Reader Case Study: Furloughed Behavioral Therapists Wait Out The Pandemic
Anne and her husband Michael live in rural Colorado where, until the pandemic, they worked as behavioral therapists for children with Autism Spectrum Disorder (ASD). Now, they’re on voluntary unpaid furlough and requesting our help deciding what to do next. They recently sold their behavioral therapy practice, have a five-acre homestead with dogs and farm animals and are wondering if now’s the time to transition to full-time homesteading.
What’s a Reader Case Study?
Case Studies address financial and life dilemmas that readers of Frugalwoods send to me requesting advice. Then, we (that’d be me and YOU, dear reader) read through their situation and provide advice, encouragement, insight, and feedback in the comments section. For an example, check out the last case study. Case Studies are updated by participants (at the end of the post) several months after the Case is featured. Visit this page for links to all updated Case Studies.
The Goal Of Reader Case Studies
Reader Case Studies are intended to highlight a diverse range of financial situations, ages, ethnicities, geography, goals, careers, incomes, family composition, and more!
The Case Study series started in 2016 and, to date, there’ve been 52 Case Studies. I’ve featured folks with annual incomes ranging from $17,160 to $192,720 and net worths ranging from -$317,596 to $1.5M. I’ve featured single, married, partnered, divorced, child-filled, and child-free households. I’ve featured gay, straight, and trans people. I’ve featured cat people and dog people. I’ve featured folks from the US, Australia, Canada, England, South Africa, and France. I’ve featured folks with PhDs and folks with high school diplomas. I’ve featured people in their early 20’s and people in their late 60’s. I’ve featured folks who live on farms and folks who live in New York City.
The goal is diversity and only YOU can help me achieve that by emailing me your story! If you haven’t seen your circumstances reflected in a Case Study, please feel free to apply to be a Case Study participant by emailing firstname.lastname@example.org.
Reader Case Study Guidelines
NEW INFO: Based on popular demand from you all, and a TON of submissions, I’m going to start featuring TWO Reader Case Studies per month!
I probably don’t need to say the following because you folks are the kindest, most polite commenters on the internet, but please note that Frugalwoods is a judgement-free zone where we endeavor to help one another, not condemn. There’s no room for rudeness here–the goal is to create a supportive environment where we all acknowledge that we’re human, we’re flawed, but we choose to be here together, workshopping our money and our lives with positive, proactive suggestions and ideas.
A disclaimer that I am not a trained financial professional and I encourage people not to make serious financial decisions based solely on what one person on the internet advises. I encourage everyone to do their own research to determine the best course of action for their finances. I am not a financial advisor and I am not your financial advisor.
With that I’ll let Anne, today’s Case Study subject, take it from here!
Hi Frugalwoods and Fam! I’m Anne, I’m 39 years old and my husband Michael is 42. We live in a semi-rural unincorporated community outside of Colorado Springs, Colorado on a little 5 acre homestead with our family of dogs and various farm animals. Due to the pandemic, we’re currently on unpaid voluntary furlough from our jobs as behavioral therapists for children with Autism Spectrum Disorder (ASD).
Michael and I met while we were both working at a private school for children with autism. I have a Master’s degree in Psychology and am a Board Certified Behavior Analyst (BCBA) and Michael has a BS in Elementary & Special Education.
Anne & Michael’s History of Travel
We both have a passion for farming and travel. We often used our work breaks as opportunities to travel and volunteer on farms. Going through an organization called WWOOF, we enjoyed working farm stays in Nova Scotia and Florida. We also took a year off to teach English at a school in rural South Korea. This time overseas was transformative for us. We loved the experience of cultural immersion and the freedom and excitement that came with seeing something new and different each day. We were also surprised at how cheaply we were able to live and travel while in Asia and even in Korea, where our housing and most of our meals were paid for.
During this time, we traveled to 10 countries–including spending a month in India–and we still came home with more savings than when we left. We grappled with the decision of whether to remain expats long-term or return to the US and to our careers and our homesteading dreams. At that time, we’d rescued a dog from a meat farm in Korea and the logistics of traveling and living abroad with a pet seemed much more difficult.
The Move to Colorado
When we returned state-side, we relocated to Colorado Springs from our hometown in the Northeast after I received a job offer, without ever having visited Colorado before. Returning to the US and its high cost of living was a big wake-up call for us and we quickly went into debt with the purchase of our two vehicles and all the other expenses that came with furnishing our apartment and getting situated in our new life.
We also had to re-learn that eating out, travel, and entertainment are not as affordable in the US. We struggled for a long time with finding this balance and were very uncomfortable with the amount of debt we acquired in such a short amount of time while all of our savings disappeared.
Starting a Behavioral Therapy Private Practice
This began us on a path of getting out of debt and then learning about financial independence. After being unhappy at many of our jobs, Michael and I started our own private practice providing behavioral therapy to children with Autism Spectrum Disorder (ASD). At our happiest, we were both working four-hour days while making a low six-figure income. We began to pay down our debts and fund our retirement. Five years ago, we were able to buy our first home: our 5 acre homestead. We adopted other rescued animals including another dog, two goats, one sheep and five chickens, and slowly learned through trial and error about gardening in our region.
We experienced enormous pressure to grow our business and, what began as our ideal work-life balance began to transform into an all-consuming business. We eventually leased a clinic location and had 10 full-time employees. I began to take on too many roles in the business and was really struggling to manage all my duties. I was under constant stress, which took a toll on my health, relationships, and our marriage–and I knew I couldn’t continue much longer. It took about a year to find a buyer for our business and after that, there was a one-year transitional employment contract for Michael and myself to remain full-time with the company.
The sale was a huge relief and a lot of weight was lifted from my shoulders, but I was so burnt out that my plan was to finish out my year long contract and then transition to a part-time role, or even better, take some time off. I’d also started a few side-gigs, one of which was teaching make-and-take chunky blanket classes; and would make a little more than $300 a class, often teaching two classes a month. I began to consider the possibility of making a living somehow doing various side gigs that I enjoyed instead of having an actual job or career.
And then… COVID
Then COVID happened and everything changed. Michael and I took a voluntary furlough from our company in mid-March. I stepped down from my Director position and Michael and I began homesteading full-time and living a mini-retirement lifestyle. We’ve developed a friendship with the buyer of our company and have not been pressured to return to work during a pandemic. Because I have a potential health complication, we continue to mainly self-isolate at home and I have reduced my side gig classes to smaller classes once or twice a month.
Being at home on our property, with many of the previous stressors removed from life, has been healing and transformative. Our days consist of taking care of our animals, gardening, preparing meals from scratch, exercising, and pursuing hobbies and creative projects. As a 40th birthday present to myself, I’m taking an online creative writing class at a university, something I have always wanted to do—but never felt like I had the time or the right mind-set to dedicate to.
This time has given us a unique opportunity to re-evaluate our lives and what we want our future to look like. I would like to take a slower and more balanced work flexible path to FI (financial independence). I enjoy work as long as I am passionate about what I’m doing. While I enjoy my career, I sometimes find it stressful to work with families who are experiencing the trauma of having a special needs child and I don’t like how the insurance landscape has been transforming our field and limiting our ability to serve our clients. I’ve always felt that my career had an expiration date, particularly as I get older and it becomes harder to keep up the energy and manage the injuries from working with the special needs population.
I’d like to find more ways to generate passive income so that we can continue doing the things we love. I would also like to explore location independent work in a career I’m passionate about. Michael spent the last few years developing a specialty garlic crop, which we hope we can begin to sell commercially next year. But we have no idea how much income this will produce for us.
With the change in our employment status, we were able to crunch down our finances and get a better idea of how much our lifestyle costs when we aren’t working. We eliminated insurance on all but one of our vehicles, cancelled our landline and alarm system, stopped our cleaning service, and reduced a lot of our eating out, clothing, travel, and personal care expenses. We are hoping to be able to avoid having to work in an office or school setting until after the pandemic.
My current position does not offer remote work and, although I’ve applied for a number of remote positions, we don’t have high speed internet service in our area, which might make our ability to work remotely a challenge.
We Want A Plan
Our lifestyle is very serendipitous and we lack a clear budget or financial plan. We’re both disorganized, free-spirit types who struggle with spreadsheets and organization, and I worry that we may end up in debt again or with a poorly planned out retirement. Last year our spending was $50,758 and in these last six months our spending has been $24,472. We have various unexpected emergency expenses each year that always drive our numbers up.
