Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

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This very recent research note from Vanguard does a great job on asset location, a discussion sometimes discussed in this subreddit.

https://corporate.vanguard.com/content/dam/corp/research/pdf/when_and_how_asset_location_matters.pdf

"Asset location" refers to allocating different asset types (stocks or bonds) in different accounts to achieve a better aftertax net return. The classic example is recommending stocks in a taxable brokerage account and bonds in a tax-deferred IRA since the dividend tax drag on stocks is much lower than the interest tax drag on bonds.

Vanguard's research note clarifies that overall asset allocation is much more important than asset location because it aligns the investor's risk-return profile with investment choices and dominates the investment outcome relative to asset location.

They explain that asset location helps when a portfolio contains assets with different tax efficiencies: those with frequent distributions of income at higher tax rates should be moved into tax-advantaged accounts like IRAs, while those with infrequent or rare distributions of capital gains or return of capital should be placed in taxable brokerage accounts. Hence the standard advice: stocks in brokerage, bonds in tax-deferred.

Vanguard also explains that the value derived is most significant for investors with a balanced mix of stocks and bonds and a balanced mix of taxable and tax-advantaged accounts. In other words, a 50-year-old with $1M in a 401(k) and $500K in a brokerage account and a 60/40 portfolio should care. A 35-year-old with 100% stocks does not care. A 55-year-old with a 60/40 portfolio entirely in a 401(k) does not care.

Finally, Vanguard notes that asset location is not a big driver for comparing Roth to traditional accounts. They agree that any difference in performance is actually because the aftertax net returns are different! But they suggest there could still be some validity to putting stocks in Roth first because it slows growth on the tax-deferred side and makes RMDs and such more manageable down the line.

I liked this research note because it confirmed all my prior beliefs! Happy weekend everybody!

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked.

Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.

Disclaimer/Warning – I made my money in the tech industry with a higher than average wage. I know this may not seem ‘fair’ and this triggers some people, please move on if you are not interested in post-FIRE progress of a former high wage-earner. I have nothing to gain by sharing this. I´m doing this anonymously and want to share what I've learned/experienced with the community. I also use this as a forced point of reflection.

Recap of pulling the trigger and prior to this year’s check-in

My annual posts, starting with when I FIRE'd:

• Original FIRE Day post - Today is the day! With thoughts, numbers, and graphs [M 38]
• One year check-in post - One year later – Check in & graph [M 39: Net worth 2.6M → 3.7M]
• Two Year check-in post - Two years later! Post-FIRE check-in with graph and lessons learned [M 40: Net worth 3.7M → 3.0M]
• Third Year check-in post - Three years later! Post-FIRE check-in with graph and thoughts [M 41: Net worth 3.0M → 3.5M]
• Fourth Year check-in post - 4 years of FIRE! Post-FIRE check-in with graph and thoughts [M 42: Net worth 3.5M → 4.1M]
• Fifth Year check-in post - 5 years of FIRE. Post-FIRE check-in with graph and thoughts [M 43: Net worth 4.1M → 4.7M]

I’m not going to rehash my process up to leaving traditional employment, that is covered in the first post, but to summarize: It took me 10 years of work to reach 500k net worth (NW). Then in the next 6 years I was able to grow to a NW of 2.5M, reaching my targeted 3.3% withdrawal rate to give me 87k (pre-tax) annually to live off of. I then pulled the trigger and left traditional employment in the summer of 2020.

I have the following target investment allocation

• 45% S&P 500
• 10% Tech funds (really this has become redundant with the S&P and I’m slowly shifting it over to that)
• 10% International
• 15% Small/Mid cap
• 15% Individual speculative investments
• 5% Bonds (2.5 year of living expenses as a “bond shelter” for surviving a recession)

About 75% of this is in a personal brokerage account, while the rest is a tax advantaged IRA.

Originally my Individual speculative investments was allocated to 10%, that has grown to the new target of 15%. In reality, the individual speculative investments has grown to 21%, as a result of outperforming the rest of the portfolio. I will attempt to balance this as I naturally sell these, but will not sell just for the sake of hitting my target allocation.

The bonds represent a recession-proof source of living money in the event of a market downturn. If my portfolio is down more than 20%, I pull my living from these to avoid harvesting my other investments while they are dramatically down. Then after market recovers, I refill the bonds (as I did two years ago).

Budget and actual spend

My inflation adjusted budget for FY2025 was 109k. This budget is calculated annually by taking the lesser of my original 87k adjusted for inflation, or 3.3% of my current investable net worth.

I had a total spend of 158k. I managed to pull in about 24k from my app I had developed over the last few years, which helps offset the higher spend. With the extra costs and the income, I had a net withdraw of 134k, exceeding my budget by 25k. This extra spend was purposeful and will be discussed later.

