As September was wrapping up I realized the anniversary of when I quit my last job had just slid by again. Since I don’t celebrate that day every year I had to check some notes to remind myself of exactly when that was. My last day as an employee was September 4, 2018, when I was 44 years old.
That realization inspired me to start journaling about our first 4 years of retirement and my brain quickly pitched out around 15 pages of thoughts about all kinds of stuff. That journaling exercise started with a one page ranty-blurt on what I most disliked about my last 2 jobs, which isn’t worth sharing. Then I covered 14 pages with what I most loved during life after financial independence. Once I got through all of that I started thinking about what I might want to share in this post, probably just a few personal musings without a list of achievements.
Before I dive in… I’m not trying to brag about my situation. I recognize the privileges I’m enjoying as best as I can. I know most people won’t have enough money saved to retire at any age. And lots of people with enough money to retire wouldn’t choose to quit working early or at all, for various reasons that are personal to them. I also know my willingness to live on a tight budget in order to make retirement possible wouldn’t appeal to everyone.
We are not certified financial professionals, nothing we share is professional advice. For more info read our Disclaimer.
And now I’ll jump ahead and answer the first few questions people ask the most these days. The questions are obvious so here are my answers…
No, I’m not bored in retirement.
No, I don‘t miss having a job.
Yes, I’m still glad I quit my last job in 2018.
Our first few years of early retirement have been pretty darn good. They’ve also been a wild ride full of changes. If I was going to pick a theme for each year I think it would go a little like this… Year one was full time travel. Year two was year one of the COVID pandemic. In year three we built our compound. Year four was the year we got back into travel (and the longest market downturn since we retired).
It’s True, the Market is Waaay Down
The S&P 500 is way down this year, and not just in a relatively quick bear market bounce like we saw in 2020. So far 2022 has been a consistently down year and that sucks for everyone, me and Alison included. The market was actually crazy high for the first three years of our retirement though, and that was good for our investments.
Of course things like market corrections, black swan events, bear markets, and recessions will have a big impact on our investments. But this scenario is exactly why we were cautious and financially conservative with our retirement planning process and our decision to quit. We waited until we had 33x our inflated annual expenses before setting a timeline for quitting our jobs. We also waited until we had a written plan, our own Personal Money Statement, to help us make thoughtful decisions about our spending and intentional choices about our drawdown plan. We aren’t reacting to the market out of fear, and we aren’t checking the market or our investments every day or every week.
It helps us stay calm to know our portfolio isn’t down as far as the market because we only hold index funds and 20% of our investments are in bonds and cash-like holdings. It also helps us to remember that we haven’t actually experienced any realized losses because we haven’t sold any funds at a loss. And it definitely helps us to know we still have about three years of living expenses in cash and cash-like holdings so we can wait while the market does its thing.
On a related note, our investments only include these same four ETF funds: SCHB, SCHF, BSV, and MUB. People keep asking us if we’ve changed our investments in reaction to this wacky year of market craziness, and the answer is no. We aren’t buying I-bonds or anything else that’s trendy. We have no intention of dropping any of our existing funds or adding any new funds at this time. And if we had any new income right now we’d be investing our new money into those same four ETFs while they’re still on sale.
When our friends tell us they’re feeling anxious about the market we basically say: Try to think of market downturns as something to expect and plan for. Market downturns are not something to react to from a place of fear. Try to avoid sudden investment decisions that don’t jive with your personal finance plan, and especially try to avoid unplanned selling in reaction to the downturn. Most importantly, if you don’t have a written plan to help you make decisions during this kind of scenario, this is the perfect time to slow down and make one. Also, talk with someone about money who isn’t trying to sell you anything so you don’t feel alone.
