Retirement Date Announcement!

Ok everyone, the big reveal regarding my retirement!

I am retiring effective September 15, 2003. 

Yes the title of this post is very tongue-in-cheek. On or about September 15th, 2003 I was allowed to resign from a very brief stint at Morgan Stanley here in Prescott. I failed to meet sales quotas, I'm a terrible sales person, and so I walked out the door. Starting September 16th of 2003 then was the first day that I permanently owned my time, set my schedule working for myself, starting from scratch with two clients, a few months' worth of expenses in the bank and a very low monthly nut. 

I wasn't worried about not having a job, I'd taken several, calculated career risks already and this was just the next one. Our mortgage on our old house was about $650/mo and we had no car payments which left me feeling very empowered to start the next and still current chapter. Joellyn worked part time for our friend Bill here in Walker, whom I've mentioned many times, as handyman and that small income covered most of our bills. 

The catalyst for this post is a short article from Barron's about FIRE-FFYO...I made that acronym up, it's about FIRE for 50-year olds. The article does a good job covering the basics for anyone new to the subject but I think there is a lot more to delve into in terms of the psychology of retirement versus being financially independent.

My joke at the start of this post could have been a serious observation if I had instead said I am financially independent effective on that date in 2003. 

The psychology of actually retiring is potentially brutal in terms of confronting your mortality. I've talked to enough people about this to draw that conclusion, trust me. Financial independence is more of a continuum. 

Think about this flow; you're working but living way below your means so you can leave your job anytime you want for something new or entrepreneurial or something you would love to do but would pay much less. You're financially independent, not necessarily rich but independent, and just being able to leave your job if you wanted has given you tremendous empowerment. Time goes on and you continue to set your own schedule, finding time for the things you want to do and incorporating those things in with whatever you're doing to make an income. 

Then at 60 or 70 you're a little less concerned about the income you are making and devoting more time to things you're passionate about all the better if any of those hobbies kick off some sort of income, all the better still if you have passive investment income from a good decision you made in your 40's or 50's. Next thing you know you're doing all of these same activities but instead of your primary source of income being some sort of job, it's Social Security. Your transition into retirement then looks nothing like the person's who put in 40 years with some company doing work that didn't allow time to pursue outside interests in the manner they'd have hoped for. That second, more traditional scenario leaves us more vulnerable to retirement being a big psychological event.  

I certainly have to acknowledge that I was lucky in having this work out for me but I started cultivating this outcome much earlier than I actually started living it. I've told this story before, but I was heavily influenced by the TV show Northern Exposure. It gave permission to a city/beach kid (city growing up, beach in college) to live in a small town mostly owning their time. This was 1990 so I didn't know how I would make it happen. Then a few years later I was working on the equity desk at Schwab Institutional and some of the advisory clients were doing exactly what I wanted to do, managing small books of business living wherever they wanted to live, other clients were huge organizations in big cities too. Then the internet came along, I got laid off at Schwab in 2001 and at that point I was just a couple of years away from September 15, 2003.

All in that was 13 years plus a couple of more years for the income to be viable. Mark Baker, who I quote all the time is big on quitting your job and owning your time. I view a job where you don't own your time as a form of dues payment. There are no reliable shortcuts. I've always been good at playing the long game or as has become fashionable to say, good at understanding low time preference. 

On September 15, 2003 I was 37 years old. Dues had been paid, experience had been earned and I was still young. At 55, I am still young. At some age, we realize that we're old enough that we could have serious problems. I pin that in my life to my 25th high school reunion when all of sudden, people weren't coming back. If you start the 10 or 15 year journey to a financially independent lifestyle when you're 40 then you probably want to enjoy many years living that independence. You're more likely to have that happen if you stay strong, lean and aren't spending $1500/mo on prescriptions. Plenty of people in their 40's and 50's are not healthy and that does not portend well for a long future. I don't give a hoot about comparing myself to anyone else, I care about being independent, financially and all other ways, to a very old age. Take care of the financial independence with good decisions related to spending and the risks you take and take care of the physical independence by staying fit, lean and strong.