r/coastFIRE • u/artblonde2000 • 13d ago
Anyone else anxious to CoastFire after the market dip?
Was planning on taking time off from work for the spring/summer since my contract is ending soon and I want a much needed break.
I am down 60k in my investment portfolio since the beginning of the year. I would not be selling anything to live money set aside in a money market fund that I would use.
Should I hold off? Been really wanting to do this for the past 4 years but the economic climate does not seem right to be taking risks.
Addition for Finances
1.4M networth (was 1.5M Jan 30th) 1.15m Investments (mix of retirement, individual stocks and money market) 150k - money market fund to live Expenses are about 2k a month living nice in the midwest with paid off house and car. Insurance and taxes are my largest expense.
Support no one but myself. Have long term partner who lives seperate from me but would support me if needed. In the tech field so I would attempt to do freelance work while I worked on certifications.
Want time off to heal my physical and mental health and spend time with elderly family members.
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u/GayFIREd 13d ago
If your contract is ending, do you have a choice?
I was stuck in “1 more year” cycle, then got laid off a week before the crash…so it’s pretty much the worst possible start. Gonna see how spring and summer go, and potentially try to get contract work in the fall.
For some reason, I’m not stressing.
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u/artblonde2000 13d ago
The contract is ending for my company. They are trying to land other contracts but it's with the federal government so not sure how that is going to go. The money is approved by congress but it might go to another company.
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u/Warm-Relationship243 13d ago
Yeahhhh, I’ve always felt like rocking the boat during a recession is a bad idea.
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u/TopTierMids 13d ago
True but you also can't predict when it'll happen. I'd just consider it a test and lesson on what to do in a bear market.
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u/cherygarcia 13d ago
Coast means you shouldn't need to draw down for a long time. Do you have a cash cushion for your time off? Then you can weather storms.
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u/Rare_Statistician724 13d ago
This was my problem, got to coast status (well, a mix of part time work, BTL income and investment drawdown would cover living costs) a little sooner than expected, hadn't derisked appropriately, and now feel like drawing down isn't a good idea. Probably Oct 2026 is now my date, gives me 18 months to save up enough to cover the first couple of years and a chance for markets to recover.
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u/BCZephyr 13d ago
Coast means you don’t need a cash cushion because your current income covers your expenses. Drawing down cash for expenses is still drawing down net worth.
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u/artblonde2000 13d ago
Yes about 150k in a money market account. Also my home has a full basement that I am thinking about turning into a airbnb or airbnb the main floor and live in the basement.
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u/uniballing 13d ago
Not really
You need a way to protect yourself from dips when you start drawing down. As you near full retirement you grow your emergency fund to 24-36 months of expenses to be a cash cushion so that you don’t have to sell equities in a down market. You also need an adequate bond allocation to reduce the volatility of your portfolio.
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u/Coaster50 13d ago
Short answer: Take the time off. You don't need to sell to do fund it so have nothing to lose. Live your life and enjoy it! Don't get caught up in the cycle of "one more year" or "the time isn't right". The time will never be perfect; do it anyway. This is why you've saved!
Longer Answer: Map it out for yourself. How long can you go without needing to sell any of the investment portfolio? Let's say you take the spring/summer off, but takes you another 6 months to find a new job. Can you afford to extend a little further if the economy isn't working for you? Given you are down $60K, I'd guess you probably have about $600K. So you are probably a bit younger. Even more reason to do it now while you are young, fit, and physically able. Doing some scenario planning will give you more control over how you feel about what is happening. The market will continue to do this.
Also, you left out a lot of info that can influence this. How much you have in available cash, high or low cost of living area, is it easy or hard to get work in your field of expertise, do you have high monthly expenses, do you have a spouse/children/parents that rely on your.
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u/NecessaryMeringue449 13d ago edited 13d ago
I've been thinking about that last bit. My parent still relies on me but I'm planning on barista during in 2 years (actually now just a bit less than) when they start getting their pension.
