Is Our FIRE Plan Actually Working?

We're six months into early retirement. How is our financial plan working out so far?

Being our first full year where both my wife and I are retired, I thought I’d report back how 2025 is going so far. Is FIRE actually working?

Our Safe Withdrawal Rate

Starting with our safe withdrawal rate, at the 6-month point, we are on track to spend about $67,000 in 2025. That represents a withdrawal rate of about 3.9% based on our 2024 year end portfolio.

We actually modeled closer to 4.5% for the next few years while our kids launch, so we are a little under budget for the first 6 months of the year.

Our spending so far in 2025 includes:

• A $2,600 down payment on a 2nd (new to us) car.

• Three weeks in Mexico for my wife and I.

• CampFI and EconoMe conferences in March.

• A road trip up through the mountains of North Carolina and Virginia.

• We’ve also tried to loosen up on eating out a little more often.

We are watching our numbers closely in our first year, but we’re definitely not depriving ourselves of life’s little pleasures.

Spending is a skill that needs practice. We’ve been practicing for years to find the right balance for us. We strive to be intentional with our money, not cheap.

ROTH Conversions

We intend to do roughly $60,000 in ROTH conversions this year. This helps us in a couple of ways.

• ROTH conversions generate taxable income. In a year when neither of us is working, we need a certain level of income to qualify for the Affordable Care Act.

• ROTH conversions are accessible penalty free after five years. Roth conversions in 2025 represent the first rung in our ROTH ladder, enabling us to access our retirement accounts before age 59 1/2.

In my super viral Sh*t Just Got Real post, I talked about doing ROTH conversions at the end of this year, after we’ve accounted for any other income. This ensures we are being tax efficient and hitting our income target for the ACA.

But then, the big April kablooie happened, and the S&P dropped nearly 20%.

It became a good time to go ahead and do a portion of our ROTH conversion early, moving about $25,000 worth of shares over from my IRA. Mathematically, we moved about 20% more shares than we would have at market highs.

We also took advantage of the downturn to do some tax loss harvesting of about $900.

Portfolio Performance

The US market has been mostly flat up to this point (June 2025).

Our largest equity holding, a total US stock market fund, is up about 1.25% year to date.

Our second largest equity holding, a total international stock market fund, has outperformed the US market and is up about 13% year to date.

Our third largest equity holding, a dividend growth ETF, is down 2.27% year to date, but will throw off about 4% in dividends as a consolation prize.

Our total bond fund has been terrible as the market worries about the deficit and inflation, but is yielding more than 4%.

We also continue to get a decent yield on cash (which we likely hold too much of).

All in all, despite market volatility and spending down nearly $34,000 to cover expenses so far in 2025, our portfolio is sustaining us and our net worth is actually 2.5% higher than it was at 2024 year-end.

Purpose and Meaning and All That

We are still pretty excited about the next chapter of our lives and the flexibility that FIRE has given us to travel and spend quality time with friends and family. A few highlights so far:

• We obtained our Mexican residency, allowing us to stay and travel in Mexico indefinitely. While we want to travel the world, we like Mexico’s proximity to the US at a time when our adult children and parents may need a little help.

• This was our 2nd year at the March CampFI, and we’re both excited that we’ve bonded more with the Jacksonville ChooseFI folks and sad that they are 3 1/2 hours away.

• Some of us took a road trip up from CampFI to EconoMe, with a stopover in Louisville, KY. I may or may not have tried a very special gummy and carried on a five minute conversation with a bathroom sink that I thought was a bird.

• My wife has begun volunteer work, teaching English to a local woman from Colombia, and has started a YouTube channel aimed at providing basic English content for beginner / advanced beginner learners.

Is Our FIRE Plan Working?

I know it sounds ridiculous, but when you are drawing it up, you do begin to second guess yourself. “Wait, are we really allowed to live off the money we’ve saved? Is this really ours?”

Some of this trauma comes from the fact that we were treated poorly when trying to move money (our own money, mind you) out of a bad investment in the past. We got a lecture and lots of big scary letters.

I was honestly waiting on someone to come knock on our door and tell us we had to stop; to waggle a finger at us and warn us to get back to work. But so far, the only punitive action as been an unusual amount of jury duty, which I try to get out of by spontaneously yelling “Posi-Traction! Tire marks!”

Despite my protest, Allen insists many readers will get the reference to the 1992 comedy “My Cousin Vinny” — Ed.

Six months is no time at all, but so far, the answer is yes. Everything we’ve learned and implemented is going to plan. Even amid the big April kablooie.