So What Exactly Is The Amazing Plan?
Updated: Oct 24, 2020
There sort of isn't one, that's the excitement and terrification (yes, that is a word) of it.
Well that's not strictly true, there actually was a plan, I just couldn't risk waiting for it to happen.
The original plan was cunningly simple:
Reduce monthly spending to the lowest amount possible whilst still maintaining an acceptable standard of living
Save the aforementioned newly created surplus cash like our lives depend on it
Invest the accrued savings into something that will make it grow as quickly as possible
Repeat this process until savings are equal to 300 months of spending
Retire and do nothing, or whatever we want.
This is called the FIRE (Financial Independence Retire Early) principal and makes a lot of sense and allows pretty much anyone that doesn't live hand to mouth the opportunity to retire in around 10 years or less.
I had been saving into company pensions all of my working life and had dabbled a bit with the stock market (to usually calamitous affect) so it wasn't quite a standing start and as we both have (had) pretty decent jobs, have paid off the mortgage and no longer have much expenses for the kids (they never stop costing you, never), our outgoings are lower than the average bear. Add to that the fact we previously never really questioned what we spent as our lifestyle didn't outweigh our salaries anymore, tightening up and tracking day to day spending soon meant we were able to save between 40%-50% of our take home pay.
In true geek fashion I built a spreadsheet and started tracking on a daily basis, quickly to realise that no matter how I cut it, to get to 300 times monthly spending in order to never lift a finger for the rest of my days should I so choose, I would need to keep this up until the end of 2023. Not great but also I would still only be 47, a very respectable age to retire.
Then it happened on the 25th May 2019 I went to the doctor with pain in my back and spent the next 2 weeks in hospital including a spell in intensive care. When I came out, my company were pretty supportive with their words but not so much their actions. Everyone said "Take your time" "Don't rush back" "Wait until you feel right", then I started to get the WhatsApp messages "I know you're off but......" "Do you mind if I just ask you a quick question" and "Do you know yet when you'll be back?". My boss came to visit me at home whilst I was convalescing and just as he was leaving he asked me if I could join a call at 2am South Africa time to talk to an Australian client as I was "The Expert". I did that call, and then went back to work. A week later I was back in intensive care fighting for my life. I should point out at this juncture that I have no ill feeling toward my boss, he was right, I am the expert and I had put a brave face on the whole thing when I was in hospital the first time and had been sending jokes and updates to my friends (including him) , he had no comprehension at that time how ill I had actually been. Needless to say, the 2023 plan got filed under F........for Fuck it.
So the plan is called the "2023 is too far away" plan and I finish work ont he 30th April 2020. I had managed to save about 18 months of take home salary since I got into the FIRE thing and our pensions have grown into a decent nest egg for this stage of our life so it's not like I need to start visiting the food bank yet! Plus Mrs H will continue to work for now and her take home pay is not too far off our monthly expenses, so hopefully I can grow our savings quicker than we spend it. That's the plan, again cunningly simple:
Don't Run Out Of Money
Enjoy Every Day As Best As You Can
Only work on things you love doing
Don't Forget Rule One
My trusty spreadsheet tells me we have around about 70% of what we need to be financially secure for the rest of our lives without Mrs H working either. Not a bad start. I basically need to come up with the other 30% before I can really say "I retire", and that's the plan.
Over the coming weeks, I'm going to be sharing every detail of how I'm going to generate enough income to not "have to" do anything for the next 50-60 years (I'm making 100, I've decided) and I suppose we should leave a little bit behind for the spawn.
I'm excited, and that was the point of all this. Although I'm currently oscillating between excited and shit-scared at any given moment of the day, I have to keep reminding myself that the worst case is I have to find another job. A small amount of fear is good, keeps you focused, I've probably had it too easy for too long, I haven't really had to think about money or my spending for about 10 years but I've been broke before so I know what it's like and I don't mean "We've run out of Fois Gras and Champagne dear!" kind of broke I mean deciding whether to pay the overdue rent or eat kinda broke. It's been a long time since then and I don't intend going back, but I also am not going to be the richest man in the graveyard so it's time to stop talking and start doing.
See you on the next post.