Meet the ERN family!

Well, the day has come! I have finally announced at work that I will be retiring! We have talked to family and friends about our plans. No turning back now! One way I ensured that I’m not going to get cold feet was to do the ChooseFI podcast that I knew will broadcast on March 12. Since I spilled the beans there I might as well do so here on the blog as well!

Who is the ERN family?

I hope I don’t disappoint anyone by revealing that my real name isn’t Ern. But I am a big guy, at 6’6″ (just under 2 meters), which explains why the name “Big Ern” stuck! My real name is Karsten. I am originally from Germany but came to the U.S. in 1995. Initially as an exchange student at Purdue University and then for my Master’s and Ph.D. in economics at the University of Minnesota. After graduating, I got my first “real” job at the Federal Reserve Bank of Atlanta and I also did a number of side gigs/hustles: teaching both undergraduate and Ph.D.-level economics at Emory University in Atlanta.

The ERN family: Karsten, Kristal and Kati during our 2018 ski vacation at Lake Tahoe.

In 2008, I moved to San Francisco to join the research department of a large investment manager. I prefer to not mention my employer’s name out of an abundance of caution; nothing I write here is endorsed by them and blogging is purely a hobby of mine! But if you really want to know where I work, you’ll find everything you always wanted to know on Google.

I am married to my beautiful wife Kristal who is also an immigrant. She’s from the Philippines originally, and just like me, she’s become a U.S. citizen after spending many years in this country by now. Our four-year-old daughter Kati is the sunshine of our lives and definitely one big motivator for us to retire early and spend more time with each other. So, my wife has also just quit her job as a nurse and she will join me on this journey.

Why the secrecy?

Quite amazingly, I was able to keep my identity a secret for almost two years now. Nobody ever recognized my voice on the ChooseFI podcast. And nobody in my personal and professional network ever noticed that my views on index investing, options trading, safe withdrawal rates, etc. sound a heck-of-a-lot like Big Ern’s. Of course, a better explanation is that they never heard of Big Ern! In any case, I preferred to keep our identities a secret until now because that’s the reality of working in Corporate America; companies don’t like employees who are not in it for the long-run. In the finance industry, in particular, we’re talking about bonuses and other perks that might have been a bit less generous had everybody known what I was planning. Why mess with the gravy train? But with the calendar year 2017 bonus in the bank on February 28, we can finally come out of the closet!

Quitting the gravy train

GravyTrainWithBisquitWheels copy

Leaving my job isn’t easy! To use a quote from the other Big Ern McCracken (Bill Murray) in the movie Kingpin, I have been “on a gravy train with biscuit wheels” for the last ten years! Nice salary, great benefits, a window office on the 39th floor overlooking San Francisco. One promotion away from a corner office! High enough in the corporate hierarchy that nobody would mess with me. But also low enough that I still wouldn’t have to deal with some of the boring corporate B.S. Add to that very smart and hard-working colleagues and bosses! So, I have actually thoroughly enjoyed my career at my current firm!

But, of course, I’m not married to my job. It all boils down to opportunity cost. When I was young, opportunity cost fit the economics textbook definition: Fun activities have the additional cost of lost wage income. Now, money is more abundant and time is becoming scarce. Opportunity cost now works the other way around; the corporate rat race has the steep price of time away from my wife and daughter, time away from other loved ones. Makes me think of the Dietrich Bonhoeffer quote Time is the most precious gift in our possession, for it is the most irrevocable. This is what makes it so disturbing to look back upon the time which we have lost. Time lost is time when we have not lived a full human life, time unenriched by experience, creative endeavor, enjoyment, and suffering. Time lost is time not filled, time left empty.

Kati (back in 2014): “Don’t go to work today, Daddy” – there is a huge opportunity cost of going to the office!

How did the talk with management go?

While recording the podcast in late February I hadn’t given notice. In fact, as I mentioned above, doing the podcast and revealing my identity and my picture there was my way to “handcuff” me to the idea of early retirement and cure any last minute episode of “cold-foot-itis,” otherwise known as One-More-Year-Syndrome. So, in late February I broke the news to the bosses. I had the suspicion that leaving will be more complicated than just giving notice, using left-over vacation days and walking out of the office that same day. So, in the end, my employer and I agreed to do a more gradual transition. I am still involved with some projects that I like to finish before I leave and I also prefer to do a proper and thorough transition of my duties. So I can enjoy retirement knowing that people from the office won’t keep bugging me about some Matlab code I wrote ten years ago while I’m retired and trying to relax at a beach somewhere! But there’s no turning back now – I will be out in mid-June, for sure! Around the same time as Fritz from The Retirement Manifesto. We might even use the same countdown clock as Fritz! How cool is that?!

