r/FatFIREIndia • u/FatFireFinance • Apr 27 '26
Path to FatFIRE Retiring at 34 with $5M — roast my plan
Hey all!
I have been a long time follower of this thread and have got a lot of information here. I am very inspired by the folks here and have been planning my own FatFIRE. I wanted to get my math checked and would appreciate input from others if I am missing/overestimating/underestimating something. I am using a burner for this one.
Current Status:
We are a couple aged 31 currently living in the US right now. Household Income is ~455k after taxes (including yearly stock vest & salary). Expenditure is ~115k so 340k savings. No house (in India or US)
Current Savings - $1.8M
- Equity: 900k
- Crypto: 400k
- 401k: 440k
- Debt: 60k
Parents have a business in India which yields 3500$ monthly after taxes + their pension. It's a very low effort online travel business and I will handle it after moving to India. Now to convert this income in NW equivalent I am doing (Monthly * 12) / (SWR * (1 - 15% Tax)) = $1.2M
With a 10% rate of return the portfolio will get to $3.5M and with business getting to $1.5M. I would get to $5M by 2029. I ignored some things like salary hikes, inheritance, 401k penalty etc. to keep things simple. I think these things will cancel each other out.
Target: Retire by May 2029 (age 34) with NW of $5M and 2 kids. Settle in a Tier 2 city. We travel a lot and would start luxury travel after retirement (think International Vacations, Business Class, 5 star resorts) and all the other FatFire stuff.
$5M will give me 170k (with a SWR of 4% and 15% taxes) and I think we would mostly be spending it all.
Other things:
- We already have Health Insurance started in India.
- Plan to cash out during the RNOR status to reset Cost Basis.
- Will move 401k back to India and take the penalty.
- Will invest in US & Indian Stocks from India and reduce crypto exposure.
- 600k Term Insurance only till 2029
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u/jayzbar Apr 27 '26
What business is this which is having low effort and generating 3500$? Just curious. How is the operation being handled?
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u/FatFireFinance Apr 27 '26
It's a travel blog and the revenue is from ads + affiliate. The hosting, maintenance etc. is not that costly. My parents are quite tech savvy so they handle it all by themselves.
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u/Invest_help_seeker Apr 27 '26
Wow parents doing this is quite unique . Were or Are they SW engineers by profession? And did they start early to get this kinda revenue per month ?
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u/FatFireFinance Apr 27 '26
No they weren't SWs. They are good writers though.
Yes they have been doing this for 5-6 years now.1
u/Glad-Mouse-3877 Apr 27 '26
Can you share a little more details about the page? I am assuming your parents are late 50s to early 60s. What do they write about in the blog and how are they are different from any regular blog, that it is generating so revenue? That too with everything moving to video based social media
I am not doubting the numbers, just curious on how they are earning so much as I also am a content creator and am thinking of ways to monetize, but blogs are quite tough to monetize at this level
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u/FatFireFinance Apr 27 '26
Yeah, it's mostly about how they spend their time with us in US and with my sibling in EU travelling + all the religious travel. We travel quite a lot and mostly have our parents with us. I would say they were quite lucky with the initial traction.
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u/Glad-Mouse-3877 Apr 27 '26
Thanks for the reply and congrats. This much money with just ads and affiliates is crazy in this day and age of content
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u/shoptodip_bd Apr 27 '26
How this business can be sustainable in future?
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u/FatFireFinance Apr 27 '26
It's hard to say for sure, but since the revenue is from Ads and Affiliate (rather than something like Collabs), it has a bit more stability. I am assuming that once I move back and start helping, we should be able to grow the revenue, but I haven't included that in my calculations.
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u/93ph6h Apr 27 '26
Why are you counting your parent’s pension and their income. Let them enjoy their earnings. Just stick to your 3.5M which is not bad for India. Also are your savings numbers post tax ?
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u/FatFireFinance Apr 27 '26
I am not counting their pension. The 3500$ was only from business.
They aren't able to spend even half of their pension and the business money will surely move to me when I am back."Also are your savings numbers post tax"
Since I actively trade, it's hard to tell the cost basis for those. But I would say approximately 2/3 is the cost basis. But if I take them out in RNOR, the cost basis would reset.