Where Anne and Michael Want To Be in Ten Years:
- Finances: I’d like to be fully funded for a traditional retirement, and ideally on track for an earlier retirement if possible.
- Lifestyle: We’re considering relocating in the next 5 years out of state up north to a lower cost of living area with lower wildfire risk. Once all of our animals pass, we’d like to live and slow travel abroad indefinitely.
- Career: We enjoy work when it’s something we’re passionate about doing—but don’t want to return to full-time employment.
- My goal is to have a location independent career and multiple streams of income.
- We’re also interested in rental real estate, but would most likely want to buy in a resort area or other area out of state where we would want to visit or live in in the future.
- If we do return to our previous jobs, I wouldn’t want to remain for more than 5 years.
Anne and Michael’s Finances
|Monthly payments from the sale of our therapy practice||$4,166||Through 2024 with interest beginning at 5% in 2021 and increasing each year.|
|Unemployment Income||$2,660||This likely won’t last much longer.|
|Side gig income||$350||Etsy Store sales and Art Classes|
|Item||Outstanding loan balance||Interest Rate||Loan Period and Terms||Equity||Purchase price and year|
|Mortgage||$162,394||3.87%||30-year fixed||$387,606 (current value is $550k+)||$390K in 2015|
|Item||Outstanding loan balance||Interest Rate||Monthly required payment|
|Student Loan||$3,198||1.62%||I pay the $125.64 monthly minimum|
|Item||Amount||Notes||Name of bank/brokerage|
|Michael’s Brokerage Account||$128,695||Vanguard|
|Emergency Fund||$85,000||ENT Federal Credit Union|
|Michael’s Brokerage Account||$65,920||Schwab|
|Michael’s Roth IRA||$41,755||Schwab|
|Anne’s Rollover IRA||$38,952||Our old company 401K rollover|
|Anne’s Roth IRA||$30,693||Schwab|
|Anne’s SIMPLE IRA||$30,237||Vanguard|
|Michael’s Rollover IRA||$29,351||Our old company 401K rollover||Vanguard|
|Michael’s gold||$20,000||Precious Metals 10 oz.|
|Joint Bank Account||$16,724||ENT Federal Credit Union|
|Michael’s HSA||$16,629||Health Savings Administrators|
|Anne’s HSA||$16,014||Health Savings Administrators|
|Michael’s SIMPLE IRA||$15,532||Vanguard|
|Anne’s SEP IRA||$9,428||Vanguard|
|Traditional IRA Contributions for 2020||$1,000||To fully fund both of our accounts. We don’t have access to any other tax advantaged accounts right now.|
|Groceries, Household Items, and Dog Food||$800||We buy only organic and support our local farmer’s market. This also includes all of our household supplies and some pet food expenses since I homecook for our dogs|
|Health insurance, medications and co-pays||$950||Health insurance ($650/month) plus medications and co-pays (we have high deductible health plans).|
|Pet Expenses||$250||All food and supplies for our animals each month|
|Homeowner’s Insurance||$238||Through Geico. We live in an area that had a wildfire recently and we haven’t been able to find cheaper coverage.|
|Gifts and Charitable Donations||$166|
|Debt Payment||$125||Student Loan Payment|
|Gas and Car Maint.||$100||Gas, Maint., Tolls, and Registration fees for 3 vehicles and 2 trailers|
|Cell Phone||$89||Verizon – 2 lines. This is the only carrier that services our area|
|Vacation and Travel||$66||We inherited a time share from a relative and split the costs with a family member. We have no plans to travel until after the pandemic.|
|Car Insurance||$50||Geico. We currently only have one of our vehicles insured due to us being home|
|Internet||$44||Century Link. This is the only service provider in our area.|
|Dental Insurance||$41||Humana Dental Insurance for both of us.|
|Beer/Alcohol||$30||This has INCREASED since the pandemic|
|Restaurant||$25||This has decreased significantly since we’re always home|
|Quickbooks Intuit||$15||We wanted to better track our expenses but will be canceling this service because it doesn’t really meet our needs.|
|Clothing||$0||We haven’t purchased any new clothing in 6 months and don’t have any need|
|Vehicle make, model, year||Valued at||Mileage||Paid off?|
|2010 Toyota Corolla||$2,800||190K||Yes|
|2005 Ford Mustang||$2,300||135K||Yes|
|2004 Honda Pilot||$2,000||165K||Yes|
Credit Card Strategy
|Card Name||Rewards Type?||Bank/card company|
|Chase, Southwest, United, Citi||Travel||We have them all and have used them to travel internationally 2x a year for the last several years as well paying for flights for some domestic flights.
We’re thinking of canceling them all since we’re paying fees and not able to travel right now and having so many cards at a time makes budgeting more complicated.
Anne’s Questions For You:
I’d like to know how long we can wait out the pandemic or figure out alternative income streams/remote careers before we need to return to work to avoid derailing our retirement/going into debt.
- How do we realistically come up with a budget for retirement planning? We know what our fixed expenses are, but how much should we budget for “emergencies” so as not to deplete our emergency fund?
- Over the past two years, we’ve had many unexpected expenses such as needing to replace a well pump for $5k, $3k in car repairs, $8k on dental implants and, just this month, $3,500 on surgery and medical expenses for a goat plus $1,700 on a new washer and dryer.
- With so many unexpected expenses that throw off a budget, how much should we reasonably be budgeting each year for emergencies annually and in our retirement (where our living expenses and emergency expenses due to not owning a home or pets or being overseas might be much less)? Also due to inflation, a retirement budget of $50k might be a lot less when we’re 90.
- Should we consider buying a condo or house out of state in an area we might want to move to in the future, which could bring in some passive income as a rental now? How should we allocate funds for this?
- Should we fund our traditional IRA’s this year with money we have set aside, or should we add that to our emergency fund since we’re not earning much income and don’t know about our future work situation?
Mrs. Frugalwoods’ Recommendations
Anne and Michael are in a good position to do what we’re all doing right now: wait for the pandemic to end. They’ve done a great job of paying down their debt, accelerating their savings, and trimming their expenses. While being unemployed is no one’s cake walk, Anne and Michael are fortunate to be in sound financial shape. Congrats to them both for getting on solid ground!
Before diving into Anne’s questions, I want to reflect on the word that comes to mind as I read their story: discernment. Anne and Michael are at a juncture right now and they have a lot of options and ideas about what to do next. Before they make any major decisions–financial or otherwise–I suggest taking time to discern what matters most to them.
Some of their goals conflict with each other–such as homesteading and full-time travel–and I think giving themselves the time and the grace to reflect on their options is wise. There’s no pressing need for them to make any decisions ASAP, which is a blessing.
They can absorb today’s Case Study, their own thoughts on what it’s like to homestead full-time, and what they think will fulfill them in this next stage of their lives and careers. I’m a person who loves to jump from one big project or decision to the next, so I completely understand the struggle of stillness. But if they can, I recommend they practice the art of Be Still and Know (don’t worry, I’ll be doing this right alongside them). It’s also true that you can’t make a longterm plan without knowing the parameters of that future.
Anne’s Question #1: how long can we wait out the pandemic or figure out alternative income streams/remote careers before we need to return to work to avoid derailing our retirement/going into debt?
Short answer: for awhile, but not forever.
They have plenty of money to wait out the pandemic (assuming it doesn’t gone on for years and years). They’ll start to deplete their savings when unemployment runs out, but they do have an $85k emergency fund (side note: way to go, Anne and Michael!!!!!).
This question is, in large part, dependent upon how much they spend every month. Anne noted that they’ve already reduced their monthly spending and the math is always the same: spend less, earn more, or do both.
Anne and Michael’s Monthly Spending
At present, Anne and Michael spend $5,829 per month and make $7,176/month. Once unemployment stops, they’ll be making $4,516 a month, which would put them in the red. However, I think we can find a way to get their spending to fit into $4,516 a month. They won’t be saving or investing, but that’s ok to do (for a short period of time). To be clear, I don’t recommend a long term strategy of breaking even every month, but it’s completely fine to do for a short period of time, particularly since Anne and Michael already have robust savings, taxable investments, and retirement investments. So, what can they cut to reduce their monthly expenses by $1,313?
