Catching Up With Darrow Kirkpatrick

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Darrow Kirkpatrick started this blog in 2011, shortly after retiring at age 50. Over the next six years, he was the sole voice at Can I Retire Yet?, building it into one of the most respected and trusted personal finance sites on the internet. Over the past three years, we’ve shared the writing duties.

Darrow pic from the CO trail

Darrow recently decided that he didn’t want the demands of a regular writing schedule as he is transitioning to a different phase of life and retirement in his early 60’s. But he’s still interested in helping you prepare for a successful and happy retirement.

Read on to learn what projects have been occupying his time, how his thoughts on risk management are evolving based on recent personal adversity, how his approach to managing his portfolio and using retirement calculators has changed over the years, and other financial and personal lessons learned after a decade of early retirement. Take it away Darrow…

What have you been doing in the past year?

A New Phase of Life

I’d say I’ve entered a different phase of life, though it’s early to put a label on it. I recently turned 61, and my 60’s do feel different from my 50’s. I’m not as strong, though I’m also wiser about living.

I believe that fitness is central to good health as we age. But it comes at a cost. I sleep more than I did ten years ago. And I exercise more too. That leaves less time and energy for other projects, which is one reason I’ve stepped away from the blog.

A New Home

We finally bought a home late last year. I’ve always been concerned by how much time and money houses consume, and this experience hasn’t changed my opinion. Buying the house, moving into it, fixing it up for our tastes, then maintaining it, have consumed most of my free time for the past six months.

A Personal Milestone

I’ve maintained my love for and commitment to the outdoors. I take one or two long hikes each week. My trusty SideStix forearm crutches have continued to expand my range.

This year I made major progress on my long-term goal of completing the 500-mile Colorado Trail. On a recent overnight backpack, I hiked 25 miles and climbed 3,000 feet over a 12,000 foot summit. Even with a 60-plus year old body and a bunch of aches and pains, you can maintain good fitness and find a lot of adventure, if you’re attentive and fortunate.

Have you learned anything new about personal finance?

Renting vs. Buying

It’s been interesting to own a house again after renting for 7 years. Ironically, I’ve been identified with a pro-renting position because of my widely-read article on renting vs. buying.

Though renting suited us well for a long time, it was never my point to argue that it’s superior to buying. I was arguing against the old-fashioned viewpoint that owning a home is superior to renting. It’s a complex financial decision that must be analyzed in light of your own financial variables. Just as important, it’s an emotional decision, where personal values could outweigh financial ones.

Renting through our 50’s, when we had more energy and flexibility, and weren’t sure where we wanted our retirement home, made a lot of sense for us. But, as we entered our 60’s, and stability and convenience became more important, owning our own home suitable for aging in place became the top priority. Either way, there are tradeoffs. But owning is the right tradeoff for us at this stage.

Getting Sued

In addition to buying a home, we faced another major financial challenge this year: Late winter there was a knock on the door, and we were handed a summons. Yes, we were being sued, related to an auto accident. The process is over now, but it was a dreadful experience.

I won’t go into all the details, but I’d like to share some lessons learned, so you can be better informed and prepared if it ever happens to you:

We’ve always tried to carry more than enough personal liability insurance, especially umbrella insurance, to protect ourselves (and others). And we are grateful that we were prudent in that department. Though no amount of insurance will protect you from the stress and time drain of getting sued.

Ignore the aggressive and intimidating language in any complaint or summons until you consult an attorney. It’s a tactic from the other side to frighten you and gain leverage, and may have no basis in fact. Sadly, lawyers are free to accuse you of nearly anything. It doesn’t necessarily mean they have a case.

You may have as much to fear from your insurance company as from the plaintiff. At one point, ours sent us a terse warning that we would not be covered for “punitive damages.” We spent an agonizing few days thinking we could be financially ruined, before a friendly attorney advised us there was little risk in this case.

Moral: consult an independent attorney who is 100% on your side. Try or if you don’t have a personal connection.

Asset Protection

Finally, I learned a few things about asset protection. How much can you lose if you exceed your liability coverage?

