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Since our inbox is filling up with lots of reader cases, it’s time for another one :
Hey Kristy and Bryce!
I just finished “Quit Like a Millionaire” for the second time in as many weeks, and just wanted to shoot you a thank you. While it’s certainly not the first book I’ve read on FIRE/related topics, it’s certainly one of the most updated, concise, and helpful!
I’m at an impasse, hoping you can help. Here’s my situation:
- Married, in our late 30s
- We live in a converted van, work full time, and travel the US
- Income / Expenses:
- ~$114k combined post-tax income from two jobs
- ~$30k/year ($2.5k/mo) living expenses
- Able to save around ~73% currently – $3300/month in post-tax investments after maxing out 401k and Roths offered through employers (which we haven’t started doing)
- Note: we currently just piss through most of our money and need to be more disciplined!
- Equity: ~$302k
- $180k gross in stock from my former employer
- 2/3 of which are long holds/long-term cap gains
- Noteworthy that my stupid ass didn’t sell when it was higher, I keep thinking “but it will go up, right?!”
- $12.8k in a Rollover IRA from my former employer
- $2.6k in a Roth from my former employer
- $92.4k in a Rollover IRA from my spouse’s former employer
- $15k emergency fund in savings
- $180k gross in stock from my former employer
- Debt:
- $19.2k van loan @ 3.99%
- 100% not having kids.
- We’re both currently working for startups with equity.
- One seems very promising and will likely IPO within a couple years, which may result in a nice little bump in the low six-figure range (though I’m not factoring it into anything since it’s not “real money” yet)
Some goals:
- Want to FIRE before 50 (seems very doable based off of multiple FIRE calcs)
- Honestly, after the past two years especially, I’m burned the f*ck out with work. The sooner the better.
- Will 100% househack (since we’re not having kids, we’re looking to buy an investment property in the next 1 to 5 years – rent out most of it and live in an in-law type setting).
- Hopefully with the goal of paying 3/4 if not all of our mortgage via rent.
- Notable that I’m very handy and can do basic carpentry/woodworking, plumbing, electrical, etc.
- Long-term goal of this would be to either flip or have somewhere to retire to
- I would never buy a property again without putting enough down to eliminate PMI
In my calculations, with our current income and savings rate, we’re on track for FIRE in 9.8 years. Note in the FIRE calc link that I have retirement spending at $65k and SWR at 3.5%. I always have the habit of over-planning. I expect retirement spending, especially if a property is basically paying its own mortgage via rental income, to be more like $45k. This reduces the 9.8 year timeline to 7.1, which is an easier pill to swallow. I also did not calculate anything from my wife’s employers potential IPO, since it hasn’t happened yet and thus isn’t real.
So my questions are:
- Should I sell my long-held equity (~$100k post-tax worth) of TOST now, at a record low, and diversify?
- I’d like to take this moment to say how much of a fucking idiot I am for not selling back in April when it was $24/share. But HOW do I get over that little voice that says “but what if it goes up?!” in my head?
- Let’s say that I do sell and get $100k post-tax. Where the fuck do I put it? VTI?
I’m sure I have more questions, but those are the big two right now.
Thanks for all the help, past and future! 🙂
VanFIRE
Okay, first of all, I’m impressed by the fact that VF is saving an insane 73% of their combined salary and still thinks “we currently just piss through most of our money and need to be more disciplined!”
Say what? Your savings rate is currently as high as our HIGHEST savings rate, and you still think you’re overspending?
If that were true, then everyone in the FIRE community is pissing away too much money. You might be spending way too little (I know, very hypocritical coming from me). From the level of detail and the calculation, it seems like you might also be an Optimizer like me. So, if that’s true maybe it’s because of the appeal of trying make everything efficient and not wasting money. Like a chess game you can’t lose!
Now, you did mention that going forward you want to buy an investment property and do some house hacking, which given the current state of the falling housing market due to interest rate hikes, might be catching a falling knife. But, given how strong your finances look, could it still work out?
As we always say on this blog, let’s MATH THAT SHIT UP!
Summary:
Net family Income: | $114,000 |
Expenses: | $2500/month or $30,000/year |
Debt: | -$19,200 |
Investible Assets: | $180k (company stock) + 12,800 (IRA) + $92,400 (IRA) + 2600 (Roth) + $15,000 (emergency funds) = $302,800 |
This means your savings rate is 114K-30K/114K = 74%, your FI number is $30,000*25 = $750,000, and your total net worth is currently: $302,800 – $19,200 = $283,600.
