Retirement Reflections: Insights from the FIRE Class of 2024 – A One-Year Review
Exiting the workforce marks a significant turning point that brings with it a mix of enthusiasm and apprehension. While many resources offer theoretical guidance on achieving financial independence and retiring early (FIRE), the most profound lessons often stem from those who have walked the path — real retirees living the lives that others aspire to.
Today, we present a one-year update from a member of the Millionaire Money Mentors community, who concluded his career at the close of 2023. As part of the “FIRE Class of 2024,” his journey is filled with insights, successes, and teachings that future retirees can glean from.
Let’s delve into how his inaugural year of retirement transpired.
Overall Evaluation: A− (Near Perfect Implementation)
After years of meticulous planning, our retiree embarked on early retirement at age 52 with a net worth of $1.85 million and a withdrawal rate of 4.2%. A year later, he reports a healthy increase in net worth to $2.4 million, despite drawing from his savings for living costs. His candid and thorough self-review makes this an exemplary case study in both transparency and equilibrium.
Continue reading as we examine the essential aspects of his first-year retirement journey.
1. Timing the Retirement Decision: A
One of the most crucial choices in any retirement timeline is determining when to make the leap. Forget chance — this retiree approached his departure from the workforce with rational analysis, spreadsheets, and ample foresight.
What stands out? His choice was data-driven. By employing platforms like New Retirement’s planning tools, he achieved a 95% success rate under typical market conditions. With a measured withdrawal rate of 4.2%, he even factored out potential Social Security benefits and the planned elimination of his $22K/year mortgage.
Significantly, he aimed to retire after receiving year-end bonuses and utilized a savvy tax strategy: generating some income in the new year to contribute to a Roth IRA and enhance Social Security benefits.
His narrative emphasizes the necessity of synchronizing financial readiness with personal circumstances, such as family commitments and increasing job dissatisfaction stemming from a return-to-office requirement. A “test run” retirement — a three-month sabbatical in New Zealand — provided a preview of retired living that solidified his choice.
Conclusion: Flawlessly timed departure, both financially and emotionally.
2. Health Transformation: B+
Retirement gave him a blank canvas to emphasize his health. Following a period of inactivity linked to work and a physician’s warning, he embraced a dual approach of daily exercise and reduced calorie intake.
Highlights:
– Increased from an average of 7,000 to 12,500 daily steps, aiming for 15,000.
– Cut out lunch and, notably, ice cream for the entire year (with just one minor gelato exception!).
– Shed 30 pounds and witnessed normalized blood pressure.
While tempted by indulgent Italian dishes during a fall getaway, he refocused post-trip and concluded the year in better health. His next target: to lose the final 22 pounds, even with an impending visit to Oktoberfest!
3. Financial Outcomes: A
Even while withdrawing $78K for annual living expenses, his net worth grew from $1.85M to $2.4M within the year. This adjustment lowered his withdrawal rate to just 3.3%, despite a modest lifestyle inflation of 2.5%.
He now has the capacity to spend significantly more annually without risk, yet prefers a minimalist approach, prioritizing experiences over possessions — with only modest increases in mind for aiding his children with future housing needs.
Key takeaway: Thoughtful withdrawals and solid market performance can enhance wealth rather than deplete it, even early on in retirement.
4. Personal Development & Hobbies: B+
One of his articulated intentions was to follow personal interests after retirement — something that many overlook in favor of solely financial pursuits.
Here’s how he performed:
– Opera Enthusiasm: He began with a self-created opera course aimed at viewing 176 operas — but encountered burnout midway. Plans are in place to resume next year.
– Reading: Completed the sprawling 14-book Wheel of Time series, a long-cherished aspiration.
– Upcoming Adventures: He’s prepared a lineup of sci-fi masterpieces like Dune, Foundation, and The 3-Body Problem for his second year.
The main takeaway? It’s acceptable to adjust your hobbies after retirement. Flexibility and enjoyment should be central to this next chapter of life.
5. Travel Aspirations: A+
Six months. Ten locales. One content retiree.
He embraced the globetrotting lifestyle that many yearn for following retirement, exploring:
– New Zealand
– Italy
– Iceland
– Bali
– Slovenia
– Hong Kong
– Finger Lakes (NY)
– Florida
– Seattle
Crucially, he highlights the concept of “front-loading”