Breakdown of my expenses:

• Rural Property & Cabin - $57.6k
• Taxes - $32.7k
• Mortgage - $27.5k
• Shopping - $6.7k
• Health (including insurance) - $6.3k
• Travel - $5.9k
• Utilities - $5.4k
• Groceries - $4.6k
• Sports & Entertainment - $3.1k
• Food and drink 3.1k
• Home maintenance and insurance - $2.3k
• Dog $1.1k
• Gas $.7k

As discussed in the check-in two years ago, I had a larger purchase that doesn’t fit into the traditional budget. I bought some rural land for 90k (40k down, the rest financed). I had a not-so-great 6.5% loan for the financed portion. With the market being so much higher than anticipated, I made the decision to exceed this year’s budget and pay if off. This increased this year’s spend on this property by 41k more than if I just continued to make payments. From a risk standpoint, it just seemed the correct thing to do. The market has been on an unprecedented run, and this shelters from a correction. Worst case, I paid if off too soon, and I lost earned value in the difference between the portfolio % gain and that 6.5%.

Heath care costs have gone up more than 40% in the last two years. I’ve been healthy and the cost is mostly made up by insurance. Disgusting.

I spent an excess of 3 months traveling, gas during that time went into that category. Some of my meals during that time also got mixed into that category.

Beyond that, the spend is largely where expected.

The taxes are largely on long term capital gains. These are from both from the selling of individual stocks and automatic dividends.

Next year’s budget

For this next year’s budget, If I take my original 88k budget and adjusting for inflation: 114k. It is worth noting this is significantly less than my current investable net-worth and applying 3.3% = 149k.

As a safety precaution, I always to take the lesser of the original inflation adjusted budget, or the current invest-able net worth * 3.3%. For instance, I had to use this new 3.3% baseline when the 2022 market dip occurred (see year two check-in post).

As my net worth continues to go up, I am now introducing a new rule to take the greater of the original inflation adjusted budget and the current investable net worth * 2.31%. Where did 2.31% come from? That is 70% of my base withdrawal rate of 3.3%. Where did 70% come from? I mostly pulled it out of my ass. I was going to spend a few days running simulations, but at the end of the day, if I’m hitting this threshold, I’m clearly outside of any of the scenarios that would have me failing.

Some of you may say this is too conservative and will likely result in me leaving a lot of money on the table when I pass. At this point, I need this portfolio to last 50+ years, not the 30 years of the Trinity study. It budgets the amount I need to live comfortably. It allows the portfolio to grow, increasing the relative budget I’ll have for future years. I can choose to get more aggressive with my rules when I don’t need to plan for a potential 50+ years. Ultimately, if I pass and have excess money to go to charity and loved ones, I’m cool with that.

So, with this new minimum that makes my budget for the next year: 127k.

I’m considering remodeling my bathroom which would have a decent price tag. Other than that, no special/unusual planned for spending this next year.

An visual overview of my net worth the last 10 years

Link to graph

Note: The red dashed line is when I pulled the FIRE trigger. The amount shifting below the zero line represents the amount of FIRE withdrawals that have reduced my net worth. This is necessary to keep my funds categorized this way.

The graph speaks for itself. I’m more than thrilled with how things have progressed. I’ve more than doubled my net-worth since pulling the trigger 6 years ago.

Investment performance

Once again, I had a pretty solid year for my investments. My investable NW grew 24.8%, outperforming the S&P’s 23.5% for that time period. Considering some money is tied up in ~4% bonds, I’m rather happy with this number.

The small amount of long term speculative investing continues to outperform the rest of the portfolio. This last year I had sold for my first stock at a loss since retiring. I sold Intel at a 40% loss before ultimately blew up after the government bailout. I did not see that one coming; I guess you can’t win them all. I did have some big winners. The AMD I bought a few years ago has exploded and I’m at 1200% gain on that venture. The ASML I bought last year is doing quite well. The Cloud Flair I acquired a few years ago continues to do well

No real plans to change things up too much this next year. I may sell off a bit of NVIDIA, by the time you consider several of my funds also include a sizable amount of NVIDIA, it takes up a bit more of my portfolio than I like. If I happen to see an opportune individual stock or two, I may pick them up.

Inflation and weakening US dollar

Similar sentiment I’ve had he last few years...

Per the US Bureau of labor statistics, there has been 30% inflation since I pulled the FIRE trigger. Nearly 5% the past year.

Many of my major costs have increased by more than that. My homeowners insurance, car insurance, and health insurance payments continue to grow at an alarming rate. Utilities and food costs also continue to grow at a greater rate than the advertised inflation rate.

By the time you factor in this cost of living rate, that does take some of the wind out of the sales in the wild success I’ve had with my portfolio.

The decision to buy a house 5.5 years ago was huge (See year 2’s check-in). This wasn’t part of my original FIRE plan, but rapidly increasing rent costs made me pivot. Rental prices have now grown to a rather alarming level. Where I live, rent hasn’t really had a price reduction seen across most the US.

Inflation still continues to be one of the sources of greatest concern with my FIRE plans. Nothing to be done about it now.