When Alison and I started our investing adventures back in 2005, I didn’t have a lot of confidence. But over time we both found our rhythm as investors and started feeling like CFO’s of our own lives. And now I think we’ve settled into being the sort of mellow, confident, optimistic, realistic investors we were hoping to become (*wink*). I don’t worry about money, I’m not afraid of investing, I’m not afraid of the stock market, and I’m not afraid of running out of money during what I hope is a very, very, very long retirement. I don’t fear market downturns, including this whopper of a downturn right now. Alison and I have spent 18+ years together so far and all of them were at least partially focused on building financial confidence.
My brain is securely in long term investor mode and low information mode when it comes to money (and politics) these days. I don’t focus on daily market ups and downs, or even monthly ups and downs. Even though the market is down this year and we spend money every year, our portfolio is still up from when we quit our jobs in 2018. The overall direction of the market is up, and the market will come back up again, hopefully sooner than many people think.
What I’m Most Afraid Of
When people ask why I chose to retire when I did I admit that fear was one of my main motivations. The night is dark and full of terrors (*wink*)! And I am afraid of dying. I’m confident I can survive in a zombie apocalypse, but my family medical history is full of physical and mental health issues that motivated me to quit working early so I can enjoy life now.
I’m afraid of getting Alzheimer’s like Grandma Dorothy who raised me and did her best to protect me. I was very lucky to be able to move in with her when I was 12 years old, to be loved and accepted by her, and to stay safe with her until I was 18. Grandma taught me that learning can be self-directed, having an active imagination is essential, saving money for retirement is critical, and travel is the ultimate goal. Grandma encouraged me to leave home as soon as I turned 18 and graduated from high school. She pushed me to set off on my own because that was just as important as moving in with her was before that. And it was terrifying to watch as Alzheimer’s took Grandma’s ability to read and think and speak, to manage her health and her money and her house, and eventually to walk and eat and drink, and survive. Grandma died of Alzheimer’s in 2012, and I was grateful to be with her when she passed. But that whole Alzheimer’s experience absolutely terrified me. Especially because I have the late-onset Alzheimer’s gene just like Grandma Dorothy.
I’m also afraid of getting cancer like my Aunt Mary. When I left Grandma’s house I moved to Aunt Mary’s city to practice adulthood there with lots of trial and error. I was lucky to have Aunt Mary as a safety net and to be able to live with her on and off again when I was in my 20’s. We loved planning big trips to Europe together but we weren’t able to follow through since she got very sick with cancer for the 3rd time immediately before our first big trip in 2014. Aunt Mary died in 2016 from pancreatic cancer, after two different types of breast cancer before that. It scared the daylights out of me to see her suffer a massive heart attack and three types of cancer while she was planning for retirement. Thankfully, I was able to help Aunt Mary with lots of things as I matured and her health declined, instead of just benefiting from her as I did with Grandma. Aunt Mary trusted me with tasks relating to her retirement, house, money, and health. And she gave me a really important-to-her task to work on after her death, managing a relatively small amount of money with a mission to make it grow and last as long as possible for her son. That task is much more complicated than I realized it would be, but I’m grateful to still be working on it for her today. And I’m selfishly grateful I don’t have the same BRCA gene mutations Aunt Mary had because I’m absolutely terrified of getting any kind of cancer.
Important Note: If any vampires are reading this, please come find me! I would love to be friends and request your assistance with immortality, as well as the ability to avoid health issues and heal from physical injuries!!!!
What I Don’t Appreciate About Work Culture
Another thing that made it easy for me to retire early was the work culture I experienced. I didn’t/don’t appreciate the “I live to work” culture. And I don’t appreciate bonus-obsessed competition or competing for raises and promotions. I don’t think a person’s success in life is based on their career path. And I don’t think the best job title, biggest bonus, or highest salary make someone a better person. Working hard and giving my time and energy to my jobs didn’t give me a sense of purpose or meaning, it just helped me save enough money to quit. Working hard also caused stress and anxiety and took my focus away from Alison and the people and things we love. I’m also not trying to judge people who think differently about their jobs.
