

[Monocles]

I guess I'll have to take your word for it with the numbers you plugged in at the time but something isn't adding up with your example.

Here is my real life example with the same assumptions of clearing 66% of my paycheck, needing 10k a month to live, 1fte=300k, and 10% returns-

0.3FTE=90K a year. I clear 60k. I'm able to save -60k a year. I'll never be able to retire.

0.6FTE=180k a year. I clear 120k. I'm able to save $0 per year. I'll never be able to retire.

0.9FTE=270K a year. I clear 180k. I'm able to save 60k per year. I'll hit 2M in 15.5 years.

1.2FTE=360K a year. I clear 240k. I'm able to save 120k a year. I'll hit 2M in 10.6 years.

1.5FTE=450K a year. I clear 300k. I'm able to save 180k per year. I'll hit 2M in 8 years.

and to extend your intervals out even further:

2 FTEs=600k a year. I clear 400k. I'm able to save 280k. I'll hit 2M in 5.5 years.

So as you can see, working 0.9 vs 2 FTEs I was able to retire in a third of the time despite working just twice as much.
More so, theres no interval where the returns were diminishing. I.e, working an additional .3 FTEs from 1.2 to 1.5 for 8 years equals an additional equivalent of 2.4 full time years, but still shaved off 2.6 working years to hit your FI goal.

Yes its a brute simplification since you're at a higher tax bracket at 2 FTEs than at 1, but I'm still not sure how you reached your conclusion?

Sorry I dont think I'm doing a good job explaining. Let me start over.

Using your specific data above I made this visual

Assuming when you can "never retire", I used a placeholder for 40 year as standard career. Going from 0.6 to 0.9 FTEs essentially shaves off 25ish years and allows you to retire in 15.5 years, whereas going from 1.2 to 1.5 FTEs shaves off 2.6 years.

If we had additional FTEs above 2.0 we would see the trendline gradually turn more horizontal, meaning that it would take a greater amount of FTEs for each year shaved off.

If we go to the extremes and try to retire in ONE year,
I think your FTE formula is (2,000,000 + 120,000)*1.5/300,000 = 10.6, which is the number of FTEs required to reach that goal.

I'm not arguing against early investing or time in the market at all. Basically my whole point is when you look at the graph above and try to eyeball where the inflection point and recognise the diminishing returns. (which I think for you may be the 0.9 to 1.2 range) Not only does increasing FTEs not produce proportional decreases in the number of years worked, practically going from 2 to 3 FTEs is probably a lot more physically and mentally demanding than going from 1 to 2 FTES.

Ultimately the goal is about work/life balance and reaching FI at an optimal pace.

 

[Nocturnist]

Sorry I dont think I'm doing a good job explaining. Let me start over.

Using your specific data above I made this visual

View attachment 406236


Assuming when you can "never retire", I used a placeholder for 40 year as standard career. Going from 0.6 to 0.9 FTEs essentially shaves off 25ish years and allows you to retire in 15.5 years, whereas going from 1.2 to 1.5 FTEs shaves off 2.6 years.

If we had additional FTEs above 2.0 we would see the trendline gradually turn more horizontal, meaning that it would take a greater amount of FTEs for each year shaved off.

If we go to the extremes and try to retire in ONE year,
I think your FTE formula is (2,000,000 + 120,000)*1.5/300,000 = 10.6, which is the number of FTEs required to reach that goal.

I'm not arguing against early investing or time in the market at all. Basically my whole point is when you look at the graph above and try to eyeball where the inflection point and recognise the diminishing returns. (which I think for you may be the 0.9 to 1.2 range) Not only does increasing FTEs not produce proportional decreases in the number of years worked, practically going from 2 to 3 FTEs is probably a lot more physically and mentally demanding than going from 1 to 2 FTES.

Ultimately the goal is about work/life balance and reaching FI at an optimal pace.

Right, of course you can't work enough FTEs to buy yourself a time machine and retire younger than you started. So the more you work the more the time to FI condenses until it gets infinitely closer to the first day you start working but never reaches it.

Still, even in the extreme example of working 10.6FTEs and retiring in one year: you only had to work 11.6 times as much to retire in 15th of the time it would take at 0.9 FTEs. Or in the case of 1.2 FTEs, you worked 8.8 times as much to retire 10.6 times faster. In the case of 1.5 FTEs, you worked 7 times as much to retire in an 8th of the time. In the case of 2FTEs, you worked 5.3 times as much to retire 5.5 times faster.

I definitely see what you're saying- the ratio between how much harder you have to work per year vs the amount of time saved keeps shrinking and shrinking closer to 1:1. And as we start talking about 2,3, 4 or even more FTEs- you're starting to talk about working 30 days a month and even cutting into family time, eating, and sleeping (if there are even enough hours a month). But mathematically/theoretically at least, working more is always going to win.

