Mrs. RoG’s First Attempt at Early Retirement
She did it. She finally did it! On September 1st Mrs. Root of Good formally resigned from her job.
After composing the resignation email at home the previous weekend, she lingered in anguish at her desk on the morning of September 1st with her mouse hovering over the send button. She was very nervous when it came time to email the official resignation letter to her bosses. Was it the right choice? Was it the right time? Will she regret the decision later?
SEND. If not now, when?
It is done.
The Resignation Letter
“Hi BossRaleigh and BigBossNYC,
I would like to inform you that I will be retiring effective October 15, 2015.
I have enjoyed working for The Company and especially in our team. I sincerely appreciate the support the team has provided me during my years as part of the company. Thank you very much for the flexible work hours, generous time off and allowing me to grow professionally.
Time is very precious and I want to spend more time with my family.
I will be happy to provide whatever assistance I can to ensure a smooth transition.
Thank you again,
Mrs. RoG’s bosses knew she was planning on quitting soon because she told them as much on multiple occasions over the last two years. Her formal resignation couldn’t have been much of a surprise.
An hour after clicking SEND on the resignation letter, Mrs. RoG’s manager asked her to join him in the conference room to discuss her resignation.
During the meeting, Mrs. RoG said “working five days per week just doesn’t work for me. Saturday is laundry day, and it’s depressing to have just one day off before going back to work on Monday IF you have all day Sunday free.”
The manager asked if there was anything the company could do to get her to stay. They discussed working from home as an option. Her manager suggested working three days from home and two days in the office. That still wouldn’t work.
Next up was a discussion of a part time work from home arrangement. The downside to this would be a reduction in salary and a loss of some benefits like the generous 401k match, nearly free family health insurance (though we can get it nearly free on our own), and a full allotment of 20 days of vacation on January 1 each year.
In the end, they reached a pretty sweet compromise. Mrs. RoG will work four “ten hour” days and have every Friday off. “Just work whatever it takes to get the work done”, wink wink, nod nod says the manager (with accompanying waving of arms around the “ten hours per day” part of the discussion). Mrs. RoG is the one in charge of doling out work to her team of nine, so those ten hour days might be shorter than you would think.
She’ll still be a full time employee with her full salary. She will keep her fat 401k match, nearly free health insurance, heavily subsidized dental, incredible HSA at Fidelity, and a full 20 days per year of vacation time. Other than possibly a few days per month, she’ll be ditching the hour or two round trip commute that costs over $10 in gas and tolls each day. Her new commute is 21 steps from bedroom to office. Her new schedule includes a three day weekend every week while still getting paid full time.
The benefits of staying on full time don’t stop there. By continuing to work, Mrs. RoG has a chance to get laid off and receive around 9 months of severance pay plus another $7,000 in state unemployment (if she decides to pursue new employment after a lay off). If, in some unimaginably bad stroke of investing luck we see a huge 50%+ prolonged downturn in our investment portfolio, the job serves as an instant back up plan to provide income during difficult times (not that I think we’ll need it).
In any big move it’s great to hold on to as much flexibility as possible. Mrs. RoG retains the possibility of going part time at a later date or quitting altogether whenever she wants to. This will happen some day, but probably not as soon as October 15!
Tilting the Scales
Overall, this is a really good compromise that tilts the work/life balance very far toward “life”. It’s not quite early retirement but it’s also not quite full time work. We could fancy it up and call it “semi-retirement” or something like that if we really had to find a label.
Here’s a snapshot of the first day of the new working from home schedule:
- Show up to work at 7:00 am
- Walk to school to drop the kids off 7:45-8:15 am
- A few minutes off around 11:00 am to make a salad and eat lunch with me while continuing to work and chat
- Break for (home) gym time at 12:00 to 1:30 pm.
- Return to work at 1:30 pm
- Walk to school to pick up the kids 2:45-3:15
- Work till 4:30-ish
That’s pretty close to ten hours if you round up. Her daily schedule will undoubtedly vary as the workload ebbs and flows throughout the month. The rest of her first week working from home followed a very similar schedule. So far it’s working very well.
The best part of the new schedule is that by Tuesday afternoon, Mrs. RoG is halfway through the work week.
Her schedule is getting closer to my weekly early retirement schedule since she joins me on the morning and afternoon walks and takes a long mid-day break. And since she is working from home most of the time, we are one step closer to being able to drop from two cars to one.
Having Friday off means more time for fun and adventure during the weekdays. On her first Friday off we spent the morning picnicking and hiking through a new (to us) urban park where we spotted fish, frogs, and a snake(!). Our three year old loved jumping from rock to rock in the creek bed. After picking up the older kids from school we spent the afternoon at the city’s indoor water park and swimming pool (it’s deserted during the weekdays because everyone is at work).
Mrs. RoG’s bold move to working from home status motivated another coworker to grab some work-life flexibility by getting a partial work from home schedule that lets her leave the office by 3 pm and finish the day at home. Mrs. RoG is now a work/life balance trendsetter!
It’s worth mentioning that you gain a lot of negotiating power to name your terms once you reach financial independence. If Mrs. RoG really needed the job for subsistence and survival (like the paycheck to paycheck big spenders), there’s no way she would have asked for a three month paid sabbatical and another extra five weeks of paid time off. And she wouldn’t have actually resigned and received the current work from home flexible schedule.
I wanted to give a shout out to the Mad Fientist who also managed to wrangle a pretty sweet deal out of his employer when he decided to quit and retire early. He’s still working but had no problem taking a few months off to travel the globe a bit and negotiated a permanent work-from-anywhere-in-the-world arrangement.
Last month as I celebrated my two year anniversary in early retirement, I mentioned Mrs. RoG would be joining me in early retirement in “a few more months”. Her plan to resign was foiled by an unbeatable counteroffer persuasive enough to keep her at it for “a few more months” and possibly longer.
Her employer bent over backwards and touched their toes with their flexibility and willingness to keep her on board. Eventually she’ll want to leave and enter the next phase of her life, but the timing is really uncertain at this point. The next few weeks will be an adjustment period to the new schedule and flexibility, but everyone is settling into the new normal very well so far!
Financially we are doing just fine. My blog income varies wildly month to month but so far this year it has more than covered our living expenses (including the seven week vacation in Mexico). Our dividend income also roughly covers our $32,400 per year retirement budget. Mrs. RoG’s net annual income covers our annual expenses two times over again. We’re in a weird predicament of being financially independent with enough income to cover our expenses four times over. We’re either making too much or not spending enough, and we’ll have to address one of those “problems” eventually.
The extra money we’re pulling in will go toward a few items:
- Additional margin of safety – more money in the portfolio means we have a much greater chance of successfully living off our portfolio for 5-6 decades
- Potential for significant future spending increases – we don’t currently have plans to ramp up spending but that’s always an option if our wants or needs change
- More to pass on to our kids sooner and later – we always planned on helping with college, and with more money comes more ability to help
- Charity – we don’t really give much away right now, but this could change in the future if we have way more than “enough”
It’s a great position to be in both in terms of finances and lifestyle, and we’re both peepee our pants giddy with excitement over what the future holds.
What would you do in Mrs. RoG’s shoes? Quit completely? Stick around a while longer?