Reader Case Study: Should This Man Claim his Freedom?

"Badass Mustachian Eagle of Freedom" by M. Mustache. 2013, 8.5"x11", Kid paint on scrap paper

“Badass Mustachian Eagle of Freedom” by M. Mustache. 2013, 8.5″x11″, Kid paint on scrap paper

I’ve had the chance to go to lunch with quite a few visiting Mustachians of late, and a theme has been popping up in the conversations. Like my own family, many of these readers have been leading slightly-less-ridiculous-than-average lives for years, which has led to a considerable surplus of money.

But amassing money is just one side of the coin. The other is knowing what to do with it: deciding upon your own definition of freedom, figuring out when you have saved enough to accomplish it, and gaining the confidence to make the jump when you get there.

So when this incredible comment showed up on the post about The Rules, I knew I had to get in touch with the guy who wrote it. His general theme is not uncommon among readers of this blog, and if we study the theme, we may all be able to learn a thing or two.

(our conversation has been edited for length)

Dear MMM,

Love the blog. Actually, I read it obsessively, and have even begun preaching the precepts to all (including friends and family – I’m trying to convert the kids into Mustachians before it’s too late).

Anyway, here is my problem: I am a BIG FAT GUTLESS PHONY! That’s right. As far as I’m concerned I can afford to retire now at 54 years of age. Our net worth (the wife and I) incuding the house, is $4.25 million. However, any time I suggest to the wife that I am packing it in (I hate the meaninglessness, imposterism, drudgery, uncertainty, depression inducing self-esteem sucking, soul wrenching boredom, of my useless pseudo-middle-management-faking-it-all-day-$100K a year plus automobile-desk-job), she disagrees and expresses concerns about our lifestyle and the children.

I tell her it doesn’t have to be that way, and point out the huge wealth of information that you have so concisely articulated in hundreds of articles. But, alas, it does me no good.

I’m just a regular dude who happens to have some very basic Level 3 Mustachian instincts (assuming the levels go from Level 1 at the lowest to Level 15 at the highest) who got lucky with my timing in life. I bought a house 30 years ago before prices were insane, moved once, 25 years ago, paid off the mortgage aggressively a long time ago, and enjoyed the quadrupling of its value.

Similarly, I was as frugal as I could be, earning a basic salary through employment over the last 30 years, with a semi-spendthrift wife and 3 kids with quasi-rich friends, while investing in basic stuff .

So now that I’m TIRED, FED UP, DEPRESSED, and I JUST WANNA QUIT and read books, and fix up my house, and ride my Harley, and exercise, and go skiing, and ride a bike (a real bicycle), and do my photography, and cook, and volunteer, and indulge in a mid-day Bota Box if I get the urge, and stay in California, or Arizona, and shop at Trader Joe’s in the U.S., and beach bum in Florida for a couple of months a year.

Yeah – I know it’s my fault. I SUCK. So, other than just manning up and breaking free, do you have any advice on an alternate way to present the facts to convince her we’ll still be OK, even with keeping the house for now, and investing the $3M for income?
Please. I’m ready for a change. Time to break the rules.

Yin Yang

This comment blew my mind. So many aspects of Mustachianism, so many successes and failures and emotions and common themes, wrapped into a single comment. This is a man of 54 years of age who is ready for a plate of Freedom, but thus far has failed to walk up to the counter and claim it. So I wrote back to him and requested further details. His reply was:

It’s difficult to explain the situation to “non-Mustachians”. Most people I encounter do not hate their jobs (or at least do not ADMIT to it). When I mention “retirement” to anyone, I get looked at as if I had a third eye…. There’s a weird combination of guilt and pressure I feel – from my wife, parents, colleagues, acquaintances, etc. – that somehow has a psychological grip on me, and keeps me “playing the game”. It’s as if I would become a pariah if I stepped off the treadmill. The worst thing I fear is setting a bad example to my children, none of whom have even started to work yet. I don’t want them thinking “If dad can be a bum, why can’t I?”

Financial Figures

Combined Employment Income:
$140,000.00 Gross (pre tax) (My portion is $110K – that will disappear with retirement.)