- The quickest and easiest thing would be to cease their $1k monthly IRA contributions. Again, this is a short-term proposition. I don’t suggest they cease contributing to their IRAs forever, but they could stop for now. It doesn’t make sense to go into debt while contributing to an IRA. The hierarchy of financial needs is that you (almost always) want to prioritize breaking even and not going into debt ahead of investing and saving for retirement.
- If they’d prefer to continue their IRA contributions, they can comb through their expenses item by item and lop off everything that’s discretionary and reduce everything that’s reduceable. If you’re unfamiliar with this system of categorization, check out this post, in which I lead you through the full exercise of categorizing your expenses. The basic idea is to look at your spending and figure out what stuff you HAVE to pay for (i.e. your mortgage or rent), what stuff you have to pay for but could spend less on (i.e. groceries, utilities, gas) and finally, what stuff you LIKE, but could reduce or eliminate if needed (i.e. haircuts, take-out, alcohol).
Here’s the list of Anne and Michael’s Reduceable and Discretionary Expenses:
|Groceries, Household Items, and Dog Food||$800||Reduceable|
|Gifts and Charitable Donations||$166||Discretionary|
I’m not suggesting–or advocating–that they eliminate all of these expenses. To the contrary, this list gives them insight into what they have the ability to reduce or eliminate each month in order to fit into their budget. And if they decide to cease their IRA contributions for the time being, they’ll only need to save $13 more dollars per month in order to break even.
One thing they could save money on pretty easily is their cell phone service. I too live rurally and understand the pain of having only one service provider that works in your area. The good news is that there’s an MVNO for pretty much every single cell phone service provider!
Ting, the MVNO I use, re-sells Verizon service and I pay about $11 a month for each of our phones (that’s an affiliate link). For the full rundown on how to switch to an MVNO, check out this post: My Frugal Cell Phone Service Trick: How I Pay $10.65 A Month.
The Bottom Line
To (finally) get around to answering Anne’s question, if she and Michael can get their spending low enough to break even every month, they can essentially exist in this liminal state for as long as they need/want to (or at least, until the payments for their business stop). Like I said, this isn’t a viable long-term strategy since they won’t be saving or investing, but it’s a tenable short-term option while they figure out their next steps. Reducing their spending will give them time and space to think.
Anne’s Question #2: How do we realistically come up with a budget for retirement planning? We know what our fixed expenses are, but how much should we budget for “emergencies” so as not to deplete our emergency fund?
The best way to do this is by tracking your expenses. Not for one month, not for one year, but for many years. I know, I know, it’s boring and arduous, but past data is the best way to predict future spending. At the end of the day, data is all we have, folks. Plus, in many instances, “emergencies” aren’t actually “emergencies.”
Here’s what I mean by that:
- If you own a car, you can be 100% guaranteed that thing is going to need repairs, maintence, and to one day be replaced. A car breaking down shouldn’t be a surprise–it’s a super annoying, but EXPECTED, part of owning a vehicle.
- If you have kids (goat or human), you can be 100% guaranteed those things are going to need food, medical attention, toys, clothes, washable markers, etc.
- If you own a house, you can be 100% certain that mofo is going to need stuff alllllll the time: a new roof, a new toilet in the master bathroom, paint to cover the spot where a four-year-old accidentally banged a trampoline into the wall (just for example).
All of this–and more–is why we have emergency funds, but I think “emergency” is kind of a misnomer here. This is all stuff we KNOW is going to happen. An actual emergency would be if like, I don’t know, there was a global pandemic. THAT we didn’t 100% see coming. A new roof? You can see that bad boy coming from about a decade away.
And no, these expenses aren’t all going to crop up in the same year, but rest assured they’ll crop right on up. This is why you want to track your spending year after year. What I’ve found (from sharing my monthly expenses here on Frugalwoods for six years now) is that, in large part, my annual spending often shakes out to be about the same–even though some years I’ve bought cars and some years I’ve had babies and some years I’ve replaced dishwashers. Big expenses happen every year.
The best advice I can give Anne is to keep up the excellent work of tracking her spending and then figure out averages year over year. Then, round-up a bit because something is always going to break.
I use the free online service Personal Capital to keep track of my money–my spending, my investments, my net worth, etc (that’s an affiliate link). If you’re not tracking your spending every month, you might consider using Personal Capital or another free service. Here’s my explanation of how Personal Capital works and why I use it.
To Anne’s question on inflation–this is why you have your retirement savings invested in the stock market. If you kept your retirement savings in cash stuffed in your mattress, then yeah, you’d be in some inflationary trouble. But as long as you’re invested in risk-appropriate assets for many decades, your retirement funds should keep pace with the broader market and inflation.
Anne’s Question #3: Should we consider buying a condo or house out of state in an area we might want to move to in the future, which could bring in some passive income as a rental now? How should we allocate funds for this?
My inclination here to say no. Real estate prices are actually up quite a bit in light of the pandemic and so it doesn’t seem like an opportune time to speculatively buy a rental.
To more nearly address Anne and Michael’s desire to generate an income, I wonder if they’ve thought about leaning into their entrepreneurial tendencies? They built a successful therapy business together and then sold it, which tells me they have some serious aptitude in this area. Anytime folks come to me wanting to make a mid-career transition, it’s often the case that the way to make the most money is to do something adjacent to what you’re trained to do.
If they don’t want to work as therapists any more, I wonder if there are therapy-adjacent things they could do? Perhaps consulting with other practice owners/therapists who want to buy or sell a practice? Perhaps serving in a consultation role to behavioral therapists in some capacity (like therapy for therapists?) Clearly I have no idea what this would be precisely, but I do know that leaning into your expertise is often the best route to follow. Regarding Michael’s garlic crop–I say go for it! They clearly know how to build and manage a business and it strikes me that garlic could be a more shelf-stable farm product that could be sold online.
Another avenue I’m curious about are animals. Is there an opportunity/desire to run an animal sanctuary? Or to board animals? Or, or, or? Not sure, but I hear their love of animals threaded throughout their story and wonder if there’s a way to build revenue into this passion.
Anne’s Question #4: Should we fund our traditional IRA’s this year with money we have set aside, or should we add that to our emergency fund since we’re not earning much income and don’t know about our future work situation?
At this point, I personally wouldn’t fund the IRAs. I’d keep any extra money as a liquid emergency fund in order to buy them the time and space to discern what they want to do next. As I noted above, this isn’t a long-term strategy, but it’s a short-term stop gap to help them avoid debt.
- Consider this as a time of discernment and reflection. Avoid making major changes, but use this opportunity to explore and research where they’d like to go next with their lives and careers.
- Reduce their monthly expenses–either by ceasing IRA contributions or through the other suggestions I noted above–to fit into their new monthly income (after unemployment benefits run out).
- Commit to tracking their spending so that they can utilize several years of data to determine their average annual expenditures.
- Consider leaning into their strengths of starting a business and/or their professional therapy careers and connections.
- Know that they’re in a solid financial position to take this time to figure out where to go next.
Ok Frugalwoods nation, what advice would you give to Anne? We’ll both reply to comments, so please feel free to ask any clarifying questions!
Would you like your own case study to appear here on Frugalwoods? Email me (email@example.com) your brief story and we’ll talk.
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To answer one of the questions here–no, you can’t work remotely without reliable high-speed internet. And why three cars for two people?
There’s a real tension between the desire to travel full-time and this constant acquiring of animals. The animals seem to matter a lot to these people ($3500 on healthcare for a GOAT!?!) and I wonder if full-time travel is what they really want to do. Especially at a relatively advanced age. Was all the travel recent or was it when you were substantially younger, and in many ways, different people? Would you be happy with no animals or would you find yourself acquiring more?
Thanks, caryatis for your comments. We did acquire our SUV for free from a relative (which is how we ended up with 3). We only use/put insurance on the convertible for the summer so we had only been using two vehicles for day-to-day prior to COVID. If we change careers, we would consider selling one–but they are older vehicles with little value and no major problems so we haven’t felt any real need to sell. The wanting to travel and the rescuing of animals has definitly been a struggle, but aside from the chickens (whos lifespans should fit with our timeline) we haven’t acquired any new animals in 5 years and don’t plan to. Our animals are pets firstly (not farm animals we rely on for milk or meat) so we will spend money on their medical care. We were traveling internationally 2x a year, but haven’t lived abroad since 2010. And AHH! We don’t consider ourselves at 39 and 42 to be at an “advanced age” lol.. we are still very capable still of doing all the things we enjoy and had always planned to retire abroad for a lower cost of living and more affordable healthcare.
