The upcoming series of posts were inspired by our blogger friends Our Next Life who themselves were inspired by another blogger, Steve, at Think Save Retire and they will provide some insight into our early retirement plans. I think about leaving the workforce pretty much nonstop to the point where I can barely tolerate my current job at times. It’s probably not even healthy and I should enjoy the ride a bit more in the meantime since we’ve still got a little ways to go. I’m working on it.
This post will set the stage leading up to our impending retirements and the next post will discuss how we envision spending our next life after ditching the daily grind for good. The third post will give a broad overview of how we plan to pay the bills once our steady paychecks are no more.
Before going further, I want to clarify our definition of early retirement. For us, this will be a phase of roughly 15 years before full retirement where we no longer work 40+ hours per week or have our lives dictated by our jobs. During this period, we will not be 100% financially independent, although we’ll have enough stashed away to live comfortably for many years without any income. Instead, we will continue to work on a very part time basis earning only a fraction of our current salaries while gaining the time and freedom to do as we please.
Let’s start from the beginning. I’ve always liked the idea of retiring at a relatively young age. Early in our marriage, we both planned on making the military a career, sticking it out for 20 years and then living off our pensions beginning in our low to mid-40s. This was still the plan until early last year. For various reasons I decided to leave active duty, joined the reserves, and was hired into a corporate job. Very quickly I realized it wasn’t for me and started scheming ways to get out while still providing for the family. Shortly thereafter, we started this blog and through the writing process, our goals have really begun to come into focus. The more we look at what we currently have, our potential part time and investment income, and the lifestyle we want to live, the more we realize we are closer to our early retirement than we ever could’ve imagined.
Here’s a look at how our FIRE plans have evolved over the last two years (as told from my point of view):
- Pre-January 2014 – both of us stay on active duty for 20 years and retire when eligible in 2026 and 2028
- Summer 2014 – Mrs. DTG will stay on active duty for 20 years while I work a corporate job full time and reserves part time, both retire in 2028 (ages 46 and 42)
- Spring 2015 – I can’t deal with this corporate BS, hopefully I can make it six more years; Mrs. DTG can stick it out on active duty while I hang out in the reserves
- Summer 2015 – okay, I think I can make it another two years in cubicle hell; after that, I’ll hold down the fort while my sugar momma brings home the bacon*
- October 2015 – fuck it, I really don’t think either of us need to work full time for much longer; we can both be reservists and/or pull in some more cash with an occasional side gig and do whatever the hell we want the rest of the time
So that’s where we currently stand. You can see our plans have really accelerated recently. If I hadn’t already run the numbers and known I’d be giving up roughly $125K in employer 401(k) contributions by quitting before September 2016, I might be tempted to leave the corporate world today. Alas, I don’t want to throw away that much free money so I’ll tough it out for a bit longer. Plus, Mrs. DTG still has a 4.5 year service commitment after she graduates next year. I can’t just leave her out to dry.
At that point (early 2021), she’d be nearly 13 years in. Would it be foolish to leave the military only seven years away from a lifetime, inflation-adjusted pension worth roughly $45K/yr in today’s money? Maybe, maybe not. She could choose to finish out her time in the national guard or reserves, as I’m currently doing, and receive a pension for 20 good years of service beginning at age 60. In our case, it would probably be the difference between living comfortably while working part time and not having to think about money again for the rest of our lives. Right now, we are staying flexible and keeping all options open.
Personally, I’m hoping we can both quit working full time as soon as possible. I’m pretty much set on March 2017 and if everything works out right, she won’t be far behind.
*For some reason, she did not like this line