Monthly Expenses:
Property Tax $670.00
Electricity $400.00
Phone: $30.00
Internet: $125.00
Home Alarm System: $30.00
Home Insurance: $200.00
Car Insurance: $660.00 (4 vehicles)
Motorcycle Insurance: $100.00
Lawn care/Maintenance: $100.00
Life Insurance: $200.00
Disability Insurance: $250.00
Critical Illness Insurance: $225.00
Cable TV: $70
Cell Phones: $160.00 (Wife’s plus 1 kid)
College Tuition and Living Expenses (2 kids): $2500.00
Food: $650.00
Fuel for 4 Cars: $400.00
Vehicle Maintenance: $200.00 (4 vehicles)
Vacations: $1000.00 (3 trips a year plus some long weekends)

Total expenses $8295/month

Home -mortgage free; Estimated market value: $1,000,000.00

Liquid non-tax sheltered investments: $2,350,000.00
Includes an allocation of Stocks, Bonds, Preferred Shares, REITS (real estate investment trusts), ETF’s, Mutual Funds, GIC’s (CD’s), and some Cash.
Income yield across the board on all of this is approximately 5% annually. The market value of the holdings fluctuates depending on the way the market goes, interest rates, and other variables.

Registered (Tax sheltered) Funds (RRSP) (i.e., 401K)
$750,000.00 in ETF’s, Mutual Funds, GIC’s
Mostly growth oriented equity funds, some dividend reinvestment. Mostly long term outlook.

Rental Income Property
Value: $325,000.00
Mortgage: $200,000.00
NET positive monthly cash flow (after all expenses): $450.00 ($5,400/year)
(If I bailed on it now, I could likely add $100,000.00 liquid cash to my portfolio).

I have 3 “adult” children: 26, 25, and 21 – two in university. There is a potential massive expense coming if they pursue law and medical education outside of Canada ($100k for a domestic education, $500k for the US equivalent)

The house will definitely be downsized within 3-5 years, freeing at least $400,000.00 cash for more investments.

I anticipate having these ridiculously high expenses for the next 3-5 years, but would still like to retire in 1 year (at 55).  I would like to hang out in Florida and/or California for at least 2 months a year, and in Colorado (to ski) for at least 6 weeks a year as part of my retirement wish list.

Whoo. While that is a lot of information, and I can hear the WHOOSHing sound of 800,000 boxing gloves stirring up the nation’s wind currents as we all read that astonishing list of expenses, let’s start with an end-run around the whole heap of details:

This guy’s invested savings (taxable plus retirement): $3,100,000
Annual income provided by these savings, using the 4% rule: $124,000
Current (worst-case) annual living expenses: $99,540

See, once you amass a sizeable ‘stash, your money can work harder than you can. And while YinYang’s expenses are massive right now, his great collection of investments is providing passive income and growth that will on average easily outrun his family’s spending even if he never reduces these expenses. Doing the math, the current expenses are only 3.2% of the investments, meaning he has a huge safety margin beyond even that which is built into the 4% rule.

Since the worst case is already good enough, we could close this case study right now and tell our man to retire. Which is exactly what I advised him in my first response to his comment. But since I am Mr. Money Mustache, there is obviously more to be said on those expenses:

Property Tax: This will drop by at least $200/month when you move
Electricity: $400 a month – WTF? Do you live in a one-acre Bouncy Castle that you keep inflated with 1,000 blowdryers? My electric bill is under 25 bucks. You need to get yours down right now my man. Savings: at least $300/month.
Home Alarm System: 
These are a silly invention – the Timeshare Condos of the suburbs. Drop it, live free, and save $30.
Car Insurance and Gas: You are forking over $15,120 per year (and probably over $20,000 after accounting for depreciation), in order to trash your own environment while driving four unnecessary vehicles around in circles. Why are you punishing your children by addicting them to Motorized Thrones when they could obviously ride bikes? Where is your own bike? If the distances involved are too great, you live in the wrong place and need to move. Savings: at least $1,000 per month.
Life, Disability, and Critical Illness Insurance: What are you insuring against? Your savings are already equivalent to several life insurance settlements. Even if you perish before finishing this article, your family is financially set for life. Cancel all three policies immediately and save $675.00 per month.
Cable TV:
Did you throw this in just to enrage Mr. Money Mustache!? Fuck the nonsense of nationally broadcast passive entertainment – as multimillionaires who are raising doctors and lawyers, your family is obviously intelligent enough to find more advanced forms of entertainment than watching TV, for a savings of $70 per month
Cell Phones: $160 is an awful lot of cash for occasional access to radio waves. You might check out this MMM reader’s quick guide to less costly cell plans in Canada. Savings: at least $60.
Vacations and Miscellaneous:
with a tighter budget, I would grill you on these expenses as well. However, given your unstoppable cash surplus, I’ll leave these bits of luxury untouched, so you can be free to attack the other areas.