The “advanced age” part cracked me up! You’re barely touching middle age at this point, lol!
The advanced age comment cracked me up to! I can only assume the prior commenter is 21 or under to refer to 39 as advanced age. I had assumed the animals were for food so was initially shocked at the $$ spent, but I would absolutely spend that on my pets too and it sounds like the goat is a pet. Let’s see at 39…….my dad hadn’t even opened his business or had kids yet and at 39 my mom was just breaking into the peak of her career and moving to a new state. My grandpa (pre pandemic) travels more now than he ever has at the age of 80! That’s one mindset I don’t want to have…..that I’m too old to accomplish my goals and dreams because you’re never too old!
I really enjoyed the examples of your parents being in my late 30’s, thank you for sharing!
Advanced age? Ha! Wow, that made me belly laugh. LOLOLOLOL
If you would consider selling one of the vehicles eventually, why not just do it now? The market for used cars is super hot with the pandemic, especially in areas where people would normally use public transport. You will likely get more money now than you will later.
Anne- I would reconsider the cars’ value. They are high mileage but if they run and drive, there is value. You can’t get a running driving car for under $5K where I live especially private party. Don’t rely on KBB or dealer trade in values. Check out Facebook Marketplace for comparable cars.
I have to laugh at the “advanced age” comment. My husband and I have travelled a lot during our very “advanced” decades of our 50s, of which I am at the tail end. We hiked the Grand Canyon Rim-to-Rim-to Rim (50 miles total), TWICE, during that decade and did a five day back packing trip in the back country of Yosemite covering about the same distance. We traveled to the South of France for 10 days of hiking, biking, and trail running. Trust me, we are not exceptional athletes, but eat well and stay fit while working full-time.
Please don’t limit what you think you’re capable of doing by age. I suppose there our people in the their 30s and 40s who might have trouble keeping up with us, but I can tell you that hiking with my 86 year old father-in-law is not a walk in the park. That man can move!
Perhaps when we reach our 70s and 80s we will feel advanced, but I guarantee you we will still be traveling.
Anne, you child you, go forth and wander. 🙂
I’m just here to say I’ve spent $700 on an overnight admission for a chicken so you just carry on with your goat vet care! 😂
LOL! Wish there were more people like us 🙂
I hope 40 isn’t too “advanced.” As I’m 52 years old. Ha Ha. Love the goats, must save on mowing.
The “advanced age” comment was maybe just poor word choice, but nonetheless it is indicative of one of my only gripes with the FIRE movement. Although reaching FI anytime before traditional retirement (or ever reaching it at all) would be considered a success for probably a huge majority of people, it can be easy to get caught up in the FIRE blogs and spiral into feeling like you’re a failure if you’re not FI by your mid-30s.
Many people just don’t take a straight path from high school to college to full-time employment to retirement. Even if they do, a lot of folks aren’t lucky enough to be raised in an environment where money is handled responsibly and good lessons are passed down so that they can start with a solid financial foundation to build upon. The idea that you need to have it figured out by a certain age and should feel discouraged if you don’t is something that I imagine a lot of people battle with at least once or twice after reading too many FIRE books and blogs.
TLDR: The advanced age commend irked me a bit and reminded me of why you (I) shouldn’t try to compare your (my) progress to that of others on their FI journey.
YES. Love this!
I, too, was a bit amused by the “advanced age” comment, but I have different spin on this: While reading the case study I kept forgetting that the two are only 39 and 42. Going though university and accreditation as a therapist, having regular jobs, spending quite some time abroad, quitting the jobs, successfully building a private practice with those earnings and that many employees, eventually selling the thing and then starting homesteading – this is a lot! And I (30 years, also a therapist) could not quite fathom all of that happening until one is 39 – so I kept imagining two folks in their early 50s instead 😀
I appreciate your advice to reflect and use this time for discernment. I am feeling the same, as a life-long planner who needs something to look forward to, this pandemic has forced me to pause and reflect. My husband and I are having many conversations, and often come back to big topics again and again, about our future goals.
I wonder if the fact that we can’t go anywhere is causing Anne and her husband to want to travel? It’s certainly the case for me – I catch myself reflecting on happy memories from a trip, and wanting to travel more.
I would also suggest researching becoming a mentor/coach for other therapists, entrepreneurs, farmers – whichever is of interest to you (or maybe dabble in all of it)!
Finally, I wonder whether Anne should consider paying off the remaining balance on her student loan – it’s a low balance, they can easily afford it, and it would add some to their monthly cash flow.
I agree. I think you should use some savings to pay off the student loan, since it isn’t large. I wonder if you can combine some of the retirement accounts. You say you don’t like spread sheets (me either), but you have several and I think it would be easier to track if they were rolled over into only one or two?
Regarding credit card fees: if there are credit cards you want to keep talk to the providers; ask them to waive the fees. They know travel is restricted.
If you DO end up cancelling cards, be sure to harvest those points. See if points can be transferred to other cards (for instance points on most Chase cards can be transferred back and forth or to Chase’s own point “bank”). Or use your points to buy gift cards to places you patronize. When I retired I cancelled a travel card I knew I wouldn’t use any more; I was able to redeem my points for several hundred dollars worth of Amazon cards.
Chiming in to say yes- reduce the number of cards for easier tracking and point accumulation to whatever seems reasonable to you (and I agree with calling to request waived fees). See if you can erase a few purchases (many times up to a year later) to utilize the points accumulated. I ended up with a few spare points and “treated” myself to a 13 week Sunday only newspaper subscription- it was something I loved but then dropped when life got busy, now that Sunday mornings are relatively quiet, I love coffee and the physical newspaper and I used some points that were about to expire.
I call Southwest/Chase every year and get them to waive their fee.
Yeah! I got my citi/American Airlines card reduced to a card they don’t advertise, but does not have a fee. It is one of my oldest ones so I did not want to lose the credit history and I anticipate eventually traveling again, so this will make it easier to upgrade back to what I had before. I would not be surprised if every travel card had this option (I did this in April or May and now that the pandemic has been going on for longer I would not be surprised if they would waive fees even more easily)
Chase is also allowing cash back to be used at the same 1.25 rate toward groceries and dining out. Cash em all out and that will help cut your grocery bill too!
Thank you for this! You’ve given me a good idea as I need to use my points as well!
I’d consider refinancing the home, interest rates are about a full point lower now!
Without jobs? Would they qualify?
I am in the process and am doing it with the same lender as before – I did have to send recent paystubs and last year’s w2 so might be tricky, but not impossible, since they have so many assets!
Since they love their animals and their farm, would it be possible for them to run some sort of day camp / outing thing for schools and facilities with people with challenges / who are differently-abled to come and visit. Equine therapy, just for example could take place there. I wouldn’t suggest that just because they’re behavioural therapists for kids with ASD that they should now host 3 week camps for adults with mental health problems, but they could possibly host other therapists and teachers and allow for visits or even therapy type things to take place on the farm with not that much tweaking.
Obviously I have no idea if that would be A/ legal and B/ worthwhile, but it would be something adjacent to their really amazing skills and experiences BUT crucially not involve 9-5 grind and the burn-out that this has caused. Going further, they could facilitate animal husbandry / veg gardening / beekeeping courses for people with challenges, again, not necessarily doing all the teaching or anything like that, but providing back up and the venue / support.
Happy Heart Haven is a sanctuary in CA run by a young couple. They charge for tours and book them around their schedules. It’s not a huge amount of money but could be a fun venture!
I wonder if Anne and Michael have thought of just going ahead and making the move to another country once the pandemic is over? With the time now for researching other countries, they could find one that meets their needs and desires. Once travel is possible, move and establish a new life there. They could even start a homestead or animal sanctuary if that’s what they want.