The answer depends on the state you live in. Most states let you keep some personal property and a modest vehicle, while also providing some protection for your primary residence, though it’s usually only a fraction of the value.

Also, in most cases, retirement accounts are protected by Federal exemptions up to at least $1.3M. That’s likely your largest single protection. However state laws can interact with Federal and change the limits. In our state, we were advised there is no limit: IRAs are 100% exempt from bankruptcy. So consult a local attorney if you need to know.

Lastly, do not try to gift or hide assets after you’ve been served in a lawsuit. Courts are wise to this behavior and the look back period can extend for years, resulting in criminal penalties. If you’re going to diversify assets for protection, do it long before you ever get sued.

What are your latest thoughts on the implications of early retirement — financial and emotional — in today’s world?

More Time > More Money

I’m glad I retired early. I treasure the extra 10+ years of freedom I’ve enjoyed. I can’t imagine retiring in my 60’s and trying to do all the things I did in my 50’s. I still believe that time is a more important resource than money. Money can be earned and made to go further. But, as human beings, we are all living on a finite clock.

The Role of Luck

We were incredibly fortunate to early retire into a record bull market that eliminated most of our financial worries and allowed us to modestly expand our retirement lifestyle. Undoubtedly this has colored our views on our “successful” early retirement. Still, we get good marks for managing our resources prudently, especially in the early years. We never increased spending until the money appeared. And I worked part time through my early retirement to build this blog. A lifestyle business is one of the best insurance policies you can have in the early years of retirement.

Assessing Tradeoffs

That said, there are some tradeoffs when retiring early. I’m sometimes wistful when I look at the influencers in society around me. This is especially true when I consider the enormous problems the world is facing with infrastructure and the environment.

Had I stayed at my job, I’d be near the top of a large corporation that is influential in that space. I abdicated a role where I could have done some good in the world. But the personal cost would have been high. It wasn’t my calling. And this blog and my books have also had some influence.

It’s also true that we’d have significantly more money, had I worked longer, pulling in a 6-digit salary plus bonuses that I could have socked away into investments. But I very rarely miss that money. On a daily basis, we live a luxurious lifestyle — eating well, travelling as much as we want, buying the things we want, getting the best health care.

Honestly, the only time since I retired ten years ago that money has really been a factor in our lifestyle was recently, when buying a house. Real estate prices skyrocketed last year, and it was clear we would be house shopping on a budget. Still, we wound up with a beautiful home that meets our needs, and we are grateful for that.

What are your thoughts on the post-pandemic economy and markets?

I can’t predict the future, but I can point to a few trends that seem obvious from looking around.

Entertainment and travel industries

As much as people like to vacation and socialize, they are going to do it on their own terms going forward. Why take on risk when you can enjoy so much in your own home? Travel is a question mark. But RVs and camping are hot. The RV Industry Association projects 2021 sales nearly 20% higher than 2020, which were already good.

Remote/hybrid work

I worked from home exclusively starting in 1996, with only occasional business trips to headquarters. For me, and many others, working remotely, at least part time, is the ideal work/life balance. And the technology for it is so much better these days. There will be fewer office buildings and fewer workers in the office. Companies that don’t offer hybrid work opportunities, won’t get the best talent.


We’ve seen it big time in real estate, and now other commodities are catching up. There are more people with more wealth than ever. The economy was depressed by the pandemic and now it’s time to spend. Governments primed the pump with a record stimulus.

The world is on the move: people are relocating to adapt to a changing environment. Beautiful locations with less crowding and higher quality of living are in demand. It’s going to cost more to live in them going forward.

Wealth disparity

All of this means even more differences in wealth. Those with intelligence and opportunity and capital will get richer. Those without will be left out. For better or worse, freedom and security are largely a function of wealth. It’s a great time to be financially independent. And, it’s a tough time to have a low-paying job or be in debt.

Have you made any significant changes to your portfolio?

Staying the Course

I have no idea what the stock market will do. But I’ll note that we’ve been spoiled for years by a market that dips for only short periods. This is unlikely to go on forever. Approaching conventional retirement age now, I’m as risk averse as ever with my core holdings.

My investment philosophy is unchanged, and I have not made any major changes to my asset allocation. However, I have moved a lot of money around.

