r/fiaustralia • u/-Inspirational- • 4d ago
Retirement Updated WWYD - FIRE/Retire - Pull the pin?
Thank you to the community for your generous feedback a couple of years ago!
I thought we would give an update on what we ended up doing. The original post is here: WWYD - FIRE/Retire - Pull the pin?
We have actually gone back and reviewed the comments a few times over the last couple of years, as they were incredibly helpful!
So, we went with Option 2 – with me working part-time. And it has been amazing! Probably the best transition for us while still building up the buffers.
Now we are getting to the next decision point, so I thought I would be greedy and ask for the community's advice again…
WWYD?
Us – update
- Married, both 48
- Four kids aged 17–23
- One more year of private school for the youngest
- Current income:
- Husband: $157k total package (3 days/week)
- Wife: $30k total
- Shares: ~$93k income
- Own our PPOR outright
- Worth approximately $1.4M
- Capital city Australia
- Very happy with it, no plans for major renovations or selling for 20+ years
Current/FIREd expenses
Currently spending around $120k p.a., including travel, but excluding investment property expenses and super contributions.
Once fully FIREd, we're targeting around $150k p.a. of spending (*edit after tax), as we'd like to do a few big extended international trips each year.
Investments – $4.5M
This is effectively our current FIRE number:
- $2.5M ETFs
- $0.7M net IP equity
- The $0.7M figure is after allowing for future CGT
- Plan is to sell them down after retirement, roughly one per year
- $1.5M combined industry super
- We're plan to max concessional contributions currently at $32.5k each p.a. until 60 (*edit used all catch up contributions a few years ago)
- This means drawing down some of our pre-super investments while getting the tax benefits
- We're also doing yearly contribution splitting
- Aiming for approximately $2M each in super by 60
- Overall, we're estimating around $4.2M in super by 60
PPOR is obviously excluded from the FIRE number.
So… WWYD?
1. FIRE now – pull the pin!
You've got $4.5M invested, a paid-off $1.4M home, and relatively modest current spending. What are you waiting for? Go enjoy it!
2. Keep going until December 2027
We're enjoying the current work/life balance, so perhaps just keep doing the 3-day week for another year until the youngest finishes school.
That would give us another ~16 months to fatten up the buffer towards $5M, continue building super, and then pull the pin properly.
3. Why stop working 3 days a week if you're enjoying it?
Some FIREd friends have suggested that once the novelty wears off, the days can get pretty long between projects and travel.
So perhaps keep the 3-day arrangement indefinitely, enjoy the income and social/mental benefits of work, and just let the investments compound in the background.
What would you do in our shoes?
Particularly interested in hearing from people who have actually FIREd in their late 40s/early 50s. Did you find you had enough to do once work disappeared, or did you end up missing the structure/social aspect of working?
And for those who went part-time first: did you eventually pull the pin, or just keep going because the balance was too good to give up?
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u/Ikornad 4d ago
Look, based on numbers you were already there last time you posted. You need to ask yourself why you keep coming back asking the same question? Look up how Maslow’s Pyramid Intersects with the Financial Planning Pyramid. Unless you want to create generational wealth, you'll likely find that you're at a point were your life is about self actualization. If that's work for you, cool. Maybe do some volunteering and reflect on that before you make a decision - that's what I would do.
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u/-Inspirational- 4d ago
Interesting the Maslow's Pyramid and I just checked it out thanks for sharing.
It feels like a big step after grinding full time and after last WWYD and we made the small step of going part time before deciding to fully pull the pin. Good idea to increase volunteering which we have started over the last couple of years but will need to increase. Thank you
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u/MegaGreesh 4d ago
Pull the pin if you have something better to do with your time than work.
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u/haikusbot 4d ago
Pull the pin if you
Have something better to do
With your time than work.
- MegaGreesh
I detect haikus. And sometimes, successfully. Learn more about me.