How did people react?

Not one single person so far has questioned the decision. Family, friends and colleagues all responded pretty much the same: “That’s awesome, we’re happy for you, good luck!” There were no haters, no doubters, no trolls. Is that good news or bad? Sometimes it’s almost considered a rite of passage to write a blog post about dealing with the doubters. Clearly, in the finance industry, it’s much more common for folks to retire early, which may explain that everybody got over their initial surprise pretty quickly.

Where to now?

It’s hard to beat the quality of life in San Francisco! Beautiful scenery close by; think Redwood Trees, Highway One, the Sierra Nevada mountains in general and Lake Tahoe and Yosemite in particular! Nice climate, never too hot, never too cold. People are so friendly and laid-back! But we still like to leave the Bay Area and live in a place with lower cost of living to put our retirement finances on a better footing! Geographic Arbitrage!

We just finished packing our belongings and moved them to a storage room. During the next few weeks, we will fit in some more late-season skiing in Tahoe. We will also visit relatives on the East Coast and combine that with the North Atlantic CampFI in Virginia in April. In between, some couch-surfing with friends and relatives in the Bay Area as homeless millionaire-vagabonds while I head to work for another week here and there! Between April and June, I am still going to the office every day, so we will likely do a short-term rental.

Heavenly Ski Resort, top of the Olympic Lift: Getting some well-deserved R&R after a hectic week of packing and moving. Under the fog in the background is Lake Tahoe!

Between June and December, we will have a pretty ambitious travel schedule: A family cruise in the Caribbean with Kristal’s parents and siblings and their families, then spend about two months in Europe, go back to Florida to attend the FinCon in September. After the FinCon in Orlando, we’ll visit Asia, Australia, New Zealand and the South Pacific. We should land in San Francisco again in late December. 20 countries in a little over six months! Stay tuned for more details on our travel plans!


And then? The outrageously expensive Bay Area is out of the question as a long-term home base but we won’t move that far away. Very high on our list is the area around Reno and Carson City in Northern Nevada. Proximity to the mountains around Lake Tahoe, no state taxes and relatively low cost of living all sound really attractive. But California isn’t completely out of the race either. Our Next Life recently made a good case for staying in California: Relatively affordable health insurance and some other advantages could make it worthwhile paying a little bit in state income taxes. If one stays away from the overpriced coastal areas then California can be a very affordable (early) retirement destination! In one of the safe withdrawal rate case studies, I confirmed that when you keep your taxable income low enough, California’s tax burden isn’t even that bad. The really high marginal tax rates only kick in for the six-figure incomes for couples filing jointly. In any case, we’ll have plenty of time to decide! Stay tuned for updates on where we’ll finally settle down!

California or Nevada? Make up your mind, Mr. and Mrs. Ern!

So much for today! We hope you enjoyed today’s post! Looking forward to everybody’s comments below!

161 thoughts on “Meet the ERN family!

  1. Dear Karsten, congrats on your smooth transition into early-retired life and your long awaited coming-out!!! All the best for the start into your new life. Best wishes from Switzerland, Matt

  2. Congratulations “Ern”, fantastic to see your plan coming together. Welcome to the club 🙂

    Your travel plans sound amazing!

    Enjoy the run into retirement, and thanks for publishing all the amazing content to help others of a like mind follow a similar path.

  3. Aw total spoiler, this is only my 2nd time here and now I know so much hah! Congrats!!

    Dang you’re tall! I’m only 5 ft, sounds like a hilarious photo op someday. Would you be at fincon?? You have a very cute baby Kati by the way 🙂

  4. Hey Karsten, congrats mate! Good for you pulling the plug and going to live life to the fullest! Probably your smartest move ever (and that says a lot for a smart guy like you ;-))

    Oh, on the whole “There were no haters, no doubters, no trolls. etc. “, your level of detail and coverage of the whole FIRE thing leaves little to be argued, that probably helped a lot!

    Sincerely hope to meet up with you in Amsterdam (or surrounding areas) in August! Let’s get a good beer 🙂

  5. Congrats Karsten! Great to meet the real you behind Big ERN. Another immigrant success story and a fellow PhD grad (though mine was in ‘boring’ engineering as opposed to your exciting world of high finance). Hope our paths cross someday but now we are 10,000+ miles away so let’s see when that’ll happen! Enjoy the much deserved early retirement!

  6. It’s so nice to see the real you Karsten. I’m an east coaster but my eventual early retirement dream destinations include the same list. I’ll be closely following where you end up. Enjoy the last few months of work! Hopefully we’l get a chance to meet up at Fin Con.