What I Do Appreciate
I appreciate an “I work to live” culture. And I appreciate the way that type of mindset can allow people to focus on what they love and value. Each year I spend in retirement makes me even more grateful that I was able to switch my focus to what I love and value. I also appreciate that I’m much healthier now compared to when I was working, especially from an emotional perspective. I appreciate life after financial independence.
And even though I’m a huge introvert and some social situations freak me out, I really appreciate other people. Yesterday I was thinking about a conversation with one of our siblings when we told family members we were retiring. That sibling was concerned for our happiness when she said quitting our jobs and leaving our home in Seattle would mean losing all of our friends. She couldn’t see all of the benefits we were about to enjoy back then but I knew we’d keep some old friends and find new ones.
It has been amazing to meet so many new people literally all over the world since we left Seattle. Now that my brain isn’t absorbed with job-life it’s much easier to make new friends based on my genuine interest in them, not because we share the same employer. And I’m thrilled to reconnect with a random assortment of people I used to work with or share a home town with, whenever they pop back up again.
Having a Home Base Again
When we left Seattle it was thrilling to decide not to have a home to return to, and that worked perfectly for us for two years. And it felt good and also wise to choose to create a home base again, even though it felt super weird to move into our new house in January of 2021 and start buying regular home-related things again. All of a sudden we were trying to figure out what kind of hangers to buy, what kind of sheets to buy, whether our mattresses were comfortable enough, whether our pillows were the right thickness, and whether we had enough towels. Consumerism isn’t something I enjoy, but I’m very glad we have our own home again!
Buying a new home was an emotional decision. We remembered the advice we got from Vicki Robin back at our Ecuador Chautauqua in 2019, to focus on building community and being present for people who were counting on us instead of just being money rats. We’ll always be grateful to Vicki for those conversations. Now we have a home we can spend as much time as we like in, a forever home for our housemate, and a room for Alison’s mom to stay in as much as she likes. And we have new responsibilities that come with blending our lives in a healthy way with family. Alison and I have a third person at home we can count on, and our housemate has two people he can count on. Alison and I get to grow food in our backyard garden to share, we all get to watch our housemate’s puppy run around like a nut in her front yard, and we all get to enjoy family dinners together on Sundays when we’re at home. It’s pretty cool to have turned the old “We should build a compound together!” dream into a reality.
From a financial perspective, buying our house and building an apartment for our housemate allowed us to move a big chunk of our money back into real estate and diversify. We obviously didn’t know the stock market would drop this year, but our decision to take some of our old condo cash and move it into another strong real estate market feels like a great decision now.
From a spending perspective, we’re glad building the new apartment for our housemate is finished along with our major spending for the compound. And we’re glad we can share the costs of monthly utilities with our housemate. Now that the market has dropped it’s important to me and Alison that we avoid spending money to improve our own house. We won’t use our cash or our investments to repair our fixer upper while the market is down. We’ll make sure to prioritize food, gas, and other regular living expenses over a pretty kitchen and more comforts.
And from a goofy perspective, having a home of our own also brings out some wacky behaviors in me. That includes much stronger germaphobia-type-creeps, which is why a year went by after we cleaned and lined the old cabinets before I was willing to put our flatware in a kitchen drawer. And there are behaviors that just feel silly and not stressful, like making sure my clothes only live on white hangers in my closet and Alison’s clothes only live on black hangers in her closet, and “never the twain shall meet!”
I’m glad we had a chance to travel to Europe again this year since some good friends hooked us up with a pet sitting gig in Lisbon. We loved the chance to do some travel hacking again by staying in Lisbon for a month for free while we took care of 2 little doggies, and it was fun to fly almost for free to Europe and back again using points.
I seriously love international travel. But I don’t need to visit every country in the world and I’m not accumulating a list of countries visited like I’m in a travel contest. I’m also not looking for a country to live in full time. I love exploring in different locations, learning about other cultures, and being respectful guests in other people’s countries. Travel makes it easier for me to be flexible in situations I can’t control and I waste less energy on things that don’t matter. Like the quality of the towels in the bathroom, the color of the hangers in the closet, and the condition of the kitchen cupboards.
