My spouse and I enjoyed a heck of a year. The end of 2019 marks 20 years of our financial independence and over 17 years of my military retirement. I’ve written about military personal finance for over 15 years and I hope I have a few decades left!

And yeah, I empathize with my fellow math nerds who insist that 2019 isn’t the end of the decade. We might be missing the point, though. Just like we did for Y2K and 2009, I’m here for both parties when we celebrate the end of the teens and then celebrate the end of 2020.

We have a lot to celebrate. Let’s hit the highlights.

The Military Guide

The latest logo.

This site turned nine years old last year. The very first question that we answered back in September 2010 was “But… But… But What Will I DO All Day?!?”

It’s the agonized concern of everyone who achieves financial independence and quits working for a paycheck.

Speaking of agony, you can still track down the blog’s very first post with its original theme right here.

I wanted to title it “Hello world” after the computer programmer sentiment, but I eventually went with the even more clever title “The first post.” Remember blogrolls and sidebar archives? That was at least four blog themes ago.

Those posts were followed by several months of excerpts from the book. While the blog was building its audience, the book was published in June 2011.  Other editions include a bargain-price abridged 4”x6” 64-page pocket guide and the eBook.

The top three posts of the site from all of those years have aged well: VA disability compensation and calculating a Reserve pension.

VA Disability Compensation Rates (updated for 2020)
How To Calculate A Reserve Retirement
Using Reserve & Guard Retirement Calculators To Estimate Your Military Pension
As many of us have learned, those are the military’s most complex personal-finance topics with some of the most obscure details. What you don’t learn can really hurt your finances.

The site has earned millions of visitors and pageviews over the years, but the real traffic compliment is that it’s blocked nearly a million malicious login attempts and deleted a half-million spam comments.

I’ve written over a thousand posts during the decade, although our last content audit pruned that back over the years to the top 522. (Well, 523 now.) We’ve attempted to index the heck out of the database with the search box and categories and tags, yet your best navigation tool is still the archives of the post titles.  Scroll down to browse them by year, or search that page for keywords.

When’s the next edition? The next book?

We’re working on it!

“The Military Guide To Financial Independence And Retirement” is evergreen. I deliberately focused on the long-term issues of investments and lifestyle. I knew this was important way back in 2005 when I started the first draft, and I’ll keep writing evergreen books.

How traditional publishing feels today.

Today’s military pays pensions to retirees under at least four different pension plans. (We still have people in uniform who started their active duty in the 1970s!) The book’s next edition could add a chapter on the Blended Retirement System, and it could remove the debate about the value of the Career Status Bonus of the REDUX retirement system. I’ve already updated that material on the blog.

Meanwhile topics like “The Fog of Work” will always be relevant.

The warehouse at Impact Publications may still hold a pallet or two of hardcopy books from the current print run, and hopefully the future is print on demand. For those of you who’ve purchased the eBook version of The Military Guide, we’ll update your file when we publish new editions.

Our second book is in editing now with ChooseFI Media.  We expect to publish that in spring 2020, after my co-author (my daughter!) and her spouse finish the first part of their own important long-term project. I’ve written more about that at the end of this post.

My third book(!) grew out of attending FI Chautauqua in September 2019.  I’ve put together that outline and some of the blog posts will go into the book chapters. I’ll work on the rest of the book after the second book is launched and running.

The fourth book (yeah, I know) has been sitting on my hard drive for a few years. It’s a guide to making good decisions with military insurance benefits. I’ve let myself get distracted by the second & third books, and I’ll finish the fourth one during the next decade. And this time I really mean it!

The 4% Safe Withdrawal Rate

Let’s deal with the most important question of the decades: is financial independence sustainable? Will our portfolio survive the 4% SWR?

Spoiler alert: Yes.

The financial independence growth curve.

Our money will survive the 30-year simulation of the 4% SWR, and we now know that it’ll last the rest of our lives. We have 271% of the net worth we started with 20 years ago, and far more than we need. Despite spending our assets through two recessions, the vast majority of that wealth has come from investment growth.

By the way, that wealth has not come from book royalties or the blog. I donate all of my writing revenue to military-friendly charities. That’s not “a portion of the profits”– it’s all of the checks and deposits.

Here’s more context for that 271%:

• It’s over three times as much money as we need.
• It’s an average growth rate of 5.1%/year for 20 years… despite all of those 4% SWR withdrawals.
• It’s survived two recessions…
• … even though the recessions happened during the worst-case first decade of sequence-of-returns risk.

Another implication of 271% is that our withdrawal rate has dropped well below the 4% SWR. This means that our investments will survive for longer than 60 years.  If our investments keep growing in the next decade then it’s quite possible that we’ll stop withdrawing principal and live off the dividends.

A statistician would note that this success is typical because it was very likely to happen in the first place. In 1999 the survival probability of our portfolio was over 90%, and years ago William Bernstein showed that any probability over 80% was good enough.

Imagine if casinos ran blackjack tables with an 80% probability that you’d win more than you’d lose… and even threw in free food & lodging. That’s what your life can become when your net worth is at least 25x your annual spending.

My military pension is another reason that we’ve felt comfortable with the 4% SWR for the rest of our spending. We’ve annuitized a portion of our investments, and that effectively drives the failure rate of the 4% SWR to zero. We’re even self-insured for long-term care.  Today it’s clear that our assets will last longer than either of us.

Any annuity is better longevity insurance than the attitude of working “Just One More Year” to minimize the risk of portfolio failure. The 4% SWR simulations don’t even include Social Security, and for many people, it’s all the longevity insurance that the vast majority of portfolios will ever need.

