I Met A Couple Of Early Retirees – I Learned A Little More About “Retirement”
I was at a wedding this weekend and got to interact with a guy in his mid 30’s over a couple of days. We shared some great stories. Stories of an early retiree inspire me because I strongly believe that securing an early retirement, whether one works in it or not, cures many societal ailments.
I know the retirement police is reading this so I will also address my definition of retirement yet again in order to avoid the verbal fines.
Definition Of Retirement
My partner and I had yet another kind and educational disagreement on the definition of retirement. She, like the rest of the retirement brigade, insists that a person is only retired if they perform no income-generating work.
I, on the other hand, believe that retirement simply means a point in one’s life when financial independence is reached, replacing the income needed from work with income from savings or investments.
Furthermore, I will get into why it’s so important that we maintain the term retirement when discussing financial independence and why it’s so valuable to reach retirement far earlier than in our 60’s.
Addressing The Retirement Police
According to this group, a person must not be working or doing anything that might generate income. They can volunteer, take care of family members and grandkids, travel and play golf.
I am not sure where the line is drawn by this squad, but apparently, money can come in passively without needing to be labeled as income. Even income from real estate is considered okay, apparently real estate doesn’t require any recognizable work.
If they are a musician and they are no longer creating new music and only living off of royalties, then that’s okay as well.
Passion, which is remunerated must be reclassified as work and one must renounce their retirement status and reenter the workforce.
If then, during this return to work, one decides to not work to their fullest potential or choose to work only a few hours a week then that person must admit to their laziness and agree that they aren’t maximizing their potential.
What’s The Point Of The Retirement Designation
I discuss the retirement designation because the grammar of retirement is something that the average worker can relate to. Having someone hijack the term and give it a very claustrophobic meaning, takes away from its potential.
A person who can figure out a pathway towards retirement can gain independence from their job. They can achieve financial freedom, control over their life and build an independent lifestyle, both financially and otherwise.
Financial independence isn’t a common term, few will relate or understand what it means. Retirement, on the other hand, is on damn near anyone’s lips and most understand what it takes to reach retirement.
When we talk about retirement, the words social security, medicare, pensions, savings, and investments float right to surface.
When talking about financial independence, everyone thinks of a large financial windfall, a massive inheritance, lottery or striking oil with a business deal.
My Early Retirement Buddy
Back to my wedding buddy who, in his late 20’s, was building up his tech business. He was working hard and living in his parent’s basement and paying himself only $1,000/month in hopes of making this business work.
It took him a few years to become the overnight success that I’m sure everyone now remembers him for. Interestingly, he is an incredibly low-key person.
I gravitated to this dude right away. He had that happy, care-free, and secure look on his face. It’s hard to describe and perhaps I just threw out a lucky dart.
I made eye contact with him the previous day at the pre-wedding-drinking-event. We kind bromanced for a bit but there was too much going on. I pointed him out to my girlfriend for her approval which was met with her eyes rolling – damn eye-rolling, retirement policing partners!
Cashing Out And Investing The Proceeds
After I confidently made it over to him on the wedding day, without seeming desperate but not too nonchalant as to confuse my interest, we immediately man-bonded.
Sometime in 2011, he sold off the successful business and used the money to buy some commercial real estate. The goal was to have something which would be completely hands-off and generate a steady income for him.
We didn’t have enough time to discuss the real estate deal and we both were 4-5 drinks deep which made having a serious conversation a bit hard. I recall high-fiving a lot and we discussed lactation quite a bit as he was a new father.
Of course, my girlfriend walks in on us discussing not his success with early retirement but what his wife’s milk tasted like. Bullocks!
So, he bought a few pieces of real estate and used the rest of the money to take off traveling for 2 years with his new wife. They had a blast and upon returning, happily tired from the traveling, they realized that they were bored without work.
Coming Out Of Retirement
During my Arizona trip, I met a lot of wonderful people, mostly Uber drivers. I met around 15 different Uby’s, most who shared a good bit of their story with me.
I don’t like renting a car and strongly believe in the sharing economy. Supporting Uber drivers, second to taking public transportation, is a pleasure.
My Uber Driver’s De-Retirement
During one of my trips, a man in his early 60’s who was my driver shared with me his sudden path into early retirement. He was living in Portland running a successful software company when someone offered to buy it from him for a sizeable sum.
He sold it, moved to AZ with his lady and retired at age 52. After a few years he got terribly bored. Started a few other business, one of which succeeded and he sold that one too and retired once again.
