Real Stories from a Recent DIY Retirement

Real Stories from a Recent DIY Retirement

I Retired Two Months Ago


I retired two months ago now. These are my real stories from a recent DIY retirement.

The first month I was surprised how it felt to have negative cash flow (massive, really) in my checking account after a sizeable inflow from an NG-457 gaffe.

Next, I look at my current asset allocation given the bear market, and I study my historical net worth over the last three years.

Oh, and I got myself some CryptoAssets.

Okay, let’s start with Asset Allocation.


Asset Allocation during the “Bear Market”

I enjoy calculating my net worth and asset allocation when the market is down. Unfortunately, it was either in March or April of 2022 that I last looked. It is too bad I can’t remember when, as the market was down then back up 30% in that time. Oh well.

My goal asset allocation is between 70-80% equities, and I discuss it at length in my blog: Do I need more Large Cap Value?

Since I spent some time on the program calculating my net worth, I also decided to look at my net worth.


Net Worth when I Retired

It is fun to calculate my net worth when the market is down, too.

Then, I can look at my investible amount and bring that back to market highs or take it down by 50% in my mind. So, how does that change in the stock market affect my net worth?

Now that I know what I’m worth when the market is down, I know the best and worst-case scenarios.

Below is my net worth over the last three years before I retired.

I retired last month

Above, you can see the dates I updated my net worth and the growth over the last 3+ years.

It looks like I first put data in late 2018, and my first net worth update is 3/19. Then around 10/20, 3/21, and 4/22. So, in summary, there are updates about every eight months in my net worth that can be seen above.

Despite the ups and downs of the stock market, because I only rarely calculate my net worth, it goes up over time.


Real Estate has Doubled

Of course, Real Estate is included in net worth but not affected by equities (for the most part). So what has your home price done in the last three years? I haven’t apprised my home, but I’m guessing it has had a 100% increase in the 12 years since we bought it at the depts of home prices following 2009.

Let’s look at recent history. My current net worth (which I decided to calculate since it had been over a year and we seem to be near a market bottom (or it could get a lot worse, who knows) is up almost by $1M, which is about an 18% increase in the 13 months.

I “knew” I had enough to retire, but I was basing it on the “old” number from a year before retirement. And before I calculated my net worth with assumed appreciation from Real Estate Assets.

Now that I have been retired a month, my real worry is that I may have retired into the teeth of a poor sequence of stock market returns.

What did I do even though I hit the lottery and retired at the peak sequence of returns risk? Nothing. I adjusted my asset allocation because I had an influx of cash due to a NG-457 distribution.


NG-457 Distribution

At my last employer, I had a small non-governmental 457(b) plan. Over three years, I would take it out at perhaps the 35-37% tax bracket. Instead, after a botched phone call by the custodian, an irrevocable check cashing out the 457 was mailed to me.

I thought about it and cashed the check. It will probably be a push as far as taxes go, or I may pay less if the TCJA is killed in the next year or two. Unlikely.

So, suddenly I had this inflow into my checking account. And yet I suffered from checking account drain


Checking Account Drainage in Early Retirement

This is the largest wake-up call as a real story from my first month of retirement.

I was used to a paycheck coming in every two weeks. So much so that I made the typical high-income W-2 move of having way too much cash on hand and just no plan.

Formally, this is called “anti-budgeting.” It is a version of “pay yourself first,” in which you fund all your retirement goals and then just blow the rest that hits your checking account.

I never knew my savings rate, but I assume it was close to 50% as it took about 16 years to fatFIRE.

Anyway, we had two W-2 jobs with decent 401k plans and matches. So we paid off the house, invested in low-cost funds, and never looked. For a decade. That was the secret of my retirement success: benign neglect. And not knowing what to do with all the cash in the checking account, we paid off the house. My first mortgage was 7% APR, and I put 10% down and took a second on the other 10% to avoid PMI. Those were the good old days!

I’m pretty sure the second was gone within the year, and we upgraded in 2010.

Now that checks have stopped coming in, I worry I might bounce a check for the first time in 20 years. I’m still figuring out how to deal with that fear.


I Bought CryptoAssets

And finally, I got about 1% of our investible assets invested into three cryptoassets. It is time to get 1% invested. You should expect to lose this money; invest for 5-10 years or life.

CryptoAssets are an equity-alternative that is a must in 2022.



Conclusion – Real Stories from a Recent DIY Retirement

I like the idea of “Real Stories from a Recent DIY Retirement.”

I used to specialize in Infectious Diseases, and now I specialize in Retirement Planning for DIY Investors.

This is my real story of retirement. I am a DIY retiree, yet I have academic training in the topic.

And some life experience to boot. What’s up, pandemic???

So, above are some vignettes of the transition from a physician to retirement.

While some mechanical details about retiring to be a “Lead Dad” of 3 kids under seven and a small business owner are necessary, I hope you don’t mind that I try to leave most of the specific details about my financial and personal life out of the story.

This way, I can focus on the emotional aspects surrounding the years before to the months after hanging up a stethoscope.

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  1. Love this, and it’d be great to see more of your thoughts as you continue the transition. It took me a solid six months to get into a new and comfortable groove after retiring. My first months were a weird mix of feeling like I should be “productive” all the time and simultaneously trying to rest/destress now that I had time to do so. Next phase was the energetic “wow, I have time for everything!” phase, followed by the “nope, I still need to prioritize” phase. 🙂 Good balance now, with very little money stress, though we’ll see how any further market drops affect that. I feel comfortable with the plans I have in place. Have you had to answer the question “What do you do?” yet? I struggle to answer that without saying “I used to…” and end up giving a slightly different answer every time.

  2. You actually did it. Nice job Dr. Dave. I have no doubt you will (eventually?) get over the loss of the paycheck, as we did. I guess we are now dealing not only with sequence of returns (stocks and now for me, even bonds at our 50/50) and sequence of inflation. Fortunately we are well-positioned. Good reminder on real estate-ours certainly has not doubled like yours but there has been a nice increase (maybe 30%?) in last 18 months. I think it is the right approach to leave out the financial details. I like the personal story which I find more impactful than a “clinical” financial discussion. 🙂

    • Simple math, 1 million is 18 percent of what? So the clinical detail is still there, about 5.5million increasing to 6.5 million.

  3. Thanks for the stories and yes, life is an interesting journey. I will look forward to further updates on your retired life transition at the same time I am going through mine. I have been on a gradually declining schedule for the past five years and have decided to fully pull the plug at the end of June and join you in the next phase. I certainly enjoy your site and the personal financial consultations you have provided. Best wishes until we talk next.

  4. I also mostly (90%) retired. Then the market dropped like a stone. I believe we will be ok but mostly my wife is anxious.
    We are or were at 60/40. I have managed without a paycheck by transferring funds esp RMD’s and spending it without any budget and filling the check book up when needed. Our needs have really dropped, but with travel being planned it will again go up. I don’t have a real plan on where to harvest the cash I need but have planned to take it out of the 40% when the market is down and the 60% when the market is up. Have just reviewed a presentation from Rick Ferri and am comtemplating the 3-4 funds plan as I have way too many.
    Thanks for you web site and I agree I enjoy readying the stories as well.

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