Travel reminds me to be open minded, curious, and humble so I can focus on things that do matter. Like respecting other people and their cultural norms, no matter who they are or where they’re from. It’s fun to be able to leave one place in a big aluminum tube that can float, travel backwards or forwards in time, and arrive like magic in another place far away. I love when people around me don’t look like me or dress like me, and speak in a different language from mine. And I love when we can’t understand the conversations around us.
I’m curious about other people and I love how different and also similar we all are, so I love meeting people everywhere we go. These are some of the questions I like to ask local people we meet in different places…
- What do you love about your home town and country?
- What’s one of the big problems in this place?
- Do you like to travel?
- Do you plan to move to another place some day?
And these are some of the questions I like to ask other travelers we meet…
- Where are you from originally?
- What do you love about this place we’re in right now?
- Have you learned about any big problems in this place?
- Where are you traveling to next?
International travel has also taught me how to be a better person in our home town (and everywhere else). I always remember that in Paris it’s important to respectfully greet a shopkeeper or server immediately after stepping foot in their shop or restaurant. And that’s how I behave now whenever I enter a store or office, walk up to a cash register, or anything like that. It doesn’t matter if I’m in a hurry or if they are distracted while helping me, and I don’t need to be treated like I’m special or like they’re there to serve me. Actually it’s the other way around, I’m a guest in their workplace and I need to be courteous and respectful of them.
Visiting other countries has also taught me a new level of appreciation for traveling in our home country. I’m so glad we found our Bessie Basecamp trailer on January 5 this year. If we had come up with that idea after the market downturn started we would have decided to save that money, which was only in cash because we were planning to fix up our house a bit. I’m glad we repurpose our house money for a trailer so we could travel around the USA independently. That was a really good decision for us and I can hardly wait for the next camping trip this winter. I love tiny living in our little tin can! Who needs decent cupboards and drawers in the kitchen when there are National Parks out there to visit!?
Appreciating Our Blog
Last year Alison and I quadrupled the amount of time we were spending on our blog and on personal finance coaching for anyone who reached out to us. The number of people we helped by listening, sharing ideas, and crunching numbers with our own spreadsheet tools surpassed 50, and we were happy to spend so much of our time focused on more than just ourselves. We were also honored (and awkwardly embarrassed) to receive our first blogging award in 2021 and our 2nd award in 2022. Earlier this year we realized we had gotten into a habit of spending as much as six hours a day on video chats talking money, plus time spent replying to emails and updating spreadsheets, and that was too much. So we decided it was time to set new social boundaries and time limits for our personal finance related projects.
I still enjoy writing about money for our blog and I really enjoy sharing information and ideas with other people. It always feels good to hear from someone directly when we’ve helped them think differently about their own personal finances, or gain a new level of confidence in their own ability to manage their money. And our blog has had tons of benefits for us that we didn’t fully expect – we’re grateful for the people we’ve met through our blog.
This year Alison and I have been refocusing on ourselves a bit more and remembering something really important – that “All Options Considered” was and still is our personal family motto. We didn’t come up with AOC for blogging. We came up with AOC back in 2007, to remind us to take our ideas seriously, consider all of our options in life, and that we’re capable of changing direction when that’s what’s best for us. AOC is really just us!
What I Like to Spend Time On
Lately when I think about the blog I’m reminded that I’ve always enjoyed writing. What that really means is that I’ve always enjoyed writing my own stories, ever since I was a kid hanging out in the library where my Grandma worked. I want to focus on my own stories again and make that kind of personal writing a priority. I have a book idea I started toying with when we were in France for almost 2 months in 2019, which has nothing to do with money. And there’s another book idea that Alison and I came up with together this year that we’d like to write together, which also has nothing to do with money. I want to make both of those personal writing projects a reality, sooner rather than later.
