Unexpected Income: Are We Un-Retiring?

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A few days ago, FIRECracker and I emerged from our AirBnb blinking in the sunlight after having been holed up in our rooms writing for 5 days straight. The two of us no doubt must have looked like zombies, stumbling down the sidewalk in our unwashed MadFientist t-shirts. As we sat down at a nearby cafe for a much-needed coffee, FIRECracker turned to me and asked “Hey, did we just un-retire?”

It’s a legitimate question.

When we started this weird little blog of ours, never in a million years did we think it would turn into anything big, and the idea that it could one day lead to an actual second career as writers was ludicrous. But 2 years later, here we are. Our blog has been viewed 3.3 Million times since inception, and we are currently writing a book with Penguin, the biggest publisher in the world. Writing 2 articles a week, plus an entire non-fiction book has basically turned back into a full-time job, though one where our “office” can be a cafe in Poland or a beach in Portugal.

Based on that sentence alone, the Internet Retirement Police (IRP) would accuse us of becoming un-retired, and promptly call for us to be tarred, feathered, and ousted from the FI community.

For the record, no I don’t believe we’ve un-retired. The key difference in being retired from a normal working stiff is that the normal working stiff has to work for the money. We choose to work because we love it. FIRECracker has been dreaming of being a professional writer since she was a child, so when Penguin pings you out of the blue and asks if you want to do a book together, you just don’t turn down an opportunity like that.

But what’s always intrigued me is why the IRP is so eager to label FI bloggers who earn unexpected income “fake” or “un-retired.” Here’s my theory.

I think the IRP isn’t going around calling people out just because they want to defend their interpretation of the word “retirement.” I think they call people out because they’re afraid it corrupts the experiment.

Let me explain.

Many of you, I’m sure, come to this blog every day for our financial advice plus the dick jokes. And that’s great. But I’m also sure many of you come to this blog to track our progress in early retirement and see if we fail, run out of money, and are forced back to work with our tail between our legs.

That’s totally fine too, by the way. Some of you are using us as crash test dummies, because you have similar numbers and want to see if we make it. In other words, us gallivanting around the world is an experiment to you. Will we actually manage to stay retired, or will we run into a problem we weren’t expecting out on the road that will force us back down to earth?

So when someone makes money after retirement, it screws up the experiment. Yes this person has been happily travelling the world, but is it because they were actually able to live off their portfolio in retirement? Or is it because they made that unexpected income and that’s the reason why the numbers have worked out?

In other words, is starting a successful FI blog required to retire?

And that’s actually a legitimate question.

So here’s how we plan to address this issue.

A Tale of Two Portfolios

Prior to retirement, we structured our money like this:

Our portfolio (worth $1M at the time) would churn out money every year either as part of the Yield Shield or from harvested capital gains. Every January, that cash would be withdrawn to our savings account and be used to pay for our Current Year Expenses. An excess reserve fund in the form of the Cash Cushion also exists to protect against Sequence of Return Risks.

Now, we have money coming in from external sources due to our post-retirement entrepreneurial activities. So the big question is: What should we do with this money? If we allow it to flow directly into our savings account, that would reduce the withdrawal pressure on our portfolio every January, which is great for us but not great for you. We will succeed in our retirement, but it won’t be clear whether it was because we managed our portfolio properly or because we made all this extra money.

So here’s what we’ve done. Any money that we earn post-retirement will be segregated into a separate, distinct portfolio. The original retirement portfolio will be known as Portfolio A, and the investment portfolio formed from our post-retirement income will be known as Portfolio B.

Portfolio A‘s role will continue to be funding our living expenses. So:

  • Rent
  • Food
  • Entertainment
  • Flights
  • Insurance

All those day-to-day costs will only be funded from Portfolio A. This will preserve the original structure we retired with, and keep our retirement experiment “clean.”