While I dont have your specific numbers, even practically speaking with work-life balance in mind, I don't think the diminishing returns concern applies to anyone working under 2 FTEs. 2 vs 4 FTEs? Sure. But certainly I dont see how i would use it to justify working less than full time.

 

[Monocles]

I definitely see what you're saying- the ratio between how much harder you have to work per year vs the amount of time saved keeps shrinking and shrinking closer to 1:1. And as we start talking about 2,3, 4 or even more FTEs- you're starting to talk about working 30 days a month and even cutting into family time, eating, and sleeping (if there are even enough hours a month). But mathematically/theoretically at least, working more is always going to win.

While I dont have your specific numbers, even practically speaking with work-life balance in mind, I don't think the diminishing returns concern applies to anyone working under 2 FTEs. 2 vs 4 FTEs? Sure. But certainly I dont see how i would use it to justify working less than full time.

I think this where the subjective decision comes in on a person to person basis. It all depends on how much one tolerates (or enjoys?) working, your values of earlier freedom vs later, etc.

For me at least it was the BEST career decision I've made since the mistake of going pre-med in college. The amount of joy, time spent with families and on hobbies has been priceless to me. I think life is too short to work any amount more than you have to in order to reach your goal. We're going to have enough money at this point, and enough to pass on to our heirs that college will be fully funded and work will likely be optional for them. It's kind of my version of "die with zero" but "die working no more FTEs than I need to", lol.

Anecdotally I know a friend who is doing something extreme like working 3 ER shifts a month to pay the bills and then spending the rest of their time doing wildlife photography!

 

[dpmd]

I think this where the subjective decision comes in on a person to person basis. It all depends on how much one tolerates (or enjoys?) working, your values of earlier freedom vs later, etc.

For me at least it was the BEST career decision I've made since the mistake of going pre-med in college. The amount of joy, time spent with families and on hobbies has been priceless to me. I think life is too short to work any amount more than you have to in order to reach your goal. We're going to have enough money at this point, and enough to pass on to our heirs that college will be fully funded and work will likely be optional for them. It's kind of my version of "die with zero" but "die working no more FTEs than I need to", lol.

Anecdotally I know a friend who is doing something extreme like working 3 ER shifts a month to pay the bills and then spending the rest of their time doing wildlife photography!

They can call their travels business expenses for their photography business if they are willing to put a little effort into making it look like they are trying to profit from it. I mentioned that to my husband before because he takes really nice scenic photos but he isn't interested in the extra effort. Your friend might though.

 

[eyeeye_captain]

Let’s be honest - some fields it will also be impossible to go <1 FTE. I think most of us in the thread work some form of specialty where you can tailor your lifestyle to a degree. If I told my local general surgeons that I wanted to work even less, their minds would explode.

I’m no boomer, but if my practice is hiring and someone says part time right off the bat, then they get a polite handshake and wave goodbye. It’s not just that I worry about their willingness to work (despite knowing they’ll slow down even more and already don’t appear motivated to come in). It’s that I don’t know if they’ll be able/want to work enough to buy in and be a partner, which is the goal since they’ll make way more. I’ve also worked with enough part timers to know they tend to be more than willing to pass the buck on anything urgent or unusual.

It would make me money if someone wanted to be a forever PT associate, but I can’t in good conscience recommend it.

 

[Nocturnist]

I think this where the subjective decision comes in on a person to person basis. It all depends on how much one tolerates (or enjoys?) working, your values of earlier freedom vs later, etc.

For me at least it was the BEST career decision I've made since the mistake of going pre-med in college. The amount of joy, time spent with families and on hobbies has been priceless to me. I think life is too short to work any amount more than you have to in order to reach your goal. We're going to have enough money at this point, and enough to pass on to our heirs that college will be fully funded and work will likely be optional for them. It's kind of my version of "die with zero" but "die working no more FTEs than I need to", lol.

Anecdotally I know a friend who is doing something extreme like working 3 ER shifts a month to pay the bills and then spending the rest of their time doing wildlife photography!

Agree everybody's situation, numbers, and risk tolerance are different. The biggest subjective decision here is one's ability to work overtime while staying sane, spending quality time with family, and not depriving your spouse to the point of divorce.

Not to beat a dead horse but so far we've only talked about how quickly we can reach FIRE and never work again. Though it sounds like most of us appropriately would like to reach financial stability i.e that FU point and then have the ability to work part time...right?

So let's just play out a couple more scenarios:

If i start my career working anything at or under 0.6 FTEs off the bat, we've established I'll never save enough to retire.

If i start out at 0.9FTEs and keep going at that pace- I'll have enough to retire in 15.5 years. Alternatively, I can work 0.9FTEs for 3.5 years, then cut back to 0.6FTEs for the next 26.5 years, and let the $237k i saved in those 3.5 years compound up to 2.9M by year 30.