As we spend more time in our own home without jobs to distract us I’ve realized that I love tinkering, dabbling, trying new things, and constantly changing what I’m doing. I don’t need to become an expert in or at retirement, I’m not trying to win anything, I haven’t mastered 12 languages, I haven’t visited 55 countries, our blog doesn’t have huge numbers of followers, and I’m still not interested in starting a new business just to earn more money.
I might wake up naturally at 5am, or 6am, or 7am. I enjoy drawing one day, cross stitching the next day, spending a day outside, spending a day in the kitchen, or spending a day learning about a place I’ve never visited before. I think it’s fun to practice some Japanese one day, some Spanish the next day, and some French the day after that. I flourish in total solitude one day, and I’ll awkwardly reach out to random people I’ve known well or met by chance the next day. And I love spending an entire day reading, writing, and dreaming.
My first two years of retirement were happily focused on international travel with no home base to return to. And the next two years were mostly focused on building stability for me and Alison and our family, because we want other people to be able to depend on us too. It might seem like Covid spoiled our thrilling nomad life, but I’m glad we were pushed to settle back down again because of the Covid pandemic.
In our first year of retirement we got to know a bunch of other travelers and retired couples, and I was surprised that so many of them asked something like this: “How do you handle spending all of your time with your spouse? Isn’t it hard to be with your spouse 24/7?”
Every time I got that question I thought it was odd, and I totally blew those types of questions off. I was living in a pretty intense state of bliss at the time so I didn’t even understand the question. After all, we retired for the purpose of enjoying our happy marriage and my primary goal was spending time with Alison.
Having said all that, something changed in 2021. Building the compound meant that Alison and I needed to learn how to negotiate with each other at a new level. And I was feeling some culture shock from settling back down again after nomad life. When things got complicated with slow construction and increased costs due to inflation, our stress levels were high. And focusing so much of our time and energy on other people through the blog and financial coaching was also causing a bit of stress, plus I was absorbing extra fear and anxiety from others because I’m a sponge for emotions. I took out some of my stress on Alison, even though she was already dealing with all of the same pressures herself.
On the bright side, we picked up a new trick that helps with our communication styles by having Alison say, “I’m done talking” as a clear signal that she is actually done talking. That really helps when we’re having an important conversation. Alison has a more thoughtful analytical style so she takes her time to think about what she wants to say before she speaks, and there are long gaps between ideas sometimes. I have a more blunt driver communication style so I often blurt before she’s done talking and then start thinking about whether I even meant what I just said. When I interrupt and Alison doesn’t have time to say what she wants to say that obviously makes it tough for us to communicate effectively. Especially if we’re both feeling emotional or intense about whatever the topic is.
When we’re stressed it helps to give ourselves space, take a neighborhood walk alone, go into town to run errands alone, or take over a room or outdoor space on the compound all to ourselves. We both need time to be introverts, to tinker on our own, and read and write on our own. And as a bonus I’ve learned how incredibly satisfying it can be to spend weirdly long periods of time alone in the kitchen, slowly chopping vegetables, literally for hours (*wink*).
Figuring all of that out helped me understand at least a tiny bit of what other people meant when they asked if it was hard to be with my spouse 24/7. And if someone asked me the same question today I wouldn’t be so cavalier and blow them off. My life isn’t perfect and I’m certainly not perfect either. There is no such thing as a perfect person, relationship, place, or situation.
And most importantly, after more than 18 years together and more than four years really together without jobs to distract us, I still want to spend my time with Alison. She’s my partner, side kick, and travel buddy. And I’m still not interested in taking trips without her unless we need to split up so we can handle all of our complicated commitments.
What Does the Future Hold?