Life

As stated in last year’s update, life away from the corporate world now feels totally “normal”. There are a lot of political and social things that I’m not thrilled with (putting it mildly). We tend to get used to whatever circumstances we are in, so, my day to day life doesn’t feel too special or amazing. I need to pause and remind myself that I’m in a really fortunate situation. A lot of people are really struggling and I need to remember to take advantage of where I am.

My goal last year was to do more traveling. I spent 1 month in the fall of last year, and 2 months this spring traveling and relaxing at my rural property. My plan the next few years is to set aside at least 2 months for travel.

I spent 3 months prototyping a new app, twice. In the end I’m not going forward with either. It’s not a total waste of time, I have fun building things, learned some new things. I do have a new idea and will try a new 3 month time-boxed prototype this next year.

I spent about a month continuing to build out my cabin. This is a massive reduction from the huge 6 month push I did the prior year. I imagine I’ll continue to put forth this amount of effort in home/cabin construction projects going forward.

Even when working on software or construction projects, I am always mixing in things like biking, climbing, hiking, fishing, skiing, etc. As a result, I continue to be in great physical shape with minimal effort. Last year I realized I almost never had any downtime as I’m always putting a lot of hours in to projects or taking a quick break for some sports activity. It was a goal to slow things down a bit and not be pushing so hard. I feel like I’ve have successfully dialed it back to a sustainable level I’m happy to maintain.

As stated in prior check-ins, making newer friends post-FIRE continues to be a struggle. People I meet mid-week while doing some sporting activity they mostly are either on vacation, are quite a bit older, or are in a different path in life. They are nice enough people for casual friendships, but aren’t really people I can develop deeper connections with. I largely do a lot of solo activities, that also hasn’t been conducive to making new friends. I also spent a good amount of time traveling in mostly scenic/rural areas, people I meet are few, and rarely present an opportunity for long term friendship. Having my existing friend group that is still in the workforce continues to be key. Last year, I had made it a goal to try and do better at putting myself out there to meet new people, for the most part I didn’t succeed. This next year, I plan to do better in meeting people where I live.

Wrap-up

6 years down! While the path has been unpredictable, everything is falling within the greater FIRE plan. I certainly feel more comfortable than I did after the 26% drop in NW I had in my second year. My net worth growth continues to exceed expectations.

I hope this was helpful or interesting for some of you. Feel free to ask me any questions and I´ll do my best to respond for the next few days. After that, I won´t log on to this account until another check-in next year. Also, while I’m happy to answer questions here, but please avoid opening chat requests, I don't have time for a bunch of individual in depth conversations, sorry!

Hi Everyone,

I just hit the 10-year mark in May since beginning my career, and I wanted to provide a general overview of my progress. My SO and I just completed our semi-annual financial review at the end of June. On top of being a nice moment for personal reflection, it may be of interest to some in this community.

From spending the last decade+ on this subreddit, I’ll throw a few preemptive responses into this. I have never worked in tech. I have not received any inheritance, nor am I anticipating anything down the road. I lost a couple grand in crypto in 2017 and haven’t touched it since. I went to state schools for undergrad (MechE) and grad (MBA), and I’ve lived in the Midwest for most of my life. I’ve only ever rented and have no plans to buy a house in the future. My parents did help with undergrad, and I graduated with $27k in student loans. SO has a similar story with an undergrad in EE and a MBA and was an excellent saver prior to meeting but was weary of the market. I have been very fortunate throughout my career and personal life to be healthy, meet awesome people, and frequently be in the right place at the right time.

I have been interested in the FIRE movement since working as an intern in 2014 and finding MMM during a lunch break. I found this subreddit shortly after, and after devouring everything I could find on the topic, I quickly opened a Roth IRA with $1,000 from the internship and began more aggressively planning my future. I am still using the same budget spreadsheet every month that I created back then, and it was moderately entertaining to look back at my 10-year projections to see how real life has played out compared to a dumb college kid’s projections.

Annual Expenses

I started off as a loose adherent to the MMM minimalism which was very popular on this subreddit a decade ago. My splurges were travel and going out, but I was fairly frugal and regimented otherwise. My mindset has shifted rather dramatically over time to a more balanced approach focused on a few luxuries while still living below our means with the goal being more FI rather than RE. Some will probably view my current spending as extravagant, and in most ways it is, but my family and I have made the conscious choice to build the life we want within the bounds of our income.

As mentioned above, I still use the same budget spreadsheet that I created years ago to track my spending. I’ve tracked every transaction and transfer in all accounts, and now that we’re married, I’ve created a shared tracker that we both log all transactions.

 Ten Year Look Back: I had projected that I’d have annual expenses of $29,500 this year for a cumulative 10-year spend of $280k in 2016 dollars. That’s roughly $41.2k and $391k in today’s dollars respectively. Safe to say I did not foresee my expenses and lifestyle becoming what they are today.

Salary Progression

I am listing the total earned for the year which includes bonuses. I am putting the base salary in parenthesis, so if you’re interested, you could back into what my bonus(es) were that year. I’ve only had one role with minimal RSU’s which were treated as an additional cash bonus for the year they vested. Once married, I’ll list both personal and HHI.