But check it: If i start out working 1.5 FTEs, I can work for *only a single year*, save that 180k, then coast on 0.6 FTEs for the next 29 years- and still end up with a 2.8M porfolio.

So for the cost of working an additional 0.6 FTE for a single year, i was able to live the dream and go part time 2.5 years sooner.

Let’s be honest - some fields it will also be impossible to go <1 FTE. I think most of us in the thread work some form of specialty where you can tailor your lifestyle to a degree. If I told my local general surgeons that I wanted to work even less, their minds would explode.

I’m no boomer, but if my practice is hiring and someone says part time right off the bat, then they get a polite handshake and wave goodbye. It’s not just that I worry about their willingness to work (despite knowing they’ll slow down even more and already don’t appear motivated to come in). It’s that I don’t know if they’ll be able/want to work enough to buy in and be a partner, which is the goal since they’ll make way more. I’ve also worked with enough part timers to know they tend to be more than willing to pass the buck on anything urgent or unusual.

It would make me money if someone wanted to be a forever PT associate, but I can’t in good conscience recommend it.

Agree. Even as a hospitalist where I can tailor exactly how many shifts i want to work and dial that up or down on a 3 month's notice- If someone was coming out of residency looking for a part time position without some damn good reason, I'd try harder to keep looking. The last time my group hired this kind of person, she called out from the airport 75 minutes before her scheduled shift. Didn't even pretend to be sick, just said she had a flight booked to visit her boyfriend.

 

[finalpsychyear]

Agree everybody's situation, numbers, and risk tolerance are different. The biggest subjective decision here is one's ability to work overtime while staying sane, spending quality time with family, and not depriving your spouse to the point of divorce.

Not to beat a dead horse but so far we've only talked about how quickly we can reach FIRE and never work again. Though it sounds like most of us appropriately would like to reach financial stability i.e that FU point and then have the ability to work part time...right?

So let's just play out a couple more scenarios:

If i start my career working anything at or under 0.6 FTEs off the bat, we've established I'll never save enough to retire.

If i start out at 0.9FTEs and keep going at that pace- I'll have enough to retire in 15.5 years. Alternatively, I can work 0.9FTEs for 3.5 years, then cut back to 0.6FTEs for the next 26.5 years, and let the $237k i saved in those 3.5 years compound up to 2.9M by year 30.

But check it: If i start out working 1.5 FTEs, I can work for *only a single year*, save that 180k, then coast on 0.6 FTEs for the next 29 years- and still end up with a 2.8M porfolio.

So for the cost of working an additional 0.6 FTE for a single year, i was able to live the dream and go part time 2.5 years sooner.

Agree. Even as a hospitalist where I can tailor exactly how many shifts i want to work and dial that up or down on a 3 month's notice- If someone was coming out of residency looking for a part time position without some damn good reason, I'd try harder to keep looking. The last time my group hired this kind of person, she called out from the airport 75 minutes before her scheduled shift. Didn't even pretend to be sick, just said she had a flight booked to visit her boyfriend.

All good info. Lets say someone is able to hit 5m liquid in the market after 15-17 years in practice so maybe for those who invested right after the 08 crash since we've had an amazing bull run.

If im not mistaken at that point the 5m will be doing all the heavy lifting even if one was PT and just paying expenses from their base salary.
So someone working hard at that point may not want to invest another 50k post tax into a brokerage in such a scnerio possibly?. Heck im not even sure if the 401k/roth/hsa contributions would matter or make sense really at that point if you were paying all expenses through PT work.

Agree?

 

[Nocturnist]

All good info. Lets say someone is able to hit 5m liquid in the market after 15-17 years in practice so maybe for those who invested right after the 08 crash since we've had an amazing bull run.

If im not mistaken at that point the 5m will be doing all the heavy lifting even if one was PT and just paying expenses from their base salary.
So someone working hard at that point may not want to invest another 50k post tax into a brokerage in such a scnerio possibly?. Heck im not even sure if the 401k/roth/hsa contributions would matter or make sense really at that point if you were paying all expenses through PT work.

Agree?

Correct, this is known as Coast-FIRE and you don't have to wait until you've hit 5M to start coasting. Many people coast just for the continued benefits/health insurance coverage and mental stimulation.

Someone with 5M liquid assets in the market 15-17 years into practice could amass 20M 15 years later if just making enough to cover their expenses and not drawing from their porfolio (assuming 10% returns).

If your goal is 10M at age 65- you just need to have 925k invested by age 40, or just 550k by age 35.

If your goal is 5M in retirement, you'll just need to save 175k by age 30, 290k by age 35, or 460k by age 40. Then never save another penny again.

I've already stopped contributing to my 457 and brokerage account a couple years ago for this reason. I could technically stop contributing to my 403b, I feel bad giving up free money, but I'll probably stop contributing in the next 3-5 when my living expenses go down.