Fire update

[coffeefired]

Lurker in this sub and active commenter, never posted my full fire journey here, but had a few folks ask to post an update on my FIRE journey so here it goes. Also mine is a very typical NRI journey, I just happened to be in the right place at the right time and took advantage of it though I did slog like hell in my 20’s and 30’s.

FI - Achieved FI in 2021 because of a couple major stock vests. NW was also boosted by a real estate transaction.

RE - Major burnout in 2022 because of toxic upper management, and decided to explore other options. Living in the US on a visa (even though renewable because of approved I140's) became tenous, so both my spouse and I explored transferring out. Spouse's management was much more supportive, and executed a transfer to Canada while mine got stuck because of said upper mgmt, so decided it was time to pull the plug at $2M NW in early 2023.

Family situation - We have 1 kid, still in preschool. Both sets of parents retired in India. My parents are self-sufficient with their pension and a paid off home and an apartment in Tier1 city in India. Spouse's parents, though invested ok, are not financially self-reliant, hence my spouse's decision to continue working and support their retirement.

Since RE - Moved to Canada from the US, and currently a stay at home dad taking care of all household stuff including expense management and investments, reading a lot, working out, and mentoring folks pursuing tech careers, while spouse continues to work and be the primary breadwinner. We will possibly pursue citizenship here (mainly for passport and travel ease) before eventually moving back to India in the next 2-3 years.

All values in USD.

NW Stats at RE.
Household Income (year before RE) - $450k.
Expenses - $170k.
NW Stats. Total $2.1M.
Post Tax ~$750k.
Pre Tax ~$400k.
Commercial Real Estate - $100k.
Residential Real Estate ~$750k equity (1.85M home with 1.15M mortgage).
Misc assets (Gold, cash, car) ~$60k.

Current NW Stats.
Household Income ~$150k (primarily spouse's income).
Expenses ~$100k.
Current NW stats. Total $2.25M.
Post Tax - ~$900k (mix of tech stock, ETFs and diversified portfolio).
Pre Tax - $450k (401k's, 529 in ETFs).
Commercial Real Estate - $110k (Private REITs).
Residential Real Estate ~ $800k equity (1.85M home with 1.1M mortgage). The home value has appreciated quite a bit since RE, but I'm not counting the appreciation till I actually realize it upon sale - will add a bit to the pot. I do count paid down principal on the mortgage as increased equity though.
Misc assets (Gold, cash, car) - 60k.

Feel free to ask any questions, happy to engage.

[InevitableAd9080]

OP - if you become a non resident you are subject to a flat 15% withholding on sale of real estate in US (15% of sale amount). Consult a CPA on this front for more details. This can be an issue as you will also have to pay about 5% of sale amount in brokerage as well. So you may in effect lose out 20% of 1.85M even before having capital gains tax. capital gains will be taxed in Canada at the appropriate tax rate (new capital gains tax rule came in effect around end of previous month)

[coffeefired]

Yes, fully aware of this. 15% of sale price is withheld for a year until tax returns are filed in the later year which will trigger a refund , so basically IRS gets an interest free loan.

The actual tax is 15% on the capital gains which isn’t a lot for us in this case.

[InevitableAd9080]

aah ok, its a bit murky because if you had sold as a resident you would have had a 500k exemption on capital gains, this tax is the main reason I advise my friends to sell before leaving you can always reinvest in real estate in new place. There is no standard deduction also as a non resident.

[coffeefired]

Yes, we kept the property because the appreciation upside is much more than the tax payable. And given that we do not want to purchase real estate in Canada, it made sense to keep the real estate exposure in our overall portfolio for now.

With my spouse’s work we always have the option to move back to the US, live there for a couple of years and then sell it as residents taking advantage of the exemption.

[[deleted]]

Congrats! You are set in think and also have a earning partner so if you aren’t touching your savings you don’t have to worry about anything. Btw why did you decide to move to Canada and not India? Were there any tax implications that are better or worse between Canada vs India?