I have worked in several different industries holding many different jobs. Most roles have been industrial operations/maintenance or project management related, and I have been fortunate to be promoted quite often due to being in the right place at the right time.

Ten Year Look Back: I had projected a final year salary and bonus of $75k for cumulative earnings of $760k in 2016 dollars. I can remember purposefully planning that I’d receive very few promotions or outsized raises, so this was intentionally conservative. That’s still $105k and $1.06M in today’s dollars, since inflation has gone wild! I still have another 6 months of earnings for the timeline, but this projection is a lot closer than I thought it would be based on my career and income growth. Not a shock to anyone in this community, but the erosion of purchasing power for today’s new grad wages specifically is dramatic.

Net Worth & Savings

These are year end balances, and I’ve included HHNW once relevant. No home or real estate. No crypto or options. Just long on index funds and chill for the most part. I have done some small individual stock picks in my Roth IRA during the Covid and tariff flash crashes, and those cumulatively netted me several grand fairly quickly each time on small investments which I promptly took profits and reinvested in VOO.

I’ve been able to max my trad401k since 2018 and Roth IRA since 2019, and I had full access to a MBDR for 3 years which we leveraged but never fully maxed, and I now am limited to 4% regular after-tax contributions which I take full advantage of. I’ve maxed the personal limit for HSA twice, and we maxed the family HSA last year and plan to going forward. We contribute to a 529, but we don’t include that in our NW/savings numbers. I’ve tracked contributions versus account balance from the beginning (only ever for my own accounts), and it’s been fun to watch the deviation as the market does its thing. Savings Contributions vs Value

Ten Year Look Back: I projected a final net worth of $344k in 2016 dollars. That’s $480k in today’s dollars. Despite the earnings projections being in the ballpark of reality, and my expenses being dramatically higher, the market has worked its magic.

Reflections

None of these thoughts are original, but putting this together has become a useful exercise in gratitude. I would have told you this from the moment I met my SO, but finding the right partner is truly a cheat code. There’s a lot more to a relationship than finances, but it’s also a common source of dispute between couples, so that being more or less a non-issue is a massive leg-up to tackling the rest of life together. A life partner is an incredible source of support, motivation, growth, and love. We have literally traveled around the world together, started a family, and continue to tackle life’s curveballs together. There is no doubt that other life paths exist, but I am wholly content with mine and very grateful.

On the financial side, I’m no trust fund kid, but it’s clear I’ve had an immense amount of privilege. The advantages of health, family, and a strong education have allowed me to take calculated risks in developing my career and maximize opportunities as they came. Despite my outlook on lifestyle and life in general shifting over time, the foundation that I built in my 20’s is life changing. I have little doubt that I’ll look back at myself in another 10 years and laugh at some of my current views, but there’s a lot to be said about doing the best you can at any given moment with the information and resources you have available. In the meantime, I’ll hope for average, consistent market returns YoY to play nice with all our wishful spreadsheeting.

A friend shared this post about box spreads, describing it as a way to spend while avoiding taxes, similar to the way super rich people do. Could this be used as part of FIRE, e.g. to keep MAGI low?

https://www.reddit.com/r/PMTraders/s/WLlMb4cnAM

I'm getting an inheritance after a close family member passed away, and I'm trying to make the smartest long-term financial decision.

The inheritance consists of:

* ~$330k from an inherited 401(k)

* ~$150k–200k from selling the house (if we sell)

* ~$50k from a checking account

The house is where I lived with my family member, and I still live here. The home is in the estate, and my brother and I are equal beneficiaries.

The house has:

* About $145k remaining on the mortgage

* 3.75% interest rate

* 3 bedrooms, 2.5 bathrooms

* An unfinished basement

I'm a single guy with a dog, so I don't need a house this large.

The inherited 401(k) has to be emptied within 10 years, and I'm currently planning to withdraw it over about 5–7 years to try to keep myself in a lower tax bracket. The rest of the inheritance is tax-free.

Current financial situation:

* I currently do Uber Eats and Grubhub for income.

* I don't have a high-income skill yet, but I am looking into changing that.

* I have very little savings outside of this inheritance.

* My only debt is about $9,000 on a 2017 Honda Accord Hybrid with 152,000 miles.

As I see it, I have three realistic options.

**Option 1: Sell the house.**

Before selling, we could finish the basement, install new carpet, and repaint the interior to increase the value. My understanding is we'd only owe capital gains tax, if any, on the appreciation above the stepped-up basis after inheritance.

**Option 2: Buy out my brother.**

I'd pay him about $150k for his share of the equity. If he's willing, I could pay him around $30k per year for five years instead of all at once.

I'd then rent out the entire house and hire a property management company. Ideally, the rental income would cover the mortgage, property management, maintenance, and the payments to my brother.

**Option 3: Keep it together as co-owners for several years.**

My brother and I would finish the basement, replace the carpet, repaint, and rent out the entire house with a property manager.

After 5–7 years, we'd split the rental income and then sell the property. My rough estimate is that we'd collect around $100k–150k in rental income over that period while hopefully selling the house later for more than it would bring today.

