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I know financial independence is a dream that many people have, but few are able to attain. The reality is that most people have to work for someone else, and finding a good job in this economy is extremely challenging.
Have any of you managed to escape the rat race and build a reliable income source so you can leave your 9-5 job?
If so, what do you do and how did you get there?
If you're not 100% financially independent, do you have a consistent side income?
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Not yet, but I did have a business for 16 years until the 2008 recession and didn't report to anyone but myself. Since then I got a good job with great benefits and after several raises and promotions have put considerable amounts into savings of various types. In a couple of months I'm retiring and selling our home, buying in a less expensive area for cash. Then with my pension and my wife's, our social security, IRA, 401 and 457, we will finally be as close as possible to financially independent, though I may still continue my side gig worth a few thousand a year (leftover customer from the business.)
Not yet FI, but I plan to be in the next 4 years or so. I'll be 50 then, wife will be 41. We'll be selling our house in expensive Denver and moving back to the Midwest to be closer to family there, and should have enough to buy a house in cash with a little bit of land. We've looked into the Dubuque, IA and Galena, IL areas because it's halfway between our two families and the prices there are quite reasonable, and the scenery still good (not Colorado but good for the Midwest!). We'll have several hundred thousand in savings and investments, which combined with our much lower cost of living (no mortgage!), and the fact I'll qualify for VA healthcare means we'll be comfortable either working very little or not at all. This of course provided no serious economic or market collapse in the next few years.
Have any of you managed to escape the rat race and build a reliable income source so you can leave your 9-5 job?
If so, what do you do and how did you get there?
If you're not 100% financially independent, do you have a consistent side income?
You have to build income streams. These work for you, even while you are at leisure.
It helps if you are debt free.
1 thing that helped me was accepting what I have. I don't have any desire to impress the Jones family.
I turn 65 this month. I have been retired for over a decade. In that time I traveled extensively.
A lot of how I got where I am at today was pure luck. By that, I mean it wasn't deliberate, especially in my early years. Here's how my journey went. FWIW, if I can achieve this, no reason why others can't also.
Was in the military. Bought homes along the way. I kept them as rentals as I was transferred. Rental income = income stream #1. (Being a landlord isn't as simple as it sounds)
Retired from the military. Military pension = income stream #2.
I qualified for VA benefits. VA benefits = income stream #3.
Social security = income stream #4.
IRA disbursements = income stream #5
If done properly, income stream #1 also yields appreciation. IS1 & IS5 are variable. IS2, IS3 & IS4 are pretty much guaranteed.
I know financial independence is a dream that many people have, but few are able to attain. The reality is that most people have to work for someone else, and finding a good job in this economy is extremely challenging.
Have any of you managed to escape the rat race and build a reliable income source so you can leave your 9-5 job?
If so, what do you do and how did you get there?
If you're not 100% financially independent, do you have a consistent side income?
Looking for some ideas.
I don't think this really counts as I have been working in a career (IT) for someone else for most of my life, but I did just crunch some numbers on my own, look at retirement planning tools, and talk to a Financial Planner and am planning to retire in 15 months when I turn 65 (won't take social security till age 67). While not being an overly wealthy person by any means it looks like I have enough to enjoy my same life style while I was working in retirement plus a cost of living increase each year in a variety of different scenarios and even doing this leaving most likely a reasonable amount of money (what I want to) to heirs. It means that for retirement I'll be volunteering as a greeter at a National Park that's less than a 1/2 hour from my home, playing more tennis, and joining a book club on top of recreational activities I already do while working. I'm later to the game than a lot of you for sure, but it is actually a really good feeling to be here and I am very much looking forward to my retirement adventure. My career was a reasonable compromise for me for doing things I enjoy to some extent and am good at, but I'm the first to admit that my career was never really a passion. I never figured out something better to do, though, that would also pay the bills and give me the lifestyle I wanted and the financial security I wanted for my family, so I stuck to that. It was a compromise for me like so many things in life are.
So I will be joining this club, but only at age 65 when I am eligible for Medicare and a Medicare Supplement. If I were to be laid off between now and then, though, I think I would be fine, not looking for another job. I would though have to look for health insurance for that period of time (maybe I'd just do Obamacare, but no supplement for me).
What I did to get here, and I think you're looking for something that gets there a lot sooner than I did was put 15% of my salary in a 401K in a growth portfolio every year. Before I was eligible for a 401K when they didn't have those I still put that same percentage toward retirement, but in an IRA and in taxable investments. As a married person income wise I never qualified to do a Roth, but I will do a Roth conversion for some monies.
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Now here is someone who got their earlier - and wow I've always been really impressed with him, my dad.
My dad did early retirement at 50, but he was offered that after 30 years of service (small pension and medical) and had wisely invested in 10 single family homes that he did all the work on himself and rented out in the 1970s (bought one property with a positive case flow each year of that decade). Then at age 60 when he didn't want all that work, he slowly started selling them on contract. It's not like that wasn't a lot of work though, but it was something he enjoyed and was good at and gave him a lot more free time than say a full time job. And when people asked him what he did for a living, he liked to be able to say he was a property manager. I think I have a smart, savvy, kind father and he certainly enjoyed his active retirement years. Mom retired at 60 (college math professor) when they offered early retirement and incentives for years of service (38 years for her) and medical too. Wow. Mom is now deceased. Boy though did mom and dad enjoy their retirement with university activities - lectures, concerts, theatre, sporting events, hobbies, and volunteer work. They were blessed and were blessings to others too.
I was able to retire at 61 with a government pension, and total retirement income greater than my work income had been. It took decades of hard work, perseverance, living frugally, saving and investing, and absolute faith in the upward trend of the S&P 500 Index. I don't know any easier or quicker ways of doing it.
Yes, retired at 57. Overfunded, can’t spend all that we make. Currently 30% equities, 70% bonds. No pension. The bonds throw off 150%+ of our expense needs.
Work hard, save til it hurts. Best to be poor young, than poor old.
The reality is that most people have to work for someone else, and finding a good job in this economy is extremely challenging.
WonderfulAlex, I must disagree with the bold. It isn't challenging at all - but it is incumbent upon each of us to enhance our own skills and human capital.
Early in my career, I adopted a mindset that I am the CEO of the "Moguldreamer" company even though I received a paycheck from a big company. Yes, my employer gave me a paycheck every 2 weeks, but I considered that company to be my "customer" and I considered myself a vendor of my skills & human capital. As long as I had something to sell (my skills & labor) that my customer (legally my employer) wanted to buy, we'd continue to do business. Every now and then, my customer might decide it didn't want to purchase my products (skill, labor) - and that was fine - because I always kept my skills & IP up to date. And every now and then, I decided my "customer" was a pain in the rear so I dumped them and found another.
Keep up to day and continuously improve your human capital and you will always be in demand.
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