back to indexThe_Surprising_Benefits_Of_Early_Retirement
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And I've just been doing a lot of reflecting, 00:00:07.800 |
lots and lots of reflecting, because I'm planning 00:00:13.900 |
to talk about the surprising benefits of early retirement 00:00:18.800 |
So to recap, I left my full-time job in investment banking 00:00:35.360 |
to do at the age of 34, going into my prime earning years? 00:00:45.200 |
you're going to get used to your new situation. 00:00:48.240 |
And you're going to figure out ways to adapt. 00:00:50.160 |
So I had about $80,000 in gross passive income 00:00:54.000 |
coming from dividend stocks, CDs, savings, and mostly 00:01:01.200 |
But as I got older, I realized I needed to make more, 00:01:08.640 |
My wife stopped working also at the age of 34. 00:01:14.240 |
As you get older, you just want to do more things, like travel 00:01:20.360 |
care of your elders and people that you care about. 00:01:25.920 |
have been on the fence about whether to truncate 00:01:28.180 |
their careers and cut their main source of income. 00:01:34.040 |
And I also want to say that no matter how much you plan, 00:01:41.620 |
on the unanticipated benefits of early retirement. 00:01:44.720 |
So I want to go through five of the main ones. 00:01:50.940 |
because I'm reviewing that and I'm thinking to myself, 00:01:53.400 |
I would retire right now if I had a job just because 00:02:04.400 |
you're going to college, you're working 60 hours a week, 00:02:13.880 |
But you don't really realize how much stress and chronic pain 00:02:18.480 |
you develop while you're working until you're no longer working. 00:02:22.720 |
So when I was 33, I started sprouting my first gray hair. 00:02:26.720 |
And I thought, hmm, finally the dam has broken, 00:02:29.440 |
because my dad's-- he started going gray and losing his hair 00:02:34.480 |
And I was thinking to myself, well, OK, that's it. 00:02:38.800 |
of getting beaten down by the finance industry. 00:02:41.400 |
Then one morning, a year-- about a year after I retired, 00:02:52.680 |
and she couldn't find anything on the top of my head either. 00:02:55.880 |
So I'm 42 now, and I still don't have any gray hairs. 00:03:02.360 |
have this scar on the top left of my forehead 00:03:06.480 |
that seems to get more and more prominent, or it seemed to. 00:03:15.040 |
might be one of the best ways to extend your life 00:03:36.120 |
and then we just learn to suck it up and deal with it. 00:03:49.040 |
Two, on the same lines of feeling healthier and maybe 00:03:52.440 |
slowing your aging, your chronic physical pain might go away. 00:04:02.000 |
TMJ, which is tightness in your jaw, sciatica, and also 00:04:12.480 |
And there was one point I just couldn't walk, 00:04:18.440 |
So I had to go buy one of those Aeron chairs that 00:04:20.480 |
were like $800, and the firm wouldn't pay for it. 00:04:25.440 |
But back then I was like, OK, I've got to do this myself. 00:04:28.400 |
And I just couldn't drive either for longer than 10 minutes, 00:04:37.800 |
and I would wake up with a very, very sore jaw. 00:04:44.320 |
Every time I would talk longer than five minutes, 00:04:49.360 |
And so the pain got so bad that I went to a dental specialist 00:04:53.000 |
and paid him $760 out of pocket to drill some divots 00:05:03.720 |
that my jaw could close more evenly so I can get some relief. 00:05:18.840 |
whether it's tennis elbow, lower back pain, or whatever. 00:05:22.680 |
The book talks about how our minds can manifest chronic pain 00:05:26.200 |
to deal with the stress and anger in our daily lives. 00:05:31.560 |
It's the top book I just would give to everybody 00:05:36.600 |
So then amazingly, about 10 months into retirement, 00:05:41.640 |
So after 13 years of living and working through chronic pain, 00:05:49.680 |
Now looking back, it's just so shocking how much I put up 00:05:53.080 |
with this chronic pain in the pursuit of career progression, 00:05:58.080 |
So if you have pain right now, retiring early 00:06:00.840 |
could be one of the best moves if you do it right 00:06:13.640 |
for those of you who are trying to have kids. 00:06:16.360 |
I think something like 20% of couples trying to have kids 00:06:22.760 |
or more serious abortion later down the road. 00:06:25.840 |
And I think it's just not talked about enough. 00:06:28.200 |
And it's really difficult for some couples to have kids. 00:06:33.680 |
it takes about seven to eight months or seven to eight tries 00:06:46.800 |
And some folks fail during that process as well. 00:06:49.840 |
So it's not easy or it's not as easy as you think 00:06:52.840 |
to have kids, especially if you're in your 30s 00:07:04.200 |
Although the money was good, we were constantly tired. 00:07:10.080 |
because we didn't feel like we had any energy left to spare. 00:07:19.320 |
And this is kind of the mantra that we've been living with 00:07:23.600 |
And living in New York City and San Francisco, 00:07:27.520 |
So we were just focused on trying to make as much money 00:07:33.120 |
And it wasn't until after my wife turned 32 in 2012 00:07:36.720 |
that we began to contemplate seriously having children. 00:07:40.160 |
We had always been told that it's best to have children 00:07:51.480 |
fertility rates really plummeting after the age of 39 00:07:55.520 |