With the $84,000 you are saving every year, you should reach FI in:
Year | Balance | Contributions | ROI (6%) | Total |
1 | 283,600.00 | $84,000.00 | $17,016.00 | $384,616.00 |
2 | $384,616.00 | $84,000.00 | $28,116.96 | $496,732.96 |
3 | $496,732.96 | $84,000.00 | $34,843.98 | $615,576.94 |
4 | $615,576.94 | $84,000.00 | $41,974.62 | $741,551.55 |
5 | $741,551.55 | $84,000.00 | $49,533.09 | $875,084.65 |
Less than 5 years!
That means, you’ll be FI by the time you’re in your 40s, beating your projected FI age of 50 by a whole decade!
In your calculations, you’re assuming a retirement spending of $65,000 even though you don’t plan on having kids (we don’t even spend that now, even in Toronto, one of the most expensive cities in Canada), and an extremely conservative withdrawal rate of 3.5%. I think this is extremely conservative and not necessary if you’re good at optimizing, but hey if it gives you peace of mind, than you can redo the calculation with 1/0.035 =29 times your $65K spending number to get an FI number of $1,885,000, which at your current savings rate, you would reach in:
Year | Balance | Contributions | ROI (6%) | Total |
1 | 283,600.00 | $84,000.00 | $17,016.00 | $384,616.00 |
2 | $384,616.00 | $84,000.00 | $28,116.96 | $496,732.96 |
3 | $496,732.96 | $84,000.00 | $34,843.98 | $615,576.94 |
4 | $615,576.94 | $84,000.00 | $41,974.62 | $741,551.55 |
5 | $741,551.55 | $84,000.00 | $49,533.09 | $875,084.65 |
6 | $875,084.65 | $84,000.00 | $57,545.08 | $1,016,629.73 |
7 | $1,016,629.73 | $84,000.00 | $66,037.78 | $1,166,667.51 |
8 | $1,166,667.51 | $84,000.00 | $75,040.05 | $1,325,707.56 |
9 | $1,325,707.56 | $84,000.00 | $84,582.45 | $1,494,290.01 |
10 | $1,494,290.01 | $84,000.00 | $94,697.40 | $1,672,987.41 |
11 | $1,672,987.41 | $84,000.00 | $105,419.24 | $1,862,406.66 |
Slightly over 11 years!
So, even with this extremely pessimistic conservative outlook, you’d STILL reach FI by your 50s!
So, you’re in on track either way.
Now, as for buying an investment property to do house hacking, since I don’t know where you are planning to buy it and what the rent-to-own ratio or cap rates are, I can’t tell you whether mathematically it makes sense. You’re just going to have to Math Shit Up and figure it out when you have all that information.
I do like that you said you “I’m very handy and can do basic carpentry/woodworking, plumbing, electrical, etc.” so that makes you a much better fit for this than me. Real-estate investing can beat index investing in returns but it’s not passive. But hey, if you’re like Mr. Money Mustache and love putting in sweat equity, it might be a good fit. Just make sure you’re aware of the risks if housing prices fall.
To learn more about House Hacking, read my friend and fellow Chautauquan, Craig’s book and check out BiggerPockets.
And finally, to answer your questions:
- Should I sell my long-held equity (~$100k post-tax worth) of company shares now, at a record low, and diversify?
- Let’s say that I do sell and get $100k post-tax. Where do I put it? VTI?
If you want to have the mindset of a long-term investor to reach FI, the first thing you MUST do is stop beating yourself up for not having a crystal ball. What if your company stock had gone up instead of down? Then you’d be stressed over whether you should sell now or hold out for even more gains. See, this is why I hate 1) timing the market and 2) individual stocks. You’re always worried that it could crash to zero so you’re always on edge to stampede for the door when it tanks. And when the prices go up, you have no idea when to sell. Even if you make a decent profit, you feel bad if it goes up even more.
Stop beating yourself up, sell, diversify and move on with your life. Honestly, I think at this point, you’re shortening your lifespan by stressing over this and you’ll never become a veteran investor if you keep trying to time the market. Diversify, set it, forget it, and get paid dividends and interest to own assets regardless of what the capital values are. That’s why we can sleep easily at night these days even with the market volatility causing our net worth to oscillate.
