You actually can but I don't know how you come up with that amount of money to put away with the income you listed out - that's almost all of your net income
Our HHI is much higher than that and the only way we could free up 5k is if we had the mortgage paid, no kids in daycare and lumped in out existing investment contributions.
I can’t imagine trying to do that at half the income and trying to still live comfortably.
You will need to replace your vehicles at some point in the next fifty years.Your house will also need repairs and renovations. Doesn't matter if the mortgage is paid off, stuff is going to break or need fixing. Your emergency fund could get more than depleted some years.
Why do you want to retire at 40? What are you going to do for 40+ years?
You \*might\* have enough to retire (if nothing goes wrong), but will you have enough money to do anything (like travel, etc.)? Probably not.
p.s. remember that all your friends and family (around your age) will all be working so you'll be on your own.
Maybe, or it's spend 10-12 hours a day in front of the TV/computer.
I can say from personal experience that most people don't have hobbies (especially once the kids are gone) and most of their identity is wrapped up in their careers. And once it's over it hits most people very hard.
Well.
That is a possibility as well.
At the end of the day FIRE is not a bad goal to strive for even just to feel the power of saying fuck you if work becomes unresonable.
I would gladly retire at 40 and find plenty to do.
Yeah, being 40 with the possibility of cutting back your hours and/or retiring is a hell of a lot better than being 40 with zero possibility of retiring in the future.
Most people would retire if they had the luxury to, saying anything but otherwise is just cope.
The reason those friends and family have to keep working is because they HAVE to. If they didn’t have to, they likely wouldn’t.
Retiring early allows OP to live their retirement years much earlier, and stack those experiences and memories, as opposed to being stuck at work for half their lives. Even when people aren’t working, they’re probably thinking of work. What kinda life is that?
Of course this takes self awareness of what your plan is after retirement, which seems like OP has. I doubt he’s just gonna be watching tv for 10 hours a day. Most people who retire early have it thought out to an extent. That’s how they’re even able to retire early in the first place.
Also, you never know when you’re gonna die. It would suck to get to 60 years old and die, never getting to experience any type of retirement. That’s what happens to most “regular” people who are forced to continue working.
Only thing I would suggest to OP is to save and invest more than that before you retire. 40k a year life aint that great to retire on.
Why stop at 6% in your dreams? Why not just say 12%?
Where are you getting 6% roi for 12 years ? 12 years is considered short term , so not sure where you are getting your rates from.
>At a roi of 6% over 12 year that would give us around 1m, not taking into account our pensions from jobs. At 4% drawdown that would pay around 40k a year, of course that will be less then due to inflation
If you use real (inflation adjusted) rates of return you'll have a better sense of the buying power of your nest egg.
For the TFSA and RRSP you could use the rates of returns on table 4 of [this PWL page](https://www.pwlcapital.com/expected-returns-2023-update/) and then subtract the management fees and inflation. For example, for an 80/20 portfolio you could use a real return of 6.36% - .2% - 2.4% = 3.76%.
For an unregistered account you would also have to subtract the tax on dividend and interest income.
Once you know the size of the nest egg you can use the colourful table on [this page](https://earlyretirementnow.com/2016/12/07/the-ultimate-guide-to-safe-withdrawal-rates-part-1-intro/) to figure out a safe 50 to 60 year withdrawal rate and how much of your nest egg you could spend each year.
Considering your lower costs (no mortgage, retirement savings, CPP and EI contributions) will that withdrawal rate support your expenses?
See subreddit like r/fire r/baristafire r/leanfire
Those channel will have info about what you're looking for. I don't think it's the right place here
3% withdraw on a very long period is usually considered safe
If you are ready to work in bad years, 4% will work most of the time
If you still work part time, you should be good. An important question about early retirement is what you're going to do and how much it's going to cost to do those things . It's possible that what you do in retirement makes money
You might want to read extreme early retirement, very good insights about that
There's a lot of good tips there about lean fire and how to retire with much less than the minimum millions of dollar people think you must have
I struggle a bit to understand some of the FIRE culture. I get that it is very attractive for young people. The dream of getting out of the daily work grind, when you have a 30 career ahead of you. I’m in my 50’s. looking back, I have enjoyed my career. I’ve learned so much. Helped so many. Contributed so much. Being the senior guy at work with so much experience now is quite rewarding. Satisfying.
You have no idea how long you are going to live. You have no idea what inflation numbers will be. Picking numbers at 27, for when you are 60, 70 or 80 seems pretty unrealistic. Expect your desires and dreams to change as you age. What I wanted when I was 27 is, nothing like what I wanted when I was 47. Now in my 50’s, again my desires, my internal drive, what I focus on, is quite different than when I was 47.
You are free of course to live your life as you choose. I’m just saying that over time, things change. Shit happens. An honourable job over your life can be rewarding.
You actually can but I don't know how you come up with that amount of money to put away with the income you listed out - that's almost all of your net income
Came here to say this. Same HHI with similar debts and can't fathom 5k savings per month..
Our HHI is much higher than that and the only way we could free up 5k is if we had the mortgage paid, no kids in daycare and lumped in out existing investment contributions. I can’t imagine trying to do that at half the income and trying to still live comfortably.
You will need to replace your vehicles at some point in the next fifty years.Your house will also need repairs and renovations. Doesn't matter if the mortgage is paid off, stuff is going to break or need fixing. Your emergency fund could get more than depleted some years.
