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By Michael Drak
Special to the Financial Independence Hub
Today there are a number of early-retirement bloggers out there doing great work, teaching people how important it is to adopt a frugal lifestyle so they can quickly regain their freedom.
They continue to preach the merits of “early retirement” but as far as I can tell none of the ones I follow are really retired. They continue to earn money from some activity but the key difference is that they earn that money on their own terms doing something they enjoy. They have earned the option to take a traditional full-stop retirement but for some reason have chosen not to. The question we all need to ask yourselves is why?
The other day I read an article in the Toronto Star about “Canada’s Youngest Retiree” and his book that outlines the strategy that enabled him to retire at the early age of 34. The article went on to say he authored six national best-selling books after retiring and became a millionaire through investing.
Why not retire at 14 and make millions revealing how you did it?
I found the article interesting and said to my son Austin (who still lives at home): “Why don’t you pack in school, and retire? Being 14 years of age we could probably get you into the Guinness Book of Records as the earliest retiree on record. Then all you have to do is write some best-selling books about how you were able to retire at such an early age, go out on the seminar circuit and preach to everyone about how you were able to do it.
You will make millions as people always want to find the quick-fix, the easy way to become financially independent without doing all the hard work. Austin was really excited about retiring and not having to go to school anymore but then the Contessa got involved and let’s just say that was the end of that.
I’m concerned we are being oversold on the illusion of early retirement as if it will be the solution to all our problems. Believe me on this, it will not be. You still need to have a well-thought game plan for what you plan to do for the rest of your life. In simple words, you need to find something fulfilling to do. Based on their actions most of the early-retirement bloggers and Canada’s Youngest Retiree would seem to agree.
A Retirement Lesson from my Father
I remember when my father decided to retire. He was in charge of a large accounting department that went through a difficult SAP conversion late in his career. The constant high stress over a couple of years finally convinced him that he had to leave to protect his health. However, being my father he felt he had an obligation to the company to hang on until the pro
ject was completed even though he was suffering from high blood pressure.
Staying there too long would have killed him but as we later learned, leaving to do nothing would have ended up killing him as well. Death by stress or death by boredom either way you cut it you end up being dead!
He finally was able to retire when he turned 60 but immediately started to suffer from Sudden Retirement Syndrome (which I described in a previous Hub blog). The shock of leaving a long-term successful career to do nothing created significant stress for him. He was unprepared for a full-stop retirement and the drifting and boredom was causing him to lose it.
Luckily my mother (who is a very smart woman) threw a copy of the want ads at him with a few opportunities circled and said “Here, stop whining and go find something to do.” My mother is Irish, can you tell? It didn’t take long before my father had a new part-time job delivering pet food to people at their homes.
When I heard what he was doing I had to laugh. Here was a former corporate executive who at one time had managed a group of about 60 people and now he was having the time of his life delivering pet food to people. But he didn’t stop there. He was concerned about his health so decided to start cutting some lawns as a side gig to get him into shape and generate a little bit more fun money.
How to avoid gym fees and be your own boss
My father was always frugal and would never pay money to go to a gym so instead he created his own work-out program by cutting lawns and boy was he ever happy with his new lifestyle. Minimal stress, no more deadlines and he didn’t have to manage other people anymore.
He was his own boss now, working part time and was really enjoying life again. You see, it doesn’t have to be much, it doesn’t have to be complicated it’s all up to you and what you need to do in order to be happy. Some people view this as the last chance to chase their dreams, some just want a part time job. Not everyone has to buy a computer, get some good internet and create their own blog or on-line business. Everyone has different needs and we just need to find the right mix for ourselves, some combination of work and play that will make us happy and many times it doesn’t take much at all!
There is a lesson here for all of us here.
By achieving findependence we give ourselves the power of choice, an opportunity to start over and look with great anticipation for what lies ahead.
The Contessa and I have chosen to create an interesting life for ourselves and our family. Not a sit-on-a-beach, drink- and eat-yourself-silly kind of life but one that is active and exciting and that will provide wonderful memories because memories are all you are left with when all is said and done.
Turn your “Paycheck” into a “Playcheck”
The beauty of gaining findependence is that you do not have to chase after money anymore. Work takes on a new meaning and is it really work if you really enjoy what you are doing? Some may decide to follow the volunteer route, others might decide to find alternative work where they feel they are making a contribution, to feel they are still in the game, to feel that they still matter. We decided to do a bit of everything but our future income our “playchecks” will be invested in “adventures” not “things” for our family. When you view money this way it opens up a whole new way of thinking and life is suddenly very interesting again.
The Contessa and I really enjoy depositing our “playchecks” into our new “adventure” account and when we have saved enough off we go on another great adventure with the kids. An adventure where they have to sweat a little, but learn a lot. To be honest, it kind of makes me feel like a kid again understanding that our future is limited only by our imaginations, and our willingness to challenge both our minds and bodies. The anticipation of going on our future Safari adventure, the planning, the required getting into shape, puts a spring in my step and a smile on my face.
Dream it. Do it!
We have adopted “Dream it, Do it” as our new family motto. Dreams have no boundaries and thinking this way has had a positive psychological impact on both the Contessa and me. Achieving findependence was a significant pivot point for us and gave us the opportunity to take our lives to a higher level but we still had to make the decision to walk through that door.
Working in the corporate world you tend to play it safe, you drift, you are on autopilot following all the rules. Once you achieve findependence you are back in control of your destiny but you need to accept responsibility for your own future. From this point on it’s all about who you will become, not what you used to be. You are now able to make your own rules and this requires you to adopt an intentional mindset because once again you are in charge of you.
It’s your Story. Why not Write a Happy Ending?
The period following findependence is our best and last opportunity to design and live a fulfilling life before time passes us by. Our time is limited so it’s important to not put things off till tomorrow. We need to live with a sense of urgency and take positive action in some form each and every day. We have earned the chance to write our own story so why wouldn’t we write one with a happy ending? To write our best story and avoid possible regret we need to be “intentional” with the rest of our lives in order to achieve the best outcome. The key to intentional living is clearly knowing what we want. This will require goal setting (remember that word?) and the adoption of good habits/routines. Our daily behaviours need to be in alignment with our stories.
Writing Victory lap Retirement with Jonathan was a game changer for me. I guess you can say through the process of self-awareness I once again have hope for the future as I have finally found my why. When you have purpose life takes on a whole new meaning and I find I have more energy and focus than ever before. I want to make sure that my kids find purpose early on in life to know their why at a much earlier age than me. This was the one lesson that I was missing when I grew up. To have purpose early on in life will give a person the quiet confidence to continue in the right direction and to focus on what really matters. Purpose gives you the fuel to finish the race.
I can’t go back and change my past but I can control my future and finish well and that’s exactly what I plan on doing!
So I felt grateful that I had finally found the courage and give myself a chance to go at it again to create my own thing. When I feel fear and when the fear grows I know I’m going in the right direction. No matter how old you are fear is always present even though I have Financial Independence, the fear never goes away. Despite the fear of failure the excitement is back and it had gone missing for a long, long time.
Mike Drak is part of the Komitas Mastromartino Wealth Management Group at RBC Dominion Securities, based in Toronto. He can be reached at michael.drak@yahoo.ca. Mike has co-authored a book with Jonathan Chevreau about some of the themes mentioned in the above blog and at the Financial Independence Hub in general. Victory Lap Retirement will be published in 2016.