What do you put it in? Follow our free workshop here to create a balance and diversified portfolio: https://www.millennial-revolution.com/investworkshop/
So, there you have it. What do you think? Do you think VanFIRE should sell their company stocks? Buy an investment property? Let’s hear it in the comments!

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Sell & Diversify. Easier said than done though. I’m in a similar boat as the above. Although not as much in the stock, but it was sure higher 6 months ago.
How do you get over that mental hurdle of “losing” all that money you once had?
Easy: 1. You never had the money. Not until it’s cash in the bank.
2. Sell it while everything is “down”, and what you buy also will be down. When all goes back up, so will an Index fund. I’d rather bet on the whole market than a single stock.
3. For stock as compensation- you didn’t buy it (or some may have but at a discount)…. sell it and move on.
4. Consider Opportunity Cost – what else could you being with that money, that you aren’t, because you are hoping for a gain.
5. Fact is, you *might* very well get a gain … but I don’t know many who think we are going to be in gain territory for a while. Depends on how soon you need the money…
I don’t know anything about the company VanFIRE has stock in, but if it’s reasonable it will rebound, he should keep it there until he’s ready to retire (5-10 years). Individual stocks are a roller coaster and almost all stocks have nosedived these past few months. But, if it’s a good company, with good growth, it will rebound like all the others and hopefully make up for what’s been lost. I’d personally have a hard time taking a loss/hit like that if it was likely the company will rebound.
That said, any new funds that can be saved each month should be invested into a diversified portfolio. Just dump your remaining funds each month into that account. It’s turbulent right now, but the stock market always, eventually, goes back up!
Sell and diversify. My public company is in the process of getting bought by private equity, so I don’t have a choice; my five figures of company stock is getting turned into dollars later this year whether I like it or not — but it’s nice to have that kick in the pants. It’s all going right into a Vanguard index ETF.
Do I wish I’d sold sixteen months ago when it was worth twice as much? Sure. But whatever, can’t do anything about it, time to make like Elsa and let it go.
I think VanLife said they are able to save that much but they aren’t currently maxing it out (though they could be). Apologies if I read it wrong.
Being able to max out and actually maxing out are two really different things. If they aren’t currently maxing out, they might realize once they do max out that it’s unsustainable for them.
I agree. The numbers do not support the idea that they have already been saving. Heck, they haven’t filled their IRAs, let alone saved significant amounts of their income. Save first, stuff IRA and Roth, either eligible for Solo 401K?
I read it the same way as well and I agree that there is a big difference. It’s one thing if they perceive themselves as being “able to” and it’s another to actually do it. I’m not saying they can’t, but they won’t know for sure until they attempt to do so.
“Should I sell my long-held equity (~$100k post-tax worth) of TOST now, at a record low, and diversify?”
I would say, just keep the amount of money you are willing to lose in that company. $180K seems way too much. If you keep $20K or $30K, that’s already a lot of money. When you have decided what’s the amount you are confortable to lose, sell the rest and diversify.
Remember that this is a very highly speculative company. Will they replace VISA, MasterCard ? Maybe. But who knows. You will be ultra-wealthy if that happen. But it’s also very possible we will not hear about Toast anymore ten years from now…
Massive kudos to VanFIRE for freakin’ living the dream of seeing the entire country, holding down full-time employment gigs while simultaneously saving a shit ton of cash. Think about all those glorious experiences/memories while living on a simple $2500 a month all-in… that’s less than many folks pay in housing alone. Keep crushing it and living the dream! Hope I see you on down the road one day…
It seems their biggest issue is employer equity. They really need an honest assessment of their equity value and if the companies are viable IPO candidates. Be cynical and skeptical. So often, the principals at start-ups get fed up with continuing on and decide to throw in the towel and sell to the first private equity firm that happens along. When this happens, as a small private company, the equity can be significantly discounted as compared to publicly traded larger peers, so whatever their equity is worth now, it can get a heck of a lot lower…but it can also go a heck of a lot higher if successful IPO…….ugh !..This is a really tough decision !!
If me, I’m going for the sure thing and cashing out as soon as possible and not looking back.
I believe that the early shares also can get diluted if a startup has to seek more (unplanned) funding by creating more shares.
Would suggest selling some of the stock at a rate where capital gains from the stock won’t push you in another tax bracket. Immediately after the sale, buy either a total stock market or 500 fund. VTI is one example.