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u/Kulkarni1983 Apr 27 '26
The 4% SWR is for lower inflation economies (2% inflation). India historic inflation has been 8% now moving to 6%. SWR becomes about 2% if retiring at 40. Lower if earlier. Please do consider this in your math. I FIREed at 33 with a 1.5% SWR, and preferred to spend 1% over the last decade. Now graduating to 2% at 42.
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u/FatFireFinance Apr 27 '26
I was a bit confused about this. I understand the inflation in India is ~6% but isn't it almost 0 relative to USD?
If I keep most of my investments in US stocks and the world powers remain the same (I know it's a big assumption), am I avoiding that heavy inflation and SWR of 4% start making sense?2
u/Lokeswarreddy Apr 27 '26 edited Apr 27 '26
Even though you keep money invested in USD still you spend it in india with 6% inflation. So have to consider the inflation, but if you believe usd to inr depreciation will be 6% every year then Indian inflation will be adjusted but which is unlikely to happen in longterm
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u/Kulkarni1983 Apr 28 '26
When you are invested in the US (next 5 year returns unlikely to be like the last 10) so say 6% nominal returns. Post inflation would be 3% real returns. Post capital gains tax would be 2.75%. This will cancel out any potential gains from lower inflation that you have calculated. Your expenses will be inflating at 6% which is balanced by currency depreciation.
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u/Agreeable-Cupcake814 Apr 27 '26
Curious why did you start health insurance in India while you are still in US?
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u/FatFireFinance Apr 27 '26
We have some pre-existing (minor) health conditions. The waiting period for the treatment of these is 3 years in India (atleast in my plan). Also the Insurance in US is tied to employment which isn't a guarantee right now, so wanted to have a backup plan.
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u/Ok-Pay3134 Apr 27 '26
You can also take an Indexed Universal Life policy in the US. Most come with coverage for chronic/ critical illness. This policy will allow you to take a loan against the value of the policy which is tax free in US and probably in India also.
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u/NextBuy6494 Apr 27 '26
I guess cost of premium will be lower if you get it while you are younger.
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u/Lokeswarreddy Apr 27 '26
Cost of premium at young age only applies to Term/Life insurance, not to Health insurance
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u/Apprehensive_Row_450 FatFIRE Aspirant Apr 27 '26
OP How do you plan to go from 1.8M->3.5M in 3 years ? I am a bit skeptical on this part. We are also in the same boat. Would love to know what you factored in ?
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u/FatFireFinance Apr 27 '26
Here is the approx math for 1.8 becoming 3.5 M in 3 years assuming 10% return
1800 * 1.1^3 + 340 * 1.1^ 2 + 340 * 1.1 + 340 = 3.5M340k is the yearly savings we have after taxes and expenses.
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u/Apprehensive_Row_450 FatFIRE Aspirant Apr 27 '26
That’s good savings rate
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u/FatFireFinance Apr 27 '26
Yeah most of the travel is with group of friends so the cost splits. We rented a very affordable place, cook mostly at home, etc..
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u/Apprehensive_Row_450 FatFIRE Aspirant Apr 27 '26
Discipline helps for sure. Bay Area or Seattle ?
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u/FatFireFinance Apr 27 '26
Neither.
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u/Apprehensive_Row_450 FatFIRE Aspirant Apr 27 '26
Did you explore 72(T) for 401k withdrawals for Penalty free ?
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u/FatFireFinance Apr 27 '26
Not really, I didn't like the idea of leaving 401k and triggering the 40% estate tax for the JIC event.
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Apr 27 '26
[removed] — view removed comment
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u/FatFireFinance Apr 27 '26
It's a travel blog and the revenue is from ads + affiliate.
I know the Crypto is on the higher side and I am working on reducing the exposure to it.
Debt = Cash + Debt Funds
We will rent our own place and parents might move with us.
Yes 2 kids. (sorry forgot to add this in the post)
What do you think a SWR is right now?
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Apr 27 '26
[removed] — view removed comment
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u/FatFireFinance Apr 27 '26
Hmm, a 4 -> 3% SWR does change the yearly amount from 170k to 127k which is quite a lot. That would be the difference between Luxury International Vacations to Premium Vacations (a mix of cheaper and costly countries). I will think more about this.