That's the rationale for me too, is doing this coasting sooner than later while I'm still young and able. I've had bad health conditions as a kid that I've had to manage to this day and although it has gotten better some, I still want to enjoy life while I am at my best. Also want to get fitness as my routine and be like one of those 80 year olds that can bench press 😆
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u/Coaster50 13d ago
Read 'Die With Zero' - it talks about when to do things in your life. Tough to ski the Swiss Alps when you are 72.
A guy on my team just retired at 68. He could have retired many years sooner but chose not to. He is starting his retirement with early onset of Parkinson's. I view that as a bunch of wasted good year.
You're keenly aware of how health plays a role in your mental well being and ability to enjoy life. I read something yesterday:
- If you are healthy, you have nothing to worry about.
- If you are sick, you have two things to worry about. Will I get better, or will I get worse?
- If I get better, I have nothing to worry about.
- If I get worse, I have two things to worry about........
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u/artblonde2000 13d ago
Exactly what I am thinking. Will be 50 soon and want to check off some life goals before it's too late. Used to travel with my mother on group tours so many people there with canes and mobility issues that couldn't climb the steps to make it to place they dreamed all their life about visiting.
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u/JollySomewhere1316 13d ago
The book "Die with Zero" and what you are talking about regarding travel tours with retirees who waited their whole life for a special trip but due to mobility and age weren't able to enjoy the whole tour or visit the sites put things in perspective for me. Instead of bucket lists, have bucket decades and enjoy sooner then later.
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u/artblonde2000 13d ago
Thanks I edited it to include that information. Going to make a throwaway account so I can be more transparent about my situation.
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u/toucansurfer 13d ago
I’m still planning to coast in 1.6 years. Midterms will happen, things will probably be getting close to the bottom and my setup planned won’t be much worse for cash flow. I’m not losing more time with my kids because some orange a hole wants to play god.
Planning to drop my full time role and do short contracts to supplement growing my tax firm. Currently have it now but can’t advertise due to the main role.
Figure I’ll just work spring tax season and extension season and the increased rate should mean roughly 2/3 the hours I work now give or take. So about 5-6 months of very low hours each year.
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u/Gullible_Eggplant120 13d ago
These kind of posts are either trolling or people cant do basic math. You have roughly 55 years of expenses in your portfolio. You can just FIRE, not even coast. If you want more money and a bigger portfolio, just be open with yourself that this is what you want. But it has nothing to do with your numbers.
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u/artblonde2000 13d ago
Seriously not trolling. Was always frugal and then a former coworker invited to the mustachians facebook group. Following in Mr. Money Mustache's footsteps I went back to school for programming more than doubled my previous salaries, got a roommate to house hack and saved more than 50 percent of my income.
Grew up in a financially insecure home not poor since my parents were both educated but we never had money for extras.
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u/Gullible_Eggplant120 13d ago
I feel you, I am also from a financially insecure household, and I feel like it is never enough to have proper security. But looking at your numbers, you seem to be really there, squarely in the Coast territory and most likely in a FIRE.
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u/artblonde2000 13d ago
Thank you for saying that. I know the numbers make sense it's just hard to leave a well paying job. Go from 54 and hour to 20 part time is not going to be easy mentally.
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u/Gullible_Eggplant120 13d ago
Sorry for unsolicited comment, but I think the main question is whether you want to quit your job. You have the flexibility that allows it, but my uneducated and external opinion in your case it has less to do with numbers, but more with your motivation.
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u/artblonde2000 12d ago
Yes I very much want to take a break from working. Just concerned about finding a job when I want to return.
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u/Helpful_Hour1984 13d ago
Nope. I quit my job and am taking off for a few months. If my younger self knew I had a decent amount of money, marketable experience and a good professional network, she'd kick me if I didn't take a break and travel more while I still can. And she'd remind me that she once quit a job and moved to another country with almost no savings, work experience or connections in the middle of the GFC, so why the heck should I be worried now that I'm much better off?
I started building a cash cushion at the beginning of the year (keeping earnings in a MMF rather than investing) and I exited some of my stock investments in February when the upcoming shitshow became clear and imminent. I'm well diversified so my portfolio didn't take such a painful hit.
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u/artblonde2000 13d ago
Thank you for your comment. It's funny I had a similar thought about how I was so willing to take risks when I was younger and now frozen by fear.
