Money is the Easy Part

There are hundreds of talented bloggers in this space that can tell you dozens of variations on how you can become Financially Independent before you reach conventional retirement age.  I can tell you the short version in one sentence.  Spend much less than you earn, invest the balance in your own choice of stocks, bonds, real estate or your own business until your mix of investments provides you more than enough to live the way you want.  And enough so you can live that way without having to work a full time job.  And while that requires time and discipline and usually saying “no” to yourself fairly often, the math is indisputable.  As long as you have a reasonable income and do not get viciously sideswiped by Murphy it is pretty much a lock.  

That’s what my wife and I did and we did it with three kids and a single income. Admittedly it was a pretty nice income, but not a huge one.  And while I did not retire much earlier than most, I could have. But I was just having too much fun at my job.  And judging from the number of people who self report their amazing progress towards financial independence, the plan seems to work for a wide range of incomes and family situations.  In fact, I think getting enough money to retire early is not the hard part, it is the easy part. 

The hard part is…what comes next?  I know this, because I spent about two years in a job I was falling out of love with, paralyzed by not knowing who I would be if I quit.  I was the classic big fish in a small pond.  I ran the largest employer in my town, one of a handful that large in our entire state. Everyone knew my name in my town, in my state capital and to a small extent I was even known in Washington D.C.  I was on television, in the newspapers and on YouTube.  But all of that was because of my job.  I was a personality because I was the face of a well known regional corporation.  I was treated better than others by my barber, my doctor, police officers, senators, governors and other business leaders. I had a few billionaires on my contact list and they’d take my calls. 

If I let my passport expire I could have a new one the next day just by making a call.  I did not go out of my way to try to use the notoriety to my advantage but you don’t have to, it just happens.  It is the essence of privilege, that it runs in the background, like some amazing app that removes everyday friction from your life.   I  received nice gifts, free invitations to cool events, seats in football luxury boxes and  people would answer my phone calls, or call me back in five minutes. It was not celebrity status, I was not famous by any stretch, but I had just enough of something like it to realize it made almost everything in my life easier and better.  And I will admit it, I did not want to give that up.  Why would anyone want to give up that kind of treatment? 

Now that was me, and your world might look different.  If you are not surgically attached to your career like I was then leaving it behind may not induce that much fear.  But even so you still spend most of your time working.  Most of your social interaction is while you are at work and it is likely that many of your friends work there as well.  You know people are going to ask you that question, “What do you do?” because that’s what we ask everyone when we meet them for the first time.  And if you retire you will not have an easy answer.  If you retire young then you will really confuse everyone.  Half will think you were a secret trust fund baby and the other half will figure you are growing marijuana in your backyard.

I did not have as big an issue with retiring early in this regard as most do.  And that was because, along with the local celebrity status, came the idea that I must be making millions in my job.  In fact I was well paid, but on the low end for the position I held, because  I worked for a  family owned company for most of my career.  The stock options and huge corporate bonus structure common in upper management today  just did not exist at private companies like it did when we sold to a Fortune 500 firm.  I’m not complaining, I chose to stay there because I loved it and it paid me more than I actually needed. I had to save fairly aggressively to become financially independent, but so do all but a few people. But because of my job everyone thought I was rich, including my truly filthy rich friends.  All that to say that it wasn’t unusual for “rich” people to retire early and our part of the state has a lot of rich people who no longer work due to the presence of large oil fields.  So most people probably wondered why I worked even as long as I did since I was undoubtably sitting on huge piles of money.

The benefits work brings are status, pay checks, health insurance, friends and a structured way to spend your time.  Retiring means you lose all of that.  No more paychecks until you get old enough for Social Security, or perhaps a pension.  No insurance of any kind unless you pay for it.  You lose most of your work friends, trust me that you’ll be lucky to keep even a couple of them.  But the real biggie is you lose that structured way to spend your time.  That probably sounds great to you now if you are in a job you do not love.  But there is security in the familiar, even if the alarm early Monday morning makes you grimace you still get up with a plan.  It is not a plan of your own making but it is a plan to do just what you’ve done for the last 51 Monday’s in a row, go to work.  As hard as it is to feel that concept from where you are sitting right now, it is real.  When the alarm stops going off and you wake up with nothing you have to do it can feel even worse than your old workday Monday morning.