I was thinking similar about combining animals with their highly sought after therapy skills. Just personally I would be reluctant to turn my back on all the training and experience they have working with special needs kids. It seems like the burnout took place because they got the business to an overwhelming size. That original vision of four hour workdays and low six-figure income sounded manageable and with plenty of margin. Why not consider going back to that? I also would be reluctant to add additional livestock and might reduce what I have… Only because it really does tie you to one place. But that’s me.
I wonder if refinancing the mortgage is possible? A mortgage of $160k with a rate of 3.8% would have a monthly payment of about $750. Also, rates in general are lower so it might be possible to get something more like 3-3.25%. There may also be closing costs, but if it’s $2-4k they would still break even in just a few months. Just a thought to increase cash flow!
Thanks, Kay! We did look into this. We were given a rate of 3.0% for a 20 year and at the time didn’t think it would be significant enough, but maybe we should re-evaluate.
It may not change your monthly payments too much because of the 20 vs 30 year timeframe, but the lower interest could mean more of that going to equity, which will help when you eventually sell.
I just want to say great job in saving and maintaining very low debt guys. It would seem you both have conflicting goals: long term travel & homesteading. What about planning a 1-3 year lease to someone for your homestead and then rethink whether you’d like to come back to homesteading or keep the slow travel going. I have no experience in farming, but I do have some in rentals. I would wonder why you need a rental in a resort area unless you are hoping to use it yourself? Crunch the numbers and you may see a single family home in a low cost area with good rents will be less of a headache and give you better cash flow, plus you can manage it all via the internet (wherever you may end up). Best of luck to both of you
Hi, private practice therapist here! You are well suited to go into a consultant/supervisory/coaching role for other therapists, as Liz touches on in her recommendations (yes Liz, therapy for therapists is absolutely a thing!). It sounds like you’re ready to step away from clinical work as you mention the emotional and physical toll it was taking. Many (most?) therapists want to do the clinical work but don’t enjoy the business side as much or at all. You have the experience to provide guidance and support on the business side which is much needed, maybe even more these days as therapists flounder around trying to get their businesses online. It could easily be done remotely and for relatively few hours/week, leaving lots of your time free to homestead or travel. This isn’t the passive revenue stream you envision long term, but I think it’s a worthwhile interim solution to help you build your income and savings in order to support your other goals.
My first thought was also about consulting or per diem type work that would give you flexibility and much less responsibility. I’ve also thought myself about running an animal assisted therapy program like others have suggested. My worry is that it might become as much of an responsibility for you as your old practice and also would be at your house. For me that would be really hard, but maybe not for you.
I zoned in on Liz’ comment regarding consulting as well. Especially during the pandemic, I have seen numerous therapist/interventionists develop web based classes for how to grow and run a therapeutic practice. Or, if they want to participate in therapy for clients they could develop classes for parents with worksheets, videos, vlogs, etc. My granddaughter is on the spectrum and I can tell you that, given the high costs associated with regular therapy for her, my daughter would have loved this sort of thing. Check out how other therapists on YouTube have parlayed their expertise into a career that is mainly online; either their own videos or teaching others to do what they do.
Also of note, to me, while I hear that you enjoy animals, you specifically mention being able to be “free” to do things once the animals pass away. That seems like you’re enjoying the time you have there but that truly isn’t where your hearts are. If you’re just waiting for an animal to die to do what you want, then not what you want. Be clear with yourself about what is enjoyable and what your heart’s desire is.
I lived in Colorado most of my life. It’s a wonderful place environmentally but the cost of living is out of control. If you aren’t attached to it for any other reason, then yes; sell up and move. Or sell up and be ready to roam. You have so much to offer families, with remote work and training that can be done wherever you end up nesting. And, never discount your health. For whatever reason your health is precarious, plan to manage your expenses (or healthcare) no matter where you live. While my parents loved the idea of retiring to the Yucatan, they couldn’t manage their healthcare with the doctors available. Whereas, my husband’s family travels to their homeland of Colombia for healthcare because it actually costs less than the US (including their travel) and the doctors are world class! You’re young yet but things come up nowadays without warning.
All in all, you guys are in good shape! All the best to you!
Thanks, Shannon. I would be open to doing this, but I’ve found that most similar organizations are focused only on “billable hours” and I haven’t had success finding any opportunities for consulting work that doesn’t require me to put in billable client time. It’s unfortunate. I had even proposed a sort of mentorship program to my current employer (buyer of our company) which would allow me to work remotely–but it didn’t seem to be of interest since it wasn’t billable time.
I’d be interested to know if your type of license requires supervision to obtain? Not every employer provides it, and usually supervision can be done via phone/ web.
I’m a clinical social worker. I just passed up the “opportunity” to side hustle through the big app based companies because the pay scale is shockingly low and the time expectations are very high.
I work in medicine and those types of requirements don’t jive with the requirements of my work. Having said that, I’d consider supervising other social workers as they work towards their independent clinician license. That’s another option to consider.
Above all I would not let any licenses lapse. There’s plenty of CEU opportunities for little to no cost out there. It’s worth it to always have that option unless you’re 100% sure you’re never going to want that license again.
Another cell/internet option is Visible Wireless which also operates off Verizon towers. With two people on Party Pay, you can get unlimited data for $70 (2 lines at $35/month each). It’s even cheaper if you can find a few other friends to join your party. We did this option for cell service and canceled our internet in favor of using our phones as hot spots (huzzah unlimited). Savings of ~$80 a month for us. Non-monetary benefits: I do not have to deal with Verizon or HughesNet or any other craptastic communications company. I also don’t have to monitor the teen’s data usage. He can TokSnap all he wants.
I have Total Wireless which also runs off Verizon. For two lines we pay $65 and get more data than we ever had with Verizon and upgraded our phones for practically nothing during the switch. I really like them. Good luck!
I don’t have much new to add, but it seems as though these young people have done very well. I agree with Mrs. Frugalwoods that maintenance shouldn’t be a surprise (although it surprises me every time). I wish I had long ago started budgeting generously for replacement and repair costs for home, car, etc.
One or both of you could continue to provide therapy via telemedicine (be providers for teledoc or American well), this pays well, is completely remote and is in high demand – seems like a no brained!!!
I also was going to suggest refinancing your home—we just closed on a home and got an interest rate of 2.87%, so that would help trim your monthly expenses as well.
Who did you go through? I contacted our credit union and was told 3% for a 20 year (which would only save us about $50 a month before closing costs)
I ended up going with my original lender, recommended by my real estate agent. Their rate is great, but honestly, their fees were so much lower than anyone else that it made it worth it! It is a small regional bank in Greenville, SC, with like 4/5 physical branches in both Carolinas and Georgia so probably not that useful for you. They mostly write mortgages (I bank with a CU but their rates were not as good! Maybe there are regional banks where you are?)
I recently refinanced with Starwest Mortgage and it looks like they service Colorado as well. I did a no-cost refi and it was great. 15 yr fixed at 2.5%. We could have gotten 1.9% if we paid closing costs, but the break even didn’t make sense before we move in a few years. Our monthly payment is higher than our previous 30 year mortgage but we are building so much more equity! The only difficulty might be that they required a W-2, but the monthly income from your business sale might negate that need. I think it’s definitely worth looking in to!
It’s super easy to plug your numbers into something like Quicken/Rocket Mortgage. I got a quote easily! Mine is going from 4.125% to 2.75%. When a chat box opened up I was able to negotiate the fees I was seeing without any discomfort and they waived tons of fees and the appraisal so I’ll be breaking even even earlier. Now I plan to call my current lender and see if they can beat it!
Perhaps consider getting school certificates so that you can work at a school district as a behavioral interventionist. That would provide steady income, a possible pension and generous time off to travel.
Thank you so much for sharing your case study! I don’t have much to add, but I am also a BCBA and really appreciate your willingness to share! Burnout and intermittent/inconsistent income are both (often) realities in our field. I also have some creative interests, so I love seeing your creative interests listed as income potential. Thank you again for putting yourself out there!
