Cracking The Code To Early Retirement: 17 Revealing Insights To Your Burning Questions!

Questions From You— My Favorite Readers!

A hundred years ago, we thought technological advances would mean we would all work less. Instead, we are working more than ever! There is not much of a blueprint for retiring early, especially this early. I want to help demystify what early retirement looks like, so I recently posted summary of the first year of early retirement and sent out an email to ask for reader questions. Thank you for everybody who submitted theirs! Here are my 17 answers to your burning questions about early retirement.

1. How long did it take you to decompress and get accustomed to your new day-to-day?

I thought it would take about 6 months to decompress. However, I traveled extensively for the first half of the year, which didn’t feel very ‘decompressing’. Once I got home, it felt like I could start to relax. Even after six months at home, early retirement does not feel normal. It feels surreal, like I might wake up tomorrow and go back to work after a looong weekend. One aspect of it is that it’s hard to feel like what I’m doing ‘matters’ if it’s not work. It will take some time to divest of the notion that I am only valuable if I am doing something that can make money. A lot of my thoughts are thinking about businesses I could start or things I could try to make and sell. I will give it another 6 months, and see if I am accustomed by then!

2. Has the increasing cost of living impacted your expenses? Plane tickets have skyrocketed this year, Airbnbs too.

Frequent readers of the blog may have noticed that I stopped publishing monthly spending reports. That’s mostly just because I forgot. I kept forgetting what month it was, and didn’t keep good track of my money. This is the opposite of what I thought would happen! I thought in retirement I would be even more careful. However, I can track my spending trends on Empower Personal Dashboard so I took a look at last year’s spending chart:

Some context:

• August: I paid a big tax bill
• October: I got most of it back
• Also October: I spent a lot on accommodations in Indonesia, and qualified for a cash back reward on a new credit card.
• March: I was in New Zealand and adventures like sky diving were a major expense.
• Also March: My flights home were about $550 (New Zealand –> Honolulu –> Santa Barbara).
• Any income shown is usually a refund from a return or booking cancellation.
• On average I spent about $2,000 a month.

This is consistent with my spending for the past few years. While traveling, I mostly stay in hostels, which keeps the costs down. I also selected destinations based on flight costs, and was flexible on what day I would fly.

For the 4% rule, I need a portfolio of $600,000 to support my spending… check!

3. How big was your cash cushion when you quit?

I kept a cash cushion between $20-25k, which is a year of expenses. It has somehow remained consistent, though it feels like it has been slowly draining. I switched my investments from reinvesting to paying out in my account.

I still need to do some financial accounting like consolidating my 401ks to a Traditional IRA, which I didn’t do while working in order to take advantage of the backdoor Roth strategy. I also need to kick off my 5-year Roth Conversion Ladder to access funds in my retirement accounts. Until then, I will draw down from my savings, followed by brokerage accounts.

My Empower Dashboard is not too happy with how large my cash cushion is, but it doesn’t know I retired!

4. I’d love to know how you’re traveling all over the world (living on 4% or less??).  Any travel resources you could share with us that you love?

I did not spend more traveling the world than I did at home. That’s right… I could be in paradise, perpetual vacation, and spend the same amount as living at home. When most people travel, it is an expense on top of the regular spending categories like rent. Also, it tends to be a ‘treat’ so money goes towards excursions, eating out, and other splurges for the few days escaping from work.

When my normal ‘rent’ could go towards hostels, food, and transportation, my expenses didn’t increase.

For travel tools, I stick to the tried-and-true. I use a Chase Sapphire Preferred card to rack up travel points. It’s my go-to card for everything. I also learned that Charles Schwab Investor Checking Account has some great benefits like ATM fee reimbursement and no foreign transaction fees, but I didn’t get the chance to try it out myself. However, I opened up an account for next time, because ATM fees were a pain!

I use Airbnb, Hostelworld, and Booking for accommodations. I tried an app called Hopper once and accidentally booked myself into a room with four double beds (I guess meant for couples??). It was a bit awkward and I went back to my usual sites after that.

I generally used Google flights and Skyscanner to look for flights.

Maybe one of my favorite lesser-known resources is Scott’s Cheap Flights, now called Going. They send great deals and mistake fares.

5. What are you doing now that you avoided or didn’t have bandwidth for when working?

When I finished a workday, I felt like I was in a mental fog. The fog made me long for an easy meal, some TV, and the sweet escape of sleep. In retirement, I prioritize rest. Real rest.

Even travel is different. When I traveled before, I had to cram every sightseeing adventure into a puny week. Jet lag stole a a couple days here or there. When I traveled in retirement, I could spend a few days doing nothing but swinging in a hammock or spending half a day writing in a café while intermittently eating dumplings. I noticed the difference when I had family and friends come to visit, because suddenly the pace changed to make sure they got the most out of their PTO.

