FAQ: Cashing Out

January 13, 2012

Tonight I received an awesome email from a reader. She was wondering how we came to the decision to cash out a portion of our retirement to make this dream possible, and what struggles we had to overcome before feeling comfortable with the choice. I responded to her privately but then realized that I have been dancing around this in other posts. Rather than try to rephrase what I said, I’m going to post my reply in full, right here; with one caveat that I repeat in the body. This is a serious decision with serious consequences. In this email I was preaching to the converted, but our path is not the best for everyone. Also, to protect my dad’s honor and reputation I should add that while he is incredibly supportive of us and our dream, I don’t believe he would recommend this course of action if I asked him directly. This blog post is for entertainment purposes only.

Everyone has to make this decision for themselves, you seem to have already made it so I will be pretty caviler in my support of your decision. Let me start by giving my own context. My retirement was funded through 10+ years of working for a non-profit. They put in 8% of my annual salary and I put in significantly less.  So when it came time to talk to my dad (a lawyer and financial analyst) about what I was thinking of doing, I was pretty much looking at it as free money. He, being the smart and loving dad that he is, gave me some pretty amazing insights into how interest compounds over 30+ years. Before you make any decision, make sure you understand what you are giving up.
That said, I firmly believe that the money we will be taking out (this month) from retirement will be paying a dividend much greater in personal happiness and familial harmony than what I could earn in compounding interest.  I am willing to work harder, longer, and to impose on my children for both their education and my own old age, because I believe that this part of our lives (individually and as a family) is “worth more” to me than financial stability and material comfort in my old age. I could be wrong, but in a robust (though informal) canvasing of cruisers I have not yet met one that wouldn’t make the same decision, or was not happy with it if they had made it in the past.
So before leaving we both cashed out our poor performing 401ks (just enough to buy some big parts). Later this month we will cash in about a third of all the other money we have in the world. We will use this to pay off the boat and for our next year’s worth of cruising. This isn’t exactly easy to do but now that we have been out here for more than 3 months it’s pretty clear that it is the right choice for our family.

I believe that when you are doing what you are meant to be doing (in the flow, following your bliss, or however you choose to phrase it) you can trust your intuition to guide your decisions. From the tone of your email I can guess that you are fully in the flow, you know what the right choice is, and don’t need me to tell you. I also know that when you are in the groove, it is totally awesome to be around other inspiring grooversters, and to get the amplifying effect of their camaraderie. So while I can’t tell you anything you don’t already know, I can tell you that I am super impressed with your intentional living, your straightforward email and your choice to take to the sea. I can’t wait to meet you out there someday and share a boat drink in some ideal locale (they are all ideal). And I can also welcome you to whatever club it is that you have unintentionally joined by breaking the mold and following your heart.



  1. Comment by cindy

    cindy January 13, 2012 at 6:16 am

    Feed the birds Tucker, feed the birds 🙂

  2. Comment by Chuck'n Lisa

    Chuck'n Lisa January 13, 2012 at 7:42 am

    Guys- I totally support your decision and will be following that path in a few years.

    My twist on this theme is that I wrote myself a loan out of my 401k to finance to “The Chester P” project. It isn’t the easiest thing to finance the repair of a “Good Old Boat”- so writing myself a loan, and paying myself interest seemed to make sense. It was only a “small ding” in the overall, under-performing account, anyway. I think that I’m making more off of the interest of my loan than I am off of the balance in the account, with the added advantage that I was able to launch a dream.

    Update: Lisa and I traveled to Fort Lauderdale to visit her folks over the holidays and discovered that “Second-Wind Sails” is there, and sail cleaning business and purveyor of used sails. So… a new main sail came home with us on the plane… well, new to us. 7.5 Oz Dacron, fit like a glove, and not blown out. Wow, is all I can say. I never expected “The Chester P” to perform so well in light-airs.

    Your family is missed, and we continue to follow your travels.

    BTW- We’re returning to Maine late August/Early September. My youngest daughter is getting married, and the ceremony is at The Maine Maritime Museum in Bath… fun!

    Pick an address for me to send a box of parts to you, BTW. I missed you in San Diego,

    Fair Winds!

    Chuck & Lisa
    SV The Chester P

  3. Comment by Lourdes

    Lourdes January 13, 2012 at 10:15 am

    I couldn’t help noticing the beginning of some of the 10 last rows on your post, and I think there is a hidden message:
    “your bliss,…
    your decisions…
    you know…
    you are…”

    Big hug from Mexico City!

  4. Comment by Suzanne

    Suzanne January 13, 2012 at 12:15 pm

    Like the post. It is hard to find the exact right balance. Glad you found it.

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