Investments: Although we won’t get into the details, you should conduct an audit and make sure you aren’t carrying any of the nonsense high-fee mutual funds (expense ratio over 0.5% or preferably 0.25%) in the portfolio. Instead I’d carry passive index funds that track the Canadian TSX index, US total stock index (like Vanguards VTSAX), and international stocks (VGTSX). Large REITs are nice too.

Total monthly savings after application of the MMM Face Punch: $2335. This is a 28% reduction of your expenses, even without touching the core of your lifestyle – the ability to help your kids with their education. Applying the 4% rule in reverse, this spending cut is equivalent to increasing your nest egg by about $700,000. And after downsizing your house, the newly liberated cash will add to that, resulting in a total equivalent wealth boost of $1.1 million.

In a Nutshell: Congratulations. You’re set for life. There is not even the slightest logical jusification for you not to hand in your two-week notice at the end of your workday today. While the agreement of a spouse is important, there is no sense continuing an unsatisfying job when all possible calculations suggest your salary is completely unnecessary. And as the final bit of unnecessary safety margin not mentioned in the box above, your wife is still free to keep her own job.

These objections based on fear are often rooted in a lack of understanding of the true nature of investment returns. Money really does produce money when invested, but this fact is not intuitively obvious if you haven’t soaked up the idea. The solution is then some sort of education – simple investing books, or talking to other early retirees. However, the facts are behind you on this one, so I am optimistic that anyone can learn to let go and let their retirement savings sustain them, given a sufficient cushion.

While there are many good solutions to the problem of a misunderstanding like this one, “Continuing to work an unnecessary job you hate”, is not one of them.

You have many adventures in freedom and years of healthy healing ahead of you. And if you’re so inclined, please keep a journal of your experience so we can take inspiration ourselves.

As for you: If you’re more than ready to pull the plug – go for it, and share your story as well!


Further Reading: an older classic on a similar theme theme: the Quitting Lawyer and the Despondent Millionaire


  • Frank November 10, 2013, 9:13 am

    MMM answers the easy question (financial), but the harder bit of advice to give is the relationship advice.

    As someone who doesn’t even know your wife, it’s easy to look at it from far away and scream, “Run! She’s holding you back!” and suggesting that with half of this wealth you could retire if you were willing to deal with a slightly more low-key lifestyle, but I’m going to guess that you love her and want to bring her along on the adventure you want to go on.

    I don’t know anything about you, your wife, or your relationship, but there’s a good chance you’ll get further by trying to approach her on all levels: intellectual and emotional. (Logos and pathos.)

    Show her the numbers. Show her your real expenses. Show her what you really spend. Show her what you’re suggesting cutting to. Show her what you can expect to make from your investments; this includes showing what you really made last year (include the home value change) and present the 4% rule, explaining that it accounts for the volatility of the market.

    Then tell her point blank, “I can’t keep working this job, I just don’t have it in me.” Explain that if it was necessary for the kids or for you two, you could bring out something more inside yourself, but it’s not. Explain that you want freedom and adventure and you’re excited to go on it with her.

  • Jeff November 10, 2013, 4:32 pm

    What about Federal and State taxes? I know that’s my biggest expense. Is the tax burden pretty light in Canada? Just curious?

    • Elaine April 19, 2015, 5:56 pm

      At the very beginning of the article he says that he grosses $140, of which $110 is his. I would assume that the other $30 is taxes, etc.

