Slightly Early Retirement

It isn’t just a great barenaked ladies song or a preposterously small blackmail demand for not destroying the world, it is also a Blogger Challenge from Slow Dad on the Rockstar Forum. Write a post about what you’d do if you won a cool million in US dollars. Ok, I can do that. Game on….

What would you do if one million dollars just fell into your lap, no strings attached? That is a common question asked to stimulate people’s imagination. It is a gut check on your inner FIRE self-control muscle. Really, what would you do? If you know me then you know I’m a hugely annoying “know it all”, or at least a know it all wannabee. And this is a perfect opportunity for me to shine in this role because while you have to guess at the answer I know the answer. That’s right, I KNOW!

Three years ago I received an unearned, undeserved windfall of one million dollars. It wasn’t by writing a hit song or selling my blog (let me get off the floor because I fell out of my chair laughing trying to type that!) It was just free money inherited from a relative’s estate. It was two million dollars in cash and stock investments divided equally between my brother and me.

Of course there was grief over losing a loved one and also relief that years of suffering had ended for them. But once those emotions receded and the legal processes were complete then with a few taps on a keyboard and a few signatures my net worth went up by seven figures instantly. So while you may think you know what you would do with a million dollar gift you are just guessing, I know what I did because it is a part of my past.

At the time I received the money it was in two investment accounts with fairly high fee managers, plus balances in a couple of bank accounts, proceeds from a small life insurance policy and 500 shares of Walmart stock. Curiously the Walmart stock was in the real paper certificates (my dad was old school!) My wife and I initially decided to do nothing with the investment accounts, I told both managers that because they had dealt fairly and ethically with my father that out of respect I would leave the accounts as they were for at least one year, which I did. Big mistake!

Here is a tip, if you have two money managers never tell them that they are competing with another manager. In retrospect I realize that was fairly stupid because it inspired one of the two to make a high risk bet on oil company stocks about two weeks before oil fell from $100 per barrel to $40 per barrel. And no, I’m not buying any bitcoin right now because I know what it feels like to see speculation go medieval on me. Fortunately he only had about a fourth of the money so he only lost about $50,000 overnight, ouch!

I sold the Walmart stock immediately because I don’t like owning individual stocks. And yes, I know it is over $100 a share now and I sold it at $75 which is exactly why I hate owning individual stocks. I also hate managing my own money so after the year was up I liquidated all the investments and moved the money over to Personal Capital. Since the account was over $ one million I got a fee reduction down to 0.79%. I know that is way high versus Betterment or Vanguard but I have pretty big accounts with those companies too and I want to see if the Personal Capital smart beta approach would beat the pure robo investors with their lower fees.

When I retired slightly early I initially planned on DIY investing because I have helped manage two eight figure funds for nonprofits. But I found out knowing how and actually managing my own money are two different things. It is hard to explain why except to compare it to the way blood affects me. Even though I am an engineer I have medical responder training and experience and have been first on the scene to badly injured, dying and dead people. Never rattled me, others people’s blood might as well be special effects dye. The import of the crisis focused my thinking and made me razor sharp in my decision making. However, when I’ve been badly cut or injured myself I lose my objectivity because it isn’t someone else’s pain to manage. It is my pain and my blood and all I can think about is “make it stop!” That is not helpful when it comes to first aid and it is death when it comes to managing your own money, so I don’t.

Sure seems like I am leaving something out? Oh yes, buying stuff! Let me say first I was already a self-made multimillionaire, already FI, already debt free with a paid off house and with paid for cars. So was nothing to do with the money other than save it or spend it, and we did a little of both. My wife and I are extreme hikers and we do a lot of bushwhacking. Bushwhacking is just like hiking a trail except there is no trail. You just make your way the best you can across cliffs, swamps, briar patches and creeks in the search for a set of coordinates on your gps that mark the location of waterfalls or some other natural wonder.
Extreme hiking is strenuous and compares to marathoning in some ways and often on our bushwhacking adventures we would take a day or two off and rent an all-terrain vehicle. If you haven’t seen them they look like little dune buggies (see the pic above) and they are a lot of fun. We had wanted one of our own for years and we spent $15,000 of the million and bought a brand new Polaris Trail RZR 900. That was 1.5% of the inheritance. We also spent $20,000 on a new bass boat/motor/trailer to replace our ancient wreck of a boat after several fishing trips were spoiled by a motor that would not run reliably.

