Today I have an update for you from a previous millionaire interview.
I’m letting three years pass from the initial interviews to the updates, so if you’ve been interviewed, I’ll be in touch. 😉
This update was submitted in November.
As usual, my questions are in bold italics and their responses follow…
How old are you?
I am 56. My wife is also 56.
We have been happily married for 32 years.
One of the things about marriage is that two are definitely better than one. A cord of two or three strands is not quickly broken. (Ecclesiastes 3:12)
Do you have kids?
Yes, we have 2 sons.
One is 28 and our youngest is 26. Both live independently.
Our oldest just got married last December.
What area of the country do you live in (and urban or rural)?
We are in a suburb of a mid Atlantic City.
What was your original Millionaire Interview on ESI Money?
I was Millionaire Interview #43.
Is there anything else we should know about you?
I am an avid FI follower. I have optimized everything that I could possibly think of.
We are on track to “retire early” next year mid summer.
What is your current net worth and how is that different than your original interview?
Best conservative calculation shows we are around $2,400,00.
When I did my net worth tally for the first Millionaire Interview we were at $1,400,000
What happened along the way to make these changes?
This is going to be a long response, because there has been so much along the way. Looking back three plus years, we have done a lot.
My wife is still a teacher, but I have since switched jobs to work for another builder in our area. This bumped my salary some, but the real boost was when I finished the flip I was on, settled out and built another house. Then we sold our old house for an insane amount of money.
Since I am a builder/project manager I was able to serve as my own GC building our new house on the side. We did this just before lumber exploded in price, but was going up steadily at the time.
So we built a much smaller house but with nice, higher end finishes, then fixed up and sold our old house so we did not have to move twice.
What are you currently doing to maintain/grow your net worth?
We are continuing to save at an aggressive rate. We are nearly maxing out our qualified retirement accounts, and doing the max for our individual Roth IRA’s.
Combined with our jobs and low expenses, we are staying the course saving around $4200 per month.
We invest primarily in index funds. We know that historically they will provide the best returns overall. We do not try to beat the market, just be the market.
The stock market has continued to do well lately. Although I still think a pull back is coming. We just don’t know when.
What is your job?
Our job title is builder, but in reality I am a construction supervisor for a residential home builder.
I tend to specialize in townhomes.
What is your annual income?
Base salary is $75,000.
Plus truck allowance of $5400.
Plus bonuses on homes built which varies but can be up to $10,000.
Wife is a teacher. Her salary is $54,000 which is about half of what it should be given the effort needed these days to be a successful teacher.
How has this changed since your last interview?
I switched companies after making a career blunder.
I switched positions with my last builder, thinking it would be a good career move moving into land development, but quickly realized that I was a fish out of water and could not gain any traction. Seemingly out of the blue I got a call from the new builder (my current employer) asking if I would like to come work for them. In retrospect if this was not a sign from God himself I cannot imagine what else would be.
So I made the jump, and I have been happier here. I have been here 2 years. I am going for 3 so I become fully vested in the company’s 401k plan.
Have you added, grown, or lost any additional sources of income besides your career?
I have not done any house flips, because the real estate market is so tight. But what we did do was build our new house. Looking as objectively as I can, I do not think we gained the equity I thought we would get in the new house, but we did gain some.
We cashed in as many favors as we could along the way for the build, but because of cost increases and all the high end finishes we installed we felt like we did not save a lot there. But we got the house we wanted exactly how we wanted. I am very proud of the work we did banking on my years of experience.
What we really gained is by selling our old house at a time when the market was as hot as it could be and we sold it on Zillow with no realtor. When the dust settled out, we made enough from the proceeds to pay off the construction costs of the new house and put around $250,000 in our pocket.
On a side note we actually financed the new house with an equity line from our old house. So there were no construction loans, draws, etc. to worry about. We just paid as we went.
What is your annual spending and how has it changed since your interview?
One of the criticisms from the comments of the original interview was that we did not have a budget and did not seem to know how money went out the door. Well, we still don’t have a budget, but as I said earlier we have optimized everything.
I have since cut the cord, and we only pay internet, we have done a deep dive on all of our insurance needs, life, home, auto, etc.
I have made fund moves in my wife’s 403b plan to the lowest fee ones.
I have also done some analysis on our spending. What I am finding out is life is definitely not linear. There is always a big bill here and there, a big unexpected cost will hit you one month and not the next and so on.
But the bottom line is our core spending is somewhere around $3500-$4500 per month which would put our annual spending between $42,000 and $54,000. We do spend more than that, but that is the core.
The numbers do not include income taxes or health care. Given all that, we are still at FI now and I cannot begin to tell you how comforting it is to know that we could walk away from full time work now if we needed to.
Given all the market upswing lately, we want to make sure that we have enough margin and cash to weather a nasty downturn which undoubtedly will come sometime in the future.
What are your current investments and how have they changed over the years?
- Mutual fund company 1 — $1,000,000. This includes non taxable accounts, Roth’s for both of us and an old rollover IRA for me.
- Mutual fund company 2 — $735,000. This includes old company stock, old 401k and my current 401k which I have cranked up 60k in 2 years.
- Wife’s 403b — $136,000.
- Wife will inherit an IRA from her dad, which will be around $47,000.
What happened along the way to make these changes?