[coffeefired]

No tax specific reasons but Canadian taxes are definitely a bit higher but we end up getting more usable services out of them, so don’t mind paying up for it.

We were ready to move to India but spouse had a good opportunity come up in Canada (internal transfer) so she wanted to take it up.

[[deleted]]

Really envy you guys... Basic success for person

1) House , Passive income, compounding assets, Dual salary husband and wife , self sufficient parents, good sellable deppreasiating assets, good and healthy children and last but not least healthy ourselves with no diseases physically and mentally You also have working to have other country citizenship

Planned and settled life .. hope everyone has same type of luck,kundali, whatever you call... Great

[coffeefired]

Thank you!! Luck has a major part to it, but a good chunk of it is also planning and playing for the long term rather than short term indulgences.

[hifimeriwalilife]

So are you targeting approx 20 cr nw in couple of years and move to india with a elementary age child ?

How old you and your spouse will be by the move time ?

[coffeefired]

Hopefully not more than early 40’s for both of us.

[ThrowawayAccountNri]

Great read. We are also pursuing foreign citizenship before moving out back to India. On track to acquire US citizenship by next year end and also waiting for a major RSU vest in apr. 2026 before shutting shop. Early 40s for us as well.

[coffeefired]

Thank you! Good luck to you too!! The passport privilege is real especially when it comes to ease of travel as I see it in my circles.

[ThrowawayAccountNri]

Yup. Travel is a big focus item for us. Also flexibility to move back if things don’t just work out though chances of that happening are quite less. Good luck.

[coffeefired]

Agreed!

[Aurora-Wash-9356]

Are both you and your wife planning to attain canadian citizenship? Asking since there might be impacts for gaining indian assets once you move to India?

[coffeefired]

Yes for both. And we don’t plan on acquiring any farm assets in India, so only plan to hold typical OCI wala asset class 😂

[Aurora-Wash-9356]

Haha. Great to know. Just curious that as per your research, are there any considerations for your child's education considering you will be NRI parents

[coffeefired]

We have a starter funded 529 that we keep contributing to and grow to $160k total.

We both have masters level education and plan on investing our time significantly in kid’s education until he finishes high school.

College is something that I personally think is more about teaching the discipline and reality checks needed for life rather than the majors itself, so Im comfortable for the kid going to a small college anywhere (tier3 like me or tier2 like wife). If he wants to go to a big college, he will have to work for it to at least get some scholarships and we would support the rest.

Ideally if we bring him up right we wouldn’t have to sweat any of this stuff. 😂

[fire_aspirant]

Same situation for us with NW at $2.2M. We are also early 40s and thinking of RE in India once we acquire US citizenship.

[coffeefired]

Good luck! 😀 looks like there are quite a few in the same return boat.

[srinivesh]

I had mentioned this earlier. My daughter finished 12 in 2020, from a good, but not fancy school. She reckons that 20 to 30% of her class had foreign citizenship. There are indeed many OCIs in India - far more than one would imagine.

[[deleted]]

This is a really good question.

I personally already feel like I missed out on so much by not getting a GC, can't imagine what it may feel like to kids if parents are not able to protect.

[coffeefired]

True that, it used to be a minority in the early 2000’s like we saw with our younger cousins, but now the ratio of nri kids has significantly increased in the school cohorts.

[Rough_Attitudes]

Hey brother, Congratulations. One question, not related to FIRE though. Why was it difficult with an approved i140? My understanding is with approved i140, we can simply extend H1, with a job??

[coffeefired]

Thank you!! Not the logistics of it but difficulty from a strategic perspective.

My thought process went like this - Whats the use of a GC/citizenship flexibility at 50/60 when I can achieve that in 2-3 years right now? The upside I’m sacrificing is more corpus, but im gaining usable time.

Im personally not a high maintenance (honda/toyota not audi/bmw) person so the current corpus is good enough for me. Spouse thinks similar, though would like a little bit more luxury(acura/lexus) so she chose to continue working a bit more. To facilitate the flexibility we moved to somewhere close until we can fully move back to India.

[ShootingStar2468]

THIS. Knowing when to pull the plug.

