Is early retirement all that’s cracked up to be after 4 years? A journey of FIRE (financial independence retire early)…
 |
| Tybee Island Lighthouse, Georgia |
Anonymous: “Retirement is not the end of the road. It is the beginning of the open highway.”
Even after 4 years of living our early retirement, my wife and I still get asked similar questions we got when we initially told our family and friends of our plans to retire early. Such questions are: 1) What do you do all day? 2) How do you save up enough funds to retire early? and 3) Is retirement still enjoyable?There are probably many other questions we do get asked about, but I would say these are the more common ones.
When we started planning for our early retirement way back around 2010 or so, we thought carefully about all of these questions ourselves. What should we do to spend all that time after calling it quits from the rat race? How do we save enough so we can live for the next 30-40 years? How do we enjoy ourselves in retirement and not just live to survive?
We both had good ideas about early retirement thanks to our commitment to the FIRE (financial independence retire early) movement, which dictates that we save at least 25 times the yearly expenses to retire. Thanks to pioneers in the movement, including Early Retirement Extreme (Jacob Lund Fisker) and Mr. Money Mustache (Peter Adeney), we learned so much on the subject of early retirement and on what to expect once you retire.
We both understood that besides having the funds to retire early, we also needed to talk through and plan how we wanted to spend all our abundant free time. There were plenty of articles and posts from these and other fellow FIRE movement enthusiasts throughout the years which we diligently read up on.
For those of you who are new to this blog, a little background:
We both hated going to work after working close to 20+ years. The last couple of years of our working years were especially tough. People were getting much more demanding and entitled the longer we worked. It was always “I want it now!”, and it wore us down. We no longer wanted to go to work.
We always wanted to get off the rat race and the dreaded “Monday blues” to live free and to live with much less stress. I personally know many people who love going to work. They enjoy the camaraderie, they like being productive, and they love that sense of accomplishment every single day.
We were not those people. We were always free spirits, needing to live our way, and not the way society wants us to live. We don’t have children, nor would we ever. We wanted to be free from working for a paycheck.
For us, the primary reason for early retirement was to not work, period. In that sense, we accomplished our goal. Living through the pandemic in 2020 solidified our desire to retire, as we understood life can be extremely fragile and we understood that in the blink of an eye, we can all be gone.
People’s perspectives change when encountering a traumatic experience. For us, the pandemic was the sign that we should just do it, and live the way we always talked about during our working years.
We are glad we took the initiative and jumped feet first into our early retirement. No time is ever right. We could’ve waited another year, then another year, followed by another, and so on, but what’s the point? We may have more money by working one extra (or few extra years), but that would’ve negatively impacted our health, both mental and physical.
Remember this important fact:
We only have a finite number of years on this Earth. The longer you work, the more money you may accrue, but you’re also reducing the number of good, healthy years for you to enjoy your life.
Consider these two scenarios:
1) You work until you’re 70 and you manage to sock away $2 million dollars. At your retirement, you want to do all the things you always wanted to do, like hiking the famous national parks but your body isn’t what it used to be. You have little and big aches/pains, and walking, not to mention hiking, is not really in the cards.
2) You work until you’re 50 and you manage to sock away much less, say $600,000. You are still vibrant and healthy, and you actually do get to hike those same national parks without issues.
Which scenario would you consider? If you said scenario 1, then you should work until 70 or longer to get to that lofty sum. Just so you know, only the top 2% of Americans have that type of net worth. Most mere mortals have much less than that.
I personally don’t think we could be in the top 2% of Americans any time soon, but if that’s your goal, then good luck. For myself personally, I would rather have enough money to live on, but also have my good health to enjoy my life. Everyone is different, so you choose your path wisely.
I think most people would agree that by age 70, your body and your mind will most likely not be as healthy as when you were in your 50’s. Can you really enjoy your retirement at 70 if all you want to do is to sit at home all day and do nothing but watch tv? All of us can agree that being younger allows you to do more without the aches and pains that come with age.
My goal is to have enough money to live but have the health to be able to enjoy the money I’ve accumulated. I don’t need a lavish lifestyle with jet setting tendencies. I can be perfectly happy being with a loved one, just going on a nice hike in the mountains or the beach.
If you can live on less every year, then having enough money is all you need. I recently read somewhere that Americans consider $1.45 million as an ideal amount needed for retirement, yet those same respondents admitted they actually have saved on average $80,000. Where’s the disconnect here?
This goes to show that what most people think should be the right amount for retirement is not what they actually have. For me, actions matter. Talk is cheap.
Having a realistic goal, and not just a pipe dream, is how you’ll get to your goal. Forget the fantasy figure of $2 million dollars if you’re nowhere near that amount. Consider living way below your means, embrace minimalism, save/invest as much money as you can, don’t keep up with the Joneses, forget the YOLO (you only live once) or FOMO (fear of missing out), and constantly learn about money matters. That’s how you’ll get to retirement, or early retirement.
With this long and convoluted introduction out of the way, here are answers to some of these popular questions we still get after 4 years of early retirement:
- What do you do all day?
It is of the utmost importance that we all figure out things to do in retirement, whether that’s a combination of creating something new or learning something new. I personally know several retirees who went back to work because they couldn’t figure this out.