I don’t put over 10% of my savings in any one company. (I do invest in individual companies. )
You have 2/3s of your savings in one company. To me, it’s too much risk.
As for the stock and the current price you have to realize the only real numbers are the number you bought it at and the number you sell it at. I’m pretty sure you have a gain at the moment. Focus on that
First, I want to commend you on living within your means and accomplishing such a high savings rate! Huzzah!
One of the things I don’t see much discussion about RE: FIRE is where is your money? There is so much focus on what your FIRE number is and when you will reach it, but much less on strategy of how you will use these funds. For example, maybe you have hit your target FIRE number, but what if most of it is in retirement funds and you are decade away from the minimum age to access penalty-free? When you retire early, it seems important that you have enough in non-retirement accounts to bridge the gap until you can access those funds without paying penalties. Additionally, it is worth considering
taxes that will need to be paid on the capital gains from non-retirement accounts, how that might impact how much you need to pull annually to reach your true living expenses.
With that said, I have never heard of anyone saying not to max out workplace retirement accounts. I would focus on doing that before selling off existing stocks to reinvest. Like others have said, it is impossible to time the market. If you do decide to sell, consider the capital gains aspect of selling so you don’t have an expensive surprise next April. Unless you have a solid reason to think the stock from your employer won’t go up eventually, I would leave it where it is. You can diversify your portfolio going forward with that in mind. I am on the index fund bandwagon. Nothing in my portfolio has outperformed my S&P 500 index fund, so I will keep putting my investments to bridge the gap between FIRE and age 55 there, as well as a total stock market index fund, and some bonds to help diversity.
Best of luck to you! I envy van-lifers — enjoy your journey!
VanFIRE should kill that debt ($19.2K) by selling a portion of his long-held equity. Leave the remainder (~ $80K) as-is to avoid more taxes. Instead, sell it little by little each year and diversify. They do not need the $80K now anyway. Buying a property, taking on a mortgage (and thus debt), and being at the mercy of the renter to pay-it off sounds like PIA. and net returns from the property’s rent will start ONLY after they pay off the mortgage.
LOL. Keep living in the van and your lifestyle as it’s appropriate for the truck driving language you use. Too many inappropriate F’s for a property owning professional
just going to leave this here…
https://www.jbs.cam.ac.uk/insight/2021/psychology-today-are-people-who-swear-more-honest/
If you want to have the mindset of a long-term investor to reach FI, the first thing you MUST do is stop beating yourself up for not having a crystal ball. What if your company stock had gone up instead of down? Then you’d be stressed over whether you should sell now or hold out for even more gains. See, this is why I hate 1) timing the market and 2) individual stocks. You’re always worried that it could crash to zero so you’re always on edge to stampede for the door when it tanks. And when the prices go up, you have no idea when to sell. Even if you make a decent profit, you feel bad if it goes up even more.
Stop beating yourself up, sell, diversify and move on with your life. Honestly, I think at this point, you’re shortening your lifespan by stressing over this and you’ll never become a veteran investor if you keep trying to time the market. Diversify, set it, forget it, and get paid dividends and interest to own assets regardless of what the capital values are.
———
I agree fully with everything above except one item. That is, “forget it”. I think investing without paying attention to what is going on with where you have your money invested can cause problems and minimize your potential return. It can be in real estate investing, running a business, investing in a diversified investment portfolio of ETFs. That’s also true for holding company stock which is undiversified as is the case here which forms a large part of their net worth. It’s important to invest some time (not all your time) towards continual education. Knowledge is power. Things change over time. You want to be on the ball when that happens and you’ll feel better knowing you’re equipped to handle things when those changes occur. Ultimately, this money is for your retirement and hopefully a comfortable life. I talk more about it here:
https://www.fomotina.com/is-your-investment-portfolio-competitive/
Your life living in the van and exploring sounds great, if only Internet Speed for Zoom could be good everywhere you go!
Many people are hesitant to sell off RSUs because they are at a “loss” or think they will go up, but essentially like others have said you should diversify and move on, and payoff the van so less pressure on your income! Stock awards are just like cash bonuses, just in the form of stock. You wouldn’t take a cash bonus and use all of it to buy company stock would you?
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I think they were being a little sarcastic there! (About spending a lot of money)
If you do not try you will never know. I think the best laid plans sometimes drift to the side and then you have a new experience in any case! Enjoy the travels!
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