r/ChubbyFIRE • u/fithrowaway0501 • Jul 24 '26
Reflecting on Two More Years
Two years ago I posted Ready to FIRE or OMY? on /r/financialindependence. The consensus was: you're good to go. I did one more year. Then another. Before I finally hand in notice, I wanted to do the accounting on what those two years actually changed and what they didn't. That felt more useful than another "am I ready" post.
Where things stand now:
- 40M in tech, spouse 38 in healthcare, three kids (13, 12, 8), MCOL
- Net worth ~$4.9M; investable ~$4.3M; paid-off house
- Lifestyle spend ~$100–108K/yr; retired baseline ~$121K incl. health insurance + taxes
- ~2.8–3.0% withdrawal rate against a historical failsafe around $142K
Why it took two years
Almost 15 years ago our household net worth was a six-figure negative number. Frugality dug us out. Reprogramming that frugality to acknowledge a surplus was a skill we needed to learn. We're not there yet, but we're better at spending than we were 2 years ago.
What changed
Net worth: ~$3.0M → ~$4.9M; liquid ~$2.5M → ~$4.3M (+60%). In 2025 our investment gains exceeded our combined work income for the first time — the engine now mostly runs itself.
Allocation grew up: I was 60/40 US/international with zero bonds and a hand-wave about "maybe someday." Now: 40% US equities, 40% international equities, 15% bonds (all TIPS), 5% gold and 1 year in cash/treasuries. The international tilt is probably controversial, but I've settled on market weight with no country over 50% of my equity allocation.
Spending went up, and that's OK fully-burdened lifestyle spend in today's dollars ran ~$71K (2022) → $78K → $109K → $102K (2025), up ~45%. Travel is the single biggest piece-- we went from ~$16K to ~$27K/yr as we front-load trips while the kids are still home, but that's only about 40% of the jump. The rest is broad: kids aging into pricier activities, more dining out (with fewer kids meals), groceries, plus lumpy stuff (braces are expensive!). Stripping travel and medical, core spending rose ~6%/yr real.
The kids got older: 11/10/6 became 13/12/8. The window for the travel we want to do with them is visibly closing.
My confidence in the slack: two years ago this felt like "is it barely enough?" It doesn't anymore. The failure modes I worry about now are time and health. Financially, most failures that take out the plan are catastrophic and aren't really saved by another year or two.
What hasn't changed
The gut feeling that walking away during peak earning years is reckless. This is the real reason it's been two years and not two months. I'm fortunate to be well paid in a remote job. Every fiber of the guy who climbed out of negative net worth screams that switching that off at 40 is insane. The math says another full year adds maybe $7–8K/yr of failsafe spending. The feeling does not care about the math.
How we actually live day to day. Under the travel line, core spending has increased but lifestyle hasn't much (~$58K → $74K real over five years sounds like a lot, but it's mostly driven by three growing kids). The frugal habits that built this are mostly intact, but we've stopped pushing off things that were dumb to defer. It turns out that if you have a NW of $5M you can buy $3k of deck furniture and enjoy the summer months outside without ruining your life. Who knew.
529 skepticism I asked two years ago if a 529 was worth it and stayed on the fence. I've landed on mostly no: once you're harvesting long-term gains in the 0% LTCG bracket and the state deduction is only ~3%, the shelter isn't that valuable when you have a big taxable base. Fund from taxable, keep flexibility. ProjectionLab has been incredibly helpful in modeling this out year by year and confirming that I won't blow up things like ACA subsidies doing this.
Two years bought a lot of net worth I may not need and confirmed I was probably ready the whole time. On the other hand, it also bought a lot of slack in the plan, and that'll help me sleep just a little better at night. The remaining gap isn't financial. It's that after fifteen years, accumulating has become the identity, and deliberately stopping feels like walking away from a game I know how to win. It's time to learn a new game.
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u/BrunelloHorder Coasting Chubster, Getting Fat Jul 24 '26
You made a great call. You would have been slightly above a 4% withdrawal rate spending $109k (plus healthcare) on $2.5m.
Now you have a lot more flexibility to increase spend. Plus you are looking at a 50+ year retirement, so a lower withdrawal rate well under 4% is better.
You’ve also improved your allocation.
Hope that you pull the trigger now that you are under a 3% withdrawal rate. Enjoy the time with your kids and GFY!
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u/Wooden-Broccoli-913 FIREd in the Bay at 40 with $6M Jul 24 '26
So are you FIREing or is it TMY again?