  7. Congrats Big ERN and great to meet you. Please put the next White Coat Investor Conference (wherever and whenever) in 2019 on your radar!

  8. Congrats ERN!
    I’m right behind you and Fritz with only weeks to go (after my final bonus payout) and with a very similarly sized pile of assets.
    Your blog has been invaluable to me and I’m hoping you will have time to continue enlightening us with your insights and wisdom.
    Again, congratulations!!!

  9. Congrats! Thoroughly well deserved and really hope you keep up the ridiculously informative blogs.

    All the best.

  10. Congrats Karsten! I’m sure it is exciting to have the countdown clock going! While we still have a number of years before we pull the trigger, the Lake Tahoe area has crossed my mind as a possible retirement location as well. I look forward to hearing what you folks decide. Sounds like an amazing retirement journey you’ll be going on…20 countries!! Enjoy!

    1. Thanks Green Swan! Too close to the lake is quite expensive. But one valley over, the Carson Valley or around Truckee seems very affordable. I’m not surprised lots of folks have this area on the short list for retirement destinations. Cheers!

  11. Congratulations Karsten, wishing you and the family a great retirement, doing something you love even more!

    Time to see the world on your pace!

  12. Hah, I also used to work with a lot of Matlab code! I’m pretty sure you won’t miss it 😉

    Congratulations, on giving notice 🙂 Giving up the salary isn’t easy, but there is a lot more to life than money. Good luck with the plans!

  13. Congratulations Karsten. Was great to hear your announcement on Choose FI today and then read this blog entry. Exciting times ahead for you and your family. Looking forward to reading about your journey from here. Inspiring stuff. Thanks for sharing

  14. Congrats, Karsten! I’ll be at the Camp FI Midatlantic and I think I’ll be speaking too. It’ll be nice to compare notes 🙂 I’ve seen a lot of folks mention your analysis and thoughts on the market and economics so you’re certainly attracting some attention in the FI community.

  15. Hey man, awesome reading. Our family looks forward to meeting your family in April and comparing notes about our respective transitions into early retirement. Listened to the podcast this morning and I can definitely vouch for the procrastination and anxiety topics!! And those “handcuffs” are very real, whether imposed by an employer or self-imposed.

    Anyway, congratulations and big cheers to filling that time with family fun, joy and more awesome experiences you have probably not even had “time” to think about yet.

  16. Go places – study the latitude/longitude – and what energies come up. Our family tree resonate at the 47 parallel north but that doesn’t mean we will always make roots here.
    Live your dreams!

  17. That makes 2 of us with 2 degrees from the University of Minnesota. Go Gophers! We were there at the same time; I probably saw you and mistook you for a basketball player at some point.

    It’s great to virtually meet you and see your lovely family. Looking forward to an in-person meetup this fall in Orlando #FinCon18.


    1. Thanks, Dr. PoF! I was at the U of M from 1996 to 2000. Awesome time! Even the short stay at the University Hospital after a bike accident was quite an experience! Excellent care!
      Can’t wait to see you and everyone else at FinCon!

  18. Congratulations, Big ERN/Karsten!!!! I’m so glad to hear that everything went well with giving notice, especially listening to your story on the ChooseFI podcast. I too went to the University of Minnesota (I see Physician on FIRE did too!) Wahoo, Go Gophers!

    Looking forward to meeting you and Kristal at FinCon this year.

  19. Congrats! This is awesome and am excited for you. Time is precious and I was talking to my wife about going part time this weekend because our 3 year old is growing so fast…

    As for Cali, come visit Santa Rosa. The wineries are still here despite the fires. I am torn about this place in retirement. It is amazing and the weather is great, but taxes and housing are brutal. It gets better inland, but still not cheap. I am from Tennessee and low cost living with no state income tax have always been attractive. Oh well, time will tell. Reno is actually quite nice and near the mountains.

    1. Thanks, Dr. DDD! Very true, kids grow up too fast! We’ve already spent 1/4 of the time we have with little Kati before she heads to college. Time flies so fast!
      We went to Sonoma two months ago. It’s still one of my favorite places to visit in CA. No visible damage to the wineries we visited. I hope the area recovers soon. Best of luck!!!

  20. Nice to put a face with the name!!! And congrats!!! Sounds like you’ve got a great plan for the near future!!

    Make sure to enjoy it!

  21. “Opportunity cost now works the other way around”. I love it. Great news Big Karsten. Now I see why you have pointed out “low tax California”. Can I suggest you consider moving near where we live in Stockton. Lodi is a good choice. It is close to Tahoe and close to San Francisco. It is Geoarbitrage inside the state. Also I find that the Obamacare options are better in California than Nevada due to the demographics. I can hardly wait for you to start analyzing that! Congratulations to you and your family.