Portfolio B will NOT be permitted to fund our living expenses, nor will we inflate our lifestyle assuming that Portfolio B can cover any shortfall if we run into trouble. Portfolio B will only be permitted to fund the following:

  • Business expenses. Hosting costs, head shots for our book jacket, etc.
  • Business re-investment. If we choose to, say, hire a web designer to remodel this site, that cost will come out of Portfolio B.
  • Self-Improvement. If we decide to take completely optional classes to expand our minds and upgrade our skill set, that cost will come out of Portfolio B. After spending this year in Europe and last year in Central/South America, FIRECracker’s been interested in learning Spanish. I may take a film class so I can produce more videos of FIRECracker yelling at old people.
  • Gifts for family/friends and donations
  • One-Off Ridiculous Luxurious Expenditures. Any idiotic one-off luxury purchases that aren’t part of our normal living expenses. If we do make one of these, we will disclose them on this blog so as to open ourselves up to the ridicule we rightfully deserve.

That last one has actually been an interesting one to contemplate. FIRECracker and I have been trying to come up with a Ridiculous Luxury Expenditure that we’d both want and so far haven’t been able to. Buy a Tesla? What’s the point when we’re nomadic? Take a cruise? We’re already travelling full-time! Do more shrooms? OK that one does have some appeal, but a packet of shrooms in the Netherlands costs 10 Euros. It’s not exactly going to break the bank.

Time For Transparency

Anyway, enough about shrooms. Let’s talk numbers.

I don’t do net worth updates nearly as often as some other bloggers because a) who cares and b) I don’t wanna. But now might be a good time to put some numbers to those coloured boxes.

Portfolio A

Current Amount: $1,160,000

Portfolio A is our original retirement portfolio which, when we left, contained $1,000,000 in 2015. As our impeccable timing would have it, this coincided with the Saudi-led oil price war that would see a barrel of crude crash from over $100 to less than $40. Canada’s stock market was devastated, Russia entered into a recession, and Venezuela turned from a happy South American socialist paradise into a Mad Max-ian dystopia.

So in our first year, our portfolio was actually negative. But because we had the Cash Cushion, we used one year of its 3 year reserve to pay for our living expenses. The next year, the market rebounded, allowing us to resume our normal withdrawal schedule, and the year after that it went up even more, allowing us to do a normal withdrawal AND replenish our 3 year cash cushion.

Savings Account

Current Amount: $39,000

Our savings accounts store both our Current Year Expense fund as well as our Cash Cushion fund. Right now, we’re looking at a balance of $39,000. And since my portfolio’s Yield Shield is currently generating $35,000, my 3-year Cash Cushion fund is sitting fully funded at ($40,000 – $35,000) x 3 = $15,000.

That leaves $24,000 in my Current Year Expense fund. And since we’re just about to enter June, that means I’m expecting this fund to last 7 more months. With a $40,000 annual budget, that would mean I need this fund to be $40,000 x (7/12) = $23,333. So we’re good to go here.

 Portfolio B

Current Amount: $84,000

Yeah, I know, $84 grand earned post-retirement! Where did that come from? Well, in short:

  • Our Investment Workshop portfolios
  • Earnings from one-time freelance coding work
  • This blog. From advertising and affiliate links, last year we earned roughly $1100 a month, though that amount can spike or collapse wildly based on the whims of Google Adsense’s mysterious CPM algorithms. We’ve recently switched over to a new ad network so hopefully that’ll stabilize going forward.
  • Book royalties from our children’s book.
  • Our book advances (fiction and non-fiction). Book advances get paid in thirds. A third on signing, a third on completion and acceptance of the manuscript, and a third on publication.

How’s Our Retirement Doing?

I’ve got to admit, structuring our accounts this way actually makes it a lot easier to see how our retirement has panned out so far. By separating out our pre-retirement money versus our post-retirement money, we can see how successfully we’ve navigated the financial pitfalls of retiring early (right into a nasty market correction, I might add!)

Our conclusion?

Conclusion #1: Our original $40,000 retirement budget has not increased with inflation. Every year, we’re supposed to add inflation onto this original amount, but a combination of FIRECracker’s judicious budgeting and geographic arbitrage has caused inflation to seemingly skip us completely. In fact, we’ve come in or under $40,000 for total spending in the first 2 years of retirement, and we’re projecting to come in under $40,000 for this year as well.

