When it comes time to decide when to retire, if you are a member of the FIRE community, especially ChubbyFIRE, it’s a highly personal decision. If you take this one step further and believe in ChubbyFIRE, you typically have a net worth between $2.5 and $5 million, which means you likely have enough to call it quits, but still might be unsure when to do so.
One Redditor already in the ChubbyFIRE world, posting in r/ChubbyFIRE, is trying to make this very call as you read this, but is struggling to decide. At 47 years old, they are wondering what others want to have in their bank account before deciding to stop the corporate rat race once and for all.
It’s definitely a bit of a tough call, as everyone’s situation and lifestyle are different, but there might also be something here that will make the Redditor feel confident about their number being the right choice.
The Retirement Number
At 47, the Redditor acknowledges they have a good job and have been saving for retirement with a “renewed focus.” Fortunately, the Redditor already realizes that everyone’s number will be different. Still, they are curious whether it’s $1 million, $5 million, or if $10 is the number someone needs to reach in the Chubby FIRE world before saying goodbye to working forever.
Perhaps most importantly, someone has to consider a few different factors, such as whether this number is all cash or total net worth. This is an important distinction, as many Redditors responding to the original post in the comments talk about their number alongside having a paid-off house.
In other words, they want $X million on top of a paid-off house and do not include a house’s value in their retirement number.
What Does Reddit Say?
Unsurprisingly, the numbers in this post’s comment section run a pretty good spread. Some Redditors respond that $2 million is all they need, while others indicate they want the same $10 million number the original poster is considering.
Interestingly enough, many Redditors responded that their number is based on a calculation that looks at what 25 times their predicted annual expenses would be. This means that if they plan to have $100,000 available to spend every year, they would want $2.5 million in the bank (or brokerage) before deciding to walk away from it all.
It goes without saying that whether or not a home is paid off is a major factor, as most comments indicate that this is important to take care of before calling themselves members of the ChubbyFIRE club.
What Financial Planners Say
While Reddit has its view on retirement numbers, companies like Fidelity and Merrill Lynch have a different philosophy. They also do not factor in the FIRE lifestyle. For its part, Fidelity indicates that you should have 10X your current salary saved by the time you are 67.
Most financial planners would likely argue that you need at least $1 million, but they are not considering the FIRE world and those who want more than enough to live on comfortably. While it doesn’t sound like $5 million is a necessity based on how others are responding in this post, any number above $2 million seems to take things into a different comfort level.
Of course, we need some more criteria here to help the Redditor make a final call, like how much longer they plan to work, what they currently have saved, whether their children are still in school or living with them, and whether they intend to downsize or pay off a home.
Still, even without this information, it does sound like between $2 million and $3 million is a good number to focus on. Once you hit this target, it’s up to you to decide when you are ready to walk away from the corporate world forever.
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