Hey guys. When I did my master degree in Gemany I earned about 1500€ per month and I had a stressful, but great life. I decided to save enough so I have this amount available every month without having to sell my time.
I calculated with a 3.5% withdrawal rate and this means I needed to save 515’000€. I started seriously saving and investing after I graduated and moved to Switzerland in March 2016. Today with the dividend distribution of VWRL and the ETF up 0.38% I hit my initial target NW for the first time.
I don’t really plan to retire soon, but its great to know I could quit any time and live a decent life if I move back to Germany. My plan is to save more to have a little bit more money available per month and maybe lower my withdrawal rate a little bit. I also created a SaaS and a affiliate website. I’ll try to work on this websites so I can earn some money from home and reduce the sequence of returns risk. I’d also like to have more flexibility to move to other parts of the world without having to earn money at this places.
Sorry that I’m still calculating in €, but as much as I love Switzerland I don’t think I would stay here without having a swiss salary. With 1500€ per month and my girlfriend earning the same amount with a part time job we would have a pretty good life in Germany, while in Zurich we could barely pay rent and health insurance.
Congrats @Alvo! It’s always inspiring to hear success from like-minded people.
Now you’ve reached your FU money threshold, you can do what you want when you want it.
meh, that’s no fu money. he can afford a little career break but still a wage slave. you can’t buy property or have kids or buffer for unexpected with so little money
I’ve already reached the net worth cited by OP and I’m still very anxious about my work, still feel like a wage slave. Or maybe a slave of my own consumption dreams (travel, own a Tesla, be able to withstand a major economic downturn). And I say this as a Pole, not a German.
Sure, I could go back to my hometown in Poland, buy a flat and just do nothing for the rest of my life, that’s what this money would allow.
I think we all need to brace ourselves, because Europe will suffer from the generational dividend coming to an end. All pension systems are based on this. All these people who are now 50+ and haven’t saved enough, will come for the money of the younger generation, through the hands of politicians (tax). They will look for money wherever they can find it.
That’s why I think we should plan our FIRE goals with caution.
That you can’t give in to any kind of lifestyle creep on that money doesn’t matter: a milestone is a milestone and this one is worth celebrating. Life balance has a lot to do with FI, less with RE and, to be actionable, FI has to be a state of mind on top of the financial ability to live without paid work.
Alvo has got the right mindset, I say congrats and keep on!
Thanks a lot for all your answers (Even the ones telling me I’m an idiot - Reality checks really help)! I’ll write a pretty long reply as I fear some of the comments could discourage other readers.
I think it’s a question of definition. It is easy to quantify whether someone is a millionaire, but difficult to quantify whether he is FI. It is simply too subjective. For me it doesn’t mean being able to do everything I want, but not having to do what I don’t want. I basically enjoy working in my job and I’m always proud when a customer says he wants me to work with him on his next project. I don’t feel like a wage slave and if I don’t want to work for a customer then I simply don’t do it. As I have enough money I’m able to choose while many others can’t. It probably also depends a lot on what makes you happy. Is it new cars, expensive vacations and a big house? Or is it spending time with friends and family, hiking and working on interesting projects? The answer to that probably has a big influence on if you consider yourself FI. Sure more money never hurts - but for most of us it comes with opportunity costs.
The best time of my life wasn’t when I had the most money. I think I could live a happy and fulfilling life even with social care. And I’m pretty sure I could live a happy and fulfilling life with an average income (3000€ as a couple) in one of the wealthiest countries in the world (Germany).
So if you are reading the thread and you think you can’t do it, you need millions to live the life you want and you won’t be able to ever achieve it - Don’t give up! First think about what you really want. If you are a unhappy person there’s a good chance more money won’t make you happier. Instead try to find out what really makes you happy and achieve it step by step. Try to have a positive mindset, take calculated risks, have the right people around you and hold the course. If I had listened to all the people telling me why my plans will not work my net worth would be 0.
And feel free to drop me a message if you want to talk or need any help! Don’t give up guys!
Nobody told you you’re an idiot, we just looked at your numbers subjectively and thought: meh, you’re not there yet. But maybe I forgot to say, I am deeply impressed by your progress. From zero to half a million in less than 5 years is incredible! Half a million is a nice cushion, we can argue if it’s enough to FIRE or not, but it certainly gives you confidence.
In my case, I feel like a wage slave, because if I would suddenly say “ahh I have enough of this, I need a break”, then I fear I might start to forget the ropes of my profession quickly. It’s a niche and who knows how long it would take me to find a job again. Also, being unemployed would put a serious mental pressure on me. I can’t just go travel, because I have a working gf, and she is not in the same financial situation as me. I can’t just sit at home and do nothing, because maybe depression would kick in.
Don’t worry, no hard feelings here, I value your opinion. I guess we all had the same discussion before. It really depends on the personal situation, risk tolerance, if one would accept to depend on social benefits or lower his standards of life in the worst case and so on.
Same here and one of the main reasons I don’t just take a break of one year and only work on my own projects. But nevertheless I’m pretty confident I could quit if I wanted to. But don’t you think it’s strange that you say:
But also:
I’ve heard this before but never saw it this way myself. As a contractor I expect to be “unemployed” soon all the time. But this doesn’t put any pressure on me as I would just work on my own projects that are limited to the weekends at the moment. I’d even say it’s a positive thing as my job seems to be some kind of golden handcuffs to me.
I hope we can discuss this things on the next ZH meetup, it was great last time.
I personally do not really trust the “stop working at 40”-style plans (or should I say, it’s not applicable to my case) but I think it’s definitely great to know that you you will be able to face anything the professional world can throw at you (being dismissed, conflicts with your hierarchy, lack of motivation) and always have the option to safely quit at any time. I think it’s the #1 benefit of financial independence, not feeling forced to continue running the race at the expense of happiness and/or self integrity.
It looks like you have achieved that goal, congrats!..
I don’t use the 3rd pillar but I included my 2nd with about 25’000 as I could withdraw it if I leave Switzerland. The plan would be to move to Asia for some time to work on my projects and withdraw everything. At the moment I have a 80/20 stocks/cash allocation and 2nd pillar counts towards the cash part. I don’t contribute to 2nd or 3rd pillar if I don’t have to. Doesn’t seem attractive at my age because of the high opportunity costs. I prefer to pay 15% taxes and get the money today.
I can only provide anedoctal evidence here, but many parents affirmed their absolute satisfaction to be able to take time off when their children are born and are growing up (be it few months or few years). And takes a lot of burden off the working partner as well.
Perhaps not the OP situation today, but I think anyone is definitely going to be very happy to do it if/when they will have children.
I had a headstart with congratulating you in Zürich but again, that is a big accomplishment!
Many of the people here didnt read your text well enough. As your girlfriend makes 1500 euro on the side, it is the same result as with 1 Million invested. Just that the number 500k doesnt sound so impressive.
Monthly 3000 Euro is enough when you have cheap housing back in Germany.
your calculation is pretty waterproof. If you are willing to go offshore (territorial tax countries) then you could live almost tax free as a very rich person.
Flexibility is also on your side. A young IT guy with 6+ years of experience in Germany and Switzerland? --> you will always find a job on the side.
It just will not be that crazy money as before.
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I guess we all had the same discussion before. It really depends on the personal situation, risk tolerance, if one would accept to depend on social benefits or lower his standards of life in the worst case and so on.
1000 to this!