Conclusion #2: Our portfolio growth has lowered our required Withdrawal Rate. $40,000 / $1,160,000 = 3.4%! Plugging those numbers into FIRECalc reveals a 100% success rate. So by using our Cash Cushion and Geographic Arbitrage to control living expenses, it looks like we’ve successfully exited the Sequence-of-Return-Risk danger zone unscathed. Knowing this, our next moves will be to lower our Yield Shield and return back to a more traditional indexing portfolio, as well as decrease our Cash Cushion since we no longer need it. Stay tuned to this blog as we will announce these moves as they happen.

Conclusion #3: We can afford to take an inflation adjustment. With a new portfolio size of $1,160,000, we can increase our baseline spending to $41,000 (a 2.5% increase) and still have a 100% success rate. Though considering our current spending projections see us coming in below $40,000 even though we’re spending the year in Europe, I don’t see this as necessary.

So there you have it. We’re not un-retiring, we’re taking steps to keep our experiment as “clean” as possible for you readers, and it looks like our retirement has so far been a rousing success!

Questions? Comments? As always, let’s hear it below.

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101 thoughts on “Unexpected Income: Are We Un-Retiring?”

    1. Yes, all figures are in CAD, though I’m happy to report that our total net worth now makes us millionaires in USD as well!

      And you can’t control when dick jokes happen. They just pop out when they feel like it, usually at the most inappropriate times. You know how it is.

  1. Hey thanks for another great article. Two Questions for you guys.

    1) Can you explain how you withdraw? Do you just withdraw X amount of dollar in January from your investment account ?

    2) Since you’re withdrawing more than $22,000 / per year. How do you avoid paying taxes on the leftover withdrawal ?

    1. They have posted this in the past and if I recall correctly, most of the left over incomes from their TFSA’s which are non-taxable in Canada.

        1. Love, love, love all of your posts!

          BIG Congrats on the book deal, beyond proud of you guys! I always wondered if you guys would write one regarding your webpage.

          Thanks for the recap on the withdrawal portion, it’s been awhile since I read it. I already have my FU money, and daily I’m tempted to say just that but now it’s time to pick the date!!! Hopefully Nov-Dec 2018… we’ll see if I can hold out that long… lol

      1. Hello,
        interesting life, my respect.
        Have you deregistered your place of residence? Can you be permanently resident?
        We will be leaving Germany in 1 week and want to deregister. But then there is no longer any health insurance. If you want to go back at some point, you will no longer be covered by statutory health insurance; you would have to continue to take out private insurance.
        However, through ETFs, stocks, precious metals and Bitcoin, we have dividends that are taxable, so Germany wants an address from us. But we will travel through all countries with the motorhome. You are also looking for apartments via Airb2b but will also sometimes live in a mobile home.
        But how is that supposed to go with the German state and the authorities?
        How did you solve it?
        Thanks for an answer.
        All the best and kind regards

  2. Good stuff guys! I like how you broke down the portfolios and are not commingling the funds.

    Our original goal was to live off our passive income, and the modest income Financial Samurai was generating.

    But a funny thing happened. When you suddenly have a massive amount of free time, you simply spend that time doing what you enjoy. For me that was just writing on FS, so the site grew and the income grew.

    I’m not sure from which bucket we spend our money on anymore. All I know is that we continue to save about 50% over after-tax income if not more because that’s what were used to.

    Good analogy on crash test dummies. I think you’ll definitely find that the longer you last, the less doubt people will have Of your early retirement journey.


    1. Sam! Always great to see you around!

      Yeah, I used to live in fear thinking “I’ll never make another cent again” but you’re totally right. I get it now. It happens almost by accident at this point because you have all this free time to do what you love.

      Do people still write to you saying “You’ll be sorry when it all comes crashing down” or has that mostly stopped by now?

      1. It doesn’t work that way for everyone. Since I early retired 11 years ago, I haven’t made a cent from active income, because what I love to do has no income value, e.g. dating, going to the gym, basketball, getting married, raising a kid, traveling, charity work, etc. Most of those activities involve increased spending.