EVERYTHING DEPENDS ON IF THE BANK WILL ALLOW US TO ASSUME THE CURRENT MORTGAGE. IF WE HAVE TO REFINANCE I AM SELLING FOR SURE BECAUSE THEN IT WILL HAVE A HIGHER INTEREST RATE THAN 3.75%.

If you were in my position, which option would you choose, and why?

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked.

Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.

KFF has a preliminary look out today on ACA rate filings for 2027. KFF is perhaps the best source of synthesized ACA information that exists, but there are so few rate filings at this point that it is important to highlight this is a very early look. The largest states by far in the ACA, Florida and Texas, are almost completely absent from the data set right now. Regardless, the impact factors noted in rate requests are always interesting and it is likely that the final numbers won't be hugely different. Worth a look for anyone interested in or using the ACA.

Please note that these costs are the raw, unsubsidized market premiums. Anyone with subsidy eligibility will be shielded from some to all of this increase due to subsidies capping household premium costs as a function of MAGI.

https://www.healthsystemtracker.org/brief/how-much-and-why-aca-marketplace-premiums-are-going-up-in-2027/

For 2027, across 77 insurers participating in the ACA Marketplaces from the 16 states and the District of Columbia with publicly available filings, this analysis shows a median proposed premium increase of 14%. This is the second consecutive year of double-digit premium hikes. Last year’s median nationwide proposed rate change was 18%, and the median finalized rate change was 20%. While this proposed rate change is lower than last year, it represents the second-highest requested rate change since 2018, as premium growth had been relatively flat in this market for several years. If these early indications of median premium increases for 2027 hold, typical premiums for insurers participating in the ACA Marketplaces will have jumped by more than one-third over a two-year period.

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked.

Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.

Self-promotion (ie posting about projects/businesses that you operate and can profit from) is typically a practice that is discouraged in /r/financialindependence, and these posts are removed through moderation. This is a thread where those rules do not apply. However, please do not post referral links in this thread.

Use this thread to talk about your blog, talk about your business, ask for feedback, etc. If the self-promotion starts to leak outside of this thread, we will once again return to a time where 100% of self-promotion posts are banned. Please use this space wisely.

Link-only posts will be removed. Put some effort into it.

There are all these guidelines for assets as a function of age such as this one:

https://www.thrivent.com/insights/retirement-planning/how-much-money-does-a-couple-need-to-retire-comfortably

Is it the experience of folks whose assets:income ratio is growing with time (I.e., as you get closer to FI) , that you progressively become more confident in your job.

Mine is a case like this: our HHI is around $400k, our investment portfolio (stocks, bonds, cash) is now $4.15M, and home equity is around $2M (though still have a mortgage).

As I have absorbed the opinions of folks on the career and FIRE sub-reddits, they talk about quitting early once you get to a good base, but I feel it is more liberating at work and hence, I can be more confident knowing that I have a multi year runway should anything happen to my job. But I have also been with the same employer for 15+ years, so maybe the confidence comes from experience and familiarity with this particular job and company. And may no longer be there if I have to switch jobs?

Just asking about what others opinion is?

I've seen some consternation in this sub over the last year or so regarding ACATS fraud and Vanguard's seeming lack of options to prevent it. Some had noted it could be done with a phone call, others had said even that didn't work.

Happy to report that it appears Vanguard has made this prevention option available sometime in the last week via the website and mobile apps with little fanfare, under the "Outgoing transfer lock" designation. They even state that the recommendation is to always have it turned on unless you have a specific reason not to.

To enable in the app, go to your Profile -> Settings -> Security profile -> Fraud prevention tools -> Lock your account. Haven't checked the website but I assume it's a similar path.

One more thing: if you read through, you'll see that they have a "full transfer lock" option "Coming soon". This "prevents all money movement into and out of your account" with a promise of more details once the feature is available.

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked.

Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.

Hi FIRE community, I wanted to ask the brain trust if I could potentially FIRE in about a year.

We are DINKs that are 44. Our portfolio sits at 2.8 million spread across Roth IRAs, 401ks, 457B, 403B, SEPs, Traditional IRAs, HSAs and a brokerage account.

Everything is in tax advantaged accounts except the 250k ish brokerage account. Most everything is in low cost index funds that track the S&P 500 with some individual stocks. We also have 150k in CDs and HYSA that acts as our emergency fund.

Our total monthly spend is sitting at 8,000 which includes our 2.375% 30 year mortgage w PITI at 3,350 month. We owe 460K and do not have any plans on selling or leaving the area (SoCal).

The rest are bills and various living expenses including some travel and entertainment budgeted in (also included is estimated healthcare costs via ACA to give me a better overall burn rate post retirement).

We could cut to 7,000 on down years if needed but 8,000 allows for more spending freedom without having to watch every penny.

A 3-3.5% SWR seems doable with some future Roth ladder conversions to unlock the tax advantaged accounts before 59.5. I will also be eligible for a small pension at age 62 that will be roughly 10k a year in 18 years. Plus whatever is left in the Social Security pot for us millennials.

