Retire Early Home Page Discussion Board

[arrete]

Well, I'll chime in. I've notice an ongoing theme of finding intercst's homepage being the impetus to pull the plug on work. Same with me - GardenBunny bless intercst.

I stole my story from TMF because they are my words, and I can do that.
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A little background. My full-time working career was 12 ½ years. 10 as an employee and 2 as a consultant. Before that, I spent several years as a (horror!) stay-at-home mom, then about 5 years as a grad student with an assistantship (about 20 hours a week). However, the whole time, whether working or not, we always LBOM. This has to be about the most important thing, because it puts you in the right state of mind to save money, and then invest that money. And I am lucky because my husband is as frugal and investment minded as I am.

1. We lived frugally.

- We still took vacations - we just didn't break the bank. Once, talking to a colleague while we spent yet another weekend overseas away from our families, we agreed that there were so many interesting vacation spots in the United States, it just didn't make sense to spend the money to get overseas.

- We took our kids on a tour of Virginia state schools when they were pre teens. The deal was, we'll pay the amount for in-state tuition and room and board. If you want to go out of state, start saving. (If we had had a great musician who should go to Julliard, we probably would have rescinded). Our eldest got through Virginia undergraduate and med schools, saving a boatload of money in the process.

- We set limits on pampering kids. No personal cars at 16. Our oldest didn't believe it until his 16th birthday. That was tough for him. Pamper them with time, not money.

- We have a modest house in a modest neighborhood. We have all the room we need, and there is plenty of garden space - both flower and vegetable (my passion).
- Caveat. DH and I have always made it a practice to get away alone. A nurtured marriage is more important than saving a few bucks.

2. When IRAs became available, and were allowing families with a non-working spouse to put in $250 (wow!) pre-tax, we took advantage of that. And then when an working individual could put in $2000, I did that while I was a teaching assistant.

3. For 10 years, I saved the maximum amount in a 403B (take that! whoever said you had to make lots to save the max - I started at 23K/year). I did this on purpose. I wanted to be independent wrt money. That meant, if my DH and his money disappeared, I could still make it. Don't know why that was important - I think it's an INTJ thing. The company matched 11%! That was pure luck. It would be hard to find such a deal now. The 403B was in TIAFF-CREF that was invested in Vanguard funds. I was lucky in this respect - decent mutual funds. My last year as an employee, HR discovered they had been allowing those of us who maxed out to save more money than was allowed by law. As a result, in the future I was only going to be allowed to save the minimum amount. Great incentive to get out! And I did.

4. As soon as I was able to put in my share of the household money, I saved any excess. Plopped it right in my money market fund (or equivalent at the time), and then into stocks. I was able to do this because I had a budget so I knew how much money I needed, and didn't allow myself to get too far from this amount. Christmas presents have always been my downfall…sigh.

5. When I switch to being an independent consultant, I opened 2 Keoghs (a la TheBadger) - one Profit and one Money Purchase, so I could save the maximum amount, if I wanted, but could save a minimal amount if circumstances required it. And I was getting an obscene amount hourly for my consulting. Hey, if the market will bear it… And of course, I plopped the excess into stocks.

6. I did get some inheritance. Since I had no debt, I could invest it all. Just spent a small amount on a special vacation, which was definitely worth it. A lot of people think of an inheritance as play money - go blow it on a fancy new car. Makes me ill to think about it. Saved me a year of work.

7. This is a pathetic admission, but when I would think about retiring early, I would look at my taxable accounts and sigh. It was certainly a wad of money, but not quite enough to live on. I stewed about this for a year, then my DH said, "Look at both your taxable and retirement accounts. Add them together. Take 5%. Can you live on that?" That made it easy - I could live on 3%, and I have. In fact, the percentage is inching downward, because of growth, not frugalness.

Obviously, I share living expenses with my DH, but if I had to, I know I could live on the money/stocks that I have. Intercst said so .

arrete - who couldn't have done it without the support of intercst's homepage http://www.RetireEarlyHomePage.com/

[intercst]

[gw]

Intercst:

If you don't respond with sustantive proof by 5 PM Eastern Time today, I'm deleting your Hocomania-related posts from all but the 'Best of Hocomania' (BOH) board and I'm going to restrict your posting privileges on the REHP forum to the BOH board.

We can't have Hocomania ruining other boards that are providing helpful information to aspiring early retirees.

I, for one, would appreciate this. I was enjoying reading the exchanges, until hocus started to rant.

By the way, I'm pretty dense at figuring out the origins of the various monikers but my dictionary (Webster's Third New International) defines "hocus" as (1) to perpetuate a trick or hoax on (2) to befuddle, often with drugged liquor.

Honesty at last.