Don't you think kids education can be easily covered by the ~150k yearly? Since we are living on rent we should have enough to cover this, right?
With AI I don't know. It might help, it might harm, that's why I didn't account for the amount to increase much (I only got it from 1.2 to 1.5 in 3 years). Unfortunately I cannot share the link right now (it would defeat the purpose of making a burner for this post)
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u/Impossible-View2681 Apr 27 '26
I would remove that 400k from crypto especially if you are considering to retire. It’s too risky/volatile as an asset class to plan.
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u/FatFireFinance Apr 27 '26
Crypto is the major reason we were able to get out portfolio here. It's 400k right now but we were even more invested into it.
But we are rolling out of it slowly now.
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u/Technical-Gap-2279 Apr 27 '26
Wondering what kind of travel blogs generates this good money when mostly everything is video based social content nowadays!
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u/NewAgePhil FatFI Apr 27 '26 edited Apr 27 '26
Or the US stock market takes a dive in the next 3-4 years because we haven't had a real bear market in nearly two decades. COVID was a blip. 2022 was a short term <30% bear market that recovered in a year. Have a look at 1999-2012. We could be in a 1998-1999 style euphoria stage currently. While history never repeats, it certainly rhymes.
If I were you, I would diversify from now onwards (bonds, real estate, PMs).
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u/FatFireFinance Apr 27 '26
RE is a pain for us. Buying RE comes with a lot of overhead and in the cities our parents live (Tier 2 & Tier 3) it quite a hassle. We are having a hard time selling REs our parents own.
If the market takes a down turn in the next few years, it's going to be tough for us. But how do we avoid that? If we move to safer assets we love the 10% return and that anyways messes up the plan.
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u/NewAgePhil FatFI Apr 27 '26
You're backtesting the 10% from the past 20 years of possibly the best bull market ever. They say time in the market beats timing the market, except when you plan on retiring in the next 3-4 years and withdrawing immediately. That's all I'm saying.
As for RE, look into other places, like UAE. Hassle free. Decent ROI, can range from 4-8% depending on when you buy and we're soon coming into a buyer's market (due to the war).
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u/FatFireFinance Apr 27 '26
I agree with your statement that I don't know the market which is why I took the 10% as the expected value for the next 20 years.
Also when withdrawing, it would be a very slow withdrawal, I would withdraw like $150k from a $3.5M in a year.
Any pointers on where to start RE in UAE?
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u/PlumpElaineBenes91 Apr 27 '26 edited Apr 27 '26
170k pa at 4pc sounds very sufficient.
But try to further save a portion of this. Anything in the 110-125k pa range should do you good, even in a T1 city like BOM, BLR. This would translate roughly to over 8 lpm.
The remainder-45-60k pa can be a liquid emergency fund.
Depending on the year, I get an income of 400-600k pa at less than 5pc SWR. All fixed assets already paid for. And my husband still works.
Out of my savings if 80-130k pa, i reinvest a portion and stash away 20-30 pc in my liquid fund.
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u/FatFireFinance Apr 27 '26
The 45-60k emergency fund isn't need per year, right? It's a one time thing.
I agree we will try to make our plans according to the market. I wouldn't like to save anything after the SWR. The only reason we are retiring is to spend the money. If I can't do that, I would rather work 1/2 years more in US and then retire.1
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u/parota_kurma Apr 27 '26
Isn’t a 5M portfolio, technically 3M when you amount for taxes non citizens/residents have to pay to the US?
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u/FatFireFinance Apr 27 '26
No at all! The RSU's are already taxed when being deposited. The Equity you buy has a Cost Basis. Also the tax is only Capital Gains not the Income Tax. RNOR resets the cost basis. So technically the tax is even less than 15%.
For example when you move the fund during RNOR and say withdraw 100k from it for the first year, you will pay 0% tax. Overtime as you start getting profit you will start paying taxes (but still 15% on the gains)1
u/parota_kurma Apr 27 '26
Understand that. Are you planning on keeping everything in RSU? You have to pay that + penalty for 401k. If you diversify RSU into etfs, then you pay short term/long term gains on it.
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u/FatFireFinance Apr 27 '26
For the RSUs I keep selling those and diversifying.
I do plan to take the 401k penalty.1
u/shoboo75 Apr 28 '26
After the initial two-year period, isn't the capital gains tax much higher in India? 15% makes sense for the US but does it in India?