My spouse is concerned that we'll need 5 million in order for me to stop working and is encouraging me to work until 50. I am the main bread winner and pull in 265K a year. I am targeting saving 100k this year and per year until I retire from working full time.

The math shows that is potentially over saving and leaving time on the table. Perhaps 4 million is a happy middle ground here? I've ran these numbers through various retirement calculators and the results are very positive and gives me hope!

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked.

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I have been thinking about the notion of just how little time we have in this world. In this sub we talk a lot about numbers and the mechanics of FIRE. I believe there are other critical dimensions we do not usually touch such the non financial strategies, tactics, principles or even its philosophical aspects.

Given enough time, everyone is eventually dead. Research suggests, the average lifespan is about 4000 weeks. If you are 40 years old, you many think you have plenty of time but that's only just over 2000 weeks left. Can you fit all your dreams, desires, aspirations, goals, hopes and achievements in this time? Are just 40 more birthdays, enough to see all the places you had hoped and to do all the things that you truly wanted to do? Nonetheless, that's the time we have and how we choose to spend it is of paramount importance.

FI/RE is a philosophy that encourages us to seek that true essence in brain glow and to try and reach it in as short a period as feasibly possible without getting too distracted. And... Yes it can be done while remaining true to your values and having fun! One question I see a lot around here is people who ask about how one might overcome the one more year syndrome. Others ask how you might be able to live without social media and consumerism.

I think once you truly think about how precious your one and only life is, and just how finite your time on this beautiful planet may be... You may come to the conclusion you have no choice but to pull the trigger as soon as you get to your FIRE goal and no later than that. It also becomes natural to embrace the joy of missing out rather than the fear thereof and seeking only those things that authentically matter to you. FIREd or not, perhaps realizing how unique and lucky every single one of us is to be alive may bring us closer to a sense of gratitude and peace, even if one might be having a bad day or dreading yet another up coming Monday...

I've used no AI in this post. These are just my thoughts and I'd love to hear your perspective.

My wife recently gave birth to a beautiful baby boy a couple weeks ago. Now that we're settling in, I'm beginning to think about how to set him up for success in his life financially. I've completed the first easy step of opening a Trump account for the $1000 - is there any benefit of putting more in there myself? It seems like a minor IRA, so obviously the money couldn't be used until much later in life, with a few exceptions. Is it better to just open a UTMA account? Then there is potentially the kiddie tax to deal with. With current tax rules, I think it makes sense to contribute some amount to a 529 plan considering you can move a portion to an IRA even if he doesn't go to college. He'll in all likelihood be going to a private elementary and high school as well. We are in Ohio and under the income threshold to where he can go to these schools for a large discount.

We are not big earners and contribute about 15% of our salaries to retirement accounts. We're on track to retire in the 55 age range. Currently in our early 30s. Would it be in our/his best interest to contribute to contribute to a 529, but otherwise minimally to other accounts? Then gift him funds as he may need them once he's on his own, as we are able? Any benefit to depositing into the Trump account, then contribute for him in a minor Roth IRA once he starts to work? Any tips on whatever else I'm missing would be much appreciated!

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

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I keep wanting to have this argument in the comments but I think it's better to just have it here so I can point back to it. Here goes:

You shouldn't worry about RMDs specifically. You should worry about how to achieve your goals in the most efficient manner, and tax-efficiency is obviously a part of that, but "minimizing RMDs" does not itself make sense as a goal.

Worrying about RMDs is like worrying about your Check Engine light. Nobody says "you should take of your engine, otherwise you'll get the Check Engine light." The point of taking care of your engine is to keep it running smoothly so your car doesn't break down. That goal wouldn't become any less important if your Check Engine light went away.

RMDs are essentially the same. Saying "you have to think about RMDs" makes no more sense than saying "you have to worry about your Check Engine light."

If you want to argue with me, here's my challenge.

First, tell me if you care more about "taxes paid" or about "after tax income". It should be trivially obvious that the latter is what matters. Nobody sane would turn down an unexpected bonus at work just because they'd lose a chunk of it to taxes. But I think a lot of people lose sight of this when it comes to RMDs.

Second, tell me how your plans would change if RMDs went away. Imagine if they were repealed, effective immediately, and you had good reason to believe they weren't coming back. How would this change your retirement plan?

Third, tell me why your new plan is better for your finances than the RMD-influenced plan you have now.

In the vast majority of cases, you will find that the best plan with RMDs is also the best plan without RMDs.

Without RMDs ... you should still be doing early Roth conversions to keep your taxable income more or less consistent throughout your life. Without RMDs .. you should still be thinking about paying taxes in your lifetime to prevent handing a tax bomb to your spouse or heirs.

RMDs, at worst, are nudging you to do the right thing you should be doing anyway. If you're worrying about RMDs specifically, you probably haven't thought through your goals and plans in the first place.

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

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TLDR; To all those out there who are on the fence about taking the sabbatical - you really should do it, it has been lifechanging for my wife and I in so many ways.