  3. I’m slightly early retired but my hobby side gigs earn way over a median US income. I don’t earn anything from my poor little blog but my consulting side gigs are lucrative and only take a few hours a week. I do not need the money at all, not even for splurge luxuries because I worked way past the rational point of FI, mainly because I didn’t think early retirement was a thing back then, and work was fun. But it does cause a quandary when I try to write about safe withdrawal rates since mine has been zero for the entire three years I’ve been retired. Most people haven’t found a fun post retirement hobby gig that pays more than their living expenses so they face financial concerns that thus far I haven’t faced.

    1. I don’t know, it takes a few years but I think everyone eventually settles on something that makes just a little bit of money, even if it’s selling arts & crafts on Etsy or whatever.

      What kind of consulting do you do?

      1. I am an engineer and do regulatory consulting for large corporations. It was a tiny part of my old 9 to 5 but a part I always enjoyed so I invented the job the week before I retired, pitched it to a group of large companies and started right after I retired. I work from home and on my own schedule and have a lawyer and some consultants that work for me on a contract basis. It has gone well for three years now, and really given me a tiny bit of structure and keeps my brand alive in the same business circles I was in before I retired.

          1. Believe me it isn’t exactly what it sounds like but I have to be kinda vague or I might as well sign my real name because there are only a handful of people in the country doing what I’m doing.

  4. Wow! Great post. This is so helpful to those on the road to FI and always looking for motivation and sustainability! So big thanks for the relative transparency.
    Bring on the IRP!

  5. What you’re doing is perfect bookkeeping – keeping the business dealings separate from the personal ones. And of course, you’ve just doubled the fun for us readers, we now get to rubberneck more of your affairs (thanks!)

  6. Congratulations on the book deal! I’m so excited to see that more prominent FI figures will be gracing the bookshelves in the near future.

    Also, I love the idea of distinguishing between the post-retirement income and the passive income that “normal” early retirees will see. Very clever way to distinguish the two.

    1. Thanks! It actually helped us see how healthy our portfolio was too, and it was in writing this article that I realized we had successfully navigated our way out of the Sequence-of-Return danger zone, so that worked out nicely.

  7. Honestly, who cares what the IRP think? I certainly don’t.

    While I applaud the transparency that maintaining two separate portfolios gives, it seems a touch unnecessary. Let the IRP whine.

    I think it’s great your making so much money from the blog and book writing.

    I mean common guys… like me, you’re already millionaires! You define retirement in your own way. It’s not like you’re required to have a job.

    1. I agree with Mr. Tako….

      ….let the IRP whine. They will anyway.

      Math that shit up, as FC would say, and your portfolio has and could easily continue to support your lifestyle. Job done.

      Still, your portfolio separation approach is interesting and will be fun to follow. Which, in turn, will make your blog even more successful and profitable.

      Which will be even more upsetting to the IRP 🙂

  8. May I please recommend a Canadian charity that is truly deserving? 5% admin fees, rest goes straight to programs and services for those that need it most. I volunteer for this organization and am happy to send you reviews etc.

    Love your blog and am close to FIRE, keep living your dreams and shine brightly!

      1. Thank you! FYFB (Fort York Food Bank) has been independently reviewed and was one of the top 10 rated charities in Canada by Charity Intelligence, many years in the top 25. It is located in downtown Toronto, serves over 1000 people a month providing advocacy, food, community and much more. Here is the charity intelligence link: https://www.charityintelligence.ca/charity-details/156-fort-york-food-bank
        After 12 years, FYFB just moved to 380 college st. (fyfb.com) at college between spadina and bathurst where Amato pizza used to be. Lots of Newcomers, kids and many hardworking people that need a hand up : ) Please visit when in Canada, email me, saturday afternoons are great. Thank you again for considering!