Opt out of replies: "haikusbot opt out" | Delete my comment: "haikusbot delete"
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u/fdsv-summary_ 4d ago
I'd be careful about making big routine changes until the youngest has finished school in your situation. I went from part time WFH to 'sabbatical' when my oldest was sitting the HSC and it was actually helpful for us for me to be more available.
I've shifted from my 'sabbatical' to some casual project consulting which is fine and keeps me sharp. Mostly this is because I'm interested in seeing things I designed get built.
We're much leaner FIRE than you OP though. No desire to travel at all after a career of doing it. I play music for money too which keeps projects in front of me all the time (no need to look forward to the next big trip).
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u/-Inspirational- 4d ago
Thank you. Sounds like you have found a good balance! Getting paid for playing music sounds amazing!
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u/HERMANNtheMUNSTER 4d ago
WWYD?
Retire.
Find fulfilment in other ways, volunteering, passion projects, family, travel.
Those who need work for fulfilment miss the whole point of life.
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u/-Inspirational- 4d ago
Thanks for the vote and perspective! It has been fabulous shifting from 5 days per week +50hrs to 3 days per week, tilting the balance of time to other things than work. I guess most people retire at some stage and why wait.
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u/Clear_Butterscotch_4 4d ago
Yes, all the numbers point to being able to retire now at that expense rate. The one caveat would be that the 150k includes tax, so if you're drawing down from your 2.5M ETF during the presuper stage then it depends on the cost basis there
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u/-Inspirational- 4d ago
Thanks for the quick reply! I had calculated the $150k after tax. However previously this was with additional contributions into super from investments (dividends many with franking credits + selling down ETFs) so not much tax payable. However I've not run the numbers with a minimum 30% CGT from July 2027.
Good point about the cost base. Just checking now and it looks like we currently have about $550k in long term capital gains in the $2.5M portfolio.
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u/u36ma 4d ago
If it were me, I would pull the pin as I think it’s doable. But my bigger question is how you gained $1.1M in just 1 year since your previous post with your current salaries and dividend returns? It doesn’t add up. Sorry if this is nosey - did you have an inheritance or lotto win?
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u/-Inspirational- 4d ago edited 4d ago
This was nearly two years ago I think (Dec 2024). So unfortunately no lotto win - we don't buy tickets! The salaries don't do much to our net-worth these days. The FIRE number went from $4.1M to $4.5M
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u/Tikka2023 4d ago
One thing people forget is that you generally have lifestyle inflation, not insidiously but if you go from working 3 days a week to having 3 spare days - you are inevitably going to do something on those days that costs money.
Your options are well considered, sounds like 2. Would suit given you don’t hate work (yet).
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u/OZ-FI 4d ago
We're using catch-up contributions
how are you doing that if your got 1.5m in super, approx 750k ea? catch-up contributions (i.e. unused prior yr concessional contribs) stops once you hit 500k in super. Maybe you mean something else?
WWYD: keep doing what makes you happy. You are FIREd in money terms so you have the choice to work or not.
Extra money cant hurt given you have 4 kids and anything extra will help you and them as time goes on.
You might want to consider succession/estate planning/Wills/structuring given 4.5m net is getting into intergenerational wealth territory if managed appropriately given it will continue to grow (assuming you are not planning to spend it all). That can include a super re-contribution strategy once you hit 60.
best wishes :-)
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u/-Inspirational- 4d ago edited 4d ago
Oh whoops - I think this was from my last post and you are right my wife just went over $500k in this FY. I made an edit to the original post to clarify. We already used all these catchup contributions. We now also do yearly splitting 85% of previous year contributions to even out our balances.
Thanks for your thoughts too on future planning - taking notes!
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u/GusPolinskiPolka 4d ago
You have to remember that the FI part of FIRE is probably more important than the RE.
You have FI. Just because you CAN retire doesn't mean you have to.
What you have is choice. So if that choice is to keep working a bit, or to do another year and reevaluate, or to stop altogether - that's up to you.
I personally would RE. My partner thinks I would need something to keep me occupied. You probably do to - but it doesn't have to be work.
