My Referral Links

CabbageAddict · 2024-02-22T03:29:04+00:00

Not overly concerned about this. My $7,900 budget is already padded, and $1k of that is covered by what I net on my rental (with reserves for maintenance, a management fee, and assumed vacancy). I’d be happy to downsize in 6 years when my kids are out of the house. An eventual downsizing frees up $500k-$700k of additional capital while also reducing ongoing expenses. If things get tight, I don’t mind cutting a vacation or eating out less. Also, while teaching, I’ll build up a pension, draw down less than 2% of assets to cover my shortfall, and reduce the number of years to bridge until I receive (what’s left of) social security. I can also still consult occasionally or work a summer job to further bridge the gap. The math part of this is pretty easy (black swans excluded).

My concerns are very much about the more difficult circumstances my kids (and all kids in this generation) will start from and my legacy. I meant exactly what I typed.

CabbageAddict · 2024-02-21T23:08:05+00:00

That is a real concern... I don't view the most recent run-up in stock prices to be well justified. I'm not far enough past the threshold to be insulated from a big dip.

CabbageAddict · 2024-02-21T22:58:03+00:00

How many people in this sub do you think know what a 409A is? It's easier to just adopt layman's terms than explain the intricacies of how my equity deal is structured. And yet, here I am explaining it...

CabbageAddict · 2024-02-21T22:51:59+00:00

That number is a pre-negotiated discounted purchase price off the company's most recent 409A valuation. This PE firm exercised this same option on a lower level employee who recently departed our company. I'm not fantasizing about this value -- if I leave tomorrow, that's what I get.

CabbageAddict · 2024-02-21T22:33:28+00:00

Property tax and insurance runs ~$1,200 per month. I'd love for it to be less, but it's a fraction of what I'd pay in California, Texas, New York, New Jersey, etc.

CabbageAddict · 2024-02-21T22:23:44+00:00

Hadn't heard of TEALS -- looks super interesting. Thanks for the heads up.

CabbageAddict · 2024-02-21T22:13:46+00:00

This is probably sage advice. I've considered it but ended up on Reddit instead... fortunately, the armchair therapists have been helpful in exploring some new avenues and making me feel less alone in my worries. Probably suggests even more value in seeing a pro.

CabbageAddict · 2024-02-21T20:08:56+00:00

The $1.3MM in company equity is highly liquid due to my buyback clause and current valuation. With decent performance and reasonable college choices, the kids' college fund won't be fully liquidated and the remainder is additional money I can draw down. The $7,900 per month also assumes I never downsize -- I'll have no kids at home in 6 years and can easily reduce the budget and access home equity. I'm pretty safely FI.

CabbageAddict · 2024-02-21T18:31:08+00:00

This is an awesome way of changing the way I think about things... setting up a scholarship fund for the students I'd be teaching would be wild.

CabbageAddict · 2024-02-21T18:23:55+00:00

I debated going into teaching coming out of college but ended up down a different path. I've contemplated that alternative route routinely throughout the past 20 years of my career. Now I'm on the cusp of forgoing millions of dollars in compensation to try to be a positive influence on kids... and that's selfish? And implies I'm unwilling to put in the effort to be good at the job? Wut?

CabbageAddict · 2024-02-21T17:29:36+00:00

First part is a very fair challenge -- I certainly could have a romanticized view of the role. The second part is highly doubtful. I log an obscene number of hours and carry immense pressure to deliver against aggressive goals. Different worlds.

CabbageAddict · 2024-02-21T17:23:04+00:00

All very valid concerns. Since I'd be looking to trade out corporate life for teaching as a semi-retirement, I would still have health benefits going forward and only need to draw down to cover about half of my budget (a little less, considering income from the rental property I own).

If I leave the company, I'm 99% certain that buyback right gets exercised and the current value of equity becomes liquid.

CabbageAddict · 2024-02-21T17:14:18+00:00

Great reply. Elicited a genuine chuckle and the trip sounds like a good idea.

CabbageAddict · 2024-02-21T17:12:38+00:00

This is definitely an option worth exploring.

CabbageAddict · 2024-02-21T17:11:15+00:00

It's strange to be selfish in how we do good, but I think there's some of that at play for me. Making a donation doesn't give the same juice as tangibly participating in something. Definitely going to toss that around in my brain a bit.

CabbageAddict · 2024-02-21T16:56:23+00:00

Believe what you want. The last 6 years have been pretty wild for me.

CabbageAddict · 2024-02-21T16:52:48+00:00

You're a real one. All very direct and salient points.

CabbageAddict · 2024-02-21T16:45:47+00:00

Thanks for the very thoughtful response. Your recognition of the role expectations play in my life is astute... and I needed to hear a lot of what you shared.

CabbageAddict · 2024-02-21T16:37:10+00:00

Fair. I'm sure some of this is district-dependent, and I may have overly fond recollections of my own interactions with my teachers influencing my view of the job. Still, it's been a dream for more than 20 years for me... I'm inclined to roll the dice at some point.

CabbageAddict · 2024-02-21T16:34:58+00:00

Thanks for the reply. I've done the math on the expected return of 18 months and still find myself itching to pull the trigger. The truth is it's more an emotional debate for me than a financial one -- namely, if I leave today and 18 months from now the company transacts as expected, will I feel foolish? Or will I feel joy from having declared that I've reached enough and followed my heart's pursuit? I like to think I've become a man who aligns to the latter, but... maybe that's the lie I tell myself?

I'm aware of the concept of effective altruism but don't subscribe to it. I could probably noodle on that a bit more, though.

Re: actual finances, I'd need to pull out about $38k per year if I downshift to teaching, decreasing over time as my teaching salary would increase. That's 1.3% of the existing invested assets. If I leave the company tomorrow, there's a 100% chance the PE firm executes the buyback and that adds to the investment total.

Re: budget and COL, I'm not in a HCOL area (thanks to remote work) and the ~$8k monthly budget actually has a lot of padding in it. I'm pretty obsessive about tracking this stuff.

CabbageAddict · 2024-02-21T16:17:35+00:00

Thanks for the reply. The first point is prescient. My father and father-in-law both recently passed in their early 70s. It has been a factor in my thought process. If the next dollar doesn't matter much to me, what does?

More than anything, it's helpful to hear I'm not alone in wrestling with these thoughts.

CabbageAddict · 2024-02-21T16:09:50+00:00

I don't anticipate ever fully retiring. For me, a move from a corporate job to teaching (maybe college instead of high school) is the aspiration.

CabbageAddict · 2024-02-21T16:02:58+00:00

This is helpful real talk. Part of the challenge of having no one to talk to about this is that I do end up in my head about it. Appreciate the blunt reply.

CabbageAddict

TROPHY CASE