  9. In danger of being Devil’s advocate I think that you have unretired. If retirement means “The action or fact of leaving one’s job and ceasing to work” and work means “Activity involving mental or physical effort done in order to achieve a purpose or result” (Oxford English Dictionary). But query whether such a wide definition of work means the only way to stop working is sitting on one’s backside doing nothing all day…

    Personally if you have unretired what’s so wrong with that? I don’t think you’re fake. Your authenticity and openness with your numbers and generosity on letting us see inside your early retired life is what keeps drawing the readers back. It’s only when you went on to write about the portfolio being an experiment of sorts that I could see the issue / quandary. So I applaud your efforts to ensure that the Portfolio A experiment runs with as little interference from outside income as possible.

    Haters gonna hate – just ignore them.


    1. Well, even that definition of “work” is up for debate. We’re writing a book, which has been a dream of ours for decades. So when you’re living your dream, is that “work”? Or very intense “play” in which we happen to make money?

      1. It’s not “work” because you don’t have to do it. Mark Twain wrote about that in the context of Tom Sawyer and painting the fence: http://www.pbs.org/marktwain/learnmore/writings_tom.html.

        Many (but not all) parts of my prof job are living the dream, but the current state of my accounts makes it still “work” and not “play”. In some sense, as soon as you are ready and willing to pull the plug, your job becomes “play”.

        1. That’s a problematic definition of work. I work with a lot of wealthy folks, mostly those who have sold a business and had a major liquidity event, whose kids and grandkids are born financially independent. Many of them (the kids and the wealth generators themselves) go on to found and run other companies or charitable foundations. They certainly wouldn’t call themselves retired and would bristle at the accusation that what they do every day isn’t “work” simply because they don’t need the money. We see examples of this everywhere: do Oprah, Jeff Bezos, Justin Timberlake, Lebron James, and every single Fortune 500 CEO not work? They are all retired by this definition.

  10. Great article. It’s funny, I never looked at any of the blogs for failure. I however did find myself constantly thinking “these blogs sure do look more like jobs to me than the writers of said blogs ever want to talk about.” But not for you guys’ blog thanks to the varied content (traveling, user cases, general FI topic, etc). The blog Our Next Life finally called folks out on it by saying “disclose your blog income” and a few folks did it. I’m impressed with the portfolio 1 and 2 approach; it really does make it easier to track your success.

    As for the folks looking at you guys as an experiment, I think you’ve already proved your point. The members of the IRP aren’t ever retired anyway – it’s always easy to hate from the sidelines. Working as a choice versus a requirement (in order to living comfortably) seems to be the difference in what defines if it’s been successful for you or not. Which also seems to be the difference between FI and FIRE. Honestly, I don’t know that anyone has ever adequately defined the difference between those two concepts or if there is any real distinction between them as used on most of the blogs (in my opinion). Keep up the good work and thanks for continuing to pump out quality content and truthful info!

    1. Yeah, I don’t consider writing “work” either since I enjoy it so much. We can lose track of time sometimes and end up working for 8 hours straight though, so that part reminds me of work sometimes.

      And as for OurNextLife, I remember the backlash she got for that since she doesn’t show any of her numbers herself. Hoping she takes her own advice soon…

      1. What backlash (I’m asking b/c I didn’t realize there was any)? Tanja’s site doesn’t contain any advertising links nor affiliate pages (or at least I’ve never seen them). She mentioned in her article about the failure for most blogs to disclose blog income that she doesn’t make any money directly from her site. She did just mention she has a book coming out in March 2019 so I guess she’s using it to advertise that.

  11. Writing isn’t work. It’s not like you have lift heavy objects, dig a ditch, manufacture a product, break a sweat, or break a nail. You’re just tapping a keyboard and cashing a check from Penguin.

    I’m going to allow it.

    Good luck!

    1. lol I guess if you define “work” the way physics defines it as Force x distance. Very little force is exerted to move almost no distance, so technically, writing it NOT work I guess.

  12. Hey Wanderer – Keep up the great work! (oops – did I just say “work”? Honestly, that was NOT planned…)

    I love the transparency and I love the two-portfolio separation idea. And I agree: Who cares if you are “retired” or “un-retired” or have a definition that disagrees with someone else? The point is that you’re living the life that you choose.

    So here’s a little thought experiment to prove my point: If you don’t earn a single dollar actively, then you’re retired. If you earn $100k/yr actively, most people would say you’re not retired. But what if you earn $50k? Or $1k? Or $1.00? At what point does “not earning income” vs “earning income” transition from “retired” to “not retired”?

