Lately, I have been pondering a lot about what FIRE (financial independence; retire early) really means to me. Not just, “hey I do not need to work anymore.” – My views have changed a bit since I originally announced my journey.
I am not financially independent…. yet! However, the subject seems to cross my mind more and more as the days go by.
I feel like I am in a tunnel and way far off in the distance I finally see the fainted bit of light. Why? Well, my plan is solidifying and a more definitive timeline is starting to form.
Why do I want FIRE?
I notice that going to work every day is not exciting. In fact, its feels like a chore. Really, its the exact opposite from exiting. I hate working for the man and meaningless work. Anyone enjoy filling out expense reports? Mandatory quarterly compliance training? NO THANKS!
Oh, and I absolutely loath wearing a tie everyday. I now refer to my tie as my ‘corporate noose’ and it feels like I am suffocated a bit more each day.
Now, I am not looking for work to provide satisfaction and meaning to my life, but its really draining when I do not give a damn about the work I am doing. Funny though, somehow I am on pace to be the top producer at my company this year.
Honestly, I am fed up with being forced to sit in pointless meetings where nothing is accomplished. Being confined to a cubical and having to sit all day is starting to take a toll on my body. Hell, I even read that sitting is the new (worse than) smoking… There is nothing worse than being forced to be somewhere from 9-5, especially when those are not even my best hours for productivity.
And don’t even get me started on some of my co-workers….
So not the 9-5, then what?
Spending 8+ hours a day on anything seems crazy. I rather divided those 8 hour days into 4 separate blocks of time.
I would love to spend 2 hours on my health and fitness (not just working out).
Another 2 hours would go towards volunteering and improving society or the local community.
I would also commit two hours to self-improvement (reading, learning, developing skills etc.).
Lastly, I would spend two hours devoted to developing and maintaining meaningful relationships with family and friends.
Early retirement does not mean sitting on the beach doing nothing all day. Though, there is nothing wrong with that. The beauty of FIRE? You can do what you want when you want.
Blinded by the Light?
As I mentioned earlier, I am started to see the light at the end of the tunnel. Cue Manfred Mann’s Earth Band’s – Blinded by the light. The light that is
approaching quickly approaching has me distracted and dreaming about the other side.
A life with an abundance of free time comes to mind. Financial independence would provide such a thing. No need for an alarm clock if I retire early…unless I wanted to wake up early to go fishing or run before the heat. A life where I have time to regularly make it to the grocery store and cook (one of my favorite past times).
Plenty of time to travel and explore. I was tempted to turn in my two week notice earlier this month so that I could start hiking the Appalachian Trail. Unfortunately, this was not feasible. One day soon…
Less overall stress and better health sounds wonderful. No more worrying about deadlines or meeting performance goals. More time to workout and take care of myself.
This also means more free time to spend with friends and loved ones. Not just more time but better quality time. Sometimes, I feel that work bogs me down and I am not ‘fully there’ when I am with my family or friends – this is because work has me stressed or distracted.
How are you going to retire early?
Once my newest property leases up in the next month or two, it will increase my passive income to a level that is much closer to my FIRE number. However, this will not be enough to hit financial independence.
Ideally, I would like to buy one more rental property that provides strong monthly cash flow. After that, I would like to pay off my my first property (starter home).
This could be accomplished with three years (or less) of aggressively paying down my mortgage. I plan to use this property as my FIRE ‘home base’. I am fairly tired of house hacking and living with roommates.
No complaints though – house hacking has done wonders during my journey to financial independence and sped up my time to FIRE.
Not having a mortgage will help keep my cost of living down and at a level that I am use to spending.
Lastly, I would like to increase my cash reserves and non-retirement investment account income. This will provide a great buffer when I retire early. As such, I will not have to withdraw from my stock portfolio and can let the balance grow over time. Thanks compound interest!
Well…. what is life without temptation? I am tempted to resign (retire early?) from my job next year after I collect my bonus check. Sure, this would be before paying off my home and I may or may not have achieved financial independence by then.
What I do know – the cash flow from my rental properties would (likely) be enough to support my life style and allow me to travel for 6-12 months without touching my savings/investments. Heck, my net worth might even go up during this hypothetical sabbatical depending on the stock market.
I also know that I would have adequate cash reserves during this FIRE test run to cover any potential major repairs. Absolute worst case, I could sell a few stocks in my taxable account if a doomsday scenario happened.
Would you be tempted to retire early or take a sabbatical at 27 (28 next year) knowing that you have a strong safety net to fall back on? Worst case, I can decompress for 6 months to a year. After all, I am truly burnt out after years of 80+ hour work weeks. After that, I could find another job and work for a few more years until I truly hit financial independence. Perhaps, I already
acheived earned financial independence but need more of a buffer for peace of mind?