The Lizard King is forty three years old.

music selection: “Sweet Child O’ Mine” — Guns N’ Roses

weigh-in: 227.8# (0.2) #loser

Ok, so technically, my hatching date was the fifth.  I wanted to get out the quarterly results for GLRE and TPRE before celebrating.  I’ve been retired from the corporate grind since 5OCT2012.  It has been wonderful.  Today is a Monday.  I slept in.  I had lunch with my father.  I upgraded dear old dad’s PC to Windows 10 because that sort of thing terrifies him.  I sent out a group email to organize a group lunch for former cow-orkers that I don’t feel need to be kicked in the shins (really, I was very lucky in that regard.  Over all those years of drudgery, there are only two people I would like to hit with a hammer.)  So the guest list is large.

I say all of this as encouragement to raptors who are still in the accumulation phase of early retirement.  The sacrifice has been totally worth it.  Step 1: get your spending under control.  In the conventional early retirement, you save 25 times your annual expenses to allow a long term 4% withdrawal rate.  So each dollar of savings goes a long way towards reducing your accumulation time.

Step 2 is to invest the raptor way.  Start early with high yield securities, a healthy allocation to closed end bond and municipal bond funds, and juice returns with options.  As you approach the goal, begin diversifying into dividend growth securities and especially into insurance companies with a strong 10 year history or greater of profitable underwriting (a combined ratio lower than 100.)  These methods allow a more aggressive withdrawal rate.  The Lizard King retired with a withdrawal rate of 9.25%, confident that options income would provide a buffer.  (Back of the envelope calculation reveals WR is now 7.9% and still falling.)

Step 3 is leaving your workplace and gloating for the rest of your life.  You might find that the extra time on your hands leaves you wanting to give back.  My way of doing that is teaching as many people as possible how to toss off the yoke of corporate wage-slavery.  Your mileage may vary.

Devour your prey raptors!

Forty Three – w00t

Never miss another opportunity to devour prey!

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2 thoughts on “Forty Three – w00t

  • August 11, 2015 at 10:34 am

    Happy birthday!

    And thanks for the elegant 3-step summary.

    Closed-end bond funds are slim pickings in Australia, and all are currently trading above NAV (and no such thing as munis). High yield stocks are largely over-bought at the moment. That leaves juicing returns with options, and while there is volatility the guidelines you have provided over the last eight months are solid. Last month’s puts are about to expire worthless, and I’ve already got my eye on a couple more, looking to pull the trigger on one or both if the return becomes a little more favourable in the next couple of days.

    • August 11, 2015 at 3:55 pm

      Gogogogogo. Keep your puts written on issues you will be glad to own at the strike price. Because you eventually will.


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