I thought I’d get a lot more done in retirement, and in a way, I have. I’ve gotten more done in the way I rest. The way I can be more languid. I roast veggies for a lunch time snack. I don’t want to watch TV at the end of the day, because I don’t want to zone out of the time I have. I am simultaneously unbothered by long lines at the DMV and able to pick a day and time based on when the line is the shortest.

I can listen to my own body and energy levels throughout the day, to do whatever feels right in the moment. I couldn’t do that when I was working. Before, the pace of my days felt frantic, like I never had enough time to do what I needed to do. Now everything is much more zen, whatever needs to get done will get done, on its own time.

6. What’s your biggest surprise over the last year?

Here are some of my biggest surprises so far:

• I’m surprised how frequently I wonder if I should go back to work
• How psychologically difficult it is to spend money in retirement
• That 6 months of travel felt like enough for a stretch
• I got my scuba diving license after thinking I would never try that sport
• I never thought I would drive a motorcycle, but I did— to do one of the most scenic loops in the world

Despite being very happy in retirement, I often think about going back to work. I think it’s because of how much our culture is oriented around work in general. It feels weird to say I’m retired at 29. People don’t really get it, I feel like I have to justify the time by proving myself productive. And frankly I haven’t been very “productive” in retirement. Mine is a little different in that I don’t have seven passive income streams or rental properties to manage.

7. What do you say or plan to say to people who ask what do you do for a living? How do they react? How do you deal with this?

I generally try to be honest about retiring early. I think it can help more people to realize that such a thing is possible! It definitely gets interesting reactions. I imagine some people think I made a lucky Bitcoin bet or stock market pick. Others still may think that a partner or boyfriend is supporting my lifestyle. I understand their disbelief; I personally have never ever met an early retiree outside of the FIRE-blogosphere. If they are interested, they can reference this blog where I have documented my numbers, thoughts, and feelings over the last six years!

In my experience, older folks have the most incredulous reactions, whereas younger folks are surprised and typically ask “won’t you be bored?” It’s also easier to share with people while traveling, because I likely won’t seem them again. It feels weirder to mention it to extended family or new friends.

If I don’t feel like getting into it with a stranger, I sometimes say I’m taking a sabbatical (a really looong sabbatical). Another option is to talk about my writing, which is something I “work” on, even though it’s not a job. I deal with different reactions knowing ultimately that other peoples’ opinions have very little to do with me.

8. Do you think you will ever work again? How do you feel about it?

Working again is a definite possibility. My numbers support the kind of lifestyle I’ve had for the last decade: living with roommates in high cost-of-living areas, with no kids and frugal hobbies. However, if I want a lifestyle change, it might behoove me to work. At least a little bit.

I would prefer to work for myself by starting a business or freelancing over going back to 9-5 software development. I also wouldn’t need to make much. If I wanted a big lifestyle change, like living alone instead of with roommates, I might need to bring in some more cheddar. Similarly, if I want to live a little more lavishly, I will also have to earn more.

I mentioned that one of my “surprises” is how psychologically difficult it is to spend money in retirement. If I had some extra income it would take that mental burden off. Either I work on my mindset (difficult but long-lasting), or I simply add some income for “guilt-free” spending (easy but more of a short-term solution). At the end of the day, I’m very glad that the question is: will I ever work again? Rather than: will I ever be able to stop working?

9. Is your blog monetized and is that a source of income you are hoping to grow? 

My blog is currently not monetized much. I don’t currently run ads, which is generally the biggest money maker for bloggers.

So far this year, I earned $31 from affiliate marketing (when you buy something using a link on this site, I get a small kickback at no extra cost to you). I only link to products I actually use and recommend. This month, the blog has earned me $1.77.

Meanwhile, it costs me $335 a year to host the blog. I switched from Siteground to LyricalHost to try to lower this expense, though I might go back to Siteground as they have great service and good offers when switching over.

I do not think the blog is a reliable source of income for me in the future. If you get a kick out of reading this blog, I really do appreciate any support! Donations allow me to continue operations with no ads. If my journey or blogging has helped you in any way, click on the button and donate a coffee (or two!)

If you are interested in the monetizing journey, I wrote a bit about that here: 5 Years of Financial Mechanic – An Anniversary Post.

10. Have you ever felt a loss of purpose in your day-to-day life during retirement?

No, but I don’t think my work ever provided much purpose in the first place.

I could conceivably find something I enjoy to work on for money. I wouldn’t turn down an opportunity if one pops up. For example, I help people with money management coaching on the side. So let me know if you’re interested in meeting 1:1 to help you get your finances in order! In many cases, people do find work that gives them purpose, so I understand why this might be a concern when considering retirement. I did not end up tying much of my identity or worth to my job, so it wasn’t a concern for me.