Taxable Assets Became Home Equity

When we made an offer on a house late last year, we had two options for financing: we could (possibly) take out a mortgage, or we could liquidate the majority of our taxable investments. Though I made inquiries about a mortgage, and even started the application process a couple of places, we ultimately decided against borrowing.

One, we loathe debt, and I wanted Caroline to own the house free and clear if I were to pass from the scene suddenly. Two, it wasn’t perfectly clear that we would get a mortgage on favorable terms, given our status as early retirees with assets but no income. Third, with the housing market blowing up, we needed to move quickly and bring cash to the table in order to ensure our offer would be accepted.

Related: Getting a Mortgage When You Have Assets But No Income

So most of our taxable assets have turned into home equity. It was a big change, but one that I felt shouldn’t impact our overall financial picture much. And I was relieved, when I did my taxes this year, to confirm that we incurred almost no capital gains tax when we liquidated those holdings, because most of our income fell into the first two tax brackets.

Less Tax Diversification

This move left us with almost all of our investable assets in retirement accounts. My retirement savings have been with Vanguard since the beginning, and I have been satisfied with the company. They generally have an excellent reputation among do-it-yourself investors, but they have been criticized lately for customer service issues.

More Brokerage Diversification

With more than 80% of our assets at Vanguard, I decided it was time to diversify. My concerns were not so much with the company failing, as with systems failing and denying access to our money. All human institutions are fallible, and who hasn’t experienced some sort of banking or investment glitch in recent years?

So I decided to move roughly half of my retirement savings to Schwab, the other institution I have a long relationship with. And, for my diversification objectives, it wasn’t enough to simply transfer some of my existing Vanguard funds to a Schwab account. I also needed to diversify away from the Vanguard funds themselves. For that, I chose several Schwab passively managed index funds that were very similar to their Vanguard counterparts, including microscopic expense ratios, in the neighborhood of 0.05%.

As far as I can predict, my holdings should behave the same as in the past. Only some names have changed.

What’s your current approach to generating retirement income?

Theory vs. Practice

As much as I have studied and written about systematic retirement withdrawal strategies, I still don’t use one. They are fine as an academic exercise, to understand how your money will last under different conditions. But needs fluctuate year to year. And the financial world fluctuates around us. In my opinion, there is no autopilot solution to retirement withdrawals that doesn’t potentially leave money on the table, or expose you to undue risk.

My computer modeling over the years tells me that we are financially comfortable, as long as our spending stays within our historical boundaries. We are ten years older now than when we early retired, and it’s hard to be worried about our finances unless our net worth starts dramatically decreasing for several years. So far, it hasn’t.

Every few months, I sell some holdings to fund our living expenses. I keep an eye on PE ratios, and tend to sell stock instead of bond funds when those ratios are high, as they have been for most of our retirement. I also keep an eye on our accumulating taxable income every year, and try not to generate excessive income toward the end of the year that would push us into a higher tax bracket.

Since we now own a house and don’t anticipate major purchases going forward, I prefer to keep less cash on hand these days. But, as much as I want to withdraw just-in-time, to keep our assets working for us, I am sensitive to the aging bull market and feel pressure to take money off the table. Most of the time, I have at least 3-6 months of cash on hand. Buying the house significantly reduced our monthly expenses, since we no longer pay rent, so that number is smaller than when we were renting.

The Challenges of Annuities and Insurance

Some day an immediate or charitable annuity may be useful to simplify our financial life — especially if Caroline is on her own. But annuity payout rates continue in the gutter. just quoted me about 4.5% for a lifetime annuity. I think we can do better than that with a simple, inexpensive portfolio of passively-managed stock and bond funds. We have done so for nearly two decades now.

I am also less enamored of insurance companies after dealing with several of them lately: our auto insurance, one mother’s variable annuity, and the other’s long-term care insurance. The business reality is that insurance companies make money by selling you a feeling of security, and collecting premiums. They are neither optimized for, nor interested in, paying that money back out. The customer service we’ve received from some prominent and well-heeled insurance companies in recent months has been atrocious. Persistence and careful paperwork are required to get your due, and those might be in short supply as you age.