$35 thousand is a lot of money to spend on toys! That kind of thing can get you kicked out of the FIRE community or at least damage your frugal credibility. We have always gotten by with cheap and unreliable playthings in the past but we splurged this time and replaced our two toys with state of the art brand new ones and two years later we don’t regret it at all. We use them both frequently and they’ve added joy to our lives especially because we use them as a couple. We are also getting a little older and more risk adverse and some of the fast waters we fish can kill you if you cannot count on your boat performing reliably. P.O.S. ATV’s can also get you stranded beyond cell coverage in very remote locations. Those were risks we were willing to take during our accumulation phase. However, once we were past fat-FI it didn’t make sense because $35 thousand is only 3.5% of the windfall. 96.5% is still invested and earning money! We also bought an emergency beacon that will get help via satellite anywhere in the world but that was very inexpensive.

What about giving it away? We have always given over 10% of our gross income to church and nonprofit charities. Hundreds of thousands of dollars over our careers and we do the same with side gig income now. My dad did that as well his entire working life so I did not view the inheritance as an increase but as a family transfer. We are still trying to figure out the giving thing in regards to investment passive income and what to give away versus what to leave for our three kids someday. We expect to have a long time to figure that one out.

The million dollar windfall changed my mind about work forever. If there was one huge change that the windfall brought with it that was it. Precisely because we stuck 96.5% of it in savings and investments without spending much. That convinced me that we had way more than we needed. I knew we had plenty before the inheritance but I did not feel it. If one million dollars, many people’s crazy fantasy figure, did not move the needle on my lifestyle or net worth enough to matter then why in the world was I working at a job I no longer enjoyed? So two years ago I walked away from my corporate job and my life got so much better. The million didn’t cause me to retire but it started the thought process that only had one possible outcome. It was reality slapping me in the face, and I finally got it. It was time to do what we wanted and leave the 9 to 5 world behind. So maybe in my case it was worth far more than money.

So what would you do with one million dollars?

How would it change your life?

I’ve seen dozens of posts on the death of the American Dream.  You know, the house, white picket fence, dog and 2.5 kids.  The one where the guy works until he is 65 while the wife stays home and raises babies and frequents the tennis club and does charity work in her spare time. The one where at retirement they either have a fat pension, millions in the bank or perhaps both.   This is purportedly a myth, an anachronistic throwback to an earlier time, a time long long ago when dinosaurs and creatures known as Boomers ruled the earth.

The claims on the Dream no longer being possible center on a number of issues including high cost of college/student loans, lack of decent paying jobs, lack of opportunity to advance and a lack of affordable housing and tighter rules on obtaining house loans.  They are also sometimes portrayed as inherently less competitive in life due to being victims or poor parenting and the advent of the age of social media and digital overload.  So in short, against insurmountable odds  there just is no way they can achieve the American Dream the way previous generations did.

That is so untrue! Don’t get me wrong, the disadvantages are real inarguable truths.  But the idea that they represent some Great Wall of China impenetrable barrier is untrue.  There is a huge difference between something becoming more difficult and something becoming  impossibly  unicorn rare.

Full disclosure, I’m older than most in this space so I realize can’t use my own experience as proof that things can still work this way for you but I have lots of younger friends and three millennial kids that I can bring forth as expert witnesses because unlike me, they have current generation cred.  Since one of my side gigs is being an expert witness let me do this like we do in court.

“I call my millennial kids to the stand.”

“Raise your right hand, swear to tell the truth, etc.   How is life going for you, son?”

“Dad, it is going pretty great, I am heading to Tanzania in a couple of weeks for my last rotation of medical school and after that is over my wife is coming to climb Kilimanjaro with me.  I’ll be matching with my specialty in March and then headed off to six years of residency.  I guess we will sell our house since we probably won’t be coming back to the same city or maybe we’ll rent it to someone.  It took me awhile to decide on my career, I started of course in engineering and did that for six years while I put my wife through medical school and now she is doing that for me as I earn my MD.  We have some school loans but she makes great money and I will be earning at least a little soon so we are on solid financial ground headed forward.  Plus you and mom did teach us to avoid debt and invest for retirement so we are doing that as fast as we can.”