  • marian27 November 11, 2013, 2:46 am

    This is just a tangentially related comment but I was fortunate to get a 3-months unpaid leave of absence from my employer earlier this year. I’m in my mid-30s and was on the path to burnout. Those 3 months added vital perspective on what my retirement, whenever that happens, will be like and gave me a picture of what my expenses might be like when that happens. (My calculations for what I’d need during the time off were dead-on!)

    If you’re thinking of retiring early, but don’t have the guts to do it, see if you can take a sabbatical. If possible, convince your significant other to do the same. It’s not retiring. It’s dipping your toe into the bath of retirement. Who knows, both of you might realize you’re reading to take the plunge!

  • Nina November 11, 2013, 10:23 am

    I have heard that it is common in conventional retirement to face periods of depression related to a change in identity and status. Perhaps this is also the case for Yin Yang or his wife. I know that my own dad, despite retiring early from a good but demanding job, went through this. I remember trying to cheer him up with suggestions, including going back to university to study something that he enjoyed and he said to me “education is something that you do at the beginning of your life, not at the end”. I know, ouch. This rut was temporary for him – major change can take time – and he actually did go on to study and master one of our local Native American languages at our local university and enjoy a huge number of pursuits and adventures. For Yin Yang, it might be a transition to shift from his decades of selflessness (working for the well-being of his family) to the selfishness of affording himself the modest joys of time & travel and then who knows what – its his future to choose (and not the end).

  • Christine November 14, 2013, 10:39 am

    I agree with others who are saying this is a marital/mental health issue. I have to wonder if what the wife sees is a very depressed husband who has daydreams of becoming a world-traveling ski bum but who will probably end up sitting around even more depressed and isolated if he quits his job. Not saying this is what WILL happen, but her perspective may be that his job is the only thing that gets him out of the house some days. It doesn’t sound like he actually has any hobbies as it is so there’s not much of a guarantee that he’ll suddenly become happy if he quits and does all the things he says he will.

    I say this as a stay-at-home mom and wife who 100% supported her husband in leaving a 6-figure job to face unemployment and then itinerant, ordained ministry. We lost the house, lost the money, lost the status, but gained everything important early enough in life not to feel we’d wasted too much time. Our marriage is happy, the family is strong, food’s on the table, and we have a good home. And with Mustachian ways, we’re hoping to rebuild some of our financial cushion.

    But…I can understand the wife’s hesitancy, if the husband is half as depressed as he sounds in his comment. There’s no guarantee quitting will cure his depression. Then again, if you always do what you’ve always done…

  • Lynn November 25, 2013, 12:43 pm

    wow, I think this guy’s kids should learn to follow in their dad’s footsteps and be able to retire at 55. I also agree that they should pay for their own graduate studies.
    Please let us know what he decides to do.
    we will all be rooting for him!

  • Suzanne May 23, 2014, 9:56 am

    I can see why Mr. Yin Yang feels torn, even though the numbers are clearly in his favor. Perhaps it’s this: It is inescapable that the economy is set up for some of us to make money off of others, and it doesn’t quite sit well with him to retire on wealth that, to a very significant degree, the economy/market created for him during a period of tremendous growth, a period that, not coincidentally, also created unprecedented inequality and child poverty and environmental havoc.

    Of course, that may not be the source of the pressure he feels, but it certainly gives me pause as I weigh work and retirement in my own life (while trying to grow a mustache). Letting your “dollars work for you” in retirement seems to me like a not entirely accurate aphorism for letting your investments in the stock market extract wealth from workers/employees and the environment, and return it to you, in the form of shareholder profits. But my dollars don’t get together with other dollars and have dollar sex and create new dollars for me. Those new dollars are extracted from someone or something else–another resource or someone else’s effort. Or, in the case of advanced, shaky investment products–the dollars are pulled from the sky–but that’s only temporary. When they crash, there is inevitably a winning and losing side. Because, none of us lives in a vacuum, and money and work are about more than the dollar figures in black and white. Money and work link us inextricably to society, to the people around us, and I can see why someone would pause and feel unsure even if the profit/income figure quite clearly has an absolute value larger than the income/loss figure.