I’m excited about 2023, which will be year 5 of retirement for us. Most immediately, the future holds our next nerdy annual planning summit to talk money and all the things for next year. It’s time for us to start talking about next year, including our budget, planned spending, cash for unplanned spending, Roth conversions, health care premiums, withdrawal strategy, and a million other things.
We’ve already decided we won’t be spending extra money to make our house pretty next year. And we’ve already declared we’ll keep a bigger percentage of our time and energy focused on our selves, our relationship, our physical and mental health, and our family and friends as well. And I want to keep a big percentage of my focus on experiences, movement, and change because being in motion gets my brain buzzing.
We want to spend plenty of time at home on the compound next year, enjoying our personal home and time with our housemate. I’m looking forward to cooking our favorites for Sunday family dinners, and I’m excited about cooking more adventurous new recipes inspired by our travels as well.
I’m optimistic about an upwards direction and recovery for the stock market next year. And I’m excited about some ideas we’re considering to help cut regular living expenses and preserve cash. One idea we’ll dig into during our next AOC summit is renting out our house for some strategic periods as a way to earn a little bit of income. That would also help with our other big goal – spending more time on camping adventures in our little trailer. That includes more National Parks so I can fill more pages in my nerdy National Park Passport with stamps.
We’ve also been invited to three weddings next year, two family weddings in the USA and a friend’s wedding in Australia. I’ll be looking into some travel hacking ideas, including pet sitting and credit card points so Alison and I can make it to that 3rd wedding next year.
And another idea, since I know Alison’s mom reads all of our posts… I’d love to plan a make-up trip to Ireland and Scotland, or anywhere you want if you’re interested Mib! Just know there’s a first class seat on a plane to anywhere if you want it!
I recognize that every moment is unique and no moment can ever be repeated. And I feel completely safe and at home wherever I am, as long as Alison is with me. I hope next year includes fluidity, mobility, and adaptability. And I hope next year includes seeing the same faces I love that also love me, and the chance to get to know new faces as well. That’s what will make our 5th year of retirement a success!
Love how honest and thoughtful your posts are. Can’t wait to hear what happens at your Summit and your plans for 2023! Take care!
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Thanks Kelly! The past 4 years have been a roller coaster for sure. But I feel really good about our choices and we have a lot to be thankful for. I hope 2023 is a good year for all of us!
Great read! Really enjoy the detail in all you write. My wife and I retired about 5 years ago for the first time and alot of this really resonates with us also. Take care.
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Thanks Fred. Sounds like we have some things in common. It seems funny to think of this now but retirement is easy, life is complicated and full of surprises! Hope you and your wife are doing well and that 2023 is a good year for you two!
What a lovely summary of this stage in your life!
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Thanks Beth! I think this story was much more interesting and fun to write than the long 14 page love story I put in my journal!
Happy fourth year of retirement! Thanks for sharing such in-depth reflections.
I didn’t realize how much consulting (for lack of a better word at the moment) you had done this last year, that’s wonderful but I’m also glad you’re proactively choosing to set new boundaries. It’s always a work in progress for PiC and I to recognize when we’re overcommitting ourselves, no matter how important the thing is, and find balance.
I lost my mom to early onset dementia and strongly empathize with your fears about Alzheimer’s!
Thinking of that spouse/time question, I usually hear it in a negative sense but also realize people may not have the ability to balance the amount of time they want to spend with their spouse / partner with the amount of time they want for themselves so easily. We sure can’t!
As a huge introvert, I expected to be thoroughly sick of everyone during the pandemic as we stayed pretty locked down for two+ years and am very grateful that it never applied to PiC. We needed our space from time to time of course, who doesn’t?, but I’m hugely grateful that enforced time together didn’t reveal hidden or ignored cracks in our relationship foundation as it did for a lot of other folks.
Here’s to a great fifth year and beyond! Happiness, health, and prosperity, as we’d wish you at the Lunar New Year, but is always applicable.