I just wanted to pop in and recommend that you look into a concept called sinking funds, which are basically a way of saving incrementally for expenses you know you’ll have later. This will help you with figuring out how to budget for things that feel like an emergency, but really are just a normal easily anticipated part of life. YNAB is the best app I can think of in terms of understanding how sinking funds work (and they have a great book too you can borrow from the library if you don’t wanna pay for the app). YNAB is specifically designed to help you live on the cash you have now and decide how to best use it based on what you know your needs will be in the future. I have heard if you email them, they’ll give you an extended free trial, but I’d recommend starting with the book either way because it will help to cement the concept. You can also just lay it out in something as simple as an excel spreadsheet, just start with a list of those things this year that cropped up that surprised you, and then anticipate when you think they might happen again. Tracking all of your expenses is always a good idea too, but it sounds like you have been doing this to prepare for this case study. It might be painful to look not only at your current expenses, but also at future expenses you know are likely to happen whether you want them to or not… but there’s a lot of value in doing so. By looking at a clear picture now of your future expenses, you may suddenly see why some things are not as important as you thought and maybe find other things that are more important. And then it’s just a matter of putting your heads down and finding the right balance for how you want your lives to be. Wanted to add, awesome job with such a huge emergency fund, well done on that!
I envy you for living in Colorado Springs! I am not sure how remote you live in Colorado Springs, but since you have these CUUUUUTEEE farm animals and are looking into rental real estate for extra income, have you considered Airbnb Experience? I have done Airbnb for some time but I’ve always wanted to get into Airbnb Experience. Perhaps you could rent out a room on your farm and let people hang out with your goat babies! People pay a lot for them, and in this stage of the pandemic, I am SURE there are lots of people who would love to take a break from the city and reconnect with the wild, and who can say no to fluffy animals?
Hi! Some of this has already been mentioned/ touched on, but I’ll reiterate from my own experience. I have a Master’s in Social Work, and am working remotely in my private therapy practice. I do have high speed Internet, but when our router has been wonky, i’ve used my cell phone as a hotspot. You’d likely have to buy a large plan in order to make this feasible, but it’s worth looking into if you think you want to work from home. Also, with a Master’s in psychology, you have some flexibility in terms of what you do. If you think you want to stay in that line of work, many therapeutic organizations are using telehealth during the pandemic, and many in my state (MA) are what they call “fee-for-service” so you get paid what you bill insurance for by the “billable hour.” I know you said you’re burnt out on the ABA stuff, and the insurance-based stuff, so perhaps working very part-time for an agency doing something like Early Intervention, or family-based coaching/therapy would be suitable. Some agencies even provide the technology and will reimburse for data used for work purposes. This could give you the 4 hours days you’re longing for without the need to oversee the business side of things, and still helping others. I hope you find something you love while being able to take care of yourself. Good luck!
I track all my income and expenses in a spreadsheet. I do an annual “bills budget” which has everything in it including Christmas presents, Birthday presents etc then I divide that number by 12 and that amount goes into the Bills Account each month. Have you considered combining your IRA accounts into one each. Most accounts take fees for account keeping, insurance etc. so if you have one account each all the money would be in one account less fees and more compound interest and way easier to track. You have so many accounts and for what purpose is this serving you I wonder. $85K in your emergency fund is amazing and your goat vet fees and other unforeseen expenses can come out of this account. Lots of people go on holidays and need pet minding services for their dog or chickens etc. In Australia you can make $35 a day to mind someone’s dog and over here there are apps where you register your interest and connect with the pet owner. Mad Paws is one app here in Australia I’m sure there are ones in the USA. You would have to make sure you have a fully fenced area to keep the dogs safe however it’s good easy money which could be an easy side income you could start straight away. Travelling at the moment while a pandemic is in full swing is not really a good idea so sitting tight and enjoying the down time on your 5 acres is exactly where you need to be now you have sold the business. You could do private consulting and work one day a week from your house as a side income, no one says you have to work 4-5 days a week. Once the pandemic is over you could look at “house sitting” swaps. There are websites where people come and stay in your house and you stay in there’s for a holiday. You may have to have someone else stay at your place to be responsible for feeding the animals in case the person coming to stay doesn’t realize how much work it is however that way all you are doing is paying for your airfare as the accommodation is free. I think spending time together on your property sounds like a great idea all the while you can afford not to work and if the support stops as mentioned reduce your IRA contribution for a little while. You are both in an amazing position due to your hard work, enjoy it all. Kathy, Brisbane, Australia
Hi Kathy! Thank you for your suggestions. I had gone to uni in Brisbane and look forward to returning one day. I didn’t know combining IRA accounts was possible actually. Most of them are at Vanguard, but how would we do it? House sitting is something I would love to do long-term when we have our freedom again one day. I was very inspired once listening to a couple on a podcast who kept their expenses at under $30k a year while traveling the world house sitting.
Just give Vanguard a call on their regular customer service #. A couple years ago, I moved all of my various investment accounts to Vanguard. In addition to the fee savings, etc. it has made my life so much easier to have all of my investments in one place! I can just open the app and check all my investment types in one snapshot. Vanguard made is so easy to do and helped with all the forms, etc. It definitely makes tax time a heck of a lot easier too.
Animal daycare or kennel care?
Running continuing education classes, multiple disciplines need them for license review.
AirBNB at your location?
SpaceX’s StarLink Low Earth Orbit high speed internet system is currently in beta testing in the northern US and should be available to the rural dwelling general public in the next year or two. The equipment cost is about $500 and should be ~$100/mo. Beta testing is showing speeds similar to land-based broadband systems.
On the adjacent skills topic, and adding to what someone above said about a farm camp type idea: I have a friend who runs farm classes for kids, which started as a small venture that my kiddos attended – and loved!- when they were little and has now grown to include a whole selection of offerings, including homeschool classes for older children and work with neurodiverse groups, which I thought might be of particular interest with your OT backgrounds. To see what her program looks like, you can check it out at laughingbuckfarm.com (also jn CO, btw, but further North than you- just North of Ft. Collins, outside Wellington).
You can make a bit of money by breeding and selling goats.
I live in the same area and love the idea of combining something with the animals and kids with ASD. Also maybe some kind of a respite/ intermittent care for a few families with kids with autism. I have several friends in the area who would like this idea, especially if combined with some kind of animal therapy.
I second the comments about checking into Airbnb and Airbnb experiences. You’re in a location lots of people love visiting and a five-acre homestead is perfect for guests who want a weekend in the country. Check Airbnb listings in your area and see what people offer and what you could expect to charge. There’s definitely some money to be made there.
We recently did a glamping experience at a local hobby farm. It was amazing. I am not sure about it as a source of revenue, but it seems somewhat low workload. My son had a blast with the chickens, and goats, and helping with farm chores.
It seems like you have a lot of great ideas to consider here with remote counseling, remote consulting, farm tours for public or neurodiverse groups, airbnb experiences (you can offer day-trips, doesn’t need to be overnight), pet boarding, etc. Keep in mind that none of these are things you would need to do full-time. You could try out 1 or 2 (or more!), see what you llike and if there are any you want to scale up. You may end up finding one you love that pays the bills, and you may end up finding you are happiest doing something like 1 day a week of counseling or consulting, offering farm tours only one day a week, coordinating with a therapy group for a neurodiverse activity once a week, and boarding for a limited number of animals. Just like with your blanket classes, you get to choose how these things occupy your time.
Yes, living abroad would be less expensive. I know Americans in Malaysia around your age who live very comfortably on 2k/month (check out sandinmycurls blog). And in some ways sooner rather than later would make sense because it would be an easier transition while you have the monthly income from your business sale. But think seriously about whether that is a “right now” dream or a “someday” dream. If you ultimately want to make the move sooner, perhaps there is a reputable organization that would adopt the animals? If you decide you want to wait, right now is a good time to crunch your FI numbers with what might be an international budget, and check out Fioneers for calculators of “coast fi” or what income you would have to make in semi-retirement. It may be that with a lower cost of living you would only need a small amount of active income, which you could work on building now through remote counseling/consulting.
In the introduction of the case study, your discussion of your careers and debt made it sound like you were in a much more precarious financial situation. Your finances are actually very strong and you are in a good position to comfortably take some time off and plan strategically for your next steps.
Liz, if you’re listening- I think a discussion about ageing and FIRE might be an interesting topic? We don’t have a choice about ageing, as we do with say, having kids, or property ownership. as with those topics, there should be respect for individual choice (like the amount of financial investment or risk you’re able or willing to make or take while still being resonsible to others). But also, as with those other topics, there are financial “givens”. (I can tell you from experience that all the yoga and vegetables in the world will not keep you from becoming farsighted.) I think there is a tendency in the FIRE community to gloss “retiring early” with “retiring young” and those two things are not the same. I can only speak for myself but I don’t mean to be patronizing when I caution younger people to consider their limitaions (earnings, health, energy)- even and especially if they haven’t encountered them yet- because they are there. I’m not really screaming that sky is falling- it’s more that there is a long period of resources levelling off that you will (hopefully, and most likely) live to enjoy- if you plan for it.