    Bottom line IMO: Be transparent. And don’t care how other people define your retirement status 🙂

    1. Thanks! That means a lot. And yeah, does picking a penny on the ground also count as un-retirement by that definition? Seems silly to me.

  13. Greetings from Australia!

    Thanks for your transparency, guys! It’s great how you have restructured your portfolio to reflect the new income streams. I’m sure a lot of readers will appreciate the fact that they are still able to follow along and use Portfolio A as a guinea pig for their own retirement plans.

    I do have a quick question on the spending from Portofolio B that you are going to allow yourselves. You say you won’t inflate your lifestyle because of the unplanned income. But then, in the same paragraph, you outline that you might use the funds for “Ridiculous Luxury Expenditure” (the very definition of lifestlye inflation?!), gifts and courses etc.

    So I understand you ARE NOT going to inflate your lifestyle by withdrawing more from Portfolio A than usual but that you ARE going to inflate your lifestyle by using funds from Portfolio B. Is that correct?

    Anyway, keep up the good work, I really enjoy following your journey!

    1. When I say “Ridiculous Luxury Expenditures” I really mean one-off purchases that aren’t part of my daily lifestyle. Our general lifestyle will remain the same but if we decide to buy something one-off and completely wastefully, we’ll fund it from Portfolio B, and report it here.

      It’s interesting that we haven’t been able to come up with anything yet though. I mean, our life is already perfect. A new Tesla wouldn’t help 🙂

  14. Enormous admiration to you for keeping your finances separate for this experiment. I hope it’s partly for you and not just the Internet Retirement Police. They’ll never be happy, but the rest of us will relish following along.

    Good on ya for making money. I want you to thrive and keep writing!

    But I do have a question: if part of your second portfolio is from the investment workshop, where did that money come from? Taking money out of your original portfolio?

    1. That investment workshop money came from some earnings I had made in the first few years of retirement (not much, maybe $15k) and the rest I took from my cash cushion fund.

  15. New tag line?

    Millennial Revolution – Come for the voyeurism, stay for the dick jokes!

    Glad to see you’re making it work. Keep it up!!

  16. I am very interested to learn how you guys managed to spend less than $40,000 for a whole year in Europe.

    I myself wouldn’t choose to completely retire even if I can, because no wealth on earth is permanent. At most, I have the leeway to work easier and less than before.

      1. Guys, guys, guys. If you say “Fuck the haters” and “Fucking haters,” and you keep talking about dicks, the porno crowd will be heading over here soon.

        Come for the fucking dicks, stay for the low MER…

  17. Hi FC & Wanderer,

    Both of you are doing well. I think that you are not considered un-retired because you are doing the things which are of your interest. I believe that both of you would have derived joy from doing such things which happen to generate income for you.

    There is no need to bother about the comments made by IRPs. If you are affected by such comments, I feel that it is totally not worthwhile and you will be caught in their trap. My take is that the purpose of their comments is to make you feel annoyed and affected. You have fulfilled their purpose by having such thoughts.

    Continue with what you are enjoying to do without bothering all these unnecessary comments. You still have fellow readers like us who are in line with your philosphy and it will be more worthwhile spending the time mingling with readers like us. This will generate positive feeling who are beneficial to all well beings.

    My two cents worth of views.


    1. Thanks! That means a lot.
      I’m actually surprised more IRP haven’t attacked us in the comments. Maybe they’re all doing it on Reddit or something…

  18. Count another reader who appreciates the transparency and the separation of your post-retirement earned income. We are also nomadic FIRErs and it does give me great comfort to see the numbers work for others. Selfish of me, I know, but Thank You for keeping the expertiment “pure”. To hell with the IRP, don’t care about slicing hairs, but do appreciate you sharing so openly. You are both an inspiration for so many of us, including those of us many years your seniors. In Year 3 for us, and we are also “up” from where we started with no earned income, and well into our 3rd year circling the globe. What fun! Love, love, love your blog…big Congrats on the book!