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We were actually excited to see our time on coaching escalate but then it went from a couple times a week to feeling like a full time job in a flash. It was a surprise to realize we had overcommitted ourselves but it was easier than we thought it would be to dial those projects back again. So far anyway!
We definitely heard from lots of couples that covid caused some breakups. But we’ve also heard covid brought lots of couples closer together with speed dating and uhauls LOL! Personally we found our first real challenges in communication and negotiation, relating to pretty much everything we need to spend money on for the compound. That means we need to keep doing our best to listen and not take things personally so we can accomplish our goals together. Easy right? 🙃
Hopefully you have a good balance for your time on all of your projects these days. And we really hope whatever you’re planning for 2023. Happiness, health, and prosperity!!!
Wonderful! I found this to be a really interesting reflection on your post-retirement life — not least because I followed your footsteps just a little later (retiring in October, 2019 at 46!). It was particularly helpful to see your thoughts on couple communication in retirement. We also went from spending evenings and weekends together to 24/7 and it’s been a work-in-progress to evolve our communication style to fit our new situation.
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I love that our retirement paths have some similarities!! The topic of couples communication in retirement is so much more interesting than I had initially thought. My old boss used to say he couldn’t retire because he and his wife couldn’t stand to be around each other, and when people first brought this question (Isn’t it hard to be with your spouse 24/7?) to us I thought they were talking about those types of relationships. I just didn’t get how the question was relevant to us. When we were still working we didn’t have communication challenges at home, only at work and with other family so we helped each other with those types of things. And when we were nomads we still didn’t have communication challenges while we were bopping around from country to country, which is probably amazing. Now that we have the compound and all of the increased responsibilities that go with it, that seems to have been the missing ingredient for our communication challenges. So now I finally get the question. And we are very focused on flexing our different communication styles, not taking things personally, really listening and compromising, all to fit our new situation. This is a great topic to keep focused on these days!
So much of your post resonated with me! I too am very concerned about Alzheimers and cancer. And while I’m not a vampire, I believe you’ll achieve immortality through your writing! Your words live on forever. So, write that book! I have some book ideas too and perhaps we can be each other’s cheerleaders!
Agree so much about needing to introvert and have individual time vs together time with spouse. We literally have different offices, and while I used to feel guilty about this, I’ve realized I need my own time for my personal growth.
Congrats on 4 years of retirement! Loved this post!
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Thanks Dragon! It definitely helps to have our different spaces for introvert time. I often think of our fixer-upper house as the source of our stress but it’s also the solution since our house provides us with different spaces to retreat to for our own wellbeing. So definitely do not feel guilty about your two different offices, you deserve that personal space for yourselves!
And yes – we should definitely be each other’s book writing cheerleaders!
Thanks for sharing and transparency.
I’m not knowledgeable about muni investing. Could you share more of your thoughts about choosing MUB? What are its advantages that you didn’t wish having fixed income allocation in BSV only? Have you looked at how your international fund has performed? I’ve had a Vanguard FTSE fund ex-US for many years and sadly its cost basis is the same as the market price today after monthly DCA’ing for many years. Sad indeed! I sometimes wonder why I follow textbook guidelines anymore. I decided not to add new money anymore and reinvest dividends only for foreseeable future and perhaps hope for brighter days, IDK. I am steering its portion of money to the total stock market index fund now since it’s much cheaper today and it has served me MUCH better over the years.
This bear has been having fun swinging since the beginning of the year. I hope it stops and goes back into hibernation sooner than later. I’ve read that the longest it took to stop the bear in the past was 2 years, so hopefully it will shakeout within the year or so. Do you still calculate how many times of your *fat* spending you have on the yearly basis or once you retired you don’t pay attention to that metric anymore? Thanks to a great tailwind over the last 4 years you’re probably at the same 33x today and this must be very comforting. I forget to pay attention to this metric since the 4% SWR was pretty much shut down. I fall more in the 3-3.25% SWR camp and not including SS (and will not get pensions).
Enjoy your freedom!
