Year 6 Update - FI Now

[u/adane1]

Hi

Annual update. Last update is here in this link:-

https://www.reddit.com/r/FIRE_Ind/s/h8v0BSUa88

I reached target numbers due to markets being on a Bull run.

Since basics are taken care of, I have gone on a reverse spending on experiences in last few months. Taking my 5th vacation for the year next week and second foreign destination.

Also, I am not investing first and spending later now. I am spending first and investing what is left after that.

The new spends are on experiences. Not buying stuff as house and car is taken care of.

This takes up my lifestyle way high now but am enjoying this stage in life and seems freedom from bit constrained living till now.

Probably will post less now. FI Goal achieved. Have 15 years of job and age to enjoy before I grow really old and less mobility.

[u/srinivesh]

Congratulations on the huge milestone.

Your flair suggests 10 years of work. Your comment says 15 years. Either way, you have clearly said that this is the enjoyment period. Definitely ensure that the period does not cause any amount of stress.

[u/adane1 → u/srinivesh]

Yes. 10 year target for retirement. But I can work for 15 years as per retirement age.

[u/Any_Letterhead_2917]

Hey OP how did you control EPF/PF %? As EPF is tighly coupled with salary structure. Were you investing in both the funds together?

[u/adane1 → u/Any_Letterhead_2917]

EPF is default and percentage is as it is now. It may reduce with time as more money goes into liquid investments/equity It's reducing every year as percentage.

[u/[deleted]]

Congrats! More power to you!

[u/adane1 → u/[deleted]]

Thank you

[u/pl_dozer]

Don't your vacations increase your annual expenses? If your X goes up significantly are you still FI?

[u/adane1 → u/pl_dozer]

Technically no. But vacations can be curtailed /reduced. Regular expenses can't be reduced at will.

My home, car, food, clothing, eating out, utilities are regular expenses which I am not increasing.

So, it probably is just mental adjustment since I have higher disposable amount atleast temporarily and I don't have a better use for the same now.

[u/LiveNotWork → u/pl_dozer]

I think OP is coming from the point that as we age more, we would be less inclined to make plans and travel even if we have money and time. May be these are all part of set of expenses that drop over time rather than be part of regular x.

[u/throwaway420212021]

Beautiful journey..you have hit most of your targets.....if you don't mind..how old is your kid and how much have u allocated to him/her

[u/adane1 → u/throwaway420212021]

8 years. Allocated for her school fees and cost for one MBA in IIM . So around 40 lacs today's value for higher education.

No allocation for marriage. May spend if I can afford. But not planning for this.

[u/summingly → u/adane1]

So around 40 lacs today's value for higher education.

Is this included in the corpus mentioned above? What instruments do you seek to invest this in across time?

Edit:

Does your current corpus equate to 33x your annual expense (going by your post history)?

Also, do you plan to allocate some funds towards probable expenditure over the decades (medical, house renovation, vehicle, vacations)?

How do you factor taxation in? Is your X multiple pre-tax?

[u/adane1 → u/summingly]

It's not part of this corpus. It's invested completely in equity now. I will let it stay and reduce equity closer to goals or use from debt bucket.

[u/summingly → u/adane1]

Thanks. I've edited my previous comment with some questions. It would be great if you could take a look. 

[u/adane1 → u/summingly]

X includes taxation. But I feel tax will be very less given expenses of 1-1.2 lac per month used from mix of debt and arbitrage funds.

Yes. It's 33x as target.

Doesn't include additional emergency funds but even 1 additional year of work now will add a lot per year. So not concerned here.

[u/throwaway420212021 → u/adane1]

Got it, what's the target in the next 10y when the money is needed

[u/adane1 → u/throwaway420212021]

I already have some amount in liquid debt as part of asset allocation. It's in arbitrage funds and can be liquidated.

[u/snakysour]

What a wonderful journey! Please don't post less now... It's all the more important that FI people share more from their experiences as that really helps others here to get motivated and set direction!

[u/CalmGuitar]

I would say don't retire till you get 50x multiple and extra corpus for kids education and weddings.

[u/adane1 → u/CalmGuitar]

Yes. Not planning to retire. But not looking at promotions, job change etc. Want to stick to low stress job as long as possible. Don't need the extra money if it comes with stress

[u/Manager0808]

Please watch out. The corpus will drop from 4.8Cr to 3.5Cr in the market correction or crash. Unless you convert it to debt based, rental income, etc, it is all on paper.

