Requesting feedback on retire readiness

Congratulations! I ran into the same question few months back and realized its better to figure it out overselves. You could take a free trial membership of Projection Lab or Boldin or any other available retirement planner, list your assets and detailed expenses ( discretionary, non discretionary, one time expenses, recurring expenses etc) and model it. Do a chance of success simulation and you can see whether your plan needs adjustment or it is fine. The key point is willing to adjust. Once you sort that plan, you can then think about how to spend the time in retirement. Take a long sabbatical and test the waters, see if you are liking it. At the end of the day Retirement is a personal decision and you shouldn't have to convince anyone other than you.

A few things I’d think through before making the jump:

• Run a conservative withdrawal plan on just your taxable + cash for those 2 years. At $770k liquid vs. $125–130k spend, you’re drawing 16–17% annually, so sequence of returns risk matters a lot if markets dip early. You may want to tighten spending assumptions or build in a buffer.
• Think through healthcare, taxes, and flexibility. Those first couple “no income” years can be a great window for things like Roth conversions at lower brackets, but it takes planning to do it efficiently.

And big picture, make sure you account for taxes on retirement income, it’s one of the biggest levers in whether a plan like this actually works long term. This breakdown from a former policy advisor is a really helpful resource on that front:

The One Big Beautiful Bill - Webinar — BGK Financial

First of all, I just want to say congratulations. I highly recommend mini retirements. I was fed up with my high stress/high paying job when I was 48 and was at Lean FI so I took two years off. Here’s a few things I learned that might be helpful to you first of all. Definitely look into the cost of health insurance. Also, you’ll want to have enough in regular savings to cover the next year‘s expenses. Having adequate savings before January will help you avoid paying more on your taxes the next year. There are savings accounts that earn 3.5%. Also, when you do a MINI retirement it’s a great time to roll over any traditional IRA dollars to a Roth IRA or do some capital gain harvesting. Your annual expenses sound high to me, but it could be based on your location or kid related.

I ended up going back to school and picked a totally different profession for my second act. While I really enjoyed my previous vocation I found a new interest I wanted to pursue. The first month was the hardest so I recommend starting a list of things that you have always wanted to do and just pivot to those initially. After that, you’ll just find other things to do. Don’t stress about it and remember that you don’t have to justify what you do all day to anyone. One downside to retiring in your 40s is none of your friends are retired and most of the retirees are in their 60s. It would be good to seek out other people in your situation in your community. Hope this helps.

TB

Your will be fine for a couple years, but need to have a plan to earn more money in the future.

You need to get more granular on what your expenses actually are today and what they are likely to be tomorrow. They are likely to rise as your child gets older and does more things.

What's the plan man? Are you guys going to chill with the kiddo? Travel around? What's your why of FI at this point?

Don't get me wrong. I'm all for the mini retirement. I think we're just missing your reason for bailing on the high paying job.

On the technical side, you appear to have achieved/surpassed Coast FI (assuming you go back to work after a couple years as you said you are considering), but definitely not "Regular Retire" (I assume you mean standard FIRE) as you called it. Your withdrawal rate assuming your current savings and $130K annual expenses would be >8.5%, which puts you closer to ½FI, certainly not full FI. Reason being your planned spend is somewhere in the Chubby/Fat FIRE range, but your savings is not.

Depending who you believe, 100% FI requires somewhere between a 3%-5% Safe Withdrawal Rate (<3% is also safe). The only person who recently claimed 8% being a safe withdrawal rate is Dave Ramsey, and that has been widely slammed as utter BS! It is precisely that BS, which prior to then had been widely assumed by financial advisors, that prompted Bengen to do his original safe withdrawal rate research (he called it SAFEMAX) back in 1994. You cannot safely withdraw average market returns early in retirement because of sequence of returns risk. Ramsey should have know better and it was incredibly irresponsible of him to have said that - probably for publicity, knowing that he was wrong and would get a lot of people calling him out on it.

It sounds like you are financially ready for a mini-retirement or sabbatical, and to return to maybe Barista FIRE or higher income work to achieve full FI faster, but not full retirement yet.

Congrats on making it to this pivotal point!

What’s your vision for post-fi life? Have you begun living and trying that life already? My advice is to get clear and start that work now both individually and with your wife.

I retired early at end of 24 with a clear vision which enabled me to transition into the new life. That said it still was an adjustment, in large part of how my corp career ended, but also as I had more time to live my vision. I learned and adjusted but all of that would have been so much harder had I started from scratch.

would love to hear what you’re envisioning for post-fi life.

hope this helps

This is perhaps not at all what you were asking for, but I have one question and one prediction! Question: what do you envision your days looking like when you aren't working? Prediction: you won't go back after the two years are up, unless you are interested in generating that income with more of a passion project or fun business. Keep us posted!