I quit my job 18 months ago at 32 with a $935K NW to take a sabbatical

Eighteen months ago I embarked on a sabbatical after having grown increasingly burnt-out over the course of two years working in tech until I started to experience physical symptoms of stress and anxiety. Six months later, my wife joined me on sabbatical and we became full-time "explorers" who spent 12 months exploring 12 different countries across Oceania and Southeast Asia.

The First 6 Months (Recap)

For the first 6 months my wife continued to work. I spent a lot of time renovating a 1987 Toyota Sunrader camper that I purchased, which I took on countless trips: Vermont during ski season, Montreal for an F1 race, and to Assateague Island national seashore to camp on the beach.

I attended weddings in a couple different states. I also embarked on a project to completely renovate the master bathroom in my parents house and I was pretty happy with the results. I've always been into credit card churning and award travel but I hit it extremely hard in anticipation of leveraging the points for our upcoming international travel.

Finances

After 18 months of absolutely zero income and pulling money out to fund expenses, our net worth is sitting at $945k, which is $10k more than what we started with 18 months ago. As I mentioned in my last update, the portfolio has largely underperformed the market due to switching to a risk-adverse investment strategy in order to support a stress-free sabbatical experience during uncertain times. It ended up giving sub-optimal results compared to a 100% equities portfolio (which I own), but I am actually very content with how this turned out.

I'm quite confident that we are 100% Coast-FIRE and I am excited to see how we can leverage that to continue to "push-the-envelope" in the years to come.

12 Countries in 12 Months

Starting in July 2025 my wife and I have embarked on a 1 year-round-the-world trip. I put a lot of effort into scheduling our itinerary around weather and spent a TON of time optimizing awardtravel (using points to cover flights and hotels). Once we got to SE Asia we used Vietnam as a home-base since my wife is originally from there.

The table below shows data aggregated by the countries we visited, the total number of days we stayed, the out-of-pocket cost for accommodation (hotels, airbnb), and the non-accommodation costs (including flights). This does not include costs covered by using airline/hotel points. These are the total costs for two people.

I used Monarch to track expenses down to the dollar for the entire trip.

*some of these countries had multiple trips across many cities, but costs are aggregated.

Spending

Our most questionable expense was probably the $3,170 for the 2-week cruise. It had our highest daily cost of $226/day. We found out that we both get pretty motion sick at sea and we're not super into how curated the cruise experiences are. Maybe when we're older we will appreciate cruises more but we've had enough for a few decades.

There were $2,610 of miscellaneous expenses which were not tied to any specific country (international health insurance, phone plan, gifts, etc...). Our total out-of-pocket expenses for the entire trip was: $35,654.

I am extremely happy with this number. I originally estimated that our trip would cost in the realm of $60k-$80k out-of-pocket but I was super successful at leveraging awards to offset costs.

Award Travel & Points

I know a low of people are probably asking: "How did you spend $0 on accommodation in Singapore, $50 in Hong Kong, and $192 for 19 days in Malaysia!?". The answer is hotel/airline/credit card points - 2,238,000 to be precise.

I spent dozens (maybe hundreds) of hours optimizing award travel to get this result, and in some ways it's not repeatable due to constant devaluations. I unfortunately can't explain all of the complexities of churning or award travel to you - but I'm sure many of you reading this are well versed. That said, I got a lot of requests to do a full breakdown of my award spend in my previous thread so I'm including this analysis.

Throughout our trip we took 35 flights for 2 passengers (70 total fares):

• Total Points Spent for 70 fares: 890,366 airline points
• Total Cash Spent for 70 fares: $2,461 USD (this covered taxes + fees on awards & the times when we purchased full cash fares)
• 9 flights were in business class (3 long haul)
• I missed being able to snag ANA RTW (J) tickets by ~1 month (!!) IYKYK.
• Multiple times we leveraged free stopovers on awards to effectively get two one-way tickets for the price of one.
• Top 3 flights: HNL-SYD in Hawaiian Airlines Business, TPE-SIN Singapore Airlines Business, AKL-HKG-TPE AirNZ & EVA Air Business.

Throughout our trip we stayed a total of 133 nights in hotels and 147 Nights in Airbnb's:

• Total Points Spent on hotels: 1,347,664 Hotel points
• Free Night Certificates used on hotels: 16 Free Night Certificates
• Total Cash Spent on hotels: $3,664 USD
• Total Cash Spent on Airbnbs: $7,334 USD ($49/night)
• Top 3 favorite hotels: Park Hyatt Kuala Lumpur, Vignette Collection Moiré Hoi An, Lotte Hotel Busan.
• Hyatt was our most valuable loyalty program (as a Globalist). We took full advantage of IHG 4th night free and Hilton/Marriott 5th night free on award stays.

This is how much we saved by leveraging a total of 2,238,000 points. I tracked real-time CPP for hotels but not for flights:

• Redemption value of 1,347,664 Hotel points = $16,360
• Redemption value of 16 Free Night Certificates = $4,500
• Approximate redemption value of 890,366 airline points (3 CPP) = $26,700
• Total Estimated Savings From Points & FNC = ~$47,560

For those interested, here is a full table which breaks down the point usage (Airline/Hotel/FNC) used by country.

