Since I took my sabbatical & returned to work, I've largely been focused on seeing how things evolved, and not setting a particular end date. This has been helped tremendously by no international travel in 2020, and unlikely travel in 2021. Removing this from my plate has brought so much balance back to my life (despite all of the other noticeable COVID tradeoffs.) Once it is safe to do so, I will be required to travel internationally again (6-8 weeks/year), as my job is global.
One of our big financial goals for 2020 (and, carried over to February, 2021 as we're in the middle of a refi) is paying off our mortgage to the half way point. This is my disclaimer to add that, even at the half way point, it's a huge mortgage. We have plenty of equity in the house (more than 60% currently), but there's a big mental milestone involved in getting below the half way point of the mortgage we originally took on in 2017. Paying half of it off in four years would be awesome.
I'm now ready to set our next big milestone, and I'm really, really excited about it. My plan is for us to have the full mortgage paid off in early 2023, and for me to leave my job. M would keep working, and could easily cover our non-mortgage expenses, with plenty to save. I won't need to work a big "career" job once the house is paid off. That means we'll pay off the same amount (half the mortgage) in half the time as we paid it off last time, which is why this is quite an aggressive goal. But, I think we can do it. A few things are working in our favor:
- We paid off our vacation house
- We sold our Seattle house
- Because we're at the half way point of the mortgage, each payment goes a little further towards the principal & we're about to close on a very favorable refi rate
- I'm making more, as is M
- When we bought the house, we used all of our available money to pay for the house. I mean, all available money. Because of that, it took us a while to get a large emergency fund going again (I like a huge emergency fund, given our expenses, so 6-12 months worth). We're not starting in a hole this time, which will be tremendously helpful.
Assuming we can hit the goal of 2023 for paying off the house, I'll likely plan to quit in early 2023. I get my bonus in January, so I'd definitely stay until then & stay flexible, but am eyeing February, 2023 for a potential exit. I can flex as needed, if we're a little short on the mortgage. Right now, the math adds up to having everything but $180k paid off (special shout out that this is a bay area mortgage, so this is, unfortunately, a small amount of the total), but I'm hoping with some dedication & creativity, we can hit an early 2023 payoff date.
What will I do once the house is paid off? While I will probably "work" in some form, it's more likely to be flexible: volunteering, consulting, etc. I'm not interested in switching to another big "career" job, unless something drastic changes in my life.
What big goals are you setting right now?
Dream big and plan big I say! I'll be rooting for you all the way. I've shared our first goal is for husband to retire in three years, give or take a few months, but definitely by May 2024, when he'll be well past 62, but still considered an early retiree. The next goal is me to retire three years after that, give or take a few months, putting me at 61 1/2.We need though a much better cash cushion-hard to do with a child in a private college, even though she has hefty scholarships, but I know it was the right school for her for her future. IT's all relative to where people live, number of kids, and desired lifestyle, so no need to do any disclaimers-and I hope the trolls and opinionated people keep their typing to themselves on your post.
ReplyDeleteHa, the market here is crazy, but often so are the salaries. People often focus on one but not the other, and draw assumptions that don't match up.
DeleteYour goals sound great. Love that your husband is in the home stretch. Perhaps it will be relaxing for you to have a "house husband" in your last few years of working.
I am about 61. I have four grown kids, but two have refused to go to college or trade school. Really, if I could convince them to go to school, it would make my planning much easier. I would pay for it as much as possible just like my momma and uncles helped me. At the moment, I am planning on working at my current job until almost 65, so about four more years. I plan to retire and open my own practice. I am like you, I have nothing to prove, career wise. I like the people I work with, and I like my job, but I need more flexible hours to go visit the one kid who live thousands of miles away from me. I do not get to see her/grandkid enough. Well, that is the plan, but my plans never go as planned...lol. Cindy in the South
ReplyDeleteI can imagine flexible hours being such a big blessing at this stage of your life. That sounds lovely.
DeleteOn the career front, I've more than overachieved what I could have ever thought possible, so no matter what, I'm good there. It's a great feeling, right?
It's great to have a goal that is so close! Yes, lack of travel sure has worked in your favor for the last year. International travel is so bloody tiring
ReplyDeleteIt's so motivating. When I was working towards the sabbatical goal, it really helped me get through challenging work milestones. And yes, the lack of international traveling has been a tremendous gift, financially & health wise. I can't believe what a difference it's made for my health.
DeleteHoping you are all well!
That's a big goal & I am confident that you'll achieve it. You guys have done great paying half in such a short time. I'm rooting for you!
ReplyDeleteThank you! It's so motivating to have a plan. Even if we need to make adjustments, it helps me feel very focused.