Engineers plan, it is one of the main parts of almost every one of our job descriptions, planning.  And from early in my career I had been making plans for retirement and for keeping my marriage strong.  My wife and I cultivated shared active hobbies, things like tennis, running, hiking, fishing and a half dozen more.   I also had studied my dad’s retirement and the fact that he got great pleasure from working part time into his 70’s.  In fact the income he brought in after he retired allowed a guy who never got close to making six figures to become a millionaire and to be able to watch his portfolio grow until the day he died.  When my company sold to a large Fortune 500 corporation I knew I might lose my job, in fact I expected to.  Usually my level of upper management was swept away and replaced with “their people”.  As fate would have it the people running the new company were old friends of mine and I was spared, in fact I was promoted.  But I did not know that at the time we were sold. I had two pretty fun years with the new guys and enjoyed the extra financial perks that came from stock awards and bigger bonuses but the extreme management style started to wear on me. The fact that I realized I was past needing any more of their money finally sunk in, so I pulled the trigger on retirement in spite of my fears of becoming someone else without my title and my position.

And my plans have worked out well for the first three years of my retirement.  Because I stepped straight into a consulting agreement with several large companies in my region I kept some of my public image and many of my business and political contacts even though I only work a day or two a week. I don’t have all the perks of my previous life but I still have most of them and can gradually slide toward being totally unemployed at some future date at my own pace.  I also make, on an hourly basis, about the same amount I made during my highest earning year, though the work I do now is low stress and enjoyable.  My wife and I spend more time on all of our hobbies.  We just got back home this Saturday morning after a seven mile run together with several other friends. She’s headed across the state later today to play on a tennis team and I’m typing my blog.  This last week we hiked, visited the Grand Canyon of South Arkansas (very top secret, you won’t even find it on the internet!), played pickle ball and tennis several times and I squeezed in a couple of days of lobbying at the state capital where the legislature is in session. 

I spend a lot of time chairing a college board and a charitable foundation board, both of which do great life changing work and the combination of paid work, non paid volunteer work, active hobbies, blogging and keeping track of our three grown and out of town kids leaves me and my wife pleasantly busy but with as much down time as we want.  Sometimes I think there is maybe one more thing I need to find to round things out or that maybe I should replace my side gigs with something more important but I’ve got the rest of my life to figure that out.  Our finances are on autopilot, the consulting pays all our bills so we just let our portfolio reinvest itself and grow.

In short, the planning paid off, it is all working just the way I hoped it would.  But what would life have looked like now if I had failed to plan?  Financially would I be happy if I had not saved enough to know that I’ll only need a mathematically sound withdrawal rate to support my lifestyle if I stop earning completely? If I had not invested years in the volunteer work I’m doing could I have stepped into those positions after retirement?  If my wife and I had not run thousands of miles together over the last decades and hit millions of tennis shots  since college would we be fit enough to do the extreme hiking we do and competitive enough to play on tennis teams with people twenty years younger? If we had not invested the time and required the accountability we did with our three now grown kids would they all be the self sufficient and fiscally sound adults they are today or would we still be having to help support them? It occurs to me that I love my life, to a large extent, because I built a life I love. 