Retirement Calculators and Optimization

Finally, a word on retirement calculators. These are fascinating and helpful tools for peering into the future when you need to assess your financial situation. Like many technical early retirees, for years I found it entertaining and reassuring to rerun my retirement numbers. But, having determined that we have enough, if there are no major changes to our income or expenses, I rarely revisit the issue now.

Some people enjoy paying the minimum taxes, or growing their assets for a legacy. But, for me, there are more important things in life than optimizing finances. Though, if there is a big decision, like buying a house, I do rerun a simple version of my retirement model. For that I use Pralana Gold.

How is life in your “ideal retirement location”?

We still love Santa Fe. The last couple of years have been a good test of this medium-sized mountain town, given the pandemic, economic pressures, and political upheaval. No place is perfect, and New Mexico has its problems. But it’s about as good as it gets for us right now.

Environmental Concerns

The climate remains hard to beat. The seasons are moderate and most days are sunny. We do get a few more weeks of cold weather in the winter than we’d like. Though there is little snow, and it’s easy to travel to warmer climes. The summers are occasionally a little warm for one of us. But so far in the recent western heat wave, we’ve only had one short week of temperatures in the mid-90’s, before going lower again. The altitude here (about 7,000 feet), and the low humidity, make the difference.

Like the entire southwest, serious water issues are brewing. We’re in a record drought which could well be a permanent change. Though the monsoons have been good this season, and there is green all around us as I write this, the lakes, reservoirs, and rivers are suffering. It’s a bad part of the world to be running a farm. And we’re likely to pay more for water going forward. Though I can’t say if the impacts will be worse than that in our lifetime. The politicians are just beginning to wrestle with the issues. Santa Fe, specifically, has multiple water sources: mountain reservoirs, wells, and the Rio Grande river. Though the local paper just reported that one of our reservoirs is down to 13% capacity.

Upsides of the Mountain West

The outdoor recreation here is excellent, one of the main reasons we chose the area. Drive uphill and you’re in the southern Rockies surrounded by conifer/aspen forests, mountain lakes and meadows, and rugged peaks. Drive downhill and you’re in canyon country with sandstone walls, deep gorges, and an iconic river. The states of Colorado, Utah, and Arizona are all only a half-day’s drive away. We have access to the best of the mountain west, without the crowding of areas like Colorado’s Front Range.

Related: Where Should You Retire?

As we get older, healthcare takes on increasing importance. We are happy with our doctors here and have even seen an increase in quality specialists locally, so we rarely need to travel to Albuquerque for healthcare anymore. Yet it is nice to have that big city nearby when needed. The well-maintained, uncrowded airport with flights throughout the country is just an hour from our doorstep.

Increasing Cost of Living

Finally, yes, real estate and cost of living have gone up dramatically here like everywhere. Our local paper reports that the median home price in the county jumped nearly 35% year over year. I don’t see that moderating soon. Buildable land here is limited by the surrounding mountains and reservations. And the county has a 50% open space requirement for most new development. But prices are still below the shocking levels of big cities in California, whose residents are migrating here in droves. We are expecting a continuing stream of new arrivals, and hoping the quality of life stays high all the same.

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[The founder of, Darrow Kirkpatrick relied on a modest lifestyle, high savings rate, and simple passive index investing to retire at age 50 from a career as a civil and software engineer. He has been quoted or published in The Wall Street Journal, MarketWatch, Kiplinger, The Huffington Post, Consumer Reports, and Money Magazine among others. His books include Retiring Sooner: How to Accelerate Your Financial Independence and Can I Retire Yet? How to Make the Biggest Financial Decision of the Rest of Your Life.]

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Disclosure: Can I Retire Yet? has partnered with CardRatings for our coverage of credit card products. Can I Retire Yet? and CardRatings may receive a commission from card issuers. Other links on this site, like the Amazon, NewRetirement, Pralana, and Personal Capital links are also affiliate links. As an affiliate we earn from qualifying purchases. If you click on one of these links and buy from the affiliated company, then we receive some compensation. The income helps to keep this blog going. Affiliate links do not increase your cost, and we only use them for products or services that we're familiar with and that we feel may deliver value to you. By contrast, we have limited control over most of the display ads on this site. Though we do attempt to block objectionable content. Buyer beware.