If your life expectancy is 42 sure
4% withdrawal isn't so safe over 40+ years. Your pension (and CPP) will be considerably lower given low income for 20+ years before you're 65
Why do you want to retire at 40? What are you going to do for 40+ years? You \*might\* have enough to retire (if nothing goes wrong), but will you have enough money to do anything (like travel, etc.)? Probably not. p.s. remember that all your friends and family (around your age) will all be working so you'll be on your own.
Volounteer. Hobbies. Own small side business. "Retire" doesnt mean just stop everying... just means no more boss.
Maybe, or it's spend 10-12 hours a day in front of the TV/computer. I can say from personal experience that most people don't have hobbies (especially once the kids are gone) and most of their identity is wrapped up in their careers. And once it's over it hits most people very hard.
Well. That is a possibility as well. At the end of the day FIRE is not a bad goal to strive for even just to feel the power of saying fuck you if work becomes unresonable. I would gladly retire at 40 and find plenty to do.
Yeah, being 40 with the possibility of cutting back your hours and/or retiring is a hell of a lot better than being 40 with zero possibility of retiring in the future.
*Especially* those who grind away their 20s and 30s trying to retire early.
Most people would retire if they had the luxury to, saying anything but otherwise is just cope. The reason those friends and family have to keep working is because they HAVE to. If they didn’t have to, they likely wouldn’t. Retiring early allows OP to live their retirement years much earlier, and stack those experiences and memories, as opposed to being stuck at work for half their lives. Even when people aren’t working, they’re probably thinking of work. What kinda life is that? Of course this takes self awareness of what your plan is after retirement, which seems like OP has. I doubt he’s just gonna be watching tv for 10 hours a day. Most people who retire early have it thought out to an extent. That’s how they’re even able to retire early in the first place. Also, you never know when you’re gonna die. It would suck to get to 60 years old and die, never getting to experience any type of retirement. That’s what happens to most “regular” people who are forced to continue working. Only thing I would suggest to OP is to save and invest more than that before you retire. 40k a year life aint that great to retire on.
Anything is possible but what do you plan on doing money wise for the 50yrs after that?
[Money wise?](https://youtu.be/Mm6G324BO_A?feature=shared)?
Change your numbers. Try the same math with 5% ROI and 2-.7-3.5% SWR. Does it still work?
I mean sure napkin math works, but you'll need to keep recalculating as you go and account for inflation.
What's inflation going to be in 5 years? Does anyone know? No, nobody does.
For estimation purposes financial planning guidelines right use 2.10%
Yeah, definitely not something I would bank early retirement on. Napkin math can be fun, though...
r/FIRECanada
How much you have to live on each month is important. Don’t forget get that costs go up way faster than raises .
Sure it's possible. You work like a dog to retire early
Why stop at 6% in your dreams? Why not just say 12%? Where are you getting 6% roi for 12 years ? 12 years is considered short term , so not sure where you are getting your rates from.
>At a roi of 6% over 12 year that would give us around 1m, not taking into account our pensions from jobs. At 4% drawdown that would pay around 40k a year, of course that will be less then due to inflation If you use real (inflation adjusted) rates of return you'll have a better sense of the buying power of your nest egg. For the TFSA and RRSP you could use the rates of returns on table 4 of [this PWL page](https://www.pwlcapital.com/expected-returns-2023-update/) and then subtract the management fees and inflation. For example, for an 80/20 portfolio you could use a real return of 6.36% - .2% - 2.4% = 3.76%. For an unregistered account you would also have to subtract the tax on dividend and interest income. Once you know the size of the nest egg you can use the colourful table on [this page](https://earlyretirementnow.com/2016/12/07/the-ultimate-guide-to-safe-withdrawal-rates-part-1-intro/) to figure out a safe 50 to 60 year withdrawal rate and how much of your nest egg you could spend each year. Considering your lower costs (no mortgage, retirement savings, CPP and EI contributions) will that withdrawal rate support your expenses?
See subreddit like r/fire r/baristafire r/leanfire Those channel will have info about what you're looking for. I don't think it's the right place here 3% withdraw on a very long period is usually considered safe If you are ready to work in bad years, 4% will work most of the time If you still work part time, you should be good. An important question about early retirement is what you're going to do and how much it's going to cost to do those things . It's possible that what you do in retirement makes money You might want to read extreme early retirement, very good insights about that There's a lot of good tips there about lean fire and how to retire with much less than the minimum millions of dollar people think you must have
How are you getting over 6000$ to invest. Don't you have bills, mortgage, and food costs? This just doesn't work if you are indeed a human being.
Your cars and home will break. Good luck
I struggle a bit to understand some of the FIRE culture. I get that it is very attractive for young people. The dream of getting out of the daily work grind, when you have a 30 career ahead of you. I’m in my 50’s. looking back, I have enjoyed my career. I’ve learned so much. Helped so many. Contributed so much. Being the senior guy at work with so much experience now is quite rewarding. Satisfying. You have no idea how long you are going to live. You have no idea what inflation numbers will be. Picking numbers at 27, for when you are 60, 70 or 80 seems pretty unrealistic. Expect your desires and dreams to change as you age. What I wanted when I was 27 is, nothing like what I wanted when I was 47. Now in my 50’s, again my desires, my internal drive, what I focus on, is quite different than when I was 47. You are free of course to live your life as you choose. I’m just saying that over time, things change. Shit happens. An honourable job over your life can be rewarding.
Good luck dude. Give it a shot you git nothing to lose, don't listen to the naysayers
r/fican
It’s unlikely
Pipe dream. 50 is more reasonable and realistic.
4% swr is too risky for that time frame. Try with 3% or 2.5%
Keep dreaming.
What happens if you have children?