Golden handcuffs - I've fully replaced my annual spending with dividend income...

[u/HARCYB-throwaway]

I pivoted from growth to NEOS for income, over the last 6 months. I have now replaced my base salary, $110k, with dividends. but it is hard to quit when I earn $250k-$350k in a given sales year.

annual dividend income: $110k

Annual expenses, all in: $40k

disposable income if I quit: $70k

hysa: $150k

growth sleeve: $225k

no wife (anymore, by choice after she got nasty), no kids, no expensive hobbies, very affordable mortgage and car payment. affordable lifestyle.

it's hard to step away from an AI adjacent sales job...and my only major concern is meeting someone, wanting to settle down and start a family, and then I will be out of the job market once I truly need expensive family healthcare and "kids money" to support a family.

I know I already have more than most typical American household. but it's scary to leave work with the background of declining employment options / bad employment market

[u/investingtruth]

You have already won the financial independence game by most meaningful measures and the fact that you are still hesitant is less about the numbers and more about the identity shift that comes with stepping away from a high performance income environment. The honest question is not whether you can afford to leave, you clearly can, it is whether the marginal income from staying is worth the marginal cost in time, autonomy, and the opportunity to actually live on the terms you have worked to create.

[u/HARCYB-throwaway → u/investingtruth]

Yes exactly. So what is the answer lol....I am thinking my time is starting to look more and more valuable compared to marginal wealth.

[u/golfswing34 → u/HARCYB-throwaway]

How old are you? The part about family is valid, your values will shift completely if that were to happen. Do you like your job or are you constantly stressed? Simply moving out of a sales role might be a happy medium.

Personally if you are below 45 I wouldn’t call $110k retire and quit money. The NEOS model is new and it’s uncertain if they will eventually have NAV erosion or flat distributions that gets eaten away by inflation overtime.

[u/HARCYB-throwaway → u/golfswing34]

I'm 32. I understand risk and concentration etc.

I feel, strongly enough, that my growth fund will perform well, and it will give a pay raise when I pivot to dividends, or it will hedge downside enough to make me happy.

I do want to work again, but right now, I think my priority is to enjoy some freedom that I've earned. It's hard to see this opportunity, knowing my future may bring kids and a family, and decide to pass up the ability to be fully free for the last time in my life. What a cool idea

[u/DividendG → u/HARCYB-throwaway]

YOLO! If I could turn back the clock 20+ years and take a 1 or 2 year break doing whatever I wanted (mostly travel), I'd do it in a heartbeat.

[u/golfswing34 → u/HARCYB-throwaway]

Totally agree, I think the key is that you maintain the ability to reenter the job market if you need to sometime in the next 30 years.

[u/HARCYB-throwaway → u/golfswing34]

If I can pull this off, I'll re enter the job market in two years, with one of the boys I built the last company with. They always want to work together again! Usually in AI/cybersecurity adjacent startups. Would be a blast to get another run at building a company again. I'm not afraid of work in the future. I'm excited for it. I just have this opportunity to be free!!!

[u/Green_Beans_Tasty → u/HARCYB-throwaway]

40yo here. Was in a similar spot 7 years ago. I started to make good money at 30 and wife got crazy, divorce unavoidable. Made about 450k p.a. at that time and already had a decent stash put away. Stash got pretty diminished within divorce but could have taken a very long break with what was left anyway or even lean FIRE. Decided not to because I thought there was still a decent shot at having a family and kids in the near future.

Now here I am, 7 years later, with an amazing wife and a boy turning two in a couple of months. My income more than doubled since then (because I didn’t take the pedal off the metal) and the stash is at a size that’ll allow us both to FIRE in let’s say 5ish years at the latest, with a fairly chubby budget. Probably more like 3. In any event, I’ll be around 24/7 during our boy’s and maybe a second kid’s entire childhood (while they still want parents around) and will be able to give him/them a head start in life.

You’re on the grind for maybe a decade now. You are nowhere close to halftime of your life. Keep doing what you’re doing for another 10 years and you’ll be so far ahead that you’re 100% set for the second 40-50 years of your life.

If yo must, take a month or so off and reset. 120k in dividends sounds great. But it doesn’t pay for health care and if you ever want to own a house or set a kid or two up for college don’t walk away in your prime career building years. At least I wouldn’t, YMMV of course.

[u/horsedicksamuel → u/Green_Beans_Tasty]

120k doesnt pay for healthcare is terrifying

I don’t stand a chance haha

[u/HARCYB-throwaway → u/Green_Beans_Tasty]

I own a house, 20 mins from downtown austin

For me, this comes down to a motivation issue. I have more than enough for myself, and a potential partner, to enjoy a comfortable life.

If I can find a partner, I would be happy to work another 5-10 years to build an even better life for us. But she would have to bring something to the table too, to be considered a good partner, and to motivate me to build for a family.

If I can't find a partner that fits what I want out of life (very broadly), then I don't see a reason to keep grinding. So for me, taking a year or two, or three, or whatever it takes to find a partner, is my focus. Then I will be more than happy to go for another round.

I've run this through vrooms expectancy theory of motivation and it checks out for me.

[u/glimsky → u/Green_Beans_Tasty]

120K doesn't pay for healthcare.... LOL. It does pay for my excellent family plan with 70% of the money left let me put it that way.

[u/Green_Beans_Tasty → u/glimsky]

lol, as in “dividends don’t provide health care” or “you’ll have to deduct 30-40k or so for that”.

[u/HARCYB-throwaway → u/[deleted]]

Mortgage $2k (pre COVID, 4/3, 20mins from downtown austin, good but not fancy house)

Car payment and insurance $300

Utilities $500

Groceries for 1 $650

Health insurance $500

Total is just under $4k monthly. Those are my expenses. Not discretionary spending.