    1. Thanks! And how cool is it to watch your portfolio climb after you retire? I still have to pinch myself whenever I log into that account. Yay for globe-trotting!

  19. Hi, I felt that this is semi retirement. Hate to do this but income is income. There is a lot of compartmentalization but given the total net worth based on portfolio A and B, it does give you an even lower withdrawal rate. So it is safer.

    Because its safer, we tend to be stronger in our message. For those who do not wish to work, their mileage may vary. They are working on that ideal size and they wont have that buffer. In all reality, to be safe, people should aim for a 3% withdrawal rate, else they would be a bit risk seeking (nothing wrong there)

    I do have to clarify something. Since your spending is less than $40,000, isnt the withdrawal rate lower than the 3.4% you have explained? This can go alot of ways, because by right, if you are in the third year, your withdrawal rate should be 40k x 1.025 x 1.025 x 1.025 = 43k?


    1. I think you missed the point of this entire article. I’m calculating my SWR for my day-to-day living expenses as a percentage of Portfolio A only.

      And yes we could have taken inflation adjustments, but because our travels have made inflation irrelevant, we chose not to take them. Maybe we will this year, but I doubt it.

  20. Hi Wanderer – Thanks for the numbers … it actually helps your readers see what is possible and the practical application of your ideas…. so I think it is an okay idea to share them as an educational endeavor – then we readers can juggle our own numbers according to our own situation … but an example is worth a million words … etc etc etc… It is curious that you haven’t capitalized on you blog as others like GCC even though … I think you success warrants it … of greater relevance to me though is more info on the numbers break down of your plan to stay in Europe for a year? … how do you manage, is it all AirBnB, the 3 month visa issue, and what countries besides Poland will you be camping out in? etc etc etc God Bless – From the Far Side – Michael CPO

  21. You are FI and you get to do whatever you want, that’s all that matters. Just don’t give it a name:)
    Glad you are so transparent about this, too many bloggers are not! Keep it up.
    And congrats on all your amazing achievements.

  22. I’m of the camp that who cares about the IRP. It’s your life and you really don’t owe anyone an explanation if you choose to pursue interesting opportunities that come up. Especially those that fulfill life-long dreams – definitely go for it! That being said, it does make sense to keep this additional income separate so I think you guys figured out a great solution .

      1. I got old. Wasn’t my fault. You guys weren’t here when I was a whippersnapper. Double sad. 🙁 🙁

  23. Great job, guys! You are killing it indeed. Though my anticipated WR is <3% when I retire (without considering social security), one factor that seems to have suddenly made this prospect very “cushiony” is our current location India – where we are living an upper middle class lifestyle (with maid and several weekly outings) and still spending half of what we used to spend back in US! Geographic arbitrage is a wonderful thing indeed, if you know how to hack it.

    And (un?)fortunately for me, there is hardly any money my blog makes so no need to separate portfolios!

  24. i would co-mingle up all the funds in a blender and throw off the whole space time continuum and drive the haters nuts, but that’s how i roll. who cares what the public thinks? the public never asks what i think of their slack jaws.

  25. I’m eager to see if and how your FI portfolio makes it through the next big market crash. Keeping the money segregated is critical to the experiment.

    You might be the guinea pigs in this real life experiment, but at least you’re no longer on the hamster wheel.

      1. Question for you. You say in the article your Yield Shield generates 35k, which is 3% yield on your portfolio. But in the comments you say your portfolio yields 3.5% (40k).

        Why don’t you consider that extra 0.5% portfolio yield part of your Yield Shield?

        1. Old habit. When I retired, I threw up my Yield Shield to throw off $35,000 of income from my then-total portfolio size of $1,000,000. This was a 3.5% yield at the time.

          Now, since I haven’t made any changes to the yield-producing part of the portfolio, it’s still throwing off about $35,000, but my total portfolio size has grown to $1,160,000. So my new yield has dropped to 3%, but I’m still getting the same income as before.

          The yield is determined at your buy point.