  1. Was the liability issue resolved out-of-court, or did it go to trial?

    (The one time I was on a jury was an auto accident case. Injured party had to sue, because the driver who caused the accident’s insurance company wouldn’t pay the claim. I felt bad for that girl, she freely admitted her responsibility. In VA the plaintiff can’t ask for a specific value, but the lawyer did a good job totaling up the medical expenses, lost work, etc. We added $10k because the insurance company deserved to be punished for pushing this into trial…)

    1. A few people asked about this below as well. I can confirm that it was settled out of court. Your experience lines up with the opinion that insurance companies are often better at selling a feeling of security than actually providing it when it’s needed.


      1. While not trying to invade Darrow’s privacy, the post about the lawsuit left MANY questions unanswered in my mind. Based on his experience, is he still advising that individuals purchase Umbrella policies? How much umbrella coverage makes sense, based on his real-life experience (i.e. was the amount of the lawsuit large enough that $1MM wouldn’t have been enough). Does he advise NOT relying on the insurer’s lawyers? Was the accident arguably an at-fault (no judgments from me) or did he & his spouse get put through hell for something the other party did? Also, on LTC front, what are the practical takeaways from his real-world experience? Are the obstacles insurers deploy to avoid paying serious enough that it calls the decision to pay the astronomical LTCi costs into question? This may not be possible: any suggestions on insurers from whom he’s avoiding purchasing coverage?

        1. Those are fair questions Patricia, and Darrow may want to chime in. A couple of thoughts that I have are that:
          1.) Nothing that Darrow, I, or any guest authors say should be construed as advice. I don’t mean to nitpick, but per your question I want to restate that we can’t provide any particular advice, only share our ideas and experiences to help you make your own more informed decisions.
          2.) Re: details of the situation. As bloggers, we do our best to convey a message with as much honesty and transparency as possible. But, our stories are never entirely our own. They almost always involve others who don’t necessarily want to share details.
          3.) Re: LTC, even if you choose an insurer who will make good, it is wise to consider the “astronomical costs” that you reference for LTC policies. Darrow has covered this topic in more detail in the past.


          I realize that those probably aren’t completely satisfactory answers, but hopefully that helps clarify some things for you.


    2. First, I am not trying to comment about anything related to Darrows’ lawsuit specifically but some responses about litigation in general

      In the past I worked as a bodily injury adjuster in auto claims for 9 years although I am now retired. I always cringe when reading what are at times assumptions about what has or has not happened in a lawsuit or at trial. Any employee of any business knows that the inner workings of that business are not necessarily understood or well known to the customer, consumer or client and may be mischaracterized by those parties because of assumptions being made. That being said, insurance claims are always stressful and claims involving injuries doubly so. When the matter goes to litigation people are even more alarmed and stressed.

      In one of my cases that went to trial we made what we felt was a fair offer for the injury but it was turned down. During the trial, the injured partiy’s attorney said to the jury that going to trial was the only way they could receive any recovery. This was obviously an untruth spoken to engender more sympathy for their client but had no bearing on what actually happened before the case went to trial.

      There were some attorneys whose policy was to litigate (sue) all of certain types of injuries, some who litigated whenever they did not like the particular insurance company apparenty because of what must have been unfavorable outcomes in other cases or bad experiences with the company.

      One simple thing most people should remember is to show care and concern for the injured party without necessarily admitting fault. Everyone deserves being treated with care in an accident. On more than one occasion we learned from an attorney representing the injured party that the driver who was at fault said rude or insulting things in the heat of the moment and part of what litigation was about was payback. There are many other motivations as well but this will ensure that personal payback is not the main motivation or reason the claim is not able to settle short of trial. One attorney told me they would settle for $10k over the $100k policy limit because his client wanted to know it cost the driver something out of their own pocket. We did pay our policy limit and told our client what the “deal” was. A hard lesson for careless and thoughtless words and actions. . .