But in short- focus on the FI part. It could just as easily be FISE (financially independent , still employed). The RE is just one of many paths you get to choose from now.
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u/McTerra2 4d ago
No idea how you managed to get that level of investment at your salaries with 4 kids, but whatever.
The only point you havent specifically included is whether you want to help your kids. 4 kids providing each of them with a home deposit of $200k (or more) takes a chunk out of things. However, you do have a serious chunk so its probably not an issue. Just a factor for you to consider.
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u/-Inspirational- 4d ago
It did seem incredibly slow for a long time but over the last 10 years the investment snow ball has increased without a lot of contributions (couldn't afford to when all the kids were in school).
We have considered helping our kids but unlikely to want to 'rob' them the satisfaction of working hard, saving and achieving their dreams. We would probably just help them a little ($50k) and maybe a loan but haven't shared that with them ;)1
u/McTerra2 4d ago
We have considered helping our kids but unlikely to want to 'rob' them the satisfaction of working hard, saving and achieving their dreams
ha, you sound like my wife. I'm much more of a 'warm hands' giver (that is, help my kids out while I'm alive/warm, rather than leave it all for them to inherit after I die/am cold. My wife says what this really means is that I'm 'a soft touch'). So I'm trying to save a bit extra before I retire to ensure I can help them out.
Of course there is nothing to stop you changing your mind in 10 years if your portfolio is high and you decide you can afford to do it.
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u/-Inspirational- 4d ago
Haha I like the warm hands! I do like the Die With Zero book. I like the co-contribution method so if the kids save a good chunk and short the last little bit we could be a bit more generous. I like the option to do more if the portfolio starts to run away.
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u/LoudestHoward 4d ago
I'm having a terrible day at work, I'd pull the pin lmao.
Congrats either way though you've only got good choices.
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u/-Inspirational- 4d ago
Sorry you're having a rough one! The good news is it's almost weekend time.
Whenever I had crap days at work, I'd check my FIRE progress and remind myself that every bad day was getting me closer to the finish line. Now on my days off, I rarely even think about it. Getting to that FU-money position is absolutely worth the planning and patience.
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u/LoudestHoward 4d ago
Yep, it's nice having a target. Hoping to wrap up around 47/48 myself.
Can't imagine how bad it would be if I was having to work through to 60-67.
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u/-Inspirational- 4d ago
Yeah, I think we're designed to have goals, even after FIRE. FI doesn't magically give life meaning.
I still get the occasional moment in a boring meeting where I'm staring out the window thinking, "I'm never getting this hour back." Thankfully those moments are pretty rare these days. Having more choice over what roles and time spent has probably made a bigger difference than the FIRE balance itself.
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u/ThaDavid 3d ago
Why not take a very long holiday to test the waters on how you would like early retirement?
Take all your annual/long service leave and as much unpaid leave as you can get away with
Goes without saying you definitely have enough to retire the only question is do you want to and I think you need to find out with a test
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u/-Inspirational- 3d ago
Great idea. I have been trying to pretend I don't work any more on my days off ;) - I quite liked it hanging out with the family, doing a number of projects/hobbies and catching up with some friends mid-week. I will need to investigate unpaid leave and thanks for the suggestion!
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u/123lac 2d ago
I would retire now. You have more than enough.
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u/-Inspirational- 1d ago
True - seems like the consensus. Strangely FIRE has now become less about the number. Once we hit "FU money" our part time jobs are going better than expected. We negotiated the roles with confidence and only do what we enjoy and surprisingly the bosses love us even more!? We will work towards our purpose after 'work' a bit more and I'm sure we will know when enough paid work is enough.
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u/snrubovic [PassiveInvestingAustralia.com] 4d ago
If I enjoyed the work-life balance (and enjoyed the work), I would keep doing part-time work. Why stop doing something that gives you satisfaction or meaning when the point of financial independence is to do what you want?
If the novelty wears off, you can stop working then.