DeleteI retired recently when I turned 60. Prior to that, we became mortgage-free when we downsized from a larger home. Not having a mortgage opens up a lot of possibilities. My big goals now are to stay healthy, help others, and enjoy life.
ReplyDeleteIt's awesome that you paid off your house & retired. Great work! And, love you big goals - those are all totally inline with my plans as well.
DeleteAwesome job on your 17 mortgage payoff plan. Fingers crossed for you on your business. This is such an incredibly challenging time for so many people with small businesses.
ReplyDeleteLike you, I get an instant thrill out of seeing the mortgage number drop. It's a big part of why I sell on eBay - I automatically make small payments all the time, using my eBay profits.
House payoff is my goal too. Although what is left on our mortgage is a fraction of yours ;) While the prices have increased in my part of Ontario, it is still relatively affordable. I am hoping to have it paid off in 4 years, which would allow me to do a career shift. At that point I will have taught elementary school for 25 years. I completed my Doctorate in Education a few years ago and would like to do some online university teaching. Unfortunately it pays less than teaching school. If the mortgage is paid off, I could make it work. I may even stay teaching a day a week to ensure I have medical benefits. Our house has appreciated considerably in the 8 years we have owned it, so I am confident that any money paid on the mortgage can be recouped in a sale.
ReplyDeleteThis sounds like a great plan! I love the idea of having enough flexibility to make a career switch. That's my plan as well. I doubt I'll stop working at this age but will give me the flex to work at a non-profit (for 1/20th of current salary) or work how & when I want.
DeleteYou two are so wise to bank your earnings now when they are considerable, including paying off your mortgage early, instead of increasing your standard of living to match your paychecks. You'll both be able to walk away years, perhaps decades, earlier as a result if you decide to do so. It's such a great feeling when you hit the point of your investment revenue stream matching your outlays.
ReplyDeleteWe made big bank as well during our combined working years, and we likewise resisted the urge to continually up our lifestyle. Our basic strategy was to live off my salary, and bank his salary, plus both of our annual bonuses, though we did allow ourselves to set aside 10% of our combined bonus net for a small annual splurge. That splurge each year was enough to keep us going with our otherwise aggressive saving plan.
For me it was not wanting to deal with the stress of an elevated lifestyle dictating that we keep working at our stressful jobs. My husband simply wanted to leave the demanding corporate world as soon as he could. When he did, BTW, I watched him become younger in front of my eyes. stressful jobs can really age you.
Good for you both!
And even if you change your mind and decide to keep working, it will be because you want to, not because you have to, and that may just change everything!
Yes, yes & yes! My husband really enjoys work & finds it so personally valuable. It's fascinating, because I don't feel that way, so we have such a different approach to work. We've worked hard to keep our lifestyle in check. Housing, of course, is the area where the inflation is largely forced upon you. We definitely could have lived further away, but made the tradeoff to pay more, for a much shorter commute. It was a deal breaker for me, otherwise. Coming home from a very stressful job & sitting in traffic for 60+ minutes each day was just not an option.
DeleteWhile I say now that I don't think I'll ever want to go back to a consistent job, maybe I'll surprise myself after some time. Who knows what the future holds, but I want the ability to shape it myself, vs having finances dictate what I need to do!
We are at the halfway point on a HUGE east coast mortgage too! I don’t think we can get the rest done in two though! My hope is to whittle away, and hopefully get the rest done in 5....right before the second kid hits college. Good luck to you as well!
ReplyDeleteWay to go to you! That is awesome & inspiring.
DeleteGood for you. The older your boys get the more they will need you. They always say they need you when they are young, but my kids needed me in high school and college.
ReplyDeleteI find they really do need us at this phase. In a different but still very important way.
DeleteI don't know what makes up a Big Career quite so I tend to think of mine as a medium career.
ReplyDeleteYou made me curious so I checked our spreadsheets and we are still a good $80k away from hitting our loan halfway point. That's quite a long ways considering I'd decided to aggressively invest this year and not focus so much on debt drawdown. Not that I am not at all, with the refi completed, I can now put a really good amount toward principal with our monthly payment and still be paying less than we were before. But we're not on track to cutting it down enough that we'd hit the halfway point in two years, I don't think.
I would love to be able to put together a new five year plan that includes a big change by or before the end of it though. Wishful thinking, right now :-)
I define Big Career as on a "ladder" of sorts, where you are continually progressing & need to keep going & delivering against a higher & higher bar. Dialing back isn't as much of an option, because I have to maintain a certain trajectory to keep earning the same money. The delta between what I could work at this job & something more dialed back isn't worth it. I'd rather spend a fewer number of years going all in, and then having the flexibility to do whatever I want. But, note that I made up that definition on my own. ;-)
DeleteI like a five year plan - it's close enough to be motivating without overwhelming. You've got this!