Why you can do it differently.
The common assumption about retirement is that you will get a set amount of social security at a set time – when you get to 65, you leave your job and start living off your social security checks and pension payout.
But if you want to create and define for yourself a great life pre-retirement, why would you settle for the status quo after? The truth is that you can plan for and enjoy exactly the life you want after you leave the workforce – without limitations!
There are two very simple reasons why you don’t have to adopt the same definition of retirement that everyone else does:
- Social Security is just a government program, not a code you need to live your life by.
- You have more options than ever before to save and invest your money in ways that make it possible to live alternative lifestyles.
That second point is the real key. A lot of people worry about the shift away from traditional pensions, where your company guaranteed some amount of income in retirement, towards things like 401(k)s and IRAs where the burden to save is on you. And there are some legitimate societal concerns there, particularly for older generations that don’t have as much time to adjust to the change.
But for the well-prepared, this shift actually opens up a lot of opportunities. Here are some of the big advantages you have today that didn’t exist for past generations:
- The money you save is yours – Unlike with traditional pensions, where you had to rely on your company’s word and you had to stay with the company for years to maximize benefits (or even keep them in some cases), the money you put into a 401(k), IRA, or regular old taxable account is yours, plain and simple. You can move it with you as you change jobs, start a business, become a stay-at-home parent, or whatever else it is you choose to do.
- You can choose to save more – You aren’t require to wait until 65, or any particular age, in order to get “full benefits”. If you’d like, you can choose to save more so that you can reach your financial freedom sooner.
- You have better investment options – It used to be really hard and/or really costly for regular people to invest their money well. That’s no longer the case. We now have easy access to top-notch investment options that not only perform well, but require minimal work to maintain. You can put your money to work making a better future for yourself, no matter where you’re starting from.
- You have more choices when it comes to work – Technology has made it easier than ever for people to work remotely, start side projects that could eventually turn into full-time gigs, and generally do things more efficiently. You can certainly still take the route of finding a good company and working your way up, and for many people that’s a desirable way to go. But it’s no longer your only option.
These aren’t trivial things. These are radical changes that open up an entire new world of opportunity and allow you to define “retirement” pretty much however you want.
In fact, I’m getting to the point where I’m not even a huge fan of the word “retirement”. To me, financial independence is the phrase that gets much closer to what I see people wanting to work towards.
Financial independence isn’t about working until you no longer have to work.
Financial independence is about purposefully building the financial resources that allow you to live whatever life you want to live, as soon as possible.
– via Mom and Dad Money
How Does Your Life Change In Retirement?
Leaving the rat race sounds great, but if you focus entirely on savings accounts and pension plans, it’s easy to lose sight of the day to day changes once you retire. Here are just a few of the simple pleasures you can expect once you leave your 9-5 and start this newest phase of your life
* House is much cleaner.
I’ve never had cleaners and now I know I never will. I enjoy spending 10 minutes a day, or 50 minutes once a week cleaning the kitchen, bathroom, and common areas of the house. There’s something soothing about this process that also feels very rewarding. If you have a working partner, s/he’ll love you for it too. Stay at home men of the world, unite!
* You learn to do things yourself.
When I was busy working, I didn’t have time to figure out how to fix the leaky toilet. I would call the plumber and pay him $150-$250 at a time. Nowadays, I simply search on YouTube for a home maintenance tutorial and voila! Call me handyman Sam. If I can’t fix something I’ll chat up the local hardware store attendee and see if he can tell me what’s wrong. Having a smartphone to videotape the issues helps tremendously.
* More purpose in life.
Most people I know don’t believe their purpose in life is whatever they do at their jobs. In fact, plenty of folks start getting depressed when they talk about spending all their time at a job that doesn’t really make a positive impact. They see a job as a stepping stone for something greater and can’t wait to get out. Once you no longer have to work for a living, you sidestep such a means and get to go directly to the source. I’d like to think my purpose in life is to be a good son and leave some nuggets of financial wisdom to others that will last long after I’m gone. I’m looking at new avenues in public service such as working in the foreign service to continue my family heritage of serving our country.
* No fear of getting fired.
Nobody is safe in this economy. You could be a star performer but if your bosses hates you for whatever reason, you’re done. The internet and social media has also elevated your risk of getting fired because nothing you Tweet or write is ever fully private. There’s a recent case where two developers joked about dongles, forking, and repos (real tech terms) and a woman sitting near them overheard, got offended, posted their pictures, tweeted it to her 10,000 followers and one of the guys got fired! The woman who tweeted the picture also got fired so that equals a lose-lose situation. It is a wonderful feeling not having to always watch what you say or do in this free country. If you depend on your job to survive, do not mess around with social media. You will get forked.
– via www.financialsamurai.com
Are you planning a traditional retirement? Or are you building a retirement plan of your own?