“I currently have three jobs that in combination create a fair amount of stress.” (Photo subjects are models.) – Getty Images/iStockphoto
I am an avid reader of The Moneyist column.
Your recent article — “No one writes about ‘rich guy’ early retirement” — resonated. When the letter writer asked, “When is enough enough?” You replied: “When you say so.” I related to his man. For my part, I have cash, IRAs and investments worth $3.9 million.
I worked in finance — top-tier private equity — for several years and reaped financial rewards.
I am 51 and my wife is 60. This is important because the question is about maximizing our “golden years” when we are BOTH in good health. My kids are now young professionals.
I have a house valued at $2.7 million with a mortgage at a 2.5% interest rate and a balance of $400,000. I don’t want to pay it off because the arbitrage of cash return is too favorable. I have another property in Europe, which has no mortgage and is valued at $1.1 million.
I currently have three jobs that in combination create a fair amount of stress. An advisory job to a private-equity fund with an annual income of $300,000, a board position that brings me an additional $140,000 and a non-paying job in a start-up that could yield a very high value.
My operating costs are not greater than $175,000 when capturing mortgage, property taxes, healthcare and other living expenses. I am able-bodied and don’t need to be fully retired. However, I am mindful of maximizing time and travel with my wife during the window of her 60s.
My advisory job is pretty stressful. While the cash income is great and the hours are not overly taxing there is an energy-drain aspect. I am thinking of walking away. The $140,000 annual part-time income means that I am largely covered by cash expenses.
Is it time to let go and focus only on my board position and start-up? The sad reality is that I cannot let go of the start-up. My goal is to build up as fast as possible an operational team so I can reduce the stress.
While you have a lot of skin in the game, I wonder whether that energy comes from a place where stress, and the need to succeed. – MarketWatch illustration
The stress in your life is so pronounced you mentioned it thrice.
Your $300,000 advisor job — not coincidentally the most lucrative of the three — appears to be causing you heartache, and taking time away from your home life. Unlike the previous letter writer you mentioned, your children aren’t young, which helps your financial planning.
You don’t mention whether or not your wife works, so let’s assume that you are the sole breadwinner in the household. But your wife’s Social Security, pension and any other savings will greatly help to give you more time to spend together sooner rather than later.
There is a lot on your plate. You can manage the time you spend on all three jobs if you have boundaries about checking your phone after hours and/or weekends. The $300,000 question: How would you change this job to suit your needs, if you were given carte blanche?
The start-up is your dream. If it’s a success, it could change everything. The advisor job is your bread and butter and the part-time job is a lucrative side gig. When you have an adviser crunch the numbers, see a therapist or financial therapist about your stress management.
It may be that if you could manage both — your professional and personal issues — and divorce yourself from the mental and emotional burden this advisory puts on you, you could have your cake and eat it. A happier life and salary, plus time to spend with your wife.
Three jobs are a lot for anyone and, while you have a lot of skin in the game, I wonder whether that energy comes from a place of anxiety and/or the need to succeed. If you change this, you may not have to change as much of your work-life balance as you think.
On the plus side, your kids are now financially independent and you have significant retirement savings of $3.9 million. You also have an investment property in Europe, which you could (and, perhaps, should) have a property manager rent it out on Airbnb or a similar site.
You still have $400,000 left on your mortgage, which is not an insignificant sum of money. And while your wife is 60, you are still relatively young with at least another 15 years to go before you enter your official retirement years.
Taking a blunt pencil and paper to your $3.9 million retirement fund, including your cash and IRAS in one bucket, you would be able to withdraw 4% a year for the next 30 years, you would need $4.68 million. That doesn’t include other sources of income or Social Security.
My gut tells me that, after consulting with a financial adviser, you could cut back your work obligations — if you make some changes. It may be selling or monetizing your European property and/or downsizing your U.S. home so you’re no longer paying a mortgage etc.
In other words, you can do it. But if you give up one thing that you feel is hurting your quality of life — a $300,000 advisory job — you will almost certainly have to give up other things that give you pleasure and enhance your quality of life. It’s not always a free exchange.
But your point is a good one: There is a 10-year difference between your wife and your good self, so in the broader context of your life, it makes sense to enjoy the next 10 years while you are both healthy. And, hopefully, you’ll both get at least another decade (or two) after that.
My only note of caution is that I don’t ever believe it’s a good idea to make a big financial decision based on emotion. And while the pressure is real and maintaining our mental health should be our No. 1 priority, this is a decision that should not be made in isolation.
You need support for your personal stress in addition to your professional strategy.