      1. Thanks for the thoughtful comment Lee. And wise words.

        I’m not familiar with this topic, but this sounds parallel to what is seen in the world of medical malpractice. It is well documented that physicians and other medical care providers tend not to be sued for what they did/didn’t do or the severity of harm caused, but instead due to their relationship to the patients prior to the event and the response to the harm that occurred, i.e. bedside manner.

        It seems like being nice to other people should be common sense, but if not this may provide some additional incentive.


  2. Thanks for the update! And I’m glad the lawsuit got settled. But it does make me want to call my insurance company and increase my umbrella policy. But I hear that the larger umbrella policy, the more they go after you. A catch 22?

    Any idea where they can go after your assets that are in revocable trusts?



    1. Do you answer my own question, yes, the assets in a revocable living trust can still be attacked.

      Also, I just called my insurance company and raised my umbrella policy amount. It looks like a lot of places, the maximum is $5 million.

      For those who have umbrella policies or who plan to change them, I’d be curious to hear what the max is for your carriers.


      1. I would imagine Chubb goes higher than $5M. PURE, Nationwide private client. The high rollers don’t use mass market insurers.

    2. @Financial Samurai how would someone know the specifics of someone else’s policy, including the liability coverage limits?

  3. This is an outstanding post, Chris and Darrow! As usual – for me great timing. Always appreciate you both sharing invaluable information and in a timely manner.

    I personally appreciate the “case study” or “interview” style of posts that you all frequently do. And also the sharing of your personal experiences that prompt readers to comment and thus share their experiences. Bravo!


    1. Thanks for the feedback DJ. Stay tuned next week for one of, if not the most important, case study I have done or will do.


  4. I was wondering what happened to Darrow, so thanks for the update. So sorry about lawsuit. Hope it worked out ok. I actually did buy umbrella policy based on your original article. Something I wasn’t even thinking about but good to know it’s not a fix all.

  5. Darrow, so nice to hear you are doing well and keeping healthy! I too, was disappointed by the low rates of an annuity and decided to go a route that I would have never considered in the past. While the markets were down, I set up what I call my “market annuity” by buying $110K of 20 dividend paying stocks as a test case. None of the stocks are high flying small caps, just beaten down blue chips. The portfolio pays around $500 a month, so it is very financially comparable. Like an annuity, I consider the $100K gone, and it will be interesting to see how this works for the next several years. One benefit is that the income meets the preferred capital gains rules. It should be an interesting test! Best of luck to you and keep enjoying the west. -Ed, Pueblo, CO

    1. Interesting experiment Ed. It sounds like you’re approaching it from a healthy mental framework. I hope it works out well!

  6. This is a great update…as I very interested as I am 58 and have tentative plans to retire next year (March?). Some folks say to pile on more money, but with my wife not feeling well recently and the world in the dumper, I hesitate to put it off. I agree with Darrow that it is probably better to enjoy life and make the finances work. The calculators say it would work….


  7. Darrow – good to hear from you. Great to get your perspective and hear about the ups and downs – glad that the lawsuit got resolved.

    Let me know if you want to come on the podcast – it would offer a great perspective for our audience!!

  8. Darrow, glad to hear you are doing well. I often tell friends that finding your article, what you learned about finance from big wall climbing, was the beginning for me better understanding finance and retirement. Thank you and Chris for the work you guys do! It made a big difference in my life.

    1. Earl,

      Interesting. That’s how I found this blog years ago also.

      Thanks for the kind words.


  9. Enjoyed the post and as a fellow 60 year old I can certainly relate. While we are still working and own our businesses, travel and grandkids are becoming increasingly more important. We hope to wind things down over the next few years as we work to have our investments replace and satisfy our income needs.

  10. It was good to hear from you. I would be very interested in hearing more about your choice of Schwab stocks.

  11. It would be very helpful if Darrow shared more detail on how everything played out with being sued. My biggest concerns/questions are as follow:

    – He says that he has umbrella insurance, but then the lawyer of his own insurance turned against him by telling him that the umbrella insurance will not cover ‘punitive damages’? Did I understand this correctly? If so, insurance companies are even bigger crooks than I thought before! I thought that once you have umbrella insurance, the insurance company’s lawyers are on your side, but in this case, it sounds that Darrow had to seek additional help. First, he got some help from his insurance company, but then he had to seek an independent lawyer online so that this lawyer protects him from the insurance company’s lawyer…? If so, this is crazy!!

