Ether to FI has entered the halfway house! That is, depending on the numbers used and inflation’s impact, he may be able to consider himself and family halfway to FI based on their long-term goals.
I say long-term, but achieving FI within 10 years of residency is more of a medium-term goal, and a lofty one at that. Yet, after five years and a few months, despite the market turmoil of 2022, the E.T.F. family is in excellent financial shape.
One thing I love about these Ether to FI updates is that he dishes on much more than money. Yes, there are the net worth updates with each installment, but you also learn his thoughts on career management, work-life balance, and just how amazing his wife is.
She’s shifted gears in her career trajectory, and it sounds as though Dr. E.T.F. may be considering something similar. Read on to find out more and be sure to comment to answer a question or two posed by our regular guest author.
Halfway to FI?
It has been five years since I made the first post introducing myself to this audience and starting my path to financial independence.
The original goal was $3.3 million with a timeline of ten years. We only have five years left to surpass this number and be able to declare financial independence for our family. This would give us $100,000 a year to spend at a 3% withdrawal rate and unshackle us from working for money.
We have since increased the FI number to include an additional $50,000 yearly to support extended family and charities. This would move the FI number to $4.95 million. I am going to declare victory after we surpass $3.3 million. We will likely reach this goal before the 10-year mark, but I will keep reporting to this group until we get to year 10 to show what can be accomplished post-residency.
I went through all the old articles and will provide some updates on how our family life has changed since they were written. My current pace of writing two articles a year can be revised. If you are interested in more frequent updates every 3-4 months, let me know in the comments, and I will increase the frequency. If not, we can keep the same pace.
In the original post, I shared my financial goals for the year. Below are the ET.F. household goals for 2022 and their current completion status.
- Backdoor Roth IRAs $12,000 (Done)
- $60,000 emergency fund (Done)
- $7,200 in 529 for ETF 1 ($3,000 left)
- $6,000 in 529 for ETF 2 ($3,000 left)
We will complete goals 3 & 4 in December.
During our first few years of work, our goal was to minimize how much our monthly budget inflated from our resident budget. We wanted to stay under 2x our resident budget. We are factoring in inflation, especially with the increased cost of goods in the last year, and some lifestyle inflation, also known as traveling in style. We are doing well.
Our initial budget was $8,000 per month. It is now around $10,000 per month, on average. I am happy with that number.
If we had to cut back on everything in an emergency, we could comfortably live on $5,000 to $6,000 a month and not change much. Most of the fluff in our budget is from factoring in travel. Even though Mrs. E.T.F. has taken a severe pay cut to start her business, it has not affected our lifestyle.
PoF achieved FIRE primarily on one household income. We decided that Mrs. E.T.F should spend her time working to create her own business rather than build someone else’s dream. She initially went part-time, and now is “no” time with her former employer.
I have already written in a previous post how happy it made me to see her exit the rat race. Her departure has resulted in a 95% decrease in her salary as she begins to build her business. Long-term, I think this move will enhance our FI journey.
Besides the many skills she has built creating a business from scratch, she has created time freedom for herself. She is creating a business that she can take anywhere in the world. I have visions of me frolicking in a few years in some foreign city, and she will still be able to work from there doing something she truly loves.
We will write a post in the future to share precisely what she is up to. Hint: It is designed to give you superpowers.
WCI Commandments: Save 20 % of income, Thou Shalt Minimize Debt, Estate Planning
Our goal has always been to save 50% or more of our income since I started my career as an anesthesiologist. This has stayed consistent, and we have always remained above the 50% threshold.
We have allowed for lifestyle inflation but have not violated this rule. We don’t like debt in our house. We have tolerated having a mortgage with a plan of aggressively paying off the mortgage. Plans have changed, and with inflation at 10% and a mortgage rate of 2.875%, we have stopped paying more than is due each month.
However, the mortgage will be gone in 2023 because we plan on selling our home and renting. We have lived the American dream of “owning” a house and are looking for the flexibility of renting. More on that is below.
Our estate plans are completed but will need an update if we move states (hint, hint, significant changes are afoot).
More “Home Days”
In a previous post, I talked about how little E.T.F. 1, a toddler at the time, asked me for more “home days.” It was his three-year-old way of demanding that I stop working weekends and stay home with him. His demands have not changed as he has grown older. My kids want me to work less and spend more time with them.
