Early Retirement Doesn’t Exist

Early RetirementI’m a big quote fan.

For instance, the following quip from Mary Schmich’s “Wear Sunscreen” speech is one that I like to keep handy:

“Sometimes you’re ahead, sometimes you’re behind, the race is long, and in the end it’s only with yourself.”

On the subject of retirement, I think it’s particularly applicable.

I, along with what I would imagine to be the majority of you readers, spend a good deal of time looking into the concept of “early retirement.” We share tips and tricks: tax “hacks” and money savers, frugality benefits and motivation boosters, couponing and side hustle possibilities along with the underlying concept that less is more.

We emphasize these truths – testing them out – and then dispense them freely for anyone with an open ear and a bit of time.

For instance:

Dividend Mantra has the goal of retiring by 40 and graciously shares his progress each and every month.

Retire Before Dad’s aim is to… well retire before his dad did.

Mr. Money Mustache and Go Curry Cracker continue to “show the light” after already accomplishing the objective of retirement in their early 30’s.

Some even take the X-games route and declare “Early Retirement Extreme.”

They all spread great messages; and whatever ideology you happen to follow, the general idea is to retire before what might be considered “normal.”

Yet that lends the question: “normal” in comparison to what?

Most people would default to age 65. The average is about 62. However, neither appear to be very good barometers.

Consider your typical classroom. For simplicity sake, let’s assume that the students’ grades follow a nice, normally distributed bell curve: the average grade is a “C,” with commensurate A’s and B’s flanking the flunking D’s and F’s. It’s a true hodgepodge of both intellect and drive.

Surely, you want to teach, motivate or better yet inspire the D and F students to do better (as all of those encouraging movies with the sad to upbeat soundtracks accomplish in an afternoon). You know it’s possible. Perhaps not in an hour or two, but with enough time and effort anything is achievable.

For the C students, conceivably you work with them some, but not as much as the D and F students. Their situation isn’t quite so dire and after-all they will pass – someone has to be average.

When you get to the A and B students, you basically pass along this advice: “keep doing what you’re doing.” Perchance your instructional techniques might vary slightly from the one’s I just made up on the spot. What’s clear, though, is that it would be misguided to tell the A and B students: “You know, you’re doing better than average, you should slow this thing down as to not appear as if you’re gloating. There’s nothing wrong with getting some C’s, just ask Sally.”

The same holds true for retirement.

The average person is expected to retire around 65… then the story stops. The follow up to that statement should read something along these lines: “everyone is different with varying goals, objectives, talents and motivations; some have the wherewithal to retire at 30 while others may never stop working. Yet none of that is important as long as you understand that the only person responsible for your actions is you.”

Admittedly it’s a bit longer, but I think it represents the idea a little more fairly.

Retirement is a highly personal thing, and I’m saying that without getting into the numbers (do you need $250,000 or $2.5 million?).

If you have the potential to retire at 40 and you try on the golden watch at 55 should you truly be celebrating its “early” arrival?

For that matter, should we trivialize the hard worker that enjoys spending time with co-workers and finally decides to hang it up at 75?

I’m not here to tell when or what your retirement should be. Out of all the people in the world, Warren Buffett is the absolute last person who needs to have a job (in this millennium or next) yet, at age 83, he still heads to the office each morning. He enjoys it.

The person who ”wins” is not the one that gets there the quickest. Instead, it’s more along the lines of the old John Wooden quote: “don’t measure yourself by what you have accomplished, but by what you should have accomplished with your ability.”

What should you accomplish?

12 thoughts on “Early Retirement Doesn’t Exist

  • August 14, 2014 at 2:34 pm

    Thanks for the mention in your post. Lot’s of food for thought. I usually try to add a qualifier like ‘relatively early’ when discussing my retirement age because it is before the averages you mention above, but quite a bit later than some early retirement achievers/goals out there. And like you say, everyone has a different vision of retirement. At 55 I want to stop working completely, no side gigs, all passive income. Buffet on the other hand keeps working. To each his own.

    I’ve been a reader for a while on SA. Good luck with your new blog.

    • August 14, 2014 at 2:39 pm

      RBD, thanks for stopping by! Yeah, it’s all personal – “in the end the race is only with yourself.”

      It seems like you’re a pretty good track. I appreciate you following me on SA and here. Stay tuned for more. All the best.

  • August 14, 2014 at 5:23 pm

    I think the key is to seek financial independence, whether you decide to continue to work afterwards or not is of another matter, but I want that mark at an early age while also enjoying my journey.

    • August 14, 2014 at 5:45 pm

      Kipp, I think you have the right idea. I believe the traditional view of retirement is… well, retiring; especially for those motivated to reach financial independence on the sooner side. It doesn’t seem too far-fetched to imagine a future whereby we’re “working” (i.e. trading time for money) much less and “enjoying” much more. In fact, it’s already begun. Thanks for sharing!

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  • August 19, 2014 at 7:29 am

    It’s interesting how everyone’s definition of financial freedom is so different. I’m motivated to earn enough passive (or low maintenance) income to free up time to pursue the work that I love. I don’t foresee myself retiring early necessarily, but I hope to be off the traditional path as soon as possible.

    • August 19, 2014 at 8:23 am

      Hi Addison, thanks for your comment! I believe your thinking is sound. It seems the traditional idea of “retirement” is effectively being retired while financial independence / freedom is becoming more present each day. Freeing up time is the biggest part of it – that’s the true asset.

  • August 29, 2014 at 12:52 pm

    Hey Eli,

    Came across the blog through your articles at Seeking Alpha (I need to get back on the horn to pump some more articles out myself!). I’ve always enjoyed your writings there and of course the same holds true for your articles here.

    As someone who is genuinely fascinated with retirement, the concerns with “retirement” simply strain from the definition of retirement itself. We have been brainwashed if you will to expect that retirement only comes after 65 and you must have amassed $1MM in order to do so. For me, the definition of retirement is my passive income stream exceeding my living expenses. Because of differences in definitions, my friends, parents and even wife think I’m crazy when I say I’d like to retire by 45-50 (Again I need to get on the SA horn and start doing some calculated projections).

    Now because of my 5-10 year life goals – start a family, start a business, purchase real estate, I know I currently have to supplement my passive income with a full-time job. Mr. Money Mustache published a past article that detailed a savings percentage breakdown and the biggest thing that stuck out to me, and should have been most obvious, is that if you can save 100% of your current job income, you literally can “retire”. While that is extreme to think about in my current situation, the over-arching theme is a no-brainer.

    Give me 10 years, 2 kids, a few rental properties and a potential business to sell or receive additional passive income and that just might become doable! (To those of you married, your wife definitely has to be on board 😉 )

    Keep up the fantastic writing here and on SA!

    – Erik

    • August 29, 2014 at 2:25 pm

      Hi Erik, glad you stopped by! Definitely appreciate both your comment and kind words. I’ve been working to get 3-4 articles per week out on Seeking Alpha and beginning to ramp up here as well.

      I certainly agree with your synopsis. Incidentally, I also wrote an article on Seeking Alpha titled “You Don’t Need $2.5 Million To Retire” (http://seekingalpha.com/article/1825732-you-dont-need-2_5-million-to-retire) that works to a similar point. It’s all about income replacement.

      Sounds like you have a solid plan in place. I wouldn’t worry too much about what other people think. Remember, “sometimes you’re ahead, sometimes you’re behind, the race is long, and in the end it’s only with yourself.” Keep at it!

      I’ll make you a deal: I’ll keep up the “fantastic writing” if you continue following my works 🙂

      All the best!

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