“Son, how much did Mom and I help you pay for school or really anything after high school.”

” Well Dad you didn’t pay for anything.  I had a free ride through college for my engineering degree and after that I was on my own.”

“Son, would you say you will earn more, save more and give more than I was ever able to in my life?”

“You’ve done pretty well Dad, but we will blow by you like you’re standing still in less than ten years, most likely.”

“Daughters?”

“Yeah Dad, you also didn’t shell out much of anything for our college and we also graduated with zero loans. Yeah, like bro we worked while in high school and college and learned to shop in thrift stores.  And we had free rides too including room and board through our four-year degrees because we had good grades and test scores. ”

“How did you get your advanced degrees after the scholarships ran out?  Did you rack up enormous school loans?”

“No student loans at all, Dad.  We both worked for the university to pay for our masters degrees.   We have good jobs, one with a pension.  One of us owns a house and one is renting but neither of us have any debt, except the house mortgage. We see marriage, kids and owning a house as near certain parts of our future.”

“I’ll call my last witness, Ms.M.  M you obviously have it going on for a millennial right now so I’m guessing you started out with rich parents, right?”

” You are hilarious, mi amigo.  I’ve told you my story on those many early morning six-mile runs we made together but I suppose you want these people to hear it from me.  Short version goes like this, at 16 I was literally starving to death in Mexico and in desperation ran away from home, crossed the river into the USA and started taking odd jobs.  I married and divorced from a bad man and ended up in your small town where I was working as a maid in a rich family’s home.  I had nothing, no family, no friends and no money.”

“Wait a minute M, you are now a Nurse Practitioner with four college degrees.  You are a wealthy lady, how did you get there in just a few years?”

“I did not really believe in the power of education but the lady I was a maid for nagged and nagged and finally dragged me to get my high school equivalent certificate and then convinced me to go to the community college and get my licensed practical nursing credentials.  I then got my RN, and then a BS in Registered Nursing and finally was accepted into medical school where I earned my Advanced Practical Nursing degree.  Along the way I married another Mexican immigrant, now a surgeon and a very good man, and we live in Florida.  Yes we are millionaires with no debt and yes we did all of that by ourselves with no financial help from anyone else.”

“So at the risk of leading my witness, M would you say you are living the American Dream?”

“Yes, it certainly feels like the American Dream, going from starving kid to medical professional.  From loneliness and poverty to a great life partner and wealth”

“I rest my case.”

And that is my version of why I think the Dream lives on.  No doubt it is just one side of the argument.  And, sure, it is tougher now than it was for me and my small set of examples do not adequately represent the millions of millennials struggling against odds I didn’t have to face. But the fact is most of the millennials I know, and I know a lot of them, are living lives that resemble mine at their age without a lot of obvious differences.  They have jobs they enjoy and are making nice salaries, buying houses and having kids just like their parents did.  And some of them like my, running amiga, can just drop the mic and walk away after they tell their story.  

As 2018 slowly begins now the holiday season has passed a strange thought has hit me this week. It occurs to me how different everything feels about my life now that I no longer have to go in to work. Two years ago I was facing the unrelenting pressure of a demanding CEO, working long hours keeping production maximized at a chemical plant. Worried about my workers’ safety, the competitiveness of the plant, staying within my operating budget and fearful that I would inadvertently run afoul of one of the hundreds of environmental, safety and transportation regulations that applied to my facility. It was about six months prior to leaving that I realized I had enough money, more than enough, and that I wasn’t having fun anymore after a mostly fun and long career with the company. I pondered that situation for six months then two years ago this week I walked away from my medium six figure compensation package to the strange and unstructured world of being retired. In my case what I like to call Slightly Early Retirement.

And…it…is… so much better. I never realized the stress that weighed on me, or at least not until the very end of my career. But as soon as I left, despite the uncertainty I walked into, I was amazed. I was floored actually by the incredible lightness of my body. I felt like I was 50 pounds lighter, like I was floating. It wasn’t in a physical sense it was metaphysical, a spiritual lightness that remains just as strong two years later and it makes me smile, makes the child in me laugh and the old man in me tear up with joy.