It bothers me that so many people in this space talk about their jobs like prisoners talk about their incarceration.  They seem motivated solely by the desire to escape.  But escape to what?  I fear that the reason they hate their jobs isn’t just about their jobs but it is about their not knowing how to design a life that they enjoy.  The job becomes an easy excuse for the real problem, the fact that their life has no meaning to them because they haven’t taken any steps to make it meaningful.  Somehow they make the intuitive leap to thinking that if they just escape from the tyranny of work they’ll be happy.  To me that’s crazy thinking.  You better figure out how to be happy at work and happy with your life now and then plan your post work years.  Plan them to contain more of the best parts of your current life and plan them to avoid most of the worst parts.  I started developing non-core work skills thirty years ago that now make my side gigs possible.  I started running over two decades ago, and played tennis and fished my entire life.  I’ve been doing my volunteer work for twenty years and now am an integral part of both organizations.  I can’t imagine what waking up on day one of retirement without any idea of what I need in my life to be happy and fulfilled.  I am glad that is not how my retirement started, and I hope you take steps to plan your retirement starting today. 

What about you, if you are retired did you plan your next life or did you just plan to wing it? 

Are you still years, or decades away from retiring?  If so what planning are you doing? 

As usual, to leave a comment just use the comment box or click on the title of this post.

14 Replies to “Money is the Easy Part”

  1. Steve – I think you are absolutely right. For high income earners – money might actually be the easy part – although I would say I know some folks making a million dollar income and still struggle in keeping their spending in check. The money part is the big challenge for most people not earning the high income.

    It must have been hard to walk away from your job at NewCo given the promotion, more money, and the perks. And it seems you were having fun at the same time working with people whom you have a good relationship.

    What lead you to walk away from such a job?

    1. I had three main reasons, one was it had stopped being fun, the new guys had a totally different style than the family owned atmosphere I had been used to and after a couple of years it started to irritate me. Two I did not need the money, at all. And spending 50 hours a week plus all the travel wasn’t leaving me with as much time as I wanted for other things. And third, my job exposed me to civil and criminal liability for things that I did not even know about. I know that sounds crazy but I saw two friends with similar jobs become convicted felons for things that their subordinates did because a jury of their peers thought they “should have known”. I’m not crazy about that legal standard of guilt and did not want to risk things like that if one of the hundreds of people who were under my management did something illegal that I was not aware of.

  2. >>It occurs to me that I love my life, to a large extent, because I built a life I love.

    You are very correct here, Steve. GREAT post. A funny thing with a lot of the blogging community is they are finding enjoyment in work AFTER leaving their job. I do hope more will focus on discussing ways to enjoy a full life, not stuck in life traffic waiting for the first exit out.

    I grew up very religious, and as I got older, I realized SO many people are/were waiting for the “Jesus Train” to show up and take them all away… and they were all missing out on experiencing “heaven on earth”. I realize some people are dealt a very bad hand in life, but for most of us (if not all) born in the USA, you have an opportunity to CREATE the life of your choosing. We can all be “little gods” in our own little worlds. It’s a gift — don’t waste it.

    Again, great post.

    1. Thank you! I almost included a paragraph about people who are exceptions, where systemic poverty or severe disability constrains opportunities, because I know how fortunate I am to have been given a running start in life. But I decided that wasn’t necessary because this post was directed to those who don’t struggle against staggering odds. It was written to people who will have the means to retire but may not yet have the vision to design that life in advance. It really is never too early to start preparing for the rest of your life.

  3. Anyone would have a difficult time stepping away from a job they enjoy and the status it brings. I think you did a great job with planning for retirement. That’s the key to a successful transition especially when it will be a difficult one.

    I’m not sure I agree about work, though. I liked my career at first, but I changed. By the end, I really hated going to work every day. Luckily, I had various pulling factors as well. I enjoyed being a blogger/stay-at-home dad. Self employment is a great fit for me because I can do what I want. It won’t last forever, though. I need to plan for the next phase in life too. Our son is already growing up and needs less of my time. Eventually, blogging will become old. We have to keep evolving.

    You’ve done really well. That’s good execution.

    1. I think you’ve got a great perspective, we do keep changing. What worked for me the last three years probably won’t be what works best in another three years. Blogging may get old for me too, or not, it doesn’t really matter, the possibilities in life are endless!