  • Julie August 14, 2014, 11:18 am

    MMM, why aren’t you factoring in taxes on the income? 4% of his nest egg would be $124k…pre-tax. He spends in post-tax dollars. If you shave off 30% for taxes, his nest egg will generate less than required to keep up with his post-tax expenses.

  • Jonathan Gomez January 21, 2015, 8:11 pm

    Hi Mustachians. I’m a 22, almost 23, year old college student. I’m looking forward to starting my first full time corporate job in just a little over a year when I graduate. I have been reading many of the articles and I plan to implement some of the strategies myself. However, I do have a question about a statement made in this blog post. Mr. Money Mustache suggests to the older man to invest in “…US total stock index (like Vanguards VTSAX), and international stocks (VGTSX)….” In previous posts MMM has recommended investing in VTSMX, which has a 9.62% return since the year of inception. VTSAX has a 5.78% return since the year of inception. I’m trying to further my understanding of investing, and I may be missing something. Why did you recommend that the older man invest in an index fund that has a smaller percentage of return over time?

    • Dana Olson January 22, 2015, 10:05 am

      Since these funds were started on different dates, 2000 vs. 1992, comparing returns since inception has no meaning. This is especially apparent, as these funds hold the identical list of stocks over time. The difference between these two is the expense ratio. The Admiral (VTSAX) has a lower expense ratio than the investor (VTSMX) fund. So if you qualify to do it, buy the Admiral (VTSAX) and enjoy lower expenses to own the same list of stocks. I think there may be a minimum purchase amount on the VTSAX, and some brokers don’t offer it in their line up. A look at the Vanguard site will find the answer.

      • Jonathan Gomez January 22, 2015, 12:49 pm

        That is so awesome! This gets better and better the more I learn about it. I will start investing within the next month or two. I definitely don’t qualify for the VTSAX fund, but I can purchase the ETF version of that fund since it has a lower expense ratio than the VTSMX fund. Would there be any reason for me to switch from the ETF to the Investor Share?

  • Mr CB March 11, 2015, 1:51 pm

    This is crazy! This guy could easily retire now. If he cut expenses it would be even easier.

    Obviously this guy values his children’s education but why would you want to spend $500k to go to an American university when you could spend $100k to go to a Canadian university? Seriously, is there that much of a difference between the two? Other than the fact you could make more money in the US, I don’t think there is. Even with that they could finish school in Canada and then move to the US to work.

  • Mother Fussbudget November 4, 2016, 10:19 am

    RULE OF 55:
    There is one fine point I might add… I spend most of my time these days working with folks who are doing what I call “Not-So-Early-Early-Retirement”, and believe I can help here. When this was written (back in 2013), YinYang was 54 years old. He *might* have been turning 55 during the 2013 calendar year – that point is never stated. And he *probably* has a 401K plan (again, implied, but never stated). While it’s perfectly fine to leave the rat race at 54 because of the freaking huge amount of savings YinYang has at his disposal, he *might* want to first know about the 401K plan ‘Rule of 55’:

    People can withdraw funds from their 401K account penalty free if they “retire, quit or are fired at age 55 (or older)”.
    There are three rules to know about the rule of 55:

    First, this exception applies if you leave your job at any time during the *calendar year in which you turn 55*, or later, according to IRS Publication 575.

    Second, if you still have money in the plan of a former employer and assuming you weren’t at least age 55 when you left that employer, you’ll have to wait until age 59½ to start taking withdrawals without penalty. A GREAT incentive to get any old 401k’s rolled into your current 401k before you retire from your current job so that you will have access to these funds penalty free.

    Third, this exception ONLY APPLIES to funds withdrawn from a 401k. IRAs operate until different rules, so if you retire and roll money into an IRA from your 401k before age 59½, you will lose this exception on those dollars.

  • H-Town March 13, 2018, 2:20 pm

    I know this is an older blog post, but I had to leave a comment as I guffawed out loud (for awhile) upon reading the line:

    Cable TV: Did you throw this in just to enrage Mr. Money Mustache!?


    I imagine it uttered in the same tone, and with the same volume, as the immortal line from the classic movie UHF when they show the preview of “Conan the Librarian”: WHAT? YOU HAVEN’T HEARD OF THE DEWEY DECIMAL SYSTEM?!?

    Thanks so much for all the great posts!


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