and spontaneous abortions really skyrocketing 00:08:04.800 |
Then we tried more purposefully the next year, 00:08:09.800 |
because she had just gotten passed over for a promotion 00:08:15.040 |
And I had never seen her so mad about her job before. 00:08:21.560 |
to finally plan her exit strategy by negotiating a severance. 00:08:25.240 |
And when she did, it was like the skies had parted. 00:08:39.880 |
So how much did early retirement help us conceive? 00:08:52.680 |
It allowed us to relax more, to have more time to plan. 00:08:56.600 |
So I would say absolutely retiring early for both of us 00:09:09.200 |
Depending on what part of the cycle you retire in, 00:09:17.920 |
during a bear market instead of a bull market 00:09:23.640 |
that means you can live off what you got right now 00:09:29.040 |
there should be mostly upside in your investments 00:09:44.520 |
I think you're gonna be in for a rude surprise 00:09:55.600 |
But let's say you're not counting particularly on luck 00:10:00.320 |
You just have a lot of free time to do what you want. 00:10:04.160 |
I decided to write a severance negotiation book 00:10:16.600 |
you need to accumulate at a 4% rate of return. 00:10:20.480 |
I feel that I've created a couple million dollars in wealth 00:10:24.880 |
because I did something that I thought was useful, 00:10:35.720 |
Financial Samurai now also generates enough online income 00:10:45.360 |
in the past, I couldn't get beyond the dollar menu 00:10:49.880 |
a dollar for whatever special it is that day. 00:11:11.920 |
So we fully expected our net worth to stay flat 00:11:21.600 |
because we are doing things that we like to do. 00:11:30.760 |
It's been almost eight years since I had a full-time job. 00:11:36.000 |
I'm longing to kind of get back in that grind, 00:11:49.200 |
and you will run into this huge roadblock as well 00:11:52.320 |
if you don't listen very carefully right now. 00:12:14.720 |
because HR wants to protect the company instead of you. 00:12:33.720 |
and your frustrations and your fears to your HR manager 00:12:36.680 |
because the HR manager will inevitably tell your boss 00:12:48.440 |
But if you can skillfully befriend your HR head 00:12:54.880 |
do so because that will help you during your exit period. 00:13:05.080 |
to my personal email address and it was flagged by HR. 00:13:07.480 |
And they said, "Sam, we're gonna have to get back to you 00:13:11.040 |
because you violated one of our terms of agreement." 00:13:19.440 |
And I was just like, "Oh my gosh, please, please, 00:13:28.400 |
"Well, at least it was a five-year-old file." 00:13:30.200 |
It was like client contact information and stuff like that. 00:13:44.640 |
And they said, "Look, we'll get back to you." 00:13:48.200 |
this severance package was worth over a half a million 00:13:50.680 |
dollars because it paid out all my deferred compensation 00:13:59.080 |
I went to the Hastings School of Law Community Fair 00:14:09.000 |
It was their way of providing community service. 00:14:11.120 |
And it was awesome because it was just different types 00:14:14.040 |
of legal issues, helping different types of people. 00:14:17.080 |
And my wife and I, we stood in line for two hours 00:14:19.480 |
and I kept on telling myself while I was in line, 00:14:22.160 |
"If I can get through this and get my severance package, 00:14:32.120 |
And right now, eight years later, I'm thinking to myself, 00:14:38.640 |
and I need to make some money and provide for my family." 00:14:41.840 |
And so it's really interesting that once you've tasted 00:14:48.160 |
you think you never wanna return to work again, 00:15:03.040 |
and you had a two or three month summer vacation. 00:15:05.600 |
I don't know about you, but after three months, 00:15:21.560 |
and relaxing and watching TV and stuff was the best. 00:15:32.640 |
I'm gonna have a different type of writing style 00:15:34.360 |
and I think a different adventure to bring you guys on. 00:15:37.040 |
And I think it's gonna be really, really fun. 00:15:38.560 |
So I hope you guys stick with me and stick it out. 00:15:41.640 |
In conclusion, I wanna say that retiring early is scary, 00:15:45.640 |
but it is really great if you do it properly. 00:15:53.440 |
because they underestimated how much they needed 00:15:55.640 |
in retirement or they overestimated how much joy 00:16:12.400 |
I think that extra buffer should be about 20%. 00:16:23.520 |
And to generate $120,000 a year in gross investment income 00:16:46.800 |
because you hear other people retiring early. 00:16:51.960 |
And please, please don't quit your job, folks. 00:16:54.880 |
I'm trying to get this message out as best as I can. 00:16:57.280 |
If you're gonna try to retire early and leave 00:17:00.960 |
you might as well try to negotiate a severance 00:17:03.280 |
because there is no downside to trying to negotiate. 00:17:07.920 |
is sacrifice your working life to retire early 00:17:19.120 |
to find a more enjoyable job and delay retirement. 00:17:22.560 |
Live a little, you know, a little balance here and there. 00:17:28.320 |
I was like, "Go, go, go in my 20s and early 30s. 00:17:31.240 |
"Get out and then like see what's up in the world. 00:18:01.160 |
But I think everything is gonna be all right. 00:18:03.000 |
So I hope you guys have a great rest of the holiday.