  4. You definitely have to have something to retire too. I think people kid themselves and just saw when I retire I will travel more and leave it at that.

    Sure I expect to travel more but that can only take up so much time. (I think the benefit of being retired when traveling is that I can extend vacations from the 1 wk I usually take to 2 or more weeks to really get immersed in culture)

    But still that leaves a lot of downtime. I’m glad I discovered blogging because it really keeps my creative side going. I hope I can make it last because it is quite a challenge to be consistent (and I always worry about running out of material to write about).

    I have sort of let my passion for music go down the wayside so I hope to reignite that and perhaps expand my cooking skills

    1. I kind of get ready to get back home after a week or ten days on a long distance trip. There are still places I want to see around the world but not that many. I much prefer action vacations that involve extreme hiking, or skiing or fishing or something outdoors and in motion. I like blogging too but I also do like to have my paid side gigs. There is something about them that is different, much of the rest of what I do is all on my own terms but the part time work imposes deadlines and project schedules on me and for some reason that improves the rest of my life. I haven’t really figured out why that is the case but it seems to be.

  5. Another good article and you are on a roll.
    You’re right on track by coaching the readers to define their own retirement. Winging it is not the answer if you’ve invested your time and money achieving FI,

    Find ways to spend your 168 hours each week when someone else is setting your agenda for 40-50 hours each week during your quest for FIRE. Everyday is Saturday. You need to re-learn to structure 4-6 hours each day without Outlook directing your activities.
    Retiring to another W-2 job is allowed if you are truly passionate about helping people, making a difference while enjoying the process. The freedom in your minds eye is priceless. None of your new colleagues has to know you are FIRE’d.

    1. That’s a good point, sometimes it is maybe better to keep it to yourself that you are just working for fun. I tend to tell people that do what I do full time, and probably have no choice if they want to keep eating and keep their lights on, that I only do it part time as a hobby. I think that is kind of rubbing them the wrong way, like I’m better than them or something? It is almost having to choose to let people think I mismanaged my money and now have to work just to make ends meet or come off as bragging. I still struggle with how much to say to others and how to say it. The fact is I don’t know anyone outside of this blogging space that is working just for fun in retirement, except me, and some ultra rich guys who are “working” on big corporate boards that meet maybe quarterly for a day. It is one area I still haven’t figured out, I feel great about how my life is structured and how my planning paid off but outside of the blog and my immediate family I can’t seem to tell anyone without getting weird looks.

  6. Great post Steve, and I think the line about building a life you love is extremely important. I’ve been guilty of falling into the trap of thinking that reaching my FIRE goal will somehow magically make every moment more enjoyable. Over the last 1-2 years, I’ve been thinking much more about my plan for after I retire and starting to fit more of those things into my life now.

    1. While I had a plan in place it wasn’t a sure thing I knew I could pull off. I got lucky that a number of key things fell into place at just the right time. I would have had to go with a different plan B if plan A had not come together like it did. For many people a perfectly good plan may be to decompress for six months and then to begin to form a plan. We are all so unique in our skill sets and in what makes lights us up. And often we are not great judges of what we like until we try a few alternatives. The fact that you are already thinking ahead about more than just hitting a number shows you are the kind of person that is going to enjoy putting a plan together. Plus, if money is not a pressing concern anymore you have great freedom to try, fail, and repeat as many times as it takes!

  7. Great post, Steveark!
    I love how you describe things.
    Unfortunately it feels like I’m running away from something, rather than against it.
    How much did you retire on 3 years ago?

    1. Sorry I missed this comment until now. I’ve always been cagey about our net worth because my identity has been leaking out among some of my friends despite my attempts to remain clandestine. I usually just leave it at several million, one of which I inherited. I could have retired much earlier but one, I didn’t even know it was a thing! And two, I still was enjoying the job too much to leave.

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