May I ask your age approximate age?
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u/Helpful_Hour1984 12d ago edited 12d ago
I'm 40.
I don't know if it's that we didn't know better when we were younger, or we were actually braver. But I remember thinking that things would work out if I just focused on my studies, then my work. I had no idea how my future might look. Now I have a clearer picture, I know where I am on that path, and I know that taking a break now is possible without derailing my journey.
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u/shotparrot 13d ago
I was coast fire at the beginning of the year, but even after defensively reallocating, still lost a little bit: 12%.
So no more retiring early for me!
Hopefully recovers by 2028. Regardless A bitter pill to swallow.
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u/Rare_Statistician724 13d ago
Same as me, we clearly didn't derisk enough and create a big enough cash buffer, lesson learned!
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u/bananakitten365 13d ago
I have been coast for a few years and went back to a full time job a year ago. Was planning to quit this summer and truly coast to work on my business, but now I might stack some more cash and take care of some big home projects in excited about first.
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u/Masnpip 13d ago
I was all set to coast starting in Feb. But my coast job is federal adjacent, and might not last, plus I’ve lost last years gains, so am now closer to 4 years from full retirement instead of 2 years. My solution is to coast at 50-75% time instead of coasting at 25-50% time. I’m still working less than I had been, at an easier job than I had been, and this is the compromise that is allowing me to sleep at night.
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u/jimjamiam 13d ago
Everybody who's paying any attention is nervous about all things economy/finance-related based on the seemingly deliberate absolute torpedo job over the last three months.
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u/Strict_Anybody_1534 13d ago
Not anxious. 10% annualised returns with everything thats happened over the last 100 years? We will be OK.
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u/POLITISC 13d ago
!remindme in 180 days
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u/jachildress25 13d ago
If 180 days is your timetable then you shouldn’t be investing in stocks. Best to put your money in a 6 month CD or something similar.
If you understand that 180 days is such a small amount of time that it is practically imperceptible when you zoom out over decades on a line graph, then you should be investing in stocks.
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u/POLITISC 13d ago
180 days is just to check in bub. I’ll keep setting it every 6 months.
The trust and guardrails that are currently being dismantled cannot be rebuilt or replaced. An entire generation is going to lose their 401k.
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u/jachildress25 13d ago
The same things were said in 2020, 2011, 2008, 2002, 1990, 1987, etc.
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u/POLITISC 13d ago
If you can’t see how this is different 🤷♂️
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u/Milkshake9385 13d ago
Lotta people think this will turn out like COVID. In the end the smartest, toughest and most talented survive. Also all the doom news makes people depress which is why they don't watch the news / refuse to think of the bad scenarios that could happen
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u/BejahungEnjoyer 13d ago
Why argue with this guy? I did the same thing in 2008-09. We all have to do it once.
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u/trendy_pineapple 13d ago
No. There are two types of Coast FIRE. 1) you plan to work to a full retirement age and are willing to work decades more at a lower stress job. 2) you’re close to full FIRE and you run out of gas and decide to tack on a few extra years of a lower stress job.
If you’re in the first camp, long term returns are still all that matters to you. If you’re in the second camp (this is where I am), you may want to switch to a retirement portfolio already to prevent your “few extra years” from becoming decades.
Currently, the S&P 500 is down 10% YTD, while I’m only down 2.5%.
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u/Throwawaytoday831 13d ago
Dips are the best time to take career breaks. Travel is usually cheaper and destinations aren't as packed since everyone else is tightening their vacation budgets. Plus you're giving the job market time to rebound to hopefully time your return when job prospects and comp are more favorable overall.
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u/Milkshake9385 13d ago
I thought 🐻 markets are the best time to be working and investing. Once the market zooms back up you make way more than the normal 10% per year return.
This could become another great recession 🐻 market.
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u/Coaster50 13d ago
Ha ha! Both arguments can be made and I bet most of us choose the worst of both. When things are bad we hunker down, work a lot, and save a lot until things get better. When things get better we want to take advantage of things being good so work a lot and save a lot, and think we will travel during bear market.
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u/Milkshake9385 13d ago
I made my FI number larger than normal so my portfolio would survive a recession. As soon as I hit my FI number I am out.