A couple of years went by and he got bored of playing golf yet again and so he decided to try out this Uber thing which he has been doing for a year. He is doing this temporarily, waiting for a currency investment to pay out.
Though, after a few more minutes on the road, he admitted that he found the Uber concept fascinating and wanted to see if there was another business opportunity there.
Steven! That entrepreneurial rascal.
My Wedding Buddy’s Move Back Into The Earning World
I think we were on drink 5 at the wedding when he told me about his move out of retirement.
Upon returning from his travels, he and wifey realized that they can’t just sit home and collect income from their real estate investments, even though it was a good income – they just weren’t feeling fulfilled.
So, he had another business idea in the real estate world, got together a team of software engineers and is putting all his effort into this new app.
The business is in its infancy and he is hustling real hard, with his wife helping, while juggling the little 5-month-old in order to get this business fully off the ground.
What I Took Away
Retiring out of something seems to always backfire. Retiring into something seems to be the way to go.
Humans don’t prosper without a positive way to spend their waking hours. Children, family, exercise, and chores can take up a few hours, but without something else, it can be brutal.
Retiring With A Cause
I have patients in their 80’s who are more active and busy than when they had 9-5 jobs. They are involved in their community and help out their family with day to day chores.
In a way, retiring without a cause can also be interesting/inspiring, both these men seem to have gone off to start more businesses, hopefully and likely with success.
Hobbies can be a fantastic way to spend one’s time in retirement. But not all hobbies make for good retirement hobbies. Those that generate & create seem to fare much better than those which are passive time-burners.
If you like rebuilding old cars, competing in a sport, volunteering, learning & teaching, or writing then it can make for an easy retirement.
The more worthwhile, productive or positive the cause, the lower the chance of being bored or finding oneself with too much free time.
Boredom In Retirement
Retirees can find themselves bored, a high balance of free time and a low level of mental stimulation. There are 2 sorts of individuals, those who are internally driven and those who are externally driven.
The latter is more common from what I researched and from personal experience. The internally motivated persons can keep themselves busy and occupied, motivated and driven to create without any externally structured force.
For this group, it’s quite unlikely that they will suffer any measurable boredom. Sure, we all get bored. Surgeons get bored waiting for a suitable OR to become available and a mom gets bored the last few weeks before delivery while spending more time at home.
However, there is a global boredom where we just don’t feel motivated and there is momentary boredom, lasting hours or days.
The great thing about boredom is that it can spark creativity. For me, if I can sit with my bouts of boredom and brainstorm or just patiently wait for the next idea to come to me then I often come up with some exciting gigs.
Retirement Is A Concept, Not A Number, Not A Destination
I talked about my evolving understanding of financial independence and retirement. Though in the past I thought of it as a numeric investment value, throwing off dividends aimed at replacing my expenses, now it’s something much more mature.
Retirement now is a moving target placed inside a rectangle. If I can stay inbounds within the rectangle then I’m likely to always succeed financially. But I won’t hit the target with a specific number, instead I have to develop the right set of skills which will help me stay inbounds.
Nor should retirement signal an end to earning or herald the beginning of Marxist spending. Instead, it should be an open-ended ticket to go anywhere one pleases in life.
In retirement, I shouldn’t just be happy that I squeezed myself inside that rectangle. I should continue to save and invest but from a much more liberated position. And not so much robotically stashing away acorns.
I can take bigger risks, be more generous. I can set out to change circumstances around me and help family/friends nearby and work outwards in a concentric circle.
It seems as though the more I aim for a solid definition of retirement, a perfectly comfy seat at the financial buffet, the more I realize that there is no such demarcated destination.
That said, without the goal of financial independence and retirement, there is no way to ever reach that point. Without a financial plan, a budget and financial diversification, many can end up scraping crumbs off the gov’t plate.
The Sooner The Better
I realized in 2012 that the sooner I reach financial independence and a position of being able to retire, the more options I will have in my lifetime.
It’s a short lifetime, this human life we live. Getting the whole budgeting, savings, investment and financial security over and done with early, can allow us to become a beacon of hope and support to others.
We can make our mistakes, recover and start over again or adjust our course with plenty of decades left to spare.
Or we may end up in less memorable circumstances like one of the docs I work with, who at 60 has a net worth of nearly zero due to recent poor financial decisions. He’s waiting for social security to kick in at 67.
Or the other doc who at 52 has $150k to her name in her 401k and paying nearly $4k/month in rent, unable to hold down a steady family medicine job as an employee. She was accustomed to working in her own private office which she lost in a divorce.