    – If my understanding above is correct, I would love to ask more clarification. Did Darrow hire the independent lawyer to deal with the plaintiff AND with his own insurance company’s lawyers?

    – I’m guessing that all the settlement terms are confidential, etc., but maybe he can tell an approximate amount he spent out of his own pocket. I thought that once people have auto, home, and umbrella insurances, they don’t pay more than deductibles towards any lawsuit.

    – How long did it take from that dreadful night to the settlement to close this nightmare? I assume this didn’t get to the trial, right?

    – What would his advice if a potential lawsuit fell on any of his readers? I’m guessing it would be that we need to familiarize ourselves with the rules in our own states (what should we google to reach such info?), be insured to the hilt, and stay calm? Is that it?

    – Did the insurance company drop him or increase his premiums now because of this unfortunate event?

    – How much umbrella insurance should FIRE people obtain? If I’m right (this depends on individual state’s laws, I think), 401k and IRA’s are shielded from the lawsuits. The primary residence is also shielded, but I’m not 100% sure, but the rest is a fair game to go after for us, mere mortals. So, if your taxable accounts and other property (including diamonds, expensive cars, and other collectibles) are valued between $1M-$2M, I’m guessing, you should have $2M in umbrella. Above $2M? Then need $5M in umbrella. I think the usual amounts are $1M, $2M, and $5M (and maybe $10M?). For some reason, no $3M or $4M option.
    This is just my basic understanding and if anyone knows otherwise, please share.

    Yes, the readers could google and read more about lawsuits on the Internet, but like Darrow advised it’s better to ignore the aggressive and intimidating language (even on the Internet) as that would cause them to stop dreaming about FIRE. Plus, we already have the stress of the pandemic to deal with. Therefore it would be nice if Darrow with the real experience could shed more detail.

    I’m so glad to hear that everything ended OK, but the stress he and his wife were under must have been terrible. I guess that the plaintiff was either really badly affected because of the accident or he knew the game of lawsuits and wanted to profit from the accident.

    Like David Emery’s comment above is also disturbing. Another example of the insurance company declining to pay the claim. What do you do in such a case? Do you sue the insurance company that it doesn’t fulfill its end of the contract (the defendant paid the premiums, so there must have been a contract of obligation between the insurance and the girl)?

    1. Many of your concerns and questions can be answered with an appointment with an insurance agent who is knowledgeable and experienced. Every insurance policy is a contract and the details of what is and is not covered is in your contract. Many people never read it but there are exclusions which are listed in the contract.

      Some damages are normally not covered because it might incentivize people to not behave responsibly. Your policy also expects and requires you to prevent further damage to property after a loss. If wind removes a portion of your roof, for example and water is coming inside, the homeowner needs to get a tarp or some temporary fix until the adjuster comes out and a contracfor is hired to fix it. There are conditions which go along with the coverage.

      Although a policyholder might get sued for punitive damages in a liability casualty matter, it does not mean you will ever have to pay them. The law requires certain claims be made early in the lawsuit and some attorneys will add in punitive damages just in case it might come into play as more information comes to light in the litigation discovery process. A judge or jury must decide punitive damages are warranted and the amount. That only happens if the matter goes to trial and very, very few cases go to trial.

      The attorney who is paid by the insurance company represents you, not the insurance company but anyone who wishes may at their own expense hire another attorney to review something of concern though realistically this almost never happens. It is important that you have good communication with your attorney so you understand what is happening and what the general process is. That will also help to resolve alot of your fears.

  12. Glad to hear that Darrow and his wife are doing well. Great update on how he is doing. He also has great insight and tips on many relevant topics. Darrow’s blog was the first financial/retirement blog I read. Glad I started with what I believe is still the best blog in the FIRE community.

