[tachibana]

I am a serious practitioner of the FIRE (Financially Independent, Retire Early) philosophy. Over the years, I have accumulated assets in a very conservative portfolio. This portfolio has reached a point where it has consistently generated over 150% of my base salary for more than 5 years.

[ch1zzle]

Just curious, what kind of conservative portfolios are you investing in? I was recently trying to get my wife and I invested in something similar, but didn't find many products. We are very risk adverse and recently (after maxing out 401ks) have been "hoarding" saved money in our bank, which doesn't help much.

[tachibana]

The key thing for me was to constantly and continually invest. I'm sure you've heard the saying to "maximize time in market; don't time the market." I buy a mix of bonds and stocks that pay dividends. I'll skip reading the financial news from time to time and buy shares in low-cost funds when I'm busy or just feeling lazy.

[pmiller2]

Sounds like you are already FI. Have you RE yet? Do you intend to?

[mbielski]

I'm doing roughly the same thing, but just starting out. The focus is on real estate and business ownership. How long did it take you to get to the RE point?

[tachibana]

I reached 100% income replacement for myself in my late 20s. Then I got married and had kids. My spouse and I reached 100% income replacement in our mid-30s.

Glad to see a fellow practitioner. Best wishes on your journey!

[pc86]

As someone in their mid 30's who just got below 1 year's salary in debt, I envy your position!

[zavierrodriguez]

Yes please share. As a new active investor, I've been trying to come up with a strategy that could provide that.

[Fumtumi]

Easy when your base salary is super low :D

If not, gz to making your dream.

[nunodonato]

do you mean monthly? that's impressive. care to share any tips?

[sandeshbhusal]

Tell us more please. :P

[tachibana]

You give me too much credit -- it's a really boring approach.

My portfolio used to be about 50/50 in fixed income securities and real estate. I got lucky with the real estate, and I got out because I didn't think my luck would last forever. Now my portfolio is made up entirely of fixed income securities and blue-chip stocks that pay dividends. The dividends and interest payments are laddered such that I recieve at least 2 payments a month. I didn't choose securities based on payout dates, so the amount does fluctuate from month-to-month. However, the portfolio generates enough monthly income that the "leanest" month is greater than my paycheck's monthly gross income.

Being a software engineer myself, I don't qualify for the Roth accounts so most of my investments are done in a standard taxable account. I don't buy any particular funds -- just a variety of boring bonds and stocks.

I did try the RE (retire early) part a while back. It lasted about 6 months before I got too bored out of my mind. I still continue to work because of the mental stimulation and the social connections.

[twox2]

How long did it take you to amass a portfolio like this? Seems like it would take decades unless you have a very high salary.

[tachibana]

It's a function of percentage income saved, not amount earned. The formula is (income / investment rate / percent income saved). If my investment rate is 4%, I need to save 25 years worth of salary. Saving 50% of my salary looks like I would need 50 years on the surface. However, my portfolio generates income from day 1, so it's actually a lot faster than it seems.

Just for reference, I was living on less than $750/month until I got married. The companies I worked at had plenty of free food. I didn't need a gym membership because the handyman work I did on my investment properties was more than enough. Until we had kids, my spouse and I were still able to survive on less than $1,000/month. We are based in the south SF Bay Area. We had 100% income replacement by our mid-30s.

[hey_mickie]

I really appreciate the details! Out of curiosity, how did you manage to only spend $750 a month to pay for housing, utilities, phone (you mentioned food was free) in south SF Bay Area?

[tachibana]

Digging through my old bank statements: - $500/month for rent and utilities by splitting 1 bedroom apartment with roommate) - $30/month for my cell phone plan - $100-150/month for a car 15-year old beater at the time. Mostly gas and minor maintenance - $70/month in spending money

[twox2]

Thanks for that additional context!