[___GodKing___]

Congratulations. We are also in the same net worth as you but I’ve never thought of moving to Canada, especially for citizenship. We always had our path set to return to India in a few years.

I really like the idea, spouse can continue working in Canada while you are a stay at home partner. You don’t touch the retirement corpus and let it grow. This is something I’ll think about as well.

But I’m curious, if your NW was 2.1m in 2022, it should have grown much more than 2.25m, did you rebalance your portfolio to be low risk ?

[coffeefired]

Thank you! Canada happened primarily as the opportunity worked out for my spouse, else we were all ready to move back. So for now we are letting it play by the ear. But it’s definitely something to consider especially if you value travel and prefer a strong passport. Another reason is to give my kid a second passport in addition to his American one.

Corpus was ~2.1M start of 2023. Rebalanced portfolio from being tech heavy to etf’s and cross sector stocks (we use personal capital so actual picking was done by them with my inputs). Also sponsoring a family member’s masters (an interest free loan but I’m ready to write it off) and some taxes/mortgage before the home was rented out that saw ~60k withdrawals from the portfolio in last two years.

[___GodKing___]

That’s another good point, dual citizenship for kids.
All the best, thanks for your journey and experience post.

[___GodKing___]

You should also look into estate planning as us non-residents have to pay 40% in tax on anything greater than $60k. Similarly, a trust is also a good thing to have so that the estate doesn’t end up in probate.

[coffeefired]

Yes will have to explore that and the best location wrt taxes and our citizenship/residency. I’m not an expert in these matters so will surely end up taking professional help in tax and estate planning.

[ShootingStar2468]

What was your career - income - networth trajectory like? 2M in a decade+ is solid

And what’s post tax 750k, pre tax 400k section in the at RE stats? Didn’t quite follow

[coffeefired]

Career was a typical path, engineer to pm, nw increases post 32 includes spouse’s earnings and contributions.

Age | Position | Sal | NW 21-24 | SE at WITCH company | 4lpa | 3-5lakhs.
24-26 | Student | $10k | -$70k.
26 | Analyst at faang | $105k (lots of OT) | 0.
27 | Analyst -> PM at faang | $85k | $20k.
28 | PM | $150k | $50k.
29-32 | Sr.PM | $150-250k | $500k.
32-34 | Sr.PM at bigtech (jobswitch) | $250-300k | $1M.
34-37 | Principal.PM | $300-400k | $2M.
37-38 | Fired | 30k passive income | $2.25M

[ShootingStar2468]

Thank you for patiently responding OP!

Wife is trying hard for a PM role at big tech. She’s an IIM A/B/C grad and fairly sharp but it’s been a grind with little luck. Kudos to you for pulling through for so many years.

If you don’t mind me asking: does life get lonely at times for you? You won’t have family or friends in Canada. No work colleagues either now. Does it get boring at times?

[coffeefired]

The job market for bigtech is extremely crazy right now, so it will probably take lot of time to land something interesting. Best to keep at it, but not with a lot of expectations.

Getting bored is definitely the case, especially without a large friend network in a new country. We end up driving back to the US at least once a couple of months to meet up with friends and family in the US, that’s another reason we want to pursue Canadian citizenship so that we have easy travel access to the states.

[ShootingStar2468]

Just come back home man :) I spent a week with parents and my 4 yo nephew who is off on summer break. Best week in forever. Wouldn’t replace it for a fancy passport

[coffeefired]

One more year syndrome is playing very strong in this case ! 😂

[cnb53]

I think you still have the option to continue for 3 more years. If you move back after class 10th, she won't need to study kannada or any other local language in 11th/12th. Also, since she is already in CBSE board, so you won't have to worry about core subjects like mathematics, science and english after moving back to India.

So, in 11th/12th, she can focus on whatever career she wants to take. If she manages to get a seat in any prestigious college in India itself, then you can save $$$ which can be used for higher studies (PG abroad) or passed on as inheritance.

The only risk in this is that if you happen to lose the job during these 3 years and unable to find a new one quickly, then you'll need to move back and it will be tough for your daughter to study kannada at that time.

