1 Oku yen / $700k saved - stay and FIRE in Chiba?

[dparise]

35 years old, married no kids.

We are Japanese-Americans working as expats/in gaishikei firms. We lived quite frugally and now saved 1 oku yen. How realistic is to stay and FIRE here in Japan?

We saved about 1,000man per year, mostly investing in US stocks, which happened to really pay off. 95% of our assets are US stock ETFs. We live in Chiba (Shin-keisei) and the rents, cost of living are super affordable. Looks like we can totally live off well enough with the 4% rule (400man/year + side income as needed). Any thoughts? Many colleagues are thinking the same...

 

[tinks]

@dparise While your current landlord isn’t going to be able to kick you out if you stop working, you’ll have a tough time if you ever want to move, as landlords normally will only want to rent to employed people.

 

[marcel_prix]

@tinks That's generally true but I know a recently retired foreigner who moved cities and just showed his new landlord a copy of his financial holdings and his pension registration and that was enough. I guess it's case by case. Maybe OP needs to buy an Akiya

 

[iloveeagles]

@tinks Japan is very unfriendly with FIRE because of this reason lol. It's just much easier on paper to be a working employee than someone with a lot of savings & passive income. For example, renting a place....

 

[tradervic55]

@iloveeagles In this case, UR doesn't give a shit, Pay for a year's rent in advance and you're golden.

 

[iloveeagles]

@tradervic55 True. But not everyone wants to live in an UR all their life lol

 

[klenkep]

@iloveeagles They have some very nice places, quite high end (but it's rare). I visited a high end penthouse with rooftop in a UR building in central Osaka ... it was not cheap.

 

[tes1234]

@tradervic55 Not true, my friend offered to pay two years, the entire contract, when he sold his company and retired earlier this year. They wouldn’t renew the contract because he didn’t have a job.

 

[adkp]

@iloveeagles Japan has the lowest priced real estate in the developed world. There's no need to rent when you can buy.

 

[davidsoso]

@adkp Depends on where you’re looking to live. People don’t seem to understand that akiya are akiya for a reason.

 

[adkp]

@davidsoso You don't need to buy an akiya to get a great deal on a house in Japan. Outside of a few prime areas in Tokyo (and maybe the top places in one or two other large cities), real estate in Japan is amazingly affordable.

 

[themadhatter]

@tinks what about freelancers and self employed people? what do they usually do in this case? Do you think this would still be an issue if you retired and then just became self employed?

 

[teababy1]

@tinks I don’t remember ever sharing official documents about my job with the owner/agency. You could totally lie about it if you want.

Compared to the stories I hear in France/Paris, Japan seems incredibly easy to rent.

 

[bearcrossfx]

@dparise lmao, this sub never fails to make me laugh. "You should keep working." "Why not work more?!" "You can't retire, you'll be so depressed." "Just a few more years!"

Honestly, you guys should all go work for the pension office or start selling life insurance or something. This guy has got $700k and lives in a cheap country (in a cheap area, no less) and you guys are telling him to keep working when he says he wants to quit? Just lol. Let him live a little. He can always go back to work if it doesn't work out for him or if he gets bored. The only decent advice is to buy a home first. I do agree with that one since you can get a good rate if you're full time employed before quitting.

 

[funker]

@bearcrossfx Nice work. The Pro Work bias on here is even stronger than the belief in the inevitable Economic Zombie Apocalypse that we are apparently supposed to be planning for even though that is a Hellerian contradiction of some measure.

I did think a lot of the numbers people crunched made good (very conservative) sense. Agreed about buying something, even if it's a 600Man Akiya thing somewhere they like just as a safety clause.

 

[adkp]

@dparise You have 1oku because of the USDJPY exchange rate.

Considering your ages and saving rates, I'd keep working until you have $2mil. With your existing savings and your current savings rate, that would take you 7 more years. If the JPY appreciates a bit, it will be less.

At that rate you could live very comfortably with less than a 4% drawdown. With your current savings, 4% will allow you to live okay, but if the USDJPY rate moves against you, 4% will get very, very tight. Remember, it is not all that many years ago that USDJPY=80.

On the other hand, with $2mil available you could pull out $60k/year with only a 3% drawdown, giving you both a much greater income while also not pushing things right to the limit of what is acceptable for a FIRE situation. If USDJPY moved against you, you could take 4% for a few years, still maintaining your lifestyle.

 

[funker]

@adkp As lovely as that is as advice, and agreed, for many Just Enough is much, much more attractive than More Work...........as a lifelong hater of work.

 

[kersch19]

@funker Actually, I think most people who retire THAT early find themselves really bored, especially if they don't have kids to fill the days and are living on "just enough", which doesn't allow them to go do a ton of exciting things with their newfound free time. All that extra free time means you're going to want to travel more, pursue hobbies more, go out more to see friends, just consume more in general- all of which costs money more often than not, and doing it on $28,000/year (using dollars since OP's assets are in dollars) is much harder than living on $28k/year while working full time (which itself is not easy IMO).

 

[funker]

@kersch19 I feel you might be right that most would do that, but we are looking at a very fundamental socioeconomic attitude shift I feel many are missing with their ideals and images of the big fancy retirement plan. This is a tectonic shift, even if it is limited in numbers: lots of us do not need to consume to enjoy, and lots of people are simply tired of hating work. As an example, I am loaded because I made good enough money, banked >70% it, and now, out of the ingrained habits, don't spend it. Not Consuming is in itself a valid and rewarding lifestyle.......but it's not for everyone, as we can see from so many comments echoing yours. Nice comments there. Yours is a valid, representative insight and the OP would do well to decide which side of the fence they fall on.

 

[adkp]

@funker Greetings fellow night owl...

Perhaps the only thing worse than working is stopping working, and then having to start again. With only $700k invested, 4% of that at USDJPY=80 would be only 2.2mil JPY pre-tax. They do not have enough to properly FIRE, and they don't have enough to live a comfortable "expat" (OP's word) life.

4% is also the upper limit of what is considered permissible for FIRE, so they have no cushion at all. They don't own their own home, so rent is going to be an ongoing expense.

Even if they worked another 5 years they would be in a MUCH better situation. Personally I wouldn't FIRE with less than $2mil and owning my own place to live.