I should add here that I would love to hear from older folks (70?) for their accounts of post-retirement needs, surprises, experiences.
yes! I’d love to feature a Case Study like this—please send people my way! They can email me at: firstname.lastname@example.org
I have a goat related question, how has your experience with horned goats been? People say they butt heads and get them caught. Just wondering if that has been your experience. I’m trying to decide to disbud or not, but everyone I talk to has never had a horned goat.
Not the OP, but I had a pretty rough experience disbursing a male goat (Nigerian Dwarf for reference). We had the vet do it and they still grew back but weirdly . . . I would not disbud a male again. The females were all disbudded with no trouble. But I’m not sure it’s worth the extra effort. I would not keep two intact males together and from what I have seen the females horns (at least in Nigerians) don’t get to the point where getting tangled together would be an issue.
Nigerian Dwarf goat owner here. We disbudded our kids and although the process is brutal, it is quick and the kids bounced back amazingly fast. Some of our does are polled (no horn buds naturally), but 2 of the 4 kids had the buds so we opted to disbudd given that it did not seem safe to have some with and some without horns. If you plan to show or have kiddos participate in 4H, the goats cannot have horns. Good luck! Goats are so much fun!!
Hi Erin! I’m sorry I missed your post…but we love having horned goats. If we lived within city limits, there wouldn’t be a choice but out here we never really considered it. The horns serve a purpose (helping them regulate their body temp, giving them a little bit of protection from predators, and helping with establishing hierarchy within the herd). Our goats don’t head butt us but I wouldn’t say that they are safe for kids who stick arms into pens, etc. It’s not a issue for us though and we have never seen them get their horns caught in anything ever. They are actually extremely aware of their horns and don’t put themselves into situations where they will get stuck. But we have good fencing and our goats have never escaped either (which is usually the most common complain about goats!)
Congratulations to you both for being in such good financial shape at such a young age and demonstrating excellent entrepreneurial skills! Both of these will serve you well no matter what path you take. My husband and I have just reached financial independence at age 50 and I will be “retiring” from ‘have to work’ next month. I say that because I hear in your story the desire to be financially independent – where your passive income covers your expenses and income from ‘get to work’ is a nice bonus 🙂 I am clearly biased, but I wholeheartedly support this idea.
With that in mind, I would offer the following suggestions for your consideration – as Liz and others have said, getting your expenses below your income and investing the rest is the simple formula – it seems you need to get a plan in place for that ASAP as you expect the unemployment benefits to run out soon. But, if I understand correctly, you will have income from the sale of your business coming in until 2024. If you get your expenses down below this new income level you have the next four years-ish before you have to do anything big. One suggestion for reducing expenses immediately is to pay off that student load debt. I know the interest is “only” 1.62% but when you have $85,000 in cash available, why pay a single penny you don’t have to? If you follow Liz’s advice and treat your emergency fund more for truly unexpected events – you could reasonably only need 6 months of expenses in there max…or $30,000-ish. The other $50,000 would leave you about $10k per year over the next five years to budget for large expenses….which sounds like it would cover any of the recent examples you have had. You might think this is the same difference, but an emergency fund implies you aren’t going to touch it except in a ‘break glass’ scenario, whereas a large expense fund means you recognize that you very well need to spend it – and you guys are in such great shape to be able to do that! Or in other words, cutting loose about $3k to pay off your student debt shouldn’t be a problem.
Another suggestion I have to is to consolidate your retirement and brokerage accounts if you can. Since you say you are not spreadsheet nerds, I think this may be harder to track with so many accounts and also obscures the significant investments you have. Not adjusting for inflation or increases in income, if you continue putting $1k/mo away into your IRA “accounts” and they earn a modest average of 7% by the time you can access these without penalty, you will have around $1.4 million. Based on the 4% rule, this would mean you could live on an annual income of $56,000 and likely never run out of money.
But what to do until then? If your brokerage account and home equity didn’t change over the next 5 years (not likely, but to be simple), and you sold your house around the time your income stream stops, then you would have about $220k + $400k or $600,000 in cash that you could use to fund your next steps. At that point you only need to fund 15 years until the IRA funds are available – $600k divided by 15 is $40k/year. Could you live on that? Would you want or need to work some to give you an extra cushion? I’ll just add that the Frugalwoods live on about $50k a year 😉
I am sure the details of the numbers I used need tweaking and are not exactly right, but since you mentioned that you wanted to be Financially Independent, I wanted to sketch out a way for you to see that you aren’t very far off from achieving this!! And that switching from mainly a focus on what to do for income to how to make your money work better for you might be helpful. Good luck!
One suggestion for the saving for retirement vs a larger emergency fund, a possible hybrid would be saving in a Roth IRA instead of a traditional one. No, you don’t get the tax benefits up front, but if you’re just going to put it in a saving’s account, you won’t get immediate tax benefits there either. You can put them in a money market fund inside of the Roth, so they wouldn’t be subject to market volatility, and you can always take Roth conversions without any penalty. Then, once the pandemic has run its course and your income goes up, you can move to equities. If you end up needing the money, no big deal, just take it out then.
The primary benefit of this is that the limit on IRA contributions is so low, and if you don’t “use it” all, you lose the ability to later. Put the $1k/month into a money market inside the Roth, and if you need it, it’s there for you. If you don’t, move it to equities later and you haven’t lost any time. If you put it into a savings account now, you can’t ever get that money back into a Roth.
If you decide to lean into homesteading instead of travel, you might consider moving to a lower COL area. The value of your house + 5 acres left this Midwest girl pretty wide-eyed. For comparison my husband and I just bought a 4 bedroom house on just under 6 acres for 164k.
Granted a lot of the opportunities for tourist income just don’t exist around here the way they would closer to a big city.
And I think it’s cheap 🙂 For comparison we just bought a run down 3.5 acre homestead for $508k in unincorporated King County (where Seattle is).
Hello Anne! First, I appreciate your remark about your career having an expiration date. That clarity would have been useful for me had I owned it when I started! Second, congratulations on developing and selling a successful behavioral health practice. It’s a major accomplishment, and you and Michael deserve the time now to rest and restore your emotional reserves. After reading the post and comments, I returned to the section describing where you would like to be in 10 years. I plugged your numbers into the basic FIRE calculator my friend shared with me when she introduced me to FIRE. You may already have played with this, but here’s what I found:
Plugging in your current assets ($572,092) and expenses ($69,948 minus $12k for your IRA) with a 6.61% average rate of return, if you and Michael save ZERO more for retirement, you would be fully funded for a traditional retirement (4% safe withdrawal rate) by age 54. To be funded for an earlier retirement (3.5% safe withdrawal rate) 10 years from now (age 49), you’d have to save about double what you are now. You’re already on track for an early retirement, nearly a decade prior to traditional retirement age. It’s up to you if you’d like to escalate that timeline with additional earnings/savings/investments.
To avoid eating your assets, I would recommend treating any income from entrepreneurial endeavors (especially during the pandemic) as icing. Considering only the payments from the sale of your business once unemployment benefits end, you’d have to reduce your spending by $663 in addition to foregoing the $1k you currently invest in your IRAs for now.
If one of your dreams is to slow travel (as it is mine!), I would hold off on purchasing additional property. You mentioned that you would embark on these travels when your last pet has passed. About when do you anticipate that might be? How does it align with your preferred FI timeline? To me, your story is an example of how you could do anything you want though not all at the same time. You could go full throttle on homesteading now, and when you’re ready, transition to a very different lifestyle. Or combine the two as you have before by WWOOF’ing in between stints where you are exploring new cities.
Finally, with regard to your careers, once you’ve healed your burnout (which might be hard to imagine so soon), how would you feel about returning to working half-days, 4 days a week as you did when you experienced the most job satisfaction? Would you be willing to consider a supervisory role where you would meet face to face with other ABA therapists rather than the clients themselves? Without reliable Internet access, fully remote work requiring videoconferencing might be off the table, but it may be feasible to review documentation online with what you’ve got. Your gig work seems fueled by pleasure. You’ve spent years building an expertise helping families — perhaps the intensity of this labor can be attenuated so you can leverage this investment in your knowledge and skills. Thank you for sharing your thought process to date! I look forward to reading your update(s) in the future.
