I’m currently on the second day of a leave of absence that will last until May Day week. Having followed this thread for a while now, I’ve noticed that there are others here for whom FI doesn’t mean leaving work permanently, but rather the freedom to choose. Jillian Johnsrud, for one, has written about this: https://retireoften.com/ Her podcasts have featured J.L. Collins, whose wise, teddy-bear-like voice I enjoy listening to on long cross-country skiing trips. My days off have been filled with exactly those things: skiing, swimming, reading, and trips to the forest. The final nudge to actually take this leave came from a FIRE video by a teacher couple that I saw last autumn. Another contributing factor might be that I’ve cycled all my commutes for the last six years, rain or shine, summer and winter. It has rained quite often. My workplace didn’t have any storage for bikes, so I’ve had to dig it out of snowdrifts many times when heading home.
I’ve always had a healthy understanding of money, which is why I’ve managed to save a good amount. Even before I’d ever heard of FIRE, I’d already given it a lot of thought—saving and investing so that I could be free from everything if needed. Money brings freedom and security, so why would I waste it on anything useless?
On the other hand, I really enjoy my job, so I intend to keep working for a long time. There are just many things I want to have time to do before I get too old and frail. If possible, I’ll continue to take long breaks from work in the future, while remaining aware of the freedom to retire before reaching the official retirement age. Because what’s the point of freedom if you’re no longer in good enough shape to enjoy it?
That is the formula that the world’s super-rich (tech bros, etc.) mainly seem to use to cover their living expenses. But with a €1M portfolio, one challenge might be that Finnish banks don’t seem to value stock portfolios very highly as collateral for loans. This has been my experience, at least regarding mortgages. It would indeed be interesting to hear how many Finnish FIRE-ers actually operate this way.
I’ve been thinking about the same thing, but from a slightly different perspective. I’ve thought about utilizing Nordnet’s loan balance if stocks happen to plunge for some reason and I don’t want to liquidate anything. With my current balance, I could easily live for even four years, and surely we’ll return to an upturn in that time. With a low interest rate (Private rate + tax deduction), you get spending money.
If you use money taken directly from there for consumption and claim tax deductions, the taxman might ask, ‘What exactly is the investment here?’ Avoiding sales is not an investment; you must be able to prove, if necessary, where the specific euros that increased the loan balance went and how they constitute an investment. (See the maneuvering I mentioned above for what I do myself—as a product, the Superloan (superluotto) is still a much more flexible way to borrow against your portfolio than the products offered by brick-and-mortar banks.)
The taxman hardly has the capacity to carry out any audits on private investors, except in theory. And if you’re worried about that, just sell, withdraw the cash, and immediately buy new ones back using debt.
More than one of my friends who have achieved FIRE have “won” a tax audit. If anything suspicious shows up (even if it’s not actually illegal), apparently you get it as a “recurring subscription” for several more years as a bonus. Which, evidently, is quite a lot of work.
I flagged this without hesitation, as it’s getting so far off-topic. The discussion should be moved here and continued there. You might also find some existing answers to the topic there.
A small status update. The figures above are from three months ago. Portfolio is currently €658k, mortgage decreased by a couple of grand and the cash buffer increased from €39k → €52k. The amount of cash grew by a few thousand thanks to timber sales, so the value of the forest assets has now decreased.
I have sort of () achieved financial independence, meaning if I sold the apartment and paid off the rest of the debt, I would be left with €110-115k in hand. Overall, my net worth is thus about €820k + forest assets - the latent tax liability in the portfolio. By all logic, this should be able to provide a net return of a couple of grand per month, which would be more than enough for me.
Well, apparently I’m still greedy, a wimp, or some combination of the two because work continues as normal and I moved the goalposts further away. I don’t want/dare to sideline myself from the labor market just yet because I won’t hit 40 for another couple of years and work is quite tolerable, sometimes even fun. Additionally, I want to have some wiggle room in case of a market downturn, because the staggering rise of last year and the beginning of this year is already starting to feel a bit scary
You can join me and many others in the “one more year” crowd and then repeat it until retirement or death. You always want more certainty, more cash, more of something, and you’re afraid of leaving the workforce anyway.
) achieved financial independence, meaning if I sold the apartment and paid off the rest of the debt, I would be left with €110-115k in hand. Overall, my net worth is thus about €820k + forest assets - the latent tax liability in the portfolio. By all logic, this should be able to provide a net return of a couple of grand per month, which would be more than enough for me.