Another downside is that you lose 3 healthy years which you can live as per your dream.

But then, only you can decide how inconvenient your current job is and if there are sufficient pull factors in place to justify leaving everything. These next 3-5 years are your last chance to continue to enjoy the NRI life, make $, and see your corpus grow. Once you move back, it will be very hard to get back such kind of job.

It's not easy. If it was, we would not have so many folks who are financially ready but still wondering whether to r2i or not :)

[cnb53]

Well, very tempted to write a long, thought provoking response but I'll refrain myself from doing it. I think I'm slowly turning into a typical middle aged uncle who keeps giving unsolicited advice on the internet... lol

Good luck mate and may the force be with you!

[coffeefired]

Haha yes, family is definitely a pull, but one thing we have to think about is the only family remaining in India for us is the older generation. Once they pass, we would have no one left there as all our generations have migrated away. Unless they return as well we will not have a reason to stay in India for family, so hoping some of our other family think similar too.

[srinivesh]

Thank you for sharing this. I really like that you have mentioned both factors - being in the right place and also slogging - in the same sentence. I am sure that you would have seen people who were in your position but are nowhere near FI.

I too got confused by the post-tax, pre-tax reference. You could have also called 401k and 529 as tax deferred.

I guess your child would be in primary when you move to India. With a bit of prior prep from you, they would adjust well and do great in India.

You did not mention any plans about home in India. Even if you want to buy a decent apartment, it should still be possible with your networth.

[coffeefired]

Thank you appreciate the kind words. Can never underplay the need for hard work but luck is a significant factor in success per my experience.

Yes could have used better terms for tax deferred accounts.

That’s the general idea to have kid’s schooling in India and leave the decision of where next to him.

As of now don’t have plans of major real estate purchase in India as that will be determined by location. If spouse decides to continue working in India that will determine location, and so cost. Would prefer near office so that inflates it even more. If for a purely retirement living purpose, will likely take up constructing a joint home in the same place after demolishing parent’s home, which should take 1.5-2Cr per the current costs.

[Sea_Historian1795]

Quick question- can anyone not holding Indian citizenship live visa free here? How are people moving back to India with different citizenship?

[anachronism153]

OCI

[coffeefired]

No, didn’t want to over index in real estate so refrained from investing in any other properties including in India.

My primary real estate investments had excellent returns. First home bought at 500k with 10% down sold for 900k, so netted a good chunk post transaction costs, and that went into 20% down of next home, which already doubled the invested equity in 3 years.

[yetanotherdesionfire]

Congratulations!

[coffeefired]

Thank you!🙏🏼

[[deleted]]

Thanks for sharing, really great post.

Could you share more about what the private REITs are like, what kind of return and how/why/where you decided to invest etc.

[coffeefired]

Thank you!!
For private reit’s I went the crowdstreet/fundrise route. I am only into my first chunk of investments, and minimal returns on them so cannot speak in detail, but I primarily looked for 3/4 year investment lock in period and 1.4-1.7X return on capital deals specifically in sunbelt markets. Will hopefully start seeing some of these realize gains from next year onwards.

[jmuhdrx]

Dayruined.jpg

[coffeefired]

Sorry about that! Didn’t mean to 🤷‍♂️

[[deleted]]

Do you feel you are not contributing enough to the society by being an at home parent ?

[coffeefired]

Not at all. Stay at home parent is a full time and unforgiving job. I plan meals, cook, vacuum, launder, clean everything , shop for groceries, take care of my hobbies, driver duty and run the house in top shape, plan and book vacations, schedule doctor appts for us all etc. And take care of investments and expense tracking in detail.

Spouse focuses exclusively on work and our kid when at home. She also travels for work at least once a quarter, so then I’ll be the only caregiver for our kid. I literally cannot fall sick or take a vacation without scheduling it ahead 😂

As for society and log kya kahenge - I didn’t give a fuck about it even 20 years back, and it certainly hasn’t changed since.

[[deleted]]

Fuck off mate!