Sounds like you’ve fallen out of love with your career (as a parent of an mildly autistic teenager I totally get it!), but I don’t hear any particular passion for an income-producing gig. You mentioned blankets and garlic, but you can’t grow and sell garlic if you’re “slow traveling” (unless it’s real slow!) and for that matter, teaching blanket-making classes might be impractical too, if say, you don’t speak the local language (though I suppose you could do something online… if there is a market for that….. ). Reading this I get a sense of wanting your cake and wanting to eat it too… like you’re ready for your retirement lifestyle now (which is most of us of course… but it’s realistically achievable for a very few our age.. like Frugalwoods 😉 ). I guess I would recommend defining those income-producing gigs first. It’s hard to comment about anything else such as retirement, travel or buying real estate until you’ve got proper income… UNLESS you decide to move abroad… permanently. Your net worth, after a few more years working, might be enough for some countries provided you figure out how to earn even a tiny amount of location-independent income. (not garlic!). At least I think so… do you know how much monthly income you can generate off of your investments? Would it cover any of your favorite countries? Maybe work it from that angle. For example.. for us there have been 3 tiers of FIRE… FIRE abroad, FIRE in low COL American city and FIRE where we live (Seattle)… with difficulty in order from least to greatest… but with teenagers and 3 properties in an area we are fully smitten with (including a 3.5 acre homestead purchased last month) we don’t really even think of the first 2 tiers.. they really only served as mental boosts when feeling bad about being so far away from our real goal (FI in Seattle). But for you guys… well you don’t have the kids or the properties and you love to travel… for educated Americans with a half million dollars you are definitely on your way to FIRE abroad… if you decide that’s your goal. Maybe buy a homestead abroad??? Or rentals abroad?? I know a couple that have a coffee plantation in Mexico, a townhome in the States and a home in Australia. Without kids (especially autistic ones) you’ve got SO MANY OPTIONS! 🙂
An option for living abroad would be to work at international schools, once things return back to normal. I believe some schools work with therapists such as yourselves and it is my understanding that especially in non-Western countries, English speaking therapists are more rare. So if you could figure out how to strike the balance, timewise, it could be an amazing way to slow travel around. A couple of years here and there!
For question 1:
You have $85k in your emergency fund, which is a little over 14 months of expenses. One option is to spend this down some. As an example perhaps you are comfortable with 9 months of expenses in your emergency fund, which is around $30k less than you currently have. Once your unemployment stops, assuming you make no other changes, you would be drawing down your emergency fund by $1300 a month, so it would take about 23 months to spend down $30k at that rate.
You can replace my assumptions with anything that feels better for you (adjusted spending or income or desired emergency fund amount), but that’s a simple way of looking at how long you can wait out the pandemic / figure out potential career changes. According to my calculations, you’ve got plenty of time! 2 years of still contributing to your IRAs and you would still have a 9 month emergency fund at the end.
Fellow ABA’er here. Frugalwoods is right, there is absolutely money to be made consulting or providing supervision. RBT’s must be supervised by a BCBA and organizations would pay you to supervise those hours. In my state BCBA’s are tough to come by (rural New England). Or you could contract with schools directly to do FBA’s and that’s it and not have to do the ongoing piece. These types of roles would help you use your knowledge without hopping feet first into the world of burnout again.
I always comment this, but once things return to normal, and if you do want to travel and work, I highly suggest applying to international schools in the UAE or neighboring gulf countries. I had friends who worked as school counselors and I’m sure there are lots of opportunities (although their economies are tanking a bit now…) it’s a great way to save money (tax free up to 105k/per person for Americans), and you have a fabulous base for travel. Housing should be provided and medical insurance is included, and tbh I had waaayy better medical care in Dubai than in the USA (there are lots of high quality medical facilities and the insurance covers everything)
The pay is way better usually than in Asia. Many people go to the ME to make $$ for a few years.
As a fellow BCBA I understand the stress of the job. I have been fortunate to be able to do much work through telehealth. Living in a different country it is hard to make suggestions but there is a lot of cool things outside of autism you can use your BCBA for, so perhaps a Google search or listening to The Behavioral Observations Podcast may give them ideas. I wish them luck.
Echoing many others with my suggestions:
*As mentioned by Emily, Kay, and Torrie, investigate refinancing. Even saving $50/month would be worthwhile if you can shave 5 years off your payoff time
*As Pat mentioned, shift your traditional IRA contributions to your Roth IRAs and put it into a money market fund. You can always take Roth conversions without any penalty and use it as your backup emergency fund.
*As Danielle and Michele mentioned, pay off the student loan to simplify and free up monthly cash flow
*As Kathy mentioned, you should streamline IRAs. My recommendation(s):
*Combine your SIMPLE, SEP, and Rollover IRAs into 1 Rollover IRA
*Combine Michael’s SIMPLE and Rollover IRAs into 1 Rollover IRA
*Combine your brokerage accounts from Schwab and Vanguard into 1 brokerage
*Combine Michael’s brokerage accounts from Schwab and Vanguard into 1 brokerage
This will take you from 16 total accounts down to 11 and with only 1 brokerage (either Vanguard or Schwab)
Regarding IRA contributions… You need to have “earned income” to contribute to an IRA. The side gig qualifies as “earned”, but the sale of the business and resulting interest income, and unemployment don’t. Just be sure that your earned income is adequate to cover the IRA contributions for both spouses.
If it was me..I would not move. We’re in a pandemic so traveling shouldn’t even be considered. What if one goes back to work and the other one concentrates more on the homestead? It would be hard but hopefully this too shall pass.
You have a good awareness of your finances. As a 30 yr dairy goat breeder of top champion goats I would advise you to find good homes to sell yours to. You want the freedom to travel and move. Well cared for goats live 10-18 yrs. they must have consistent care and protection from dogs and coyotes. It’s an expense. Just like dogs- more than 2. Gardens are a good option. Enough hens for personal need. Animals will tie you down and cost. Colorado is too expensive in many ways. If you can be happy in another state, explore that ! Be sure you choose carefully. There is a shortage of child psychologists nation wide. A thought. Simplify your animal situation, stop adopting until your settled. Enjoy being untethered 😊.
Hi there. I want to just state something rather unnecessary here. I agree with Mrs.Frugalwoods’ initial assessment about discernment. I thought the same as I read your case study. It does seem you want things that conflict.as far as being pulls on your resources. Unless you are independently wealthy with a fully funded retirement in the accounts already, you can’t do all of these things concurrently:
1. Not work full time
2. Manage a remote homestead and make money from it, or at least make it income neutral between income and maintenance expenses
3. Travel or relocate as your heart desires
4. Save for retirement (as noted above, it would be nice if this were finished).
I would suggest you could consider going back into business as independent therapists outside of insurance. My former dentist when I lived in Orlando, FL, Bill Bartling, didn’t take insurance. He has now moved permanently to a smaller town in Florida where he still doesn’t. He charges reasonable fees and thinks insurance is a big mess and problem. He makes a living. He gets great reviews. He is in demand. http://www.bartlingdds.com/ if you want to read about how and why runs his business this way. It’s pretty unusual but proof positive it can work. Since you only want to work part time anyway, it really doesn’t matter if this limits your client base.
I was going to say you could do fully remote counseling, until you mentioned the lack of reliable high speed internet. My teenager is in weekly counseling and with the pandemic it’s often remote via a phone call rather than in-office, depending how the surges are swinging. It works totally fine for both of them.
As others note, managing farm animals is a 24/7 commitment and makes your desire for travel or mobility almost impossible, again, unless you have plenty of disposable $$ to pay people. You (and nearly everyone else on planet earth) simply can’t afford to manage this gorgeous property, avoid full time employment, and do the rest of the things you want. I always love Mrs. Frugalwoods’ lesson number one. Frugality is not about being cheap or unwilling to spend any money. It’s about figuring out what really makes you happy, putting resources toward that, and cutting out the waste.
There’s no single right answer here, only YOUR right answer. Best wishes.