As I said the house build was a good move.
We have a brand new house that will not require any major maintenance expenses for years to come.
What other financial challenges or opportunities have you faced since your last interview?
Building a new house stretched us some. We were super tight on cash when we got to the end, but once the sale proceeds hit, we paid off everything and are completely debt free once again.
Well, we have 2 furniture payments, but I am sandbagging them since they are interest free.
I am always looking for real estate investments, but I am not so eager to overpay in a crazy market now. I am also enjoying a break from the house build now that we are settled in the new place.
Overall, what’s better and what’s worse since your last interview?
Overall things are better. We have retirement on the horizon. Our boys are off on their own and doing well.
The worst things are aging parents. Mine are fine; my wife’s mother is in poor health, and she just lost her father.
What are your plans for the future?
We plan on going another year so I can get my vesting at my new company.
My wife will finish out this school year, and then decide if she wants to call it a career or do an aid position which does not pay a lot, but is full time and offers health insurance.
Unless there is a black swan event in the market, we do plan on checking out mid next year from full time work.
We would love to see our liquid assets reach the $2,000,000 milestone. Given the 4% rule we should be good to spend $80,000 per year. I feel that we could live extremely well at anything close to that. As it is now, we don’t live extravagantly, so that should be more than plenty for a great lifestyle, including some extensive travel.
Once we retire, we are going to take a deep breath and relax a bit. We plan on doing some traveling.
As I said in the prior interview I want to do some longer sections of the Appalachian Trail. I don’t think I will through hike all of it in one season, but I want to go for a few weeks at a time.
There is also so much of this great country of ours to go and see. I want to do that without the need to be on a strict schedule.
Oddly enough I have been bitten by the High Point bug. This is where you go to each state’s highest point whether it is a mountain or prominence.
Settling back in to a routine, I plan on starting a small contracting business to earn some extra money, and to have some activities during the week. We will do some volunteering as well.
Given that you have a bit more wisdom and experience, what advice do you have these days for ESI Money readers?
Keep your eye on the prize.
Always be on the lookout for ways to optimize your life and efficiency.
Exercise and eat healthy.
Smell the roses.
Stay busy and engaged in the community.
The internet has lots of information on financial help. You are bound to find a few blogs or sites that make sense and ones with which you can identify.
The one thing that I saw on the last MI update was a bit disturbing in that this guy does not share his money with his spouse. We have always had just one joint checking account, and we have full disclosure with each other. There is no “this is mine and this is yours “ nonsense. If you are married you are a team and you have to work together.
One last thing is that the financial planner for my wife’s school system always says that he has never had someone come to him at the end of one’s career and say “I wish I had not saved so much money.” We always strived to save. I wish we would have discovered the FI movement sooner. But I am glad we have found it several years ago. This helped us put a better perspective on life.
You don’t need more stuff to make you happy. You need way less than you think. Less is more.
I would love to hear everyone’s feedback. I am just an average guy, without the high powered job, just the desire to be free from the day to day grind.
This is another confirmation that you don’t have to be a doctor, lawyer or engineer to achieve financial independence. Love to hear the experiences of those whose careers generated a more “normal” income. It makes your accomplishments all the more impressive. Great job!!
Dan M says
I love YOUR story, you are regular Joes and Joannes and have created enough wealth to give you plenty of options and comfort in retirement as well as opportunity to RE. Bravo! And, thanks for sharing your story.
Are your 2 adult children savers too?
K D says
Great story. Will your wife collect a pension and access to group health care?
Thanks for all the kind words. Yes I see the other interviews with execs, doctors and the like with 500k plus annual income. I say hmm, why wouldn’t you have a several million dollar net worth?
Yes both our sons are pretty frugal. They both have a good nest egg started already. Fortunately from both our parents and my wife and I we were blessed to be able to have them start adulting debt free from any college loans. They both realize that is a big jump start on life.
An update on my wife’s job: she is stepping down as a classroom teacher, and will be a full time substitute which is a pay cut, but more importantly she does not have the day to day grind as a regular teacher. She will still have full benefits and contributions to the state retirement pension system.
As usual health care will be a challenge if we both walked away from full time employment. But for now, she will still be under the county plan. I have not decided to walk away this summer once I am vested in my current company. Losing $6500-7000 in a company match does not move the needle that much, but I don’t want to lose that money either. Before I make the jump, I want to feel better about where the stock market is heading. Although, I know that with my construction relationships, I can make a move to be an independent general contractor, and make a pretty good go of things. There is so much work out there now, that anyone who is reliable and honest can build a good contracting business.
Agree… My husband and I have always pooled our money… for all the 45 years we have been married. In a lot of respects it has made life more manageable for us, even during difficult times such as illness or job loss. We have always acted as a team and thank goodness it has worked out exceptionally well… 🙂
Arie Frasier says
Some of the millionaire interviews on here are so intimidating to average income folks. You see couples with household incomes of $300,000 or $500,000 or even $1 million and networths of $5 million+ and honestly I can’t relate. This however I can relate to. I read this article of a couple whose main breadwin salary is $75,000 to $90,000 and I can definitely relate. The fact that they have a $2.4 million nest egg at a relatively young age for retirement is also encouraging. We need more stories of couples like this ESI!
Send any you know my way! I take all comers!