Enough money talk. Are we bored and unfulfilled yet?

Boredom happens when you’re trapped in something that you’re not interested in doing. My spouse and I have completely redesigned our lifestyles around “not boring”.

We’re responsible for our own entertainment, and after 17 years of practice we’re pretty good at it. We’re perpetually curious and we’re constantly exploring new ideas & activities. We’re optimizing every aspect of our lifestyles. We’ve stayed open to changing our priorities as we age and go through other life transitions.

Those are the types of decades that I love reviewing.

Slow travel, still not bored.

I retired from active duty at the age of 41 while we were raising a nine-year-old. We worked on our home and our rental property. I made a lot of new friends, both online and in person. We spent time with relatives and explored the islands. We optimized our finances. I even started learning about angel investing. All of that kept life exciting for the rest of my 40s. In my spare time I got better at surfing and I wrote a book.

We published the book a few months after I turned 50 years old. We also coached our young adult through college and helped my father cope with Alzheimer’s.  We survived our second recession of retirement. I attended my first FinCon, my first Camp Mustache, and my first CampFI.  We did a major renovation of our home’s family room and of our entire rental property. I made many more new friends. We spent time with family and traveled the world. In between financial meetups, I learned more about active investing, and I spent time optimizing rest of our finances to do even less of it. We vicariously enjoyed watching our daughter launch into life, career, and marriage. My life also managed to smack me upside the head with a reminder that I was no longer invulnerable, let alone immortal.  In my spare time, I got better at surfing and we wrote another book.

This year we’ll spend lots of time with family and hanging out with friends. We’re planning to travel the world some more. There’ll be at least one financial meetup, and we’re trying to schedule a couple more. We’re wrapping up our estate planning and simplifying our finances even more. My daughter and I are editing our book, and we’ll publish it a few months before I turn 60 years old. In the meantime I’m doing all the surfing I can handle, I’d like to get better at stand-up paddleboarding, and I’m intrigued by hydrofoil boards. We even came up with another book idea.

I’ll reach 18 years of retirement in June. I’m really glad I didn’t spend those years in the workplace.

Home break, still not bored.

I’m not precisely sure how we’ll spend the next decade but I bet it involves: Travel. Meetups. Family. Friends. Home improvement. Surfing. Publishing a book (or two).

Financially, we’ll focus more on philanthropy. I’ll write more about that in another post.

At the end of the 2020s decade I’ll turn 70 years old. I don’t understand how the heck that happened, but I know that I’m not bored or unfulfilled.

Will society’s financial independence trend continue?

As I was drafting this post (among everything else in our daily routine), a Bloomberg executive editor tweeted a thoughtful question:

“One thing I’ve often wondered- does the financial independence/retire early movement (#FIREmovement) survive the eventual end of the current bull market? The idea of pouring all your money into $VTSAX and living off it for the rest of your life feels like such a bull market thing.”

Of course I immediately replied that certainly our finances will survive for the rest of our lives.  Yet in retrospect I realized that I’d missed her point: Will the FI movement survive the next recession?

Will people still find careers they love, yet save for the life security of financial independence?

Will people still push for FI so that they can choose the work they love?

No seriously, this really must be the top.

Will they still save and invest for enough financial security to ditch an unfulfilling career that they no longer enjoy and find a new career path to FI?

Or will everyone end up hoarding gold, rice, water, and ammunition while hoping that this month the stock market can’t possibly go any lower?

Your call to action

I can’t predict the dates of the next bear market or economic recession, but they will happen. When world events smack us upside the head again, what do you want the next decade of your life to look like?

Do you want to find a challenging and fulfilling career while you’re investing for financial independence? Will you break free of the fog of work to spend more time with family & friends? Will you take responsibility for your own entertainment and plan for your FI life? Will you have the financial flexibility to consider all of these options no matter what the short-term stock market does?

How will you handle your next decade?

Please post your goals in the comments, or ask me more questions about your planning.

See you next year… when we’ll celebrate a new decade with all of us math nerds too!

Postscript

Why am I posting this decadal review in late January?

Well, my spouse and I have been waiting for one more project to wrap up.

Last week our daughter and son-in-law delivered a healthy baby girl. Marge and I are enjoying our new names: GrandDoug and GrandMarge.

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Related articles:
Here are the top FI posts of 2019 and the best posts of each year from 2010-2018:

Best posts of 2019:
Should You Attend FinCon, Military Influencer Conference, Camp Mustache, CampFI, and FI Chautauqua?
Family Estate Planning For Your Disability
Military Space Available Travel: Tips for Flying Space-A The Navy Way
“I Inherited Money And Now I Can’t Blog About Financial Independence Anymore”
The 1980s-2000s: How I Wish I’d Invested Back Then
Will Your Retirement Plan Handle Long-Term Care Needs? How Your Genome Impacts Disability, Caregiving, And Estate Planning
Our Retirement – The Spending Smile Of Financial Independence
Good News! How Our Nords Family Financial Independence Life Will Change In 2019
2018: Don’t Gut It Out To 20: Leave Active Duty For The Reserves Or National Guard
2017: “Hey, Nords: How’s Your Net Worth?!?”
2016: Why You File Your Veterans Disability Claim (Not Just How) (a four-post series)
2015: Getting Older In Early Retirement
2014: Why I Won’t Buy Long-Term Care Insurance
2013: Save Just One Percent More
2012: How much cash in a retirement portfolio?
2011: Five reasons to NOT retire early
2010: Frugal Living is Not Deprivation – How Living on Less Can Result in a Richer Life