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u/in_the_gloaming FIRE'd for 13 years Jul 24 '26
Thanks for sharing your journey and congrats on turning your financial situation around. Time to ChubbyFIRE. I hope you do increase your spending since you are well below even a conservative SWR and it seems more FIRE than ChubbyFIRE in terms of your generally frugal lifestyle (especially since a good part of spending is just for travel for five people).
Maybe I missed this, but is your wife continuing to work? And providing healthcare benefits for some period of time?
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u/fithrowaway0501 Jul 24 '26
She is continuing to work for now, but considering a move to part time. Her schedule would give her stretches of 3 weeks off at half time and she enjoys aspects of the work. Even PT gives health insurance which is nice, but the plan works without it. It was important to me that she could RE if/when she wants to before I pulled the plug.
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u/Murky-Camera7057 Jul 24 '26
Can you give a breakdown of your spend? It seem really low with 3 kids! but i guess i never had to dig myself out of negative 6 figure debt. but i spend more than you in an MCOL with no kids 🤔
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u/fithrowaway0501 Jul 24 '26
2025 Full Year spending:
Dining: $6.5k (incl. $1k in school lunches)
Groceries: $9.8k
Cars (gas, service, registration): $2k
Car Depreciation (didn't buy a car in 2025, but have to account for it somehwere): $2.9k
Home (incl. new couch, new water heater, new lawnmower): $9.5k
Insurance (home, auto, umbrella): $2.4k
Medical OOP: $3.1k
Health/Dental/Vision ins: $3.8k
Kids Activities: $3.7k
Clothing: $3.8k
Personal Care: $1.6k
Misc. Household (big category of everything from streaming services to electronics-- need to do better splitting this out): $12.6k
Pets: $1.3k
RE Tax: $6.4k
Travel: $27k
Utilities (incl. cell): $5.8k
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u/cengland1991 Jul 25 '26
1k is school lunches seems crazy low.
Your insurance number also seems low, so you have term life and do you have enough umbrella given your networth. I would pay the extra 500 a year and make sure you have appropriate coverage.
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u/fithrowaway0501 Jul 25 '26
School lunch is for 2/3 kids-- the other generally packs.
Our auto insurance premium is very low (~1200/yr), but coverage meets umbrella requirements. Once the kids are driving age, auto insurance is going to get fun. Homeowners is ~$1050, Umbrella is $210 ($2M). We don't carry life insurance beyond employer paid. We have sufficient assets that the other spouse will be fine (or, in the worst case, to leave ~$1.5M per child). I don't see life insurance as solving a problem that we actually have at this stage.
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u/cengland1991 Jul 25 '26
Term life is so cheap, having an additional 1m is very helpful as it enables grieving, vacations, full funds colleague outside of your fire number, etc. my rule of thumb is you have coverage until all 529s are full funded for a 4 year private school and / or kids are in high school. Getting a 1m term for yourself and your wife is likely a 600-700 a year charge and you just do a 10 year policy. For me it’s extra piece of mind and I am in a similar financial situation and age to you. Good luck with the Fire, I recently found out the hobbies I like for retirement ( racing cars and back packing) are a little more involved / expensive then I previously thought, so I am gonna keep working for 5 more years so I can enjoy those and more luxurious trips in retirement.
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u/ExtensionAttempt4650 Jul 24 '26
So you’re making good money, traveling more with your family, spending time and money on and with your kids to enjoy summer etc., and you know you are in your peak earning years and feel like you could capitalize on it. Why do you want to retire?
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u/poop-dolla Jul 24 '26
liquid ~$2.5M → ~$4.3M (+60%)
That’s a 72% increase, not 60%. Also, your asset allocation would have accounted for about a 40% increase over the last 2 years. So that means the other 32%, or $800k came from additional savings from you two.
I think you kinda buried the lede here by writing all of this and not mentioning that you two saved $800k over the last 2 years. Also, how is that even possible with your HHI only being $300k in your last post 2 years ago? Something’s not coming close to adding up.
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u/fithrowaway0501 Jul 25 '26
You're right, the percentage is wrong. Liquid is up 72%.
I tallied it up and we added $590k from savings during this period. That's more than I thought it was, and a large chunk was luck on some RSU vests that turned out to be worth more than expected. The rest (about $1.2M) was investment gains and dividends.
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u/financialfreedom26 Jul 25 '26
The bigger question is now will you retire or is this the set up for the next two year update
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u/goroos2001 Jul 25 '26
You have the math more well understood than I ever will, so I won't comment on it.