With the advent of the internet, there are literally billions of things to learn if you so choose. I can study up on financial matters, read an audiobook, learn a new language, learn an instrument, and so on. Unlike 30 years ago, you don’t need to go to a library to pick up a book to learn something. These days, there are infinite possibilities for learning thanks to the internet.
There’s no longer any excuse for not knowing where to go to get information. It’s all right there in the tip of your fingertips!
Below is our typical daily schedule on off days when we’re at a long term stay like AirBnB or at our family’s place:
- Creating blog posts (me)
- Creating/editing videos to upload on YouTube
- Drawing/painting/creating art using painting/drawing app (my wife)
- Still watching YouTube (both of us)
- Exercising (both of us)
- Lounging at the end of the day while listening to good relaxing jazz music (both of us)
- Cooking/preparing our own meals (mostly my wife, while I chip in from time to time) *this activity takes up a decent chunk of our day if you consider even a simple meal in the morning requires preparation time (cereal with unsweetened almond milk, fruits, sometimes yogurt with nuts and raisins), eating time, and clean up time equaling roughly 30-40 minutes. We may end up spending an hour or more when making pasta with chicken cutlets when considering meal prep time, eating time, and clean up time
- Keeping up with financial news of the day (me)
- Drive to the next destination (stop at a fast casual restaurant mostly, to pick up food along the way for lunch, sometimes both lunch & dinner) *we don’t prepare or cook our own meals for the most part when traveling using hotels
- Check in to the hotel late afternoon
- Settle in, unpack our luggage, take a relaxing shower, eat dinner, relax, and do a combination of writing, drawing/painting, watching videos, watching cable tv at the hotel, etc.
- We would typically stay at least 2 nights at each destination, so the next day we’re outside exploring an attraction or two
- We’re back by mid afternoon, then repeat the schedule from yesterday which is settle in, take a relaxing shower, eat, relax…
- When we’re staying longer than 2 nights at a place, we may choose to stay in at the hotel if it rains all day for example, or we’re exhausted after hiking the previous day; our choice…*This is the beauty of early retirement. We have plenty of time to do things or not do anything at all.
- Eat free breakfast at the hotel, pack, get ready, then on to the next destination, then repeat
- How do you save up enough funds to retire early?
Of course this is simple when you look at it. What many people fail to grasp is the importance of budgeting, to spend less (hopefully much less) than what you make. Without budgeting, you’ll never be able to save enough money to retire. Period!
What good is earning $100,000 each year if your yearly expenses are $100,000? In this scenario, you’ll need $2.5 million dollars to retire. Like I said, not impossible, but only the top 2% of Americans have achieved this level of net worth.
More doable scenario is to lower your yearly expenses so you don’t need to wait until you have $2.5 million dollars. Let’s say you can live on $40000 per year in retirement. Then, you need to save $1,000,000 (25 times 40000). Much more doable, isn’t it?
How about if you can live on $30,000 yearly? Then, you need $750,000 saved. Seems even more doable compared to that lofty sum of $2.5 million dollars, doesn’t it?
Now, I’m not saying any of these sums saved is easy. If it was, then everyone would be retired early right now. It takes tremendous determination, dedication, sacrifice, hard work, planning, and patience, to get there.
You can’t live like there’s no tomorrow if you want to retire early. You need to dramatically cut down your spending, budgeting every month, embracing minimalism, finding things to do that’s free (or little money), saving/investing diligently, to get to your goal.
Once you’ve controlled your spending, then concentrate on paying off debt and saving to invest money. Don’t stop at contributing 5% of your paycheck or even 10% of your paycheck. Instead, go for maximum allowed for 401k contributions when you can.
The more money you accrue in the beginning so that you have your first $100,000, the easier it’ll be to get to your goal. Let the magic of compounding interest do its thing.
For those that can follow the path of those FIRE movement enthusiasts who have successfully retired early, then the reward is having financial freedom, to decide to continue to work or not, to hand in that resignation letter or not, to live free without the dreaded “Monday blues”, and living the way you wanted to.
There’s no easy path forward. Like anything worthwhile in life, like learning to play basketball like Michael Jordan, you have to work at it…
- Is retirement still enjoyable after 4 years?
Every day is a blessing, a chance to enjoy little pleasures in life, and to hopefully learn something new and to create something out of nothing. We are so grateful, thankful, and blessed. We’re enjoying our lives right now, every day, thanks to our early retirement…
In conclusion:
There’s nothing quite like actually doing something yourself, to actually go through it yourself. Despite all the early planning and researching early retirement, we still had to adapt to a new reality that we can’t really enjoy our retirement by watching videos and sleeping late all day and every day.
We had to adapt, improvise and overcome to really start to enjoy our retirement. Once we did that, we’ve never looked back. With our combined schedule of doing long term stays (AirBnB and/or family) and hotel stays (road trips), we’ve found a perfect balance of living the best version of our retirement.
Everyone’s version of their best retirement scenario will be different. Find yours, and you’ll also be able to enjoy it all the more.
Thank you for reading and happy trails! Good luck on your path to FIRE and your journey of FIRE!
Jake
Wandering Money Pig