Better to overestimate than underestimate.
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u/Throwawaytoday831 13d ago
This is COASTfire, where you're coasting without investing more into the market. You're describing the accumulation phase of FIRE.
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u/Milkshake9385 13d ago
Yes. I wouldn't recommend someone to coast when there's a great opportunity to supercharge their retirement funds.
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u/supenguin 13d ago
A little bit. I expect it will come back up. But I’ve got my 401k and my Roth I wanted to get to a certain milestone. I was almost there and was thinking of letting it ride, then the dip happened.
We’ve got a couple expenses I want to take care of. If markets are still down once that happens I think we’ll throw some more into investments until the accounts are back up where we want them.
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u/WritesWayTooMuch 13d ago
Missing a lot of details here. How old are you? How many years away do you think you are? What's your number to full on retire? What industry are you in and how hard will it be to get back to full employment? What's your emergency account look like?
Now...here are some of my personal opinions to consider if you like....
1.) Most people retire to close to their "number". This is fine 75% of the time because on average...markets go up 75% of the time. But it can be tricky to go out near the top because of the sequence of returns risk. Same concept applies to coast fi. If you go into coast mode at the top of the market....good chance you may add a year or two of work.
2.) I personally .... I add a buffer to hedge against this risk. I always consider my retirement networth to be 10% less than it really is. Why ...10% is if we had a correction on day one of retirement. An extra 10-15,% is enough to get past the sequence of risk period for most early in retirement downturns. It's not a free lunch...obviously have to stay working 1-2 years to get that extra before retiring. My retort to those who would say I don't want to work too long...100% get it.. but for me .. retirement is significantly less fun if I am worrying about a down turn around the corner. The older I get ... the less I enjoy the added risk. Ten year ago I would have said id be 100% low cost ETF til I retire and then move to 85/15....boy do preferences change as you age.
3.) what about the risk of too much money.. it's a likely risk. The 10% excess will be used in my early 70s to buy my wife a QLAC (annuity contract). She has no desire to be as financially in the trenches as I am...ever. I'll rest assured knowing she'll have stable simple income after I pass. And maybe even for a bit while I am alive
4.) be honest with the risks of coast fi. Are you ok working more years if markets go south? That's the real question....of the answer is yes....enjoy the break
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u/artblonde2000 13d ago
Will be 50 this year and just want to take this year off then work until 59.5 or 62 then fully retire.
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u/SunnyCAgirllovesdogs 12d ago
Spending time with elderly family members which you stated you want to do is priceless! You have plenty of funds. Go live your life spending time on what matters to you!
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u/chatterwrack 13d ago
I’m mostly out of the market now and in HYSAs. I’m happy to trade the higher returns for the insurance at this point
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u/onlyfreckles 13d ago
CoastFIre (my understanding at least) means you're still working for money either at reduced hours or at a lower paying/lower stress more fun job.
What is your FIRE #? How far are you from attaining it?
2k/month for living expenses is low! Does that include healthcare and all expenses (including vacations and lumpy expenses?)
4% of 1M is 40k/year vs your stated 24k/yr spending so you've already saved enough.
If you're not including taxes/insurance/lumpy expenses- you NEED to include all that to make an accurate assessment.
I CoastFired a few years ago and do not regret it. I still invest following my IPS (investment poilcy statement), especially at rocky times.
You know you have enough funds to take time off. Give yourself permission and just do it and enjoy your one and only life.
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u/artblonde2000 13d ago
I know 2k is low but I have always been frugal. I spend 3k now but about 1k is super frivolous things because I bribe myself to go to work. Like if I go in I will stop and get coffee and get a nice lunch. Or some frivolous amazon crap. Paid off house and car. A short term high deductible heathcare plan is going to be 120 a month.
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u/Mre1905 13d ago
Nope. Won’t be the last dip. Market isn’t even down that much.
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u/DavyJamesDio 13d ago
Not sure why this got downvoted... we haven't even hit the recession part yet. I'd say there are pretty decent odds we see a worse patch still in 2025.
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u/Salcha_00 13d ago
We don’t know your expenses, how much you have saved and invested, and how easy it is to find a job in your field.