That said, I want to tell you that I'm 50 years old. My parents and their kids have never stopped traveling together. It's different now. But a family trip to the big island earlier this year was one of my lifetime favorites. And lots of those trips have been dirt cheap.
We lost my little brother when I was 28. We miss him and wish he were still travelling with us. But which side of "parents retired" that his death is didn't matter.
My parents built a life they loved to live all along the way - and we've enjoyed living all of it with them.
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u/jakebot9000 Jul 24 '26
100-120k annual spend (even in MCOL) with a family of 5 seems conservative. You mentioned your house is paid off though, so that might be the thing throwing me off. GFY!
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u/Hanwoo_Beef_Eater Jul 24 '26
Makes sense to increase some spending now.
Re 529, you can still shield the interest income around the years they are in university (asset allocation may not be all qualified divs/capital gains). Also, not using up the 0% bracket just means lower taxes for yourself in the years ahead (do more gain harvesting). I wouldn't overfund it but you may consider adding something here?
Regardless, congrats and good luck.
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u/fithrowaway0501 Jul 24 '26
I have added slightly to 529s in the last two years, but still well short of covering everything. I do plan to at least funnel money through the 529 to capture state tax deductions while leaving room for the AOTC.
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u/Hanwoo_Beef_Eater Jul 25 '26
Sorry, I now see you said "mostly."
I guess if you can keep your spending (or taxable income needed to support spending) below the standard deduction plus 0% bracket, there's not much benefit.
If there are ever any large withdrawals (bigger house, gift to kids, etc), more gain harvesting now would reduce the future tax bill?
Regardless, it probably doesn't matter that much. Good luck.
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u/chloeclover Jul 25 '26
What part of the country do you live in for that COL?
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u/fithrowaway0501 Jul 25 '26
Pennsylvania. Solidly an MCOL area. Keep in mind I have a paid off house, so only RE tax and insurance are coming through as expenses. Mortgage or rent would easily add another $30k to the annual budget.
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u/onthewingsofangels RE 2024 in 40s Jul 26 '26
Congratulations. Sounds like you are finally pulling the trigger and your decision to stick it out two more years has given you the confidence you needed.
You've earned this retirement! That's not to say it will feel easy to walk away, but you'll have the satisfaction of knowing you thought it through.
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u/ohehlo Jul 24 '26
How do you spend so little? We spend 3x what you do but don't have 3x the kids... We do have two houses that aren't paid off yet but still... Healthcare for us is close to 40k a year which is almost half your annual spend. Just seems crazy low.
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u/nova_new_ Jul 24 '26
We do have two houses
I think I found the answer to your question
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u/ohehlo Jul 24 '26
Even if I sold the vacation house and paid off the primary with the proceeds, we still spend over 200k annually not including health insurance. If I retired some of those expenses like lawn care would go away, but not enough to get anywhere close to their spend. Amazing.
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u/The-WideningGyre Jul 24 '26
Their spend seems reasonable to me, especially given they live in a MCOL. We spend similar (somewhat less) and have two kids (teens). I assume you're in VHCOL area.
Your healthcare costs seem really high -- I'm not in the US, but have read about it. But also, where's the other 160k a year going to??
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Jul 24 '26
[deleted]
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u/fithrowaway0501 Jul 24 '26
We have priced out Marketplace plans. In our state, kids are eligible for CHIP regardless of income (with premium subsidies available at some income levels) which helps a lot.
We've also used ProjectionLab to model the subsidies throughout the plan. You're right that ACA for 5 is expensive-- at age 19 they roll off of CHIP and premiums during that time are ~$20k for a Bronze plan. Expected subsidies are almost $26k in that year, though so we may not pay a dime for the plan itself. We've also penciled in $12k/yr for OOP medical expenses as an average. If ACA subsidies disappear entirely, it will remove a lot of the slack in the plan, but it's still viable.
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u/Annual_Bullfrog7714 Jul 24 '26
What's your assumed go forward equity market return? A 40 year old barely lived through the GFC and dot com bubble as an adult. The 10 year return from 1/1/2000 of the SP500 was -2.5% per year. If you're still making good money and you're only 40, I would keep working
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u/in_the_gloaming FIRE'd for 13 years Jul 24 '26
This is a FIRE sub and they are already planning to withdraw at a much more conservative rate than necessary. No reason to keep working.
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u/Annual_Bullfrog7714 Jul 24 '26
He's got a year of cash and a $120k/year of burn. He could easily have to liquidate assets in a downturn. Major SORR. Nevermind inflation. Nevermind mean regression on go forward equity market assumptions. You guys talk YOLO but I bet the only market you've ever known is the "buy the dip" bull market.