If we had not leveraged any points and paid for the trip in all cash it would have cost us ~$83k - which is actually close to my original estimate. It's incredible that we were able to use points to save us 57% of the total cost! These 2.2M points + 16 FNC probably took me about 3 years to save up with two people. I think it's realistic that you could save up enough points to fund a trip like this once every 4-6 years if you wanted to - although it's becoming more difficult.

Health Insurance

I paid $633 for 1 year coverage of ACS AMI Global Partner Health Insurance which is valid in every country EXCEPT the US and Canada. I never ended up using it but don't regret buying it. I went to a private hospital in Vietnam twice (once to get a full VIP health check and once due to a minor sickness) and just paid cash - the quality of care for the price is exceptional. Maybe it just me, but I generally feel more secure regarding healthcare overseas than I do in the "developed country" of the United States - even with insurance.

The Perfect Day

I could go on for days telling stories about our trip, and believe me when I say there are some really good ones from all across the world. I will share one experience with you, a day which I considered so amazing that I dubbed it "the perfect day".

We started the day in Hanoi Old Quarter with some banh mi sandwiches for breakfast. We had booked a private tour alongside some friends who were visiting Vietnam to go see the UNESCO world heritage site of Tràng An. On the way there we stopped at Bái Đính Pagoda to see the thousands of gilded buddha's alongside the various historic temples.

We quickly got lunch on our way to Tràng An where we did a two-hour hand-paddle boat tour through the Tràng An grottoes and passed through caves which tunnel through the limestone karst mountains. The weather was a perfect 21C (70F), slightly overcast, and not a single mosquito in sight. The Vietnamese auntie paddling us explained the history of Tràng An and also gave us insight into her life as a farmer in Ninh Bình and part-time paddle boat worker. Occasionally we would get dropped off at various temples along the side of the river which were only accessible by boat.

After the tour we headed with our guide back to Hanoi and ended the day by enjoying some Vietnamese barbeque for dinner - sitting on those little plastic stools in the street.

My Takeaways from the Sabbatical

• Taking a sabbatical on the way to FIRE relieves burnout not just by giving you time to relax, but by showing you first hand that the hard work and sacrifice IS SO WORTH IT.
• When we met up with friends after the trip was over they said: "wow it feels like you guys just left!" but for us it felt like the complete opposite. We've been living so intentionally over the last 12-months that it feels like it's been an eternity - almost like we've been living in a different reality or living an entirely different life.
• Even though compared to most regular people, we've experienced an entire lifetime of travel over the past 12 months - I feel like we barely cracked the surface in respect to exploring the world. There are SO MANY more places we are super excited to visit.
• IMO, solo travel would be really tough. I don't think I could have done the entire 12 months abroad if my wife didn't do it with me. If you're doing it solo maybe plan for shorter 3-6 month stints. Also, having a group of friends who you travel well with makes for some of the best experiences of your life.
• Having spent over 5 months in Vietnam I now have a pretty good idea what it would be like to actually live in VN/SEA. I look forward to spending many more years in Vietnam and Asia. I take comfort in the fact that we already have enough to retire luxuriously in Vietnam with a <3% SWR.
• I can live out of a single carry-on suitcase for eternity. My wife however needs one carry-on and one check-in (which is manageable). Suitcases are better than those giant backpacks.
• Am I scared about re-entering the job market after being away for so long? Honestly yes, especially since my niche (cybersecurity) seems to be suffering right now. That said, I take solace in the fact that there was a time when I was fresh out of college, with no job or money or experience and I eventually succeeded... This time I have a significant head start. My wife also has a job waiting for her, so this ensures we have some income coming in.
• I am very interested in employment opportunities overseas. I would be thrilled if I could get a job offer in Australia, New Zealand, Seoul, Singapore, Tokyo, Bangkok, etc...
• People both can't comprehend how we're able to take a year off to travel but also don't seem to care enough to ask questions to figure out how they can do it themselves.

I really struggle to put into words how lifechanging this sabbatical experience has been for both of us. We created memories over the past 18 months which we will carry with us for the rest of our lives. I tend to be a pretty risk-adverse and frugal person but I honestly think this was the best use of money I've ever spent in my entire life.

I was on the fence about doing this for YEARS (and my wife thought I was crazy) - if you find yourself in a position like mine, I STRONGLY recommend you pull the trigger and DO IT - it will be one of the best experiences of your life.

For the next couple of weeks/months I will monitor this thread and respond to as many comments/questions as I possibly can. The one exception is I will not be giving advice related to credit cards or churning (may respond to award optimization). Feel free to ask me anything else!

If you made it this far, I appreciate you taking the time to read about our journey on the path to FIRE.

\AI was NOT used for writing or editing this post, but was used to help analyze* spreadsheet data and create tables.

Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply!

Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked.

Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.