Recently, I came across a financial website that catered toward high end earners – doctors.
These are highly trained professional who had invested on the average 10 to 15 years of their lives into the art of medicine.
Most of them seemed to be burned out from the work load and are ready for a laid back lifestyle typically reserved for older population – 60’s and higher.
There are two professions in any collective society occupied the sacred stature – doctors and educators.
Doctors have the hearts, the hands and the skill that heal. Educators have the hearts, the characters and the skill that educate the new generations.
Can you imagine the world we live in if the majority of these professionals are not passionate at the work and looking for the exiting door in their 30’s, 40’s or 50’s because of FIRE?
Financial independence concept has been around for thousands of years – initiated by the early entrepreneurs.
Many people who had successfully achieved financial independence in their 30’s or 40’s are highly educated and much more ambitious than they have an intimate understanding of themselves.
It is this elusive ambitiousness that will short change them in the financial planning phase.
The typical planning for any FI strategy is evolved around the withdraw percentage from all the investible assets – most will agree with the 2% to 4% range.
More than often, the disagreement is in how much asset to accumulate! This conversation is on the same par as religions and politics – hence it is an open-end debate.
Due to the built-in side effect of years in training, these highly educated professional will financially box themselves in because the technical details – tax advantages means for retirees are very enticing for them.
Once they have decided on the personal withdraw rate – they began to max out the back end tax saving for retirement – just to come clean, I did the same thing and it was a mistake for me.
I figured if I have a high enough income to load the back end with tax savings vehicles, the SEPP rule will come to the rescue if I am short with the front end of the taxable account.
Once I have decided to get on the FI journey with my family, the 2% to 4% lifestyle is designed for life – not just for the short term 10 or 30 years time frame – this critical area of the plan works flawlessly!
For the last 9 years of living the financial independence lifestyle, I came to realized that I have more of the entrepreneur spirit in me more than I have anticipated when I was fully plugged into the system.
I am apologizing for my vulgarity – but I have to do the “WTF!”
Few years back, an investment opportunity came about with a close friend and fellow professional who I have not looped back since the day I left the company.
I have enough of the frontend taxable account to bankroll the venture, but I don’t have enough to fund the designed lifestyle for the family – just in case the opportunity got off on a slow start!
This is one of the few golden investment opportunities that are in lined with my specific training and interest.
Essentially, I have inadvertently boxed myself into the financial limit equated to 2% to 4% of all the possible endeavors.
Retirement is an invented concept. It was the side effect of the British Industrialization Revolution in the mid 17th century. The idea was meant to flush out non-productive labor resources.
It is an enticing fantasy when you are in your 30’s and 40’s seeing yourself drinking margarita on the beach somewhere in the world when you are under constant stress.
And if you are successfully crossed FI mile marker, very quickly, you will realize that you are so much more than the narrow definition of life others have defined for you.
Unless you have other tax effective vehicles that allow access full access to the fund without penalty – overloading the retirement accounts will limit more opportunities than you can imagine!
Make sure you have loaded enough ammunition in the front end taxable account for game day!
Let’s play the game of life!
I agree with the general sentiment. Basically, entrepreneurship doesn’t get enough coverage because its individualistic. You can’t just “copy” it. Even if “tried and true” methods are followed – lets pick RE, franchise etc – a newbie would have to put in the effort and learn the lessons his/her way on the job. This vs. a hey just invest in ETFs, save save save, pay debt is simple to follow; specially for doctors (I am one btw).
The problem is this isn’t really rocket science. It looks to be but this isn’t the superpower some claim to be. True independence is in business owenership. However, there are few blogs dedicated to this and the reason is simple: $$$. Where would the blogger make money talkign about entrepreneurship? Can’t talk about debt pay off ($$$ from refi links to refi banks); or courses on simple to follow “rules” of market investment (too expensive courses but “essential” since it is about money).
You get my drift. And FIRE bloggers a peddling this with at least some ulterior motive. Everybody is selling something. Remember that.
Absolutely – FI in FIRE is an concept out-born from the first entrepreneur. Currently, it has tremendous value in bucking the trend in consumerism across the entire population. Moreover, the movement lends way to opportunities in entrepreneurship for young people in the late 20’s, 30’s or 40’s. Yet, the RE in FIRE is selling a wrong message to this otherwise very bright and young people!