  22. Congratulations! I love that you tied yourself to the date so you couldn’t change your mind at the last minute 😉 In the construction/development field that’s I’m in, the opposite seems to be true – most people work into their late 60s and 70s, some by choice, some by necessity.

  23. Congratulations! I would have guessed NYC but Bay Area makes sense too. If only the Bay Area was plausible for FIRE.

    1. I always kept that ambiguity. There are only a handful of large asset managers with research/portfolio management functions in the Bay Area. So, for the purpose of staying anonymous, I preferred not to announce where I work until today. 🙂

  24. I like ERN better for some reason. We have similar educational backrounds and life ambitions, which is probably why I like reading your blog so much.

    I’ve eyed the Reno/Carson City area as well. I grew up in the bay area, vacationed in tahoe, and fell in love with it. I’d love to retire there. +1 to Carson city due to Costco. I’ve never been to Sheridan/Mottsivelle/Minden/Gardnerville, but Google maps and the bit of googling I’ve done on CityData say that it’s a pretty nice place to end up. You basically have heavenly resort in your back yard (albeit with a large hike to get there). I’m super curious to see where you guys end up. Who knows, we may end up being neighbors.

    1. Thanks, Professor!
      Yup, a Costco close by is a huge plus. We have a season pass at Heavenly this year and might get one again next year. Driving from the Carson Valley to the resort is either pretty easy (US-50 to the CA side) or a bit scary (NV-207, Kingsbury Grade) to the NV side in the winter. But then again: as retirees, we have the latitude to drive only when the road conditions are OK. 🙂

  25. Karsten, So Great to hear your plans and am genuinely excited for you and your family! Your blog and what it has meant to my financial life has been immeasurable. I very much hope you will continue to share your wisdom with us in the future. Best of luck!!

  26. A friend of mine works at the research branch of the fed in Atlanta. Wonder if you two know each other.

    Congrats on the upcoming changes. One hopes you find your retirement thing to be all you want it to be.

  27. Congratulations! I’m looking forward to reading more about your early retirement. Great family pictures. I think it’s a great time to spend more time with your little kid. They are great at that age (before they start talking back…)

    PS. Heavenly is so neat. I went once and snowboarding down while looking at the lake was surreal.

    1. Thanks, Joe! Great words of encouragement! That’s one of the reasons I run the blog!
      Our daughter is a late talker. But it seems talking back is something she learned at an early age. 🙂

      Let me know if you make it to Heavenly again. We should get together – we are at Lake Tahoe all the time and maybe permanently in 2019! 🙂

  28. Wow, your situation and thought processes on anonymity are exactly like mine. I want to remain anonymous to avoid my blog viewpoints from interfering with my professional life. I was just recently thinking about “coming out” after I hit my number and quit – just a couple years out. I even made an effort to be more personable in my writing now and let readers get to know me in my anonymous form. Then all the sudden, BOOM, you carry out my exact game plan.

    Congratulations on making it to the big FIRE day!!! So inspiring.

    Reminds me of jcollinsnh version of F-you money. You’re at a point now where you don’t answer to anyone. And now you can express your viewpoints from your true identity without worry of a clapback hitting your professional life. That’s F-you money at its finest baby!

    Wow, just wow.

    1. Thanks, Master_Duke! Sounds like the perfect game plan for us in the corporate world! And yes, even on the path to FI, the larger FU money pile makes you so much more relaxed at the office. 🙂

  29. Congrats! Most exciting. One day you realize you don’t need all the money, you just need enough. I started my 52 week a year vacation a year ago, it’s an amazing way to live

  30. Hey, Karsten! Congrats on your retirement, not completely clocked out but for sure you will be.
    What part of Germany are you from?

    It was clear from your blog that you were an immigrant (like us), but it’s nice to read the real story now. But you’re an unusual German height wise ;-).
    Are you teaching your daughter German? In case you wish her to be immersed in your native tongue you might want to consider settling down in the area whose school system offers a program of foreign languages.

    Have great fun and luck on your intensive traveling!

    1. Thanks, Mrs. Greece! I’m from the Northwest: Bielefeld.
      I try to teach my daughter some German here and there but she has to learn proper English first. 🙂
      Best of luck with your own FIRE planning!

  31. Congratulations, Big ERN! It’s great to hear more of your backstory and your plans for the future.
    As I read your post I happen to be sitting at Augustiner am Dom restaurant in München on a business trip from the USA. I had the accent pegged but you’ve done a great job keeping undercover.
    Viel Spaß als Rentner!