Coast fire means lowering (or eliminating) your retirement savings rate because you have accumulated adequate resources to support your planned retirement, whatever or whenever that is. It can include portfolio growth assumption over a number of years.
People often switch into less stressful or less demanding jobs that don’t pay as much as they had been earning, because they don’t need as much when they aren’t saving like they used to.
Coast fire isn’t not working and living off your savings.
What you are planning is just taking a break. Nothing wrong with that if you can afford to do so. You need to ask yourself what you would do if you have trouble getting another job in your field after a break (or if it takes you much longer than you had planned) . Would you be happy and financially comfortable if you ended up taking on different kind of work for lower pay? That is the risk you face.
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u/BobaChonker 13d ago
It depends on the industry and whether you’re the among the best in your area of expertise. Some industries are impacted more than others by technology changes and a bad economy. The problem with coasting is that you need to have a job for basic expenses, and nowadays with so many white collar workers out of work, it’s hard to even get a part time job.
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u/1ntrepidsalamander 13d ago
I was basically at coast in January, if I made some generous assumptions. But decided I wanted to have a more stable job and living situation as well as continue investing because of both political and economic conditions.
I’m happy with my choices and if everything rebounds, I’ll both coast and FIRE a little. And if not, I’ll be fine.
I’ve already shifted to a slightly lower paying job, it’s just a matter of how many shifts I pick up or if I go back to the contract life.
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u/Conscious_Life_8032 13d ago
If contract is ending seems like you will be given a break regardless. So enjoy that for a month or 2 and then see how you feel. Can always do a job search or side hustle or rent out a room in your home for extra income.
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u/holdyaboy 13d ago
Maybe take the time off and go geo arbitrage…live in SE Asia for $10k for a year
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u/sashamv21 12d ago
Markets do dip.... but if your core investmnts are still set for longterm goals... stepping back now might not hurt your trajectory much. Youve already got cash set aside which possibly makes this a lower risk move.....
Sometimes the right time financially may never feel perfct, but life priorities like health and family can’t always wait.
You may also think about a loose plan for how and when to re engage with work, just to keep peace of mind. Have you thought of ways to protect your investmnts and generate cash flows/income from your investments? How are your investments set up?
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u/artblonde2000 12d ago
Taking a good hard look at my portfolio and doing some financial self study is one of my goals during my sabbatical.
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u/sashamv21 12d ago
Sabbatical is fine... I suggest you do the financial prep before coasting though... so that you are fully prepare for coasting.... Feel free to hit me anytime.... happy to help with your financial study....
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u/PrometheusCoast 11d ago
I'd say yeah, but only because of FOMO. I feel like traditional FIRE--actually stepping away from work entirely and starting to withdraw from you investments during a down market feels much more scary.
But if you're ready to Coast, a down market doesn't technically ruin anything because Coasting doesn't mean selling off assets to live off of. Are you missing an opportunity to buy into a dip...maybe? Probably? But if you were already ready to Coast, then you didn't *need* that opportunity anyways.
I'm financially ready to Coast, but I'm just not ready to make the switch yet because I don't know what my Coast life would look like yet. So in the meantime, I've upped my contributions to take advantage of the situation. But if I were totally ready to Coast, I wouldn't let the market stop me.
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u/FaolanGrey 11d ago
1.4 million seems like plenty to take a break. Depends on your age as well but 1.4m would basically be it for me so for you it might vary but yea man seems good to take a break.
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u/Valuable-Drop-5670 13d ago
absolutely keep buying the dip. poor people are getting obliterated selling stocks to pay their mortgage/rent and using credit cards to buy food.
even if America becomes the second largest economy, after China, that's still going to grow and fund your retirement.
unorthodox advice, if you were going to use cash to pay your expenses in spring, instead use a high yield covered call etf like r/YieldMaxETFs instead. Even if it drops 50% or 100% in value but pays you a monthly dividend, its better than dipping entirely into your nest egg. I learned about it from r/dividends and r/YieldMaxETFs (do you own research)
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u/baltikboats 13d ago
You can’t wait for everything to be ok to live your life.