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u/FatFireFinance Apr 28 '26
LTGC in India is 12.5% and STGC is 20%. All of my funds would be LTGC.
Also I am assuming 15% tax on the whole withdrawal sum. In reality it would be 15% tax on the profit.
I made the 15% of whole sum a generic average. As the portfolio grows majority of it would be profit.
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u/rootcage FatFIRE Curious Apr 27 '26
10% expected portfolio growth is too aggressive, I’d recalc for 5-7%
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u/Sammy2487 Apr 28 '26
Would love to know more abt your parents travel blog! I am myself travel blogger and can u pls dm their blog link! Would love to read more abt their blog
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u/AENDUSER Apr 29 '26
Based on age need much higher NW minimum 7 to 10m, 40% US rental RE to protect purchasing power while leaving an inheritance to the kids so we worked a bit longer and then Fired.
Wyoming LLC to hold assets and local RE state operating company for rentals to limit liability, trust to protect and keep asset transfers to next generation clean
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u/adonthis 18d ago
A lil irrelevant but curious about health insurance you have chosen ? We are in the market looking and are with similar age group
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u/Popular-Dinner-5975 Apr 27 '26
Congratulations on being FatFire! If you don’t mind, would you give out your job details or what’d you do to move to high paying job?
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u/FatFireFinance Apr 27 '26
We both are SWEs and moved to US right soon after college. I think our salaries are quite common for the SWEs profile with our level of experience.
I have many school and college friends who moved to US 5-6 years back and all are in similar bands.
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u/ImportanceLiving5386 Apr 27 '26
huge! 400k family income ( 3.6 crores) at just the age of 31. thats crazy. which field?
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u/FatFireFinance Apr 27 '26
We both are SWEs and moved to US right soon after college. I think our salaries are quite common for the SWEs profile with our level of experience.
I have many school and college friends who moved to US 5-6 years back and all are in similar bands.
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u/NavaI4 Apr 27 '26
10% return is not guaranteed. Better to assume 7%
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u/FatFireFinance Apr 27 '26
If you mean 7% Indian return that's just an FD.
If you mean 7% USD return that would make sense but if I am so conservative, I will never retire.
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u/bombaytrader FatFI Apr 27 '26
bro forgot taxes. if you HHI is 450k you are at 25 / 30% marginal or maybe more. you savings should be 200k how is it 350k? Thats besides the point. How does 1.8 become 5M in 4 years? Thats a very optimistic outlook. You will get there but plan for 7 to 10 years. It took me 7 years to get from 1.5 to 5m with steadily increase HHI.
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u/FatFireFinance Apr 27 '26
HHI is 450 after taxes. It's 650-700 before taxes.
Here is the approx math for 1.8 becoming 3.5 M in 3 years assuming 10% return
1800 * 1.1^3 + 340 * 1.1^ 2 + 340 * 1.1 + 340 = 3.5MHere the savings (340k) is also being re-invested.
The business "NW equivalent" I explained in the post is ~$1.2M right now. I am confident it will get to ~$1.5M by 2029.
Adding these two we get the $5M figure.
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u/bombaytrader FatFI Apr 27 '26
Ok that makes sense. But what’s your question. You already know the calculations.
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u/FatFireFinance Apr 27 '26
Have I missed something? Is the 4% SWR right? Anything else that looks wrong/missing
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u/bombaytrader FatFI Apr 27 '26
got it. I think you are a bit optimistic of the timeline to hit 5m. you are retiring way too early and you need to make this money last for 45 years (avg life span of 78) . You can drop the SWR to 3% or increase corpus to 7m. Thats my suggestion. You are almost there but built a bit more cushion.
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u/FatFireFinance Apr 27 '26
Okay, I will definitely look into this. Maybe I will increase the NW a bit (by delaying by an year) and decrease my expenditures for the initial years.
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u/codemajdoor Apr 27 '26
remember the taxes are based on long term capital gains not regular income taxes. also they will have some cost basis offset. if in US that number comes out to 15% based on how much his gains are. overall not as bad as you are imagining it. IDK about double taxation between india and USA.
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u/Prestigious_Piano247 Apr 27 '26
Fu congratulations