  32. You have a beautiful family! That little girl would have been all the reason I would need to pull the trigger. You will never regret taking this time for yourself and your family. The main regret we often hear from older physician colleagues was the missed time with their young families. They finally came to realize that money could always be earned later if needed. Your diligence in questioning these oft repeated financial concepts is your real wealth. Keep up the great work.

  33. Congratulations. Hope you pick the California side like Tanja of OurNextLife. We live in Truckee and are looking forward to local FIRE meet ups. My husband and I are 2 years post-FIRE and find your withdrawal rate posts super helpful.

    1. Thanks! Oh, my, tough decisions ahead! The area around Truckee is absolutely stunning! Tough competitor, but even if we end up deep in the Carson Valley we’ll be around for local meetups in North Lake Tahoe. 🙂

  34. Congratulations Karsten! Early retirement will be so fulfilling because you will get to spend so much time with your beautiful family. It’s amazingly awesome and I wish you well on your journey. I am looking forward to reading about your travels and everything that’s in store for you.

    Also looking forward to seeing you at FinCon. If I spot you (which at 6 feet 6 inches shouldn’t be too hard), I will definitely say hallo to you!

    Consider moving to San Diego. It’s still in the wonderful state of California, much cheaper than Bay Area in terms of cost of living and housing, very laid back and relaxed life style, people are friendly, great public schools, and plenty of things to do from beaches, hiking, culture, and family-friendly activities.

    1. Thanks, Dr. MC Frugal! We should connect at FinCon! This will be my first one! Look out for the tall German guy!
      SoCal has never occurred to me so far. But I can see the appeal! So many choices!

  35. This is so Awesome! Your blog has helped me a lot with the nitty gritty simulations. I love that stuff.

    Me and my wife are quitting in about a month. We are no where near FI but we are taking a mini retirement and working on some businesses. Hopefully taking the entrepreneurship road to FI.

    We also live just south of you in Bakersfield CA. (for now) maybe we would have an opportunity to meet up as we pass through in the new camper van!

    1. Thanks, Mattoyf! Glad you found our work useful! Best of luck with your early retirement!
      Let me know when you’re in the Bay Area. We’re in the East Bay between April 25 and June 14, before going on the long trip!

  36. First time commenter here, and I just recently ran across your blog via PoF. Congrats on letting everyone know that you are pulling the plug. Safe travels around the world in the coming year, and I will be looking forward to reading about them.

  37. Big ERN,
    Mein Deutsch ist nicht gut, aber Mitfreude ist das beste Wort, das ich finden kann.

    Congrats on your accomplishment. It is a rough week “at the ranch” even though it is only Monday and, as always, your posts bring a wonderful distraction from the last few weeks of w*rk before I give notice as well.

    In short, your SWR series and Case Studies have given me the confidence to “cure” my OMY (okay, make that Four-MY) syndrome. Like many of the other commenters, it is my sincere hope that you continue to create content for this phenomenal blog of yours.

    1. Thanks for stopping by and your kind words, DrFIRE! Wow! Great German skills! Vielen Dank! Glad we can all cure OMY-syndrome one case at a time. Who knows, without the FIRE community I would have just needlessly plowed through for another 10 years?!

  38. Congrats! Here’s to a happy retirement! Boy that photo of Heavenly brings back memories. I loved skiing there back in the 1980’s.

    Thank you for your SWR spreadsheet. It is my “go to” tool that I rely on to help me figure things out. I’ve run a dozen or so scenarios (rent vs. stay vs. sell vs.early SS vs. stock crash vs….). I hope I can make it 5 more years.

  39. Congratulations Karsten. Your blog has truly become my favourite blog. I load up my RSS reader hoping to see a new article.

    There is nothing like opinions backed up by facts!

    Anyway, you have a beautiful family and I’m so happy that you now get to spend your time with them instead of working.

    I’m from Australia and on the other side of the journey. Maybe I’ll spot a really tall German-American when your here.

  40. Gratulation, du hast es geschafft ! It’s an amazing achievement, you should be proud of it. I wonder often how it is going to be when I resign. There are many lower cost locations to live in the US but here is my question: with affordable education and healthcare, does not Europe appeal to you as a place to raise a familiy ? LG

    1. Thanks, LazySod! Good suggestion! Europe could be a good retirement destination in the long-term. I’m just concerned that when becoming a resident for tax and health care purposes I also have to tax my U.S. capital income under the German tax code. Malta is one of the locations that doesn’t tax the foreign income. So, that would be an option…

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