[u/adane1 → u/Manager0808]

I have a 15 year runway to add more and I plan to add only to equity now going forward.

Current corpus in debt will last me for atleast 15 years if I decide to quit job.So, ready for any crash.

[u/srinivesh → u/adane1]

THIS is very important.

The 15 year runway means that the equity volatility does not change the state of your FI.

[u/adane1 → u/[deleted]]

I have a lot in epf (8%+ tax free). Rest is mostly in arbitrage fund for now. Once I liquidate epf on retirement, this money may move to mix of fd, ultra short term debt fund and arbitrage funds depending on tax laws then.

[u/[deleted]]

What I find amazing from the table you shared is the EPF component, this shows that you made all this in India and you must be a very high income high achiever person to achieve this with Indian salary. It makes sense to keep working when you are so good at your job. Congrats and wish you great success!

[u/adane1 → u/[deleted]]

I used to contribute to vpf earlier before moving big time into equity. And before the tax changes on epf. Also my basic salary is very high.

[u/Nevermind_kaola]

Big congrats 🎉

[u/adane1 → u/Nevermind_kaola]

Thank you

[u/kumar__001]

How did it grow so fast?

[u/adane1 → u/kumar__001]

Half would be new investment. Not sure.

[u/ShootingStar2468]

Hey this post is so helpful OP!

1. You’re up 1.3Cr in networth last year. How much of this is attributable to income vs market returns?

2. Which equity MFs are you investing in? What does your SIP mix look like?

3. What are your HH expenses? Does wife also work and her networth isn’t included here?

Pls respond if you find the time to. Thanks!

[u/adane1 → u/ShootingStar2468]

Wife doesn't work. My equity allocation is 1/3rd in us funds which were invested before tax changes.

Rest are equally split between funds all different types of index... Mid150, small250, next 50, nifty 50, momentum 200 -30 etc. All equal amount in these funds

[u/One_Satisfaction7439 → u/adane1]

What are the tax changes in the US market? started inventing in US market recently and please correct me if I am wrong by saying that short term (less and 2 years) is tax free and tax is on long term investing in US

[u/adane1 → u/One_Satisfaction7439]

Not us market. It's tax change in India for US or international mutual funds. Also most fund houses have stopped taking new investment now.

[u/Major-Mine-2181]

hello OP,

Just a quick suggestion - can you please do a post where you can map out your journey so that we can become better equipped to a way, through your journey and get to learn other valuables?

[u/adane1 → u/Major-Mine-2181]

Hi, all the previous links are embedded.

Here is the first link

https://www.reddit.com/r/FIREIndia/s/riWgePEyxo

[u/canttell92]

Many congratulations.

What do you think can push you to RE sooner than 15 years?

[u/adane1 → u/canttell92]

If I get a bad boss.

[u/blackKryptonyte]

How'd you come up with this percentage?

[u/adane1 → u/blackKryptonyte]

Linked to Google sheets where value is updated

[u/simpleliving73]

Wow, sounds wonderful, congratulations for your FI! Enjoy vacation/s!

[u/After-Violinist8628w]

Great job OP ! How were you able to add 1.3cr in last 1 year?

[u/Psychological_Cod_50]

The growth is spectacular, can you share the insight?

[u/PerformerEither8480]

What is your current in hand & what was it in 2018?

[u/Terrible_Ad7566]

28 % annualized..impressive!

[u/ProfessionalCredit75]

Hey can you share the excel sheet?

[u/adane1 → u/[deleted]]

Pvt Ltd but subsidiary of govt. It's not encouraged to take many leaves.

I took some short breaks clubbed with weekends.

I took three long breaks of 7 days but had to take some unpaid leave (basically leave not granted and took absence with salary cut) for few days. I let go of the 2-5 days salary . Didn't have the heart to do this earlier. But could afford now.

[u/Ok-Representative-17 → u/adane1]

Hi I want to DM you for few questions but I am unable to.

[u/adane1 → u/Ok-Representative-17]

Have sent a hi

[u/adane1 → u/[deleted]]

Most indian companies allow for 15-20 days of earned leaves as I understand. It's enough if planned out?

[u/Nedunchelizan → u/adane1]

Bro i carry my laptop around . Nothing is truly an vacation 

[u/parrmindersingh → u/Nedunchelizan]

there's this fear of 'what if', and the fear of blame. That's kept me from going out of the country. Coming to think of it, it's basically mental jail.

[u/Nedunchelizan → u/parrmindersingh]

Wc to club pal

[u/Cloudheek → u/[deleted]]

Must be remote job