  26. I’ve never understood the IRP anyway. It’s like people want to make FIRE out to be a giant scam: where trust fund babies cackle over their ‘secret money’ by convincing regular folk to stop buying new cars. 😛

  27. I like it. It’s a great idea to keep post-retirement income separate. It’ll be there when you need it and it won’t interfere with your crash test dummies status.
    Like Financial Samurai, our funds are all comingled together. (What a funny word, it’s hard to read.)
    The IRP already hates us because Mrs. RB40 is still working. 🙂
    Oh, for decadent purchases. You can always come down to WA or OR to try out some recreational cannabis.

  28. “Many of you, I’m sure, come to this blog every day for our financial advice plus the dick jokes” LOLOL!!! I follow a lot of personal finance blogs but both of your guys’ well-placed jokes in your posts are what keep me coming back. haha

    Thanks to both of you for starting this blog and helping me (35yo, married, living in LA) see that I can be part of the FIRE community if I stick to a great financial plan.

  29. Great to see a well thought post about this.
    I think you nailed the reason many of the IRP get upset.
    Its actually cool to see that the theory behind retiring and living on 4% of your portfolio seems to be working out in real life.

  30. Is there a reason why you didn’t incorporate a CCPC for your side hustles / Portfolio B? 15.5% small business tax (in Canada) for an effective tax deferral. It also won’t interfere with any GST credit or other Trillium benefits you might get for being poor in the eyes of the government…

    1. We had no idea we’d make any serious money from side hustles so didn’t bother. It’s something we could look into in the future.

  31. Hi FC & Wanderer,

    One question. Apart from the two above-mentioned Portfolios and current account, do you guys have other buffers fund to support you?

    In the country which I reside, we have the so called comprehensive social security fund system. Please see the below link for more details:


    Do you have such similar buffer fund as an additional security in addition to your existing portfolio and accounts?


    1. We’ll be eligible for CPP (Canadian Pension Plan) and OAS (Old Age Security) when we turn 65 but before that no.

  32. I think the IRP skepticism is more justified when the blog income starts rolling in years before the “extreme early retirement” plug is pulled. Would those bloggers have actually quit their primary jobs (or “retired”) at that age and with that portfolio if they didn’t ALREADY have substantial income from their secondary job (i.e. the website they spend almost as much time on as they do their careers by the time they pull the trigger)? We’ll never know. And maybe we shouldn’t care, but it does make the extreme early retirement claims subject to justifiable suspicion from readers and cause people with no intention of starting a blog wonder if the FIRE advice really applies to them.

    When the retirement decision is made first and then a blog is launched (a la you guys from what I know, Financial Samurai, MMM, etc.) then I think readers are less judgemental about post-retirement income – even if said retirees earn massive amounts and work 30+ hours a week (in which case I personally think it makes more sense to classify oneself as having launched a successful second career after becoming financially independent).

  33. Who cares? You do you. But if you don’t want people to define your retirement, don’t define retirement for them, either- let’s retire the silly concept of “internet retirement police.” We each get to define retirement as we like it.

    I should add that while you certainly could and have and perhaps would sustain your lifestyle with your savings, there’s a helluva difference psychologically as well as financially between living off of 4% of one’s savings vs living off other income.


  34. I follow quite a few FI blogs, and the effect of a successful blogging career has always made me wonder if the additional income was impacting FIRE success.

    The lack of earning transparency makes researching the long term success of portfolios difficult. And a failed portfolio does not make a popular blog…so exposure of the FIRE journey is a bit one sided.

    I really appreciate that you are aware of your audience. I am definitely one of those readers that is reading for the long term sustainability…as well as the dick jokes 😉

    I look forward to reading the book!

  35. I keep forgetting what the Yield Shield is and I didn’t feel like re-reading the link, but good job on lifestyle un-inflated! Way to go on getting to your goal of being a professional writer… i think creation is a part of all of us in some way shape or form… actually surprised the blog is “only” pulling in 1100/mon… i only say that because I enjoy your content far more than those earning more… oh well… #doyou

  36. This is why I’m so glad I am no longer in the mindset of working a regular job because as long as you work for that employer, employers can dictate your 401(k), retirement and pension monies.

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