11. What do you miss the most [about work].

I miss the people, the paycheck, and the satisfaction of solving problems.

People: Work provided built-in social connections. I made lasting friendships at each job I worked. Long after I’ve left those companies, I still get texts and even care packages (!) from past work friends.

Paycheck: Some retirees set up their dividends to sell and redirect into their bank account, so it feels like a paycheck to spend. That is really smart, and something I haven’t done yet. I went from publishing monthly spending reports to having no idea how much I’ve been spending month-to-month. The only time I even looked at my spending was for this blog post.

Problem Solving: Lastly, my job as a software engineer afforded the opportunity to solve interesting problems every day. Even though sometimes I felt like I was running into a wall over and over, I miss the the peak joy of finally cracking the code. Now I’m cracking early retirement!

12 & 13 What was your biggest fear upfront and how did that fear really pan out? Did you not worry at all? In the light of recent inflation etc. do you wish you would have built up some more cushion? 

Retiring was not scary for me. I can’t think of any big fears I had when I quit. With all of the preparation, encouragement from other early retirees, and travel to look forward to, I wasn’t scared. I think some people have a fear that they will retire, slip, and accidentally spend all of their money. I would have to really mess up to spend out my portfolio in one year.

One fear other people have for me is the job market closing me out. The world of software moves fast, but I doubt it will have advanced so fast that my skills will be rendered completely useless. I can just imagine it: I’d be an unemployable 30-year-old, bemoaning the year I took off. “Oh, what a fool I was, to think that I could exit the rat race and still remember how to run!”

I know how to code. I can learn new tricks of the trade. At the end of the day, quitting is not an irreversible decision. There is always more work.

I do not regret retiring when I did or wish that I had built up ‘more cushion’ because there would have been a real cost to me: more time at a job I don’t enjoy. The trade for more security is not worth it to me. I noticed how many questions I received focused on fear, worry, and regret. I will not allow those things to rule my life.

14. What one thing would your time-traveling future self have told you a year ago before you quit your job?

Take rest while traveling. Have a plan for a week of recovery after busy travel periods. For example, when I traveled with friends and family who were on short leaves, we went at breakneck speeds. I got burnt out near the end of the 6 months because of this, and I started craving being home.

15. How have you observed special occasions (your/family birthdays, significant holidays, etc.) while traveling?

I found it difficult to observe special occasions away from home. I imagine with a more nomadic life you would start to have to re-integrate these traditions into your life. For me, a lot of these events slipped by.

16. Wondering if you’ve chosen ACA for your health insurance and if so, how has your experience been with it (availability, cost, etc…)? 

When I traveled, I used SafetyWing as my Nomadic insurance. When I arrived back to the U.S. I was on Medi-cal, California’s version of Medicaid. The only time I used it was to cover some vaccinations pre-travel (I actually thought I was uninsured at that time but my provider found me in the Medi-cal system. I’m not sure how that happened.) Then my partner and I found out that I can be on their insurance even if we are unmarried, so I signed up for that. If we were to break up, I would likely travel again and go back on nomad insurance. If I wanted to stay here, I’d likely choose ACA, and ask my freelancer friends about their experience.

17. Do you feel as if you have maintained significant connections (either established prior to traveling or during your travels) with others during the year?

Yes I feel like I have. Of course I made lots of friends while traveling that I still occasionally chat to, but also made new friends when I returned. I used Bumble BFF, the friend-matching version of a dating app to start building a community once I got home. Moving so often and traveling a lot definitely limits the depths of some relationships. Despite this, I do feel like I have good friends and connections in general. One friend came to travel with me a few times. My sister came for the Australia/New Zealand portion, and I also got to see a friend there from when I studied abroad in Madrid during college. I also got to visit a friend from high school in Japan.

While traveling I met up with other FIRE bloggers like Joe from Retire by 40, Mr. and Mrs. Nomad Numbers, and Leif from Physician on FIRE. So there is a lot of diversity in the kinds of friendships I could foster. Of course, technology makes it even easier to stay connected to friends at home while traveling abroad.

17 Revealing Insights into Early Retirement

I hope sharing my experience helps inspire you to consider what working less might look like for you. Would you travel? Spend more time decompressing from the rat race? Do you think you’d want to start a business, or stop working altogether? I hope every person cultivates who they are apart from a job. I hope we all can learn to live out of joy rather than away from fear. That’s how we can crack the code of early retirement.

What would you do to keep from ‘getting bored’ in retirement?

Did anything about this surprise you?

In what ways have you turned fear into abundance?

Share in the comments below!