  13. Great to catch up on Darrow’s retirement. Thanks Chris and Darrow.Being Darrow’s peer at 61, I leaned on Darrow’s books in my own decision to retire early at age 55. Like Darrow and Chris, I also used “geographic arbitrage” to relocate from coastal California to the mountains of Arizona to stretch my retirement dollars.
    I have dragged my heels on rolling over my ERISA-protected retirement accounts (401ks, 403bs) to an IRA, mostly because of the greater creditor protections these have vs. an IRA, in most states. Darrow’s experience gives me further pause to rollover. The “qualified” retirement accounts also have legal arrangements that allow them to offer some insurance products not available outside of them.
    I hope that we will continue to receive updates from Darrow. He is a talented educator!

    1. Hey Bill,

      Darrow and I have an agreement that he is free to write whenever he wants, but with no obligation to do so. Like you, I’d love it if he would write more because I agree he is such a talented educator (and it allows me to write less 😉 ). So more encouragement and less heckling please! 🙂

      Re: rolling over work sponsored accounts, I’ve covered that here: To me, the biggest issue is weighing fees vs. legal protections. If you have high fees (that are guaranteed unless you rollover), and a low chance of being sued then I think it makes sense to roll the accounts to an IRA ASAP. If you have a good plan with reasonable fees and/or you have circumstances that make a lawsuit more likely, then there is little reason to rollover your accounts and lose the superior legal protection. Bottom line, there’s no one size fits all answer there.

      Re: crutches, Darrow has struggled with a variety of leg ailments and started experimenting. He’s written about that before here:


      1. Thank you Chris for taking the time to write your thoughtful reply, for the links, and the background on the crutches. I agree with your conclusions regarding the rollover decision. And I was unaware of Darrow’s history with the crutches. Keep the good content coming!

  14. I thru hiked the CT myself in 2018; I hope Darrow has the chance to do it also. It took me six weeks, and was about the most fun I’ve had. Is he “thru-ing” or doing it in sections? The picture near the top of the article looks like the Barbara Divide?

    You all are a great team; keep up the good work.

  15. Darrow – Great to get your news and views, and happy you’re doing well & enjoying your FIRE! I’m very happy that Santa Fe has worked out for the two of you; it’s a beautiful part of the world. My family holds reunions just north of you in Red River so, I have the pleasure of visiting the area every few years. I’m still in Sausalito, where we met for coffee a few years ago, and still loving it here…despite the droughts, fires and other NorCal challenges. Your writing style is still top notch in my view; just the right mixture of detailed research/analysis & real world practicality. And, even though I miss your posts, you’ve selected an able successor in Chris. So, I still read the blog regularly.

    All the Best!

  16. Thank you, Darrow, for coming back and giving us an update. I started reading in 2016 and enjoyed your writing very much. It was a bit of a shock when Chris began taking over; yet he has proved to be very thoughtful and kind. Now, I enjoy anything he posts. But please, come back whenever you feel like it. Thanks again!

  17. Yeah… after spending close to an hour on hold waiting for a Vanguard rep, I was greeted with a sales pitch on how I should sign up for their Preferred Client program. I pulled my money out the next week. Moved on to Schwab. Customer Service is much better but am still not sold on their Private Client program.

  18. All these comments concerning the lawsuit I’m surprised no one got into your decision to not take advantage of low interest rates and get a mortgage! Surprisingly I’m with you on your decision as I loathe debt as much as you do. We recently sold our TX ho win this overheated market for more than asking price. Our net proceeds from the sale ( home was mortgage free, I paid it off during the covid panic, April 2020 as I wanted no debt in the midst of the world chaos) was $504,000. It’s sitting in an online savings account awaiting the all cash purchase of a replacement home, away from TX, in a rural Arkansas community. We will not obtain a mortgage.

    1. I’ll share my experience with a recent home purchase in Tampa. I sold a home after the market crash in March 2020 and decided to “buy low” and invest $205K in reliable dividend paying stocks that will pay approx $19K a year in dividends. This portfolio is now worth approx $310K. I decided to finance half of our new home and was able to get a 15 year mortgage at 2.25%, where I will pay about $35K in interest over these 15 years. Between the appreciation of the portfolio and the dividends, I feel that I will be will be well ahead financially than if I spent all cash for the home. Yes, there is some risk to my strategy but I feel fairly confident of this plan.

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