My wife is similar - she’s saved more money than me, but also seems like she wants to work longer. One thing I’ve tried to stress to her is that she could just do the FI part (financial independence). She can take a lower paying job she might enjoy more (she’s talked a lot about trying to become a librarian), or even fill her time with volunteering. She does like her job, but I don’t think she finds it terribly rewarding.
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My uncle is the same age as his wife - he retired a few years earlier, but as far as I know there weren’t any hard feelings - her life improved, too, because he increased his side of the cooking, cleaning, household chores. He’s a handy guy and did a lot of projects around the house that she wanted. I’m sure not all couples will be the same, but if both lives improve with a solo retirement, hopefully the other partner can see it as a win.
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I stoped working when I was 50, basically no regrets.
Two big risks for early retirees are (1) inflation and (2) “sequence of returns” risk, ie low or negative returns early in the retirement phase eating into your savings.
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The 4% withdrawal rate rule includes a cushion to account for inflation, but yeah bad timing retiring before a downturn can be a problem.
Retirement age in Czech Republic is 65 though they’ve been trying to change it to 67 or 68 for millennials and zoomers. Though honestly I have no idea where I’ll be then or if I even make it to that age.
It’s also just not how you want to do it in real life. The 4% “rule” is a spreadsheet model that is supposed to give a general sense of how much income your portfolio sustainably generates. But when a household is actually deciding on how much money to take out you should do things like map out all your expenses and all your sources of income over your retirement and then try to mix and match your income sources to draw down money in the most efficient way. For example, for a lot of people in Canada what you really want to do is defer social security to the latest possible start date and “melt down” your retirement savings before your government pension starts. This tends to net greater after tax income for life. So your actual drawdown rate doesn’t look like 4% each year, it looks like 10% for several years and then 2% thereafter.
These specific personalized plans are really necessary when it comes time to use your assets in retirement. The 4% rule is more useful for someone like a 40 year old that wants to know if they are generally on track to have enough income in retirement. At retirement you have to be way more tactical and less strategic.
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i’m surprised with the aggressiveness so many of you applied to the formula. i felt 25x salary was very risky.
i don’t expect any pension and i’m not counting on social security still being around in 35 years. definitely having income other than selling a little bit of your crypto every year helps and makes sense to ratchet the multiplier lower. if you really think it’ll last. pensions, social security, that stuff seems like a passing fad.
I’m 40, debt riddled with 3 kids, and a did a shit job saving in my 20s. I like spending money. My current marketable skillet is in internal combustion engines. I’m turbo fucked.
I can make a decent side hustle playing