In 2023, that will be the plan, and I am looking for a new job. Yep, it is time to find a position that is not all-consuming clinically and administratively and gives me more time to be Daddy and Hubby.
Are you hiring? Kidding, not kidding. I have worked in the same position since I finished my residency. It is time for me to move on.
The location of my next job is the most critical factor. I am looking for a place with easy access to nature where Mrs. E.T.F. and I can spend more time hiking and exploring. Easy access to mountains and a large body of water, our paradise.
The second most important factor is the flexibility of scheduling. I want to create gaps during the year for travel and spend more time with my family without taking paid time off. The last factor is working with a great group of people.
I also want to find a clinical position that lets me explore opportunities outside of clinical medicine. Opportunities at the intersection of medicine and business where I can contribute to a team solving complex problems. Professionally, I have always admired people that have been able to marry their love of business with the expertise they have developed from practicing medicine.
Medical professionals with a background in healthcare technology and venture capital, how did you enter those industries? Please comment below. Those jobs seem so interesting that I don’t think I would ever “retire” from them.
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Still Reading from the Same Page
If you have been following this post from the beginning, you will already know how awesome I think my wife is, but to update you, she is still awesome. I could not have asked for a better life partner, and a significant reason for my success is that I married a superwoman.
Her FI superpower of frugality still reigns supreme. Even after she decided to start her business and we had a decrease in household income, the amount of money that we saved/invested has remained the same. Technically our savings rate has increased even with a reduction in pay.
When you live way below your means, your lifestyle does not move with fluctuations in income. She continues to default to her frugal tendencies, but I have steadily been able to coax her to spend more in the travel arena. Our goals are still in perfect alignment. Family first and travel is our number two focus.
An Upcoming December Post
I will do my end-of-the-year post next month and use it to update the audience on many of the other themes I have covered over the last five years and our plans for 2023.
A new job and new location are on the horizon.
Net worth Update
Where did we start? Where are we now?
When I started writing these posts five years ago, it was designed to give a real-time account of the potential wealth a new physician can build within their first ten years of practice. It was to keep myself accountable and provide some motivation for others to track their wealth-building journey and see the progress they could make.
In article one, our net worth for the E.T.F. household was $80,283. Since that post, the portfolio has experienced the ups and downs of the market, a global pandemic, inflation, and changes in the E.T.F. household.
The constant has been steady investment in boring index funds, month after month, and mainly forgetting about the portfolio except to provide updates through this forum. Our current net worth is $1,770,135. We are more than halfway to the $3.3 million initial goal.
We will keep on our boring plan of buying more index funds no matter how the market moves. Let’s see where we land at the end of 2022. Will we crest over the $2 million mark? Maybe Mr. Market will give us a holiday boost.
Happy Thanksgiving to all!
If you ever want to say hello, I have an email account just for E.T.F. : [email protected]
Set up your own portfolio tracking spreadsheet with the template available below. When you add the Stock Connector add-in to Excel, the sheet will update automatically based on your ticker symbols.
You enter the number of shares you own (I use Personal Capital to display the information from my various accounts), and the sheet will update the value of each of your holdings daily (or more often, if you wish) based on the current price of the assets you own.
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
- Post 11:Ether to FI: Part-Time Work. Full-Time Life! And a Net Worth Update Net Worth $583,566
- Post 12: Ether to FI: Moving Targets & a Net Worth Update Net Worth $718,212
- Post 13: Ether to FI: Embrace the Dip & 2 Net Worth Updates Net Worth $682,028
- Post 14: Ether to FI: Time Waits for No One & a Net Worth Update Net Worth $937,709
- Post 15: Ether to FI: 3 Years to the First Million & a Net Worth Update Net Worth $1,023,261
- Post 16: Ether to FI: Thank You 2020 & a New Worth Update Net Worth $1,269,059
- Post 17: Ether to FI: The Goal is Happiness, Not Perfection & Net Worth Update Net Worth $1,485,440
- Post 18: Ether to FI: 2022, The Best Year Yet & a Net Worth Update Net Worth 1,559,591
Would you like to hear from Ether to FI more than twice a year? Have any suggestions for career paths in medical technology or venture capital where medicine and business meet?