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Thanks for the message Sady. I’ll give you a bit of our thinking on bonds, though of course this is not advice…
BSV is a taxable bond fund and a good index of US Fed government, corporate, and international bonds that happens to come from Vanguard. We wanted more diversity in our bond holdings with municipal tax free bonds so we also hold MUB. MUB is a tax-advantaged fund with a higher yield compared to BSV, and MUB’s municipal holdings are a good mix of bonds from cities in lots of different locations, from Sacramento to Denver to Minneapolis. So these two bond funds behave very differently and give us the diversity we want, just like our two different equity holdings (SCHB and SCHF). Our two different bond funds work together to create the diverse fixed-income investments we need on the “safety side” of our portfolio. I hope that answers your question, but feel free to follow up if you want to chat more. Just remember that Muni bonds like all investment options have their pros and cons and they are stronger during specific market cycles and not so strong during other market cycles, so make sure you do your research and choose the investments that are right for you! Check out this article on muni bonds for more info: https://www.fool.com/investing/how-to-invest/bonds/municipal-bonds/
This bear market is a tough one for sure, and I’m really hoping we see it back in hibernation next year so the market can get back to it’s normal upwards direction. On a related note, we’re glad CD rates are coming back up again now so we have those as savings options again since the Federal Reserve hiked rates up in September.
As for the 4% rule, I think it’s good that the current market has shown some of the cracks in the 4% withdrawal concept because it isn’t and was never fool proof. Now more people are aware that 4% is not safe or perfect for everyone, and that’s a reality check that was needed since so many people have hyped 4% as a rule anyone can follow generically. It’s good to have the 4% rule as a baseline concept to build upon, knowing it’s just an equation that people have to modify based on actual circumstances in order to get realistic and specific SWR numbers. It’s super important that people use a really comprehensive and accurately inflated budget number for all of those calculations with the ability to accommodate things like high inflation, high health care costs, changing tax rates, and unexpected spending.
And yes we do still calculate our SWR and savings for “fat spending” as you put it, we look at those types of numbers as part of our bigger annual money meeting to help us get grounded at our baseline. It helps us to see that those numbers have gone up from the 3.3% and 33x when we retired. Those types of details are the counter balance we need after increased spending over the last 2 years and the market downturn this year. We are actually financially healthier now after all of that, and that is very comforting to know.
Thanks again for your comment with so many fun money details to talk about!
I enjoyed this very much because it is holistic – in real life, our time is rarely divided into segments because relationships, finances, personal plans, chores and so on, all overlap. We might think about them as “categories,” but we can’t usually behave that way because our attention is divided. Or happily merged! Thanks for including the story of the silverware drawer…we don’t live Instagrammable lives all the time 😊
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[…] Life After FI – 4 Years in Retirement, Ali: “I don’t worry about money, I’m not afraid of investing, I’m not afraid of the stock market, and I’m not afraid of running out of money during what I hope is a very, very, very long retirement. I don’t fear market downturns, including this whopper of a downturn right now.” I continue to enjoy peeking into the lives of others who have managed to retire early and seeing how their money works. I also like using snippets as a litmus test for myself. I have 3/5 of the above: I don’t fear investing, the stock market or downturns (generally). We haven’t yet achieved lack of worry about money or running out of money, and that’s not a surprise. […]
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Loved the detailed writeup of your four years in retirement. Looking forward to reading both your books whenever they are published. Good luck with your book writing projects and everything else you have planned for going forward!
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Thanks Pam. Alison and I have learned a lot in the past 4 years and we’ve certainly met a lot of really interesting people. It will be interesting to see what happens next with all of the projects we want to spend time on!
[…] from All Options Considered celebrates 4 years of being FI– […]
[…] Ali & Alison of All Options Considered (the other AOC) celebrate the same milestone. Why the bear market doesn’t phase them, the many things that do scare them, and what looks like now in Life After FI – 4 Years in Retirement. […]