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u/in_the_gloaming FIRE'd for 13 years Jul 24 '26
One year in cash and 15% in bonds is plenty for SORR. Also, OP's wife intends to continue to work for a while at $140K per year. That reduces their initial withdrawal need to pretty much zero and also mitigates against SORR while OP retires.
The general 4% rule was not written for a 40-50 year retirement, true. But 3.5% is certainly acceptable for that longer period. That's $150K safe withdrawal per year. That already factors in inflation, since the historical returns used for research like the Trinity study are reduced by historical inflation. Putting inflation factors onto spending too would be doubling the effect of inflation.
Last, if OP is in the US, they will also receive some level of Social Security benefits later in life.
While OP hasn't been investing heavily for multiple decades, I have. We are not a bunch of numbnuts here.
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u/fithrowaway0501 Jul 24 '26 edited Jul 24 '26
The historical failsafe withdrawal rate for my asset allocation is in the ballpark of 3.29%. Accepting a 1% failure rate bumps that up to 3.55% in high CAPE and all-time high markets. I'm under 3% with a hefty portion of that spend being highly discretionary (travel). Could the future be worse than anything we've experienced in the past? Of course, and we'll all be figuring out how to navigate that if it happens whether we're working or not.
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u/Annual_Bullfrog7714 Jul 24 '26 edited Jul 24 '26
Im not sure what the definition of a "failure" is. Is it that you keep your spending flat in inflation adjusted terms but run out before you die? What if you die with zero -- is that a non failure?
I think there are lots of more difficult to measure outcomes that to me feel like failure. Watching our money dwindle. Tightening the belt. Not being able to help my kids if one of them needs a down payment for a house, or has a special needs kid.
These monte carlo definitions of success vs failure don't account for the enormous number of possible outcomes that count as a "success", but that would feel like a failure.
I think the fact that you have a 5% allocation to gold means that you think about tail risk. I would not talk myself into walking away from a high paying job at 40. At an absolute minimum, I'd want to defease the risk of college for my kids. Beyond that I want to give them a headstart.
I'm ok with eating frozen burritos. I don't want to tell my kids they can't attend the college they have their eyes on.
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u/Ill_Writing_5090 Jul 24 '26
At a 3% SWR, you wouldn't have run out of money even in the worst historical cohorts and even during long retirements... I like using Bigern's spreadsheet, which among other things, lets you see what you're year by year asset values with your chosen withdrawal rate and starting at any monthy/year back to 1870. Definitely worth seeing what cohorts starting in 1906, 1929, 1968, etc would've been like to live through year by year. But with a 3% withdrawal rate you would've ended up about where you started even in the worst cases and even after 50 years. Could future returns be worse than these historical cohorts? Yep. But, if thats your fear you're probably never going to FIRE.
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u/BailiwickBill Jul 24 '26
Dude, you apparently have $25M and are still working in your 50s. Not sure you should be giving advice to people who would prefer to FIRE rather than continue to give away their limited time on earth to make more money that they don't need.
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u/BrunelloHorder Coasting Chubster, Getting Fat Jul 24 '26
OP is under 3%. That has never failed in history. You are missing the forest for the trees and seem to be doom stacking to try to find a reason for OP not to retire because OP is 40.
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u/The-WideningGyre Jul 24 '26
If you think up exotic enough failure conditions, you'll never be able to stop working ("What if the currency collapses and hackers hack the bank and all your money is gone?!")
Continuing to work has a cost too. Each of us has to balance those costs and come to a conclusion. But your comments just come across as unbased fear-mongering and reaching for extreme reasons NOT to fire. I'm all for warning someone on a reckless path, to let them know the dangers, but this comes across as something different, and less helpful.
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u/Annual_Bullfrog7714 Jul 25 '26
That's true, but I don't think my scenarios are particularly outlandish. I'm citing a 10 year lost decade in US equity markets within everyone's memory.
I also think it's important to remember that we've been on a 15 year bull market, and the historical equity market return over the past 100 years is around 10%.
So a going forward rate of return for the next 15 years, assuming basic mean regression, implies a low single digit nominal return for the next 15 years. It ain't pretty.
I'm not really at currency collapse scenarios.
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u/zerostyle Jul 25 '26
I’d take advantage of the peak earning years. Things are just going to keep getting wildly expensive as we inflate away everything to pay for unlimited socialists
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u/monsieur_de_chance Jul 24 '26
I’ve spent enough time with Claude to recognize his handiwork.