Ether to FI: Don’t Call it Retirement (and a Net Worth Update)
What will you be up to in sixteen years?
I don’t pretend to know where I’ll be or what I’ll be doing, but our friend Ether to FI, who is in his second year now as an attending anesthesiologist, has some more concrete ideas.
He’s made tremendous progress in his first full year as a physician anesthesiologist in the workforce. His finances will be outlined below in detail, but he’s also made progress in terms of thinking about his life plans and life goals.
Today, he envisions being Retired Not Retired before his fiftieth birthday, or about 17 years after starting his anesthesia career. Note that is markedly beyond his goal FI date just 9 years away. Why keep working after achieving financial independence?
I want to thank E.T.F. for coming back with this update. But don’t call it a comeback. He’s been here for years. And don’t call it retirement…
Don’t Call It Retirement
June 30th, 2034
July 1st was the grand opening; June 30th will be the grand closing.
Let’s call it a separation of service. There is too much of the world to see and time is a limited resource. We have gained better clarity as a couple over the last year about our future desires.
First is spending more time together as a family. Second on the list is eliminating our need to trade our time for money. The third is traveling extensively at a leisurely pace. Goals 1, 2, and 3 are not compatible with full-time work.
In the FIRE community, retiring in your late 40s is not considered early. In the medical community, it’s extremely early. There are too many things we want to do as a couple to wait till the age of 65 to stop. 2034 gives us the balance of accomplishing career goals, giving our kids a stable environment (K-12), and still young and fit enough to enjoy traveling.
How long will the break last?
I have seen these “breaks” last a few years for some and forever for others. I refuse to call it retirement. One year ago, I placed great emphasis on FI, because I cannot imagine a complete break from work.
Work of some sort will always be there, I can see myself taking a few years off and then working for a few years, and repeating the cycle. Mrs. ETF will likely spend her time between years “on,” volunteering, but I doubt she will have an itch to return to work.
To make this hope a reality, we will need some money. Currently, we are trying to grow our net worth substantially by 2034. We are setting a big audacious goal of $300,000 available a year to spend.
(I can hear people already, $300k, seriously?)
Yep, $300k, we don’t plan on spending anywhere close to that amount. Who knows what the future will bring, but I cannot imagine having financial problems with a buffer that large. Even if we live past a hundred years old, starting with a buffer that large in my late 40s will guarantee our great grandchildren will never run out of money.
Setting a target this large will force out of our comfort zone of a steady paycheck. We have discussed creating other streams of income, this new goal should spur us to action.
Our finances: One year in review
We have made some progress over the past year, growing our net worth from $80,283.87 to $364,089.20. I am very proud of our progress. New year, new goals: $800,000 by the end of year 2.
Go big or go home!
Let us review this past year. I rolled my residency retirement account into an IRA. The Roth 403B portion went directly into a Roth IRA. The traditional 403B plus the employee match was moved into a Traditional IRA.Backdoor Roth IRAs. $22,000 was added to our Roth IRAs, $5,500 in each of our IRA’s for 2017 and 2018.
We beefed up our cash position primarily for our house purchase hopefully in the next six months, and we will keep on adding to it. $25k is our emergency fund, the additional $67k will be part of our home down payment.
We have cranked up our retirement account contributions, maxing out all available options at our jobs. I am happiest about our college savings for our kids. Initially, it stood at $7,080, and now they have $37,795. It looks like the mini E.T.F.’s are going to college.
There will be a few things spurring our net worth along. We are planning on buying a house. I don’t expect much appreciation over the course of one year, but we will have a 15-year mortgage. I am debt adverse, and I will have extra motivation to aggressively rid us of the mortgage in 4 years or less.529 plan at $40k, and increase ETF 2’s 529 to $25k.
We will also open up a taxable account this year with at least a $10k VTSAX contribution. We have a lot of moving parts, but Mrs. E.T.F. and I work best with defined goals.
It has been a great year, thanks for following along and stay tuned.
Only 5,760 days left.
Follow Ether to FI’s progress to FI in his previous posts:
- Post 1: Introducing Ether to FI: A New Attending Striving for Financial Independence. Net worth $80,283
- Post 2: Ether to FI: Obeying WCI’s Ten Commandments & Net Worth Update. Net worth $145,194
- Post 3: Ether to FI: Home Days & Net Worth Update Net worth $176,674
- Post 4: Rest in Peace, E.T.F. A Love Letter from a Dead Man and a Net Worth Update. Net Worth $197,061
- Post 5: Ether to FI: Mrs. E.T.F., Are We on the Same Page? Net Worth $228,109
- Post 6: Ether to FI: Shifting Focus from the “FI” to the “RE” and a Net Worth Update. Net Worth $335,248
- Post 7: Ether to FI: Don’t Call it Retirement (and a Net Worth Update). Net worth $364,089
- Post 8: Ether to FI: Frugal Spouses: The FI Superpower & a Net Worth Update. Net Worth $429,155
- Post 9: Ether to FI: “I hate it. I hate it. I hate it!” Learning from Those You Disagree With & a Net Worth Update. Net worth $489,200
- Post 10: Ether to FI: Waste Not Want Not & a Net Worth Update Net worth $561,532
[PoF: This is a great example of what can happen when you have a laser focus on your finances from the day you start earning a physician’s salary. Now I’m not saying every physician will be able to replicate his numbers; he’s got several advantages that a lot of you won’t have (and some that I didn’t have, either).
His wife worked and helped pay his way through medical school, graduating with manageable student loan debt, which they paid off by the time he finished residency.
He’s in a high-paying specialty.
He does not have a high state tax burden.
Nevertheless, these benefits he enjoys are no reason to think you can’t make smart decisions with your money and save a significant sum at a relatively young age. It might take you twice as long, or you may only save half as much, but anyone with a physician’s salary should be able to increase their net worth by paying down debt and / or investing from day one.]
What do you think of the E.T.F.s’ progress thus far? Or their audacious goal of adding $536,000 to their net worth over the next twelve months? What odds would you give them?