This is not a question for those with millions/billions in the bank, but for normal software people who have saved some money, but not enough to retire.
What age are you planning to retire? What do you plan to do after retirement? What are you doing to get there?
Planning to quit by 40 and live a life of peace and quiet in Mediterranean Europe, where I was born and raised. Will spend my time napping, staying close to my aging parents that I really hope will still be alive by then, doing lots of outdoor activities, reading like a maniac, programming for fun, and never have a boss again for God sake.
7-8 years ago I was in the camp of those who thought they’d never retire, my passion for the industry and technology was too real. Well, Corporate America got the best of me and now I can’t wait to get out. Interesting to introspect how I changed over the years.
The main take-away for me is that people tend to over-save for retirement because they a) over-estimate how much they'll want to do in their 70s and 80s and b) underestimate the opportunity cost of saving when they're younger.
In any case, it prompted me to do some calculations around retirement. We could afford to retire early-mid 50s provided we were willing to save aggressively then sell our home and downsize at retirement. In reality, we'll still have teenagers at home at that point, so it's not so practical to downsize. Plus, my wife's career is starting to ramp up and be more interesting, so she'd probably want to work past 50, anyway.
Long story short, we're aiming at something like 60-65, maybe transitioning to fewer days/week over the last 5 years. The kids will have left home, our investments will have had 10-15 more years to grow, which means we can spend more now rather than be in hard-core savings mode.
As to what we'll do? Very likely sell our main residence, move to our place at the beach, have lots of time for the kids and (maybe) grandkids and do a lot of what we already do, just moreso: read, work out, hang out together, and occasionally travel.
One of the perks of academia. You can retire, but prevent boredom.
No no, you're not thinking far enough in the future. Give it enough time and there won't be any more snow!
Before going completely off the rails your last couple of years will be co-publishing papers with ChatGPT and getting listed as 2nd author.
So my plan is not to retire, per se. As I become more and more financially independent, I'm simply going to tailor the work that I do and the time that I spend on it to match whatever my desires are. No working on boring projects because it pays well, etc.
In my perfect world, which I will admit is a fetch, one of my side projects will get traction and I'll make enough to pay for a further two decades of unprofitable-but-fun projects. Or I'll win the lottery I don't buy tickets for.
It really helps that I enjoy coding and could happily do it until I croak, I don't consider it work. I keep getting roped into management though.
So not much difference from working at IBM?
I mostly have fond memories of those days. That was a different IBM than today. Back then when they moved you to another office across the country, IBM would buy your current house from you at market price so you could easily make the move and buy a new house where you were going. My dad did that a couple times before landing permanently in Portland.
[0] speaking of the picnics, I recall the joke about how the PCjr was created. The engineers and sales folks were very competitive, and during some heated talk at a picnic, the sales folks boasted that they were so good they could sell *anything* the engineers could dream up. Engineer reply: "Wanna bet?"
We had a PCjr ourselves. They gave them out to employees for peanuts.
I say the same, and I joke that I'm only slightly more delusional than the folks who play and think they can win
If someone asks, I also like to say that the odds of finding a winning powerball ticket on the ground are not significantly different from the odds of buying one yourself.
I can't back that up with real statistical modeling or anything, but given that the best odds are north of 1 in 200 million, it's close enough.
I have almost come to terms with I just need to live now and stop the voices of all the people that put this shit in my head for the last 40 years of "oh just do X and it's easy to retire! then that's when you life can start!". Life was completely different when I grew up- people had jobs with pensions, healthcare was all in, education was cheap.
But it's hard to push that shit away in your head. Plus I don't trust financial markets worth a damn. I work in the industry, this entire concept of "investing" that the rich have shoved into the middle class is absolutely disgusting and not the way the world should work.
So there's that.
A fail is not planning at all besides the money side of things. I know of people that have retired and are financially sound but without a clue of what they'll do next. The are bored all day and end up looking to get back into the workforce, at least part time.
Yep, once you have the financials figured out, you really need to spend some time focusing the life you're retiring to, instead of the work you're retiring from.
Overall I expect that I should be able to happily draw $140,000+ a year during retirement and have that NEVER run out. My wife is a teacher and should be able to pull $40,000-50,000 during retirement as well. Medical would be taken through her retirement plan. Household income between $150,000 and $200,000 during retirement.
Honestly? I don't want to retire. Why would I? I love working on computers, from my basement office and working remotely is great. I have a kid, I would expect to take 2-3, months off a year for less money, but that's not a problem to me.
What would I do with retirement? Clean my house more? walk my dogs more? travel more? Maybe? Work is great and just find something / someone you like working for, have enough fuck you money to not care if you get fired and the rest is gravy.
I think I'm far more likely to leave the programming career (web development) and pursue a masters in something like quantum computing or physics than I am to retire.
These are wild figures. Most adventurous rules of thumb are about 4-5% over inflation. If you have a way to be confident in getting 7-9% pa over 30 years quit your day job and pile your time into whatever that secret is.
Then you’re pulling out 4% + fees a year which is also around the point of confident adventurousness. Many now say 3-3.5% including fees.
Good luck to you.
Here's one source that supports the 7-9% range over the last 30 years: https://www.sofi.com/learn/content/average-stock-market-retu....
1920 to 2022: 7.38% (adjusted for inflation) https://www.officialdata.org/us/stocks/s-p-500/1920?amount=1...
1989 to 2022: 7.4% (adjusted for inflation) https://www.officialdata.org/us/stocks/s-p-500/1989?amount=1...
I generally feel the same way, but even in my mid-30s I've noticed that my energy levels have definitely trended downwards over time. And I'm doing all the right things: eating healthy, exercising, using standing desk, etc. Nothing too extreme at this point, but I also notice this trend in older relatives and coworkers, so the possibility of this happening to me seems very real and worth planning for.
If it does, there will be a point where I don't have enough energy to put into a full-time job plus everything else I need to do to live, and so it'll make sense to retire then. And if I end up feeling just as spry as I do now in 40 years, then sure why not just keep working?
I would invest up to the matching in a 401k up to the limit, and then invest in some good tech companies for long term gains.
My house is paid off (bought in 1999, paid extra each month, just paid it off a couple of years ago (30-year mortgage paid off in 23 years)) and both of my kids will be finished with college in the summer of 2030, so that gives me around 8 years to save up. I'm not putting any faith in my 401k or any investments. If they pan out, then cool, but having cash-in-hand when I retire is much more comforting.
After retirement, I plan on staying un-injured and not falling for any money-stealing scams for as long as possible. I'll write software when I feel like it. I'll experiment with new tech if and when it's cool enough to pry myself away from chatting up my fellow retirees and drinking excessively.