Blog about personal finance, personal development, travel and designing a life you love!
Most people who embark on the path to F.I.R.E (financial independence, retire early) determine the amount on money they will need for life through principals of The Trinity Study. But does this really work? I wanted to study the impact of downturns, how long it takes to recover from one and if you stick to the 4% rule, does it work?
Continue reading “Will sticking to a 4% withdrawal rate ensure your money outlasts you”
So I introduced the blog as one about personal finance, personal development and travel but haven’t really talked about travel. I LOVE TRAVEL! The bug hit me early, as I all but grew up on my dad’s ship. His first career was that of a merchant navy sea captain. My first voyage was when I was 6 months old and I celebrated my first birthday in Australia! This also drove my love for the water and the need to always live near the beach.
Unfortunately we haven’t been able to travel as much, as I had a full time job till December. But now that I am free at 41, it’s time to make up for lost time and burn those miles. In April, we are going to Hawaii for a week! Aloha Maui, here we come!
Till this point in my life, I have been following the herd! But what now? This new life is unscripted and I am trying to find my own path forward. While that sounds really romantic, it is pretty tough and there are times, I lose it. I am definitely struggling with the change in identity and figuring out my true north, my true purpose. While our jobs are definitely not our self worth, we are so entangled in them, it gets hard to let go. And when I lose sight of what’s really important, going from making a 6 figure job to making less than what I made in my first job makes me feel like a failure. But there are many definitions of success. Ultimately I want a life I can feel good about on my death bed and that definitely doesn’t involve working long hours in an office.
The 4% Rule states that if you save 25 times your annual expenses and invest that money in a diversified stock portfolio, you can safely withdraw 4% of it every year without running out of money over a long retirement. This single formula gave me a concrete number to aim for and turned an abstract dream of “retiring early” into an actual, measurable goal.
This is the story of how I discovered that rule, why it mattered so much to me, and how it became the foundation of my entire financial independence journey.
After working for two multinational corporations and then a start-up, I finally admitted something to myself: I didn’t like working for big companies or small ones.
Both were rampant with office politics. The constant, high stress levels left me feeling depleted and unfulfilled, day after day.
So I started searching the internet for how to retire early. By this time, I had already missed my own imaginary “retire by 35” mark. It was 2014, and I was 38.
The first article I came across was Jeremy’s story on Go Curry Cracker, and I found it so inspiring that I kept following along and digging deeper into the whole concept of FIRE — Financially Independent, Retire Early.
It felt like I had finally found my people. Everything I had been quietly thinking about for years was right there, written out in front of me.
From there, I fell down the rabbit hole:
That book was the turning point. I realized that every minute I spent working was taking me away from doing the things I actually loved.
“Your Money or Your Life” pushed me to look at work differently: as a trade of my life energy for money, not just a paycheck.
The cost of working is much higher than most people realize. Think about the hours spent getting ready and commuting every day. Then add the time you need afterward just to unwind and recover.
If you add up all those hours — the prep, the commute, the decompression time, even your vacations — and use them to recalculate your true hourly rate, the real cost of working can look shockingly high.
Once I saw my job this way, I couldn’t unsee it. I started listening to personal finance podcasts and deliberately building my financial IQ. Every day felt exciting as I learned something new that helped me shape an actual strategy for financial independence and the freedom to do what I wanted with my time.
The first practical question I needed to answer was: how much do we actually need to save to retire, and what withdrawal rate would let our portfolio last for the next 50 years? (I was still young, after all.)
That research led me to the Trinity Study.
Three professors from Trinity University studied historical safe withdrawal rates and introduced what’s now known as the 4% Rule.[3][4] In a nutshell, the study concludes that a person has sufficient savings if 4% of their invested assets can cover a full year of expenses.
In practical terms, this means: if you have 25 times your annual expenses invested in stocks, and you withdraw 4% of that portfolio each year, your money should be able to support you over the long run — even though the market will fluctuate year to year.
The math behind the 4% Rule is straightforward once you see it in action. Here’s a simple example:
For example, if your annual expenses amount to $60,000, you’d need $1.5 million invested to retire using this formula. That’s it — that’s the “Magic Number.”
Once I had this framework, I could finally define the actual Magic Amount my household needed to save to achieve financial independence and retire early. The next question, of course, was how to invest that money — something I’ll cover in a future post.
The 4% Rule is a fantastic starting point, but it isn’t a one-size-fits-all guarantee. A few things worth keeping in mind:
None of this diminishes how powerful the 4% Rule is as a planning tool — it just means it’s a starting framework, not a rigid law of physics.
Armed with this magic — but admittedly large — number, I built a complete plan to reach financial independence. I’ll be sharing every step of it, in full transparency, so you can pursue the same freedom to do what you love instead of staying stuck in a job you don’t.
My awakening didn’t start with a spreadsheet — it started with exhaustion, a search engine, and a stack of blog posts written by people who had already found a way out. The 4% Rule gave that frustration a shape: a real number, calculated from my own expenses, that told me exactly what financial independence would require.
If you’re at the start of your own journey, the first step is simple: calculate your annual expenses, multiply by 25, and let that number become your target. From there, the real work — and the real freedom — begins.
Yesterday was my last day in the corporate world of politics, territorial wars, bosses, and power games. I’m 41 years old, and all I can think is whewwwww, what a relief. 😅
But I’m also terrified. This is unknown territory. I’ve worked since I was a kid — my first paid job came at 17, though I had plenty of unpaid ones before that. I almost don’t know how to relax. I guess it’s time to sing a different tune: “He he he, I am on vacation, every single day, every day-ay-ay-ay-ay….” 😀
I don’t plan to sit idle, though. I’m creating a new life — one built around the things I actually love. As the saying goes, “Love what you do and you’ll never work another day in your life.”
Simplifying Life to achieve Financial Independence and Retire Early by the Bay
My husband and I and two kids live in the Bay Area. Both of us have left well paying, traditional jobs in our early forties and have retired to do things we are more passionate about. For my husband, that is about creating and teaching art and for me, it is about writing this personal finance blog to learn and share strategies to achieve Financial independence, Retire Early (FIRE)! Read about how we are redefining for ourselves what success means, simplifying our everyday, traveling and living by the rules we create rather than those of societies’. This is about our experiment with FIRE or semi FIRE! While geographic arbitrage can enable us to live comfortably in other parts of the US, we want to live by the Bay and so we are trying to create our own income streams to enable our dreams to come true. Come with us on this journey to see if and how we can make this happen!