It isn’t that I live a life of pure leisure, I still work. In fact just before I started writing this I opened checks for over $13 thousand for work done in three of my five side gigs in December 2017. $6,000 of that was a one weekend consulting job for old friends in Texas. I don’t need the money but I loved earning it, and it validates me in some strange way. Plus I enjoyed being the one guy that could come in and solve their seven figure problem in a couple of days and nights of work. But it had none of that old weight or stress or fear of failure. I walk in and walk out and don’t have to worry that I’ll get called in the middle of the night because there is a fire, or worse. It isn’t my zoo, and they aren’t my animals any more. I’m just like a visiting veterinarian who can make a house call or not, my choice.

Back in my 9 to 5 days that stretched into decades I did not think it could be like this, be good like this. I told people I wanted to work until I was 70 because in my mind I really did not have an identity outside of work. I cannot explain why I saw things that way, I had and have a lot of hobbies and volunteer gigs but I did not think they could ever give me the sense of mattering that work did. And while I was crazy wrong about not having an identity outside of my corporate world I was actually dead on about that last part. I do need to work and the reason life is so good now is that I have great work.

Work that is challenging and significant but not work that beats me down and kicks me in the teeth. I have clients that respect me and look up to me. I am no longer a Sisyphus facing a never ending and impossible task. I’m in control and the freedom of being my own boss is almost narcotic in its power. The knowledge that I have the time and money to reinvent myself as many times in the future as I want gives me a safety net under my high wire act. I don’t want to fail at anything but if I do, it is more of a shrug than a death. And instead of crazy 60 to 70 hour weeks I usually only work about two days a week. 

I would like to say there was a master plan to get here but it happened more organically than that. Along the way in my career when I would find tasks that put me in the zone of deep work, contentment and excitement I began to consider what kind of jobs have a high percentage of that kind of work. And when it finally occurred to me that I was done with the old job I had a network of contacts that were receptive of my pitching them to become my clients and it all just worked from day one of being slightly early retired.

This post is not to tell you how to get to where I am. This post is to tell you that it is a lovely place to be no matter how you decide to build it. Whether it is teaching English in China or backpacking across Europe or being a part time consultant like me who spent this week hiking to frozen waterfalls in remote parts of Arkansas mountain country.  However you choose  tobuild your future life it is wonderful to have the freedom to live it on your own terms.

It is a new year, what are you going to do to gain financial independence and freedom? What life are you going to build?

As 2018 slowly begins now the holiday season has passed a strange thought has hit me this week. It occurs to me how different everything feels about my life now that I no longer have to go in to work. Two years ago I was facing the unrelenting pressure of a demanding CEO, working long hours keeping production maximized at a chemical plant. Worried about my workers’ safety, the competitiveness of the plant, staying within my operating budget and fearful that I would inadvertently run afoul of one of the hundreds of environmental, safety and transportation regulations that applied to my facility. It was about six months prior to leaving that I realized I had enough money, more than enough, and that I wasn’t having fun anymore after a mostly fun and long career with the company. I pondered that situation for six months then two years ago this week I walked away from my medium six figure compensation package to the strange and unstructured world of being retired. In my case what I like to call Slightly Early Retirement.

And…it…is… so much better. I never realized the stress that weighed on me, or at least not until the very end of my career. But as soon as I left, despite the uncertainty I walked into, I was amazed. I was floored actually by the incredible lightness of my body. I felt like I was 50 pounds lighter, like I was floating. It wasn’t in a physical sense it was metaphysical, a spiritual lightness that remains just as strong two years later and it makes me smile, makes the child in me laugh and the old man in me tear up with joy.

It isn’t that I live a life of pure leisure, I still work. In fact just before I started writing this I opened checks for over $13 thousand for work done in three of my five side gigs in December 2017. $6,000 of that was a one weekend consulting job for old friends in Texas. I don’t need the money but I loved earning it, and it validates me in some strange way. Plus I enjoyed being the one guy that could come in and solve their seven figure problem in a couple of days and nights of work. But it had none of that old weight or stress or fear of failure. I walk in and walk out and don’t have to worry that I’ll get called in the middle of the night because there is a fire, or worse. It isn’t my zoo, and they aren’t my animals any more. I’m just like a visiting veterinarian who can make a house call or not, my choice.

Back in my 9 to 5 days that stretched into decades I did not think it could be like this, be good like this. I told people I wanted to work until I was 70 because in my mind I really did not have an identity outside of work. I cannot explain why I saw things that way, I had and have a lot of hobbies and volunteer gigs but I did not think they could ever give me the sense of mattering that work did. And while I was crazy wrong about not having an identity outside of my corporate world I was actually dead on about that last part. I do need to work and the reason life is so good now is that I have great work.

Work that is challenging and significant but not work that beats me down and kicks me in the teeth. I have clients that respect me and look up to me. I am no longer a Sisyphus facing a never ending and impossible task. I’m in control and the freedom of being my own boss is almost narcotic in its power. The knowledge that I have the time and money to reinvent myself as many times in the future as I want gives me a safety net under my high wire act. I don’t want to fail at anything but if I do, it is more of a shrug than a death. And instead of crazy 60 to 70 hour weeks I usually only work about two days a week. 

I would like to say there was a master plan to get here but it happened more organically than that. Along the way in my career when I would find tasks that put me in the zone of deep work, contentment and excitement I began to consider what kind of jobs have a high percentage of that kind of work. And when it finally occurred to me that I was done with the old job I had a network of contacts that were receptive of my pitching them to become my clients and it all just worked from day one of being slightly early retired.

This post is not to tell you how to get to where I am. This post is to tell you that it is a lovely place to be no matter how you decide to build it. Whether it is teaching English in China or backpacking across Europe or being a part time consultant like me who spent this week hiking to frozen waterfalls in remote parts of Arkansas mountain country.  However you choose  tobuild your future life it is wonderful to have the freedom to live it on your own terms.

It is a new year, what are you going to do to gain financial independence and freedom? What life are you going to build?

I’ve seen dozens of posts on the death of the American Dream.  You know, the house, white picket fence, dog and 2.5 kids.  The one where the guy works until he is 65 while the wife stays home and raises babies and frequents the tennis club and does charity work in her spare time. The one where at retirement they either have a fat pension, millions in the bank or perhaps both.   This is purportedly a myth, an anachronistic throwback to an earlier time, a time long long ago when dinosaurs and creatures known as Boomers ruled the earth.

The claims on the Dream no longer being possible center on a number of issues including high cost of college/student loans, lack of decent paying jobs, lack of opportunity to advance and a lack of affordable housing and tighter rules on obtaining house loans.  They are also sometimes portrayed as inherently less competitive in life due to being victims or poor parenting and the advent of the age of social media and digital overload.  So in short, against insurmountable odds  there just is no way they can achieve the American Dream the way previous generations did.

That is so untrue! Don’t get me wrong, the disadvantages are real inarguable truths.  But the idea that they represent some Great Wall of China impenetrable barrier is untrue.  There is a huge difference between something becoming more difficult and something becoming  impossibly  unicorn rare.

Full disclosure, I’m older than most in this space so I realize can’t use my own experience as proof that things can still work this way for you but I have lots of younger friends and three millennial kids that I can bring forth as expert witnesses because unlike me, they have current generation cred.  Since one of my side gigs is being an expert witness let me do this like we do in court.

“I call my millennial kids to the stand.”

“Raise your right hand, swear to tell the truth, etc.   How is life going for you, son?”

“Dad, it is going pretty great, I am heading to Tanzania in a couple of weeks for my last rotation of medical school and after that is over my wife is coming to climb Kilimanjaro with me.  I’ll be matching with my specialty in March and then headed off to six years of residency.  I guess we will sell our house since we probably won’t be coming back to the same city or maybe we’ll rent it to someone.  It took me awhile to decide on my career, I started of course in engineering and did that for six years while I put my wife through medical school and now she is doing that for me as I earn my MD.  We have some school loans but she makes great money and I will be earning at least a little soon so we are on solid financial ground headed forward.  Plus you and mom did teach us to avoid debt and invest for retirement so we are doing that as fast as we can.”

“Son, how much did Mom and I help you pay for school or really anything after high school.”

” Well Dad you didn’t pay for anything.  I had a free ride through college for my engineering degree and after that I was on my own.”

“Son, would you say you will earn more, save more and give more than I was ever able to in my life?”

“You’ve done pretty well Dad, but we will blow by you like you’re standing still in less than ten years, most likely.”

“Daughters?”

“Yeah Dad, you also didn’t shell out much of anything for our college and we also graduated with zero loans. Yeah, like bro we worked while in high school and college and learned to shop in thrift stores.  And we had free rides too including room and board through our four-year degrees because we had good grades and test scores. ”

“How did you get your advanced degrees after the scholarships ran out?  Did you rack up enormous school loans?”

“No student loans at all, Dad.  We both worked for the university to pay for our masters degrees.   We have good jobs, one with a pension.  One of us owns a house and one is renting but neither of us have any debt, except the house mortgage. We see marriage, kids and owning a house as near certain parts of our future.”

“I’ll call my last witness, Ms.M.  M you obviously have it going on for a millennial right now so I’m guessing you started out with rich parents, right?”

” You are hilarious, mi amigo.  I’ve told you my story on those many early morning six-mile runs we made together but I suppose you want these people to hear it from me.  Short version goes like this, at 16 I was literally starving to death in Mexico and in desperation ran away from home, crossed the river into the USA and started taking odd jobs.  I married and divorced from a bad man and ended up in your small town where I was working as a maid in a rich family’s home.  I had nothing, no family, no friends and no money.”

“Wait a minute M, you are now a Nurse Practitioner with four college degrees.  You are a wealthy lady, how did you get there in just a few years?”

“I did not really believe in the power of education but the lady I was a maid for nagged and nagged and finally dragged me to get my high school equivalent certificate and then convinced me to go to the community college and get my licensed practical nursing credentials.  I then got my RN, and then a BS in Registered Nursing and finally was accepted into medical school where I earned my Advanced Practical Nursing degree.  Along the way I married another Mexican immigrant, now a surgeon and a very good man, and we live in Florida.  Yes we are millionaires with no debt and yes we did all of that by ourselves with no financial help from anyone else.”

“So at the risk of leading my witness, M would you say you are living the American Dream?”

“Yes, it certainly feels like the American Dream, going from starving kid to medical professional.  From loneliness and poverty to a great life partner and wealth”

“I rest my case.”

And that is my version of why I think the Dream lives on.  No doubt it is just one side of the argument.  And, sure, it is tougher now than it was for me and my small set of examples do not adequately represent the millions of millennials struggling against odds I didn’t have to face. But the fact is most of the millennials I know, and I know a lot of them, are living lives that resemble mine at their age without a lot of obvious differences.  They have jobs they enjoy and are making nice salaries, buying houses and having kids just like their parents did.  And some of them like my, running amiga, can just drop the mic and walk away after they tell their story.  

Finally I figured out how to get rid of the “site coming soon” page and open my blog to the public.  Now I’m just full of questions about how in the world anyone will find it?  How can I get on Rockstar’s directory so that maybe somebody will take a look?  What plugins I need to fix the place up, and so on and etc.  But mainly I’m happy I can finally Google Steveark.com myself and see this post!

I’m also very pleased that my first guest post ever, which appeared on 99to1percent  was submitted by Ms 99to1percent herself to Physician on FIRE who included it in his Sunday Best!  All in all this has been a good start to something new and highly entertaining for me.  As a slightly  early retired guy who typically only works a couple of days a week it will be a fun way to grow some new skills.  I look forward to meeting many new people in the FI, FIRE, Retirement, Investing and Side Gig communities.

This is just a test post!

A few days ago I wrote a guest post for Ms. 99to1percent’s excellent site.   She suggested that I create a blog of my own since I had been actively reading and commenting all over the financial independence and FIRE and retirement life style and side gig community and I have taken her advice!

I’m an engineer by training and education and know my way around inside a computer and have written a lot of code over the years but know absolutely nothing about web sites, WordPress or anything else remotely useful in this new adventure.  But as a retired guy who only works a couple of days a week at my paying side gigs I do have one resource  that is in short supply for most of you, time.  So here  goes, wish me luck and I’ll try to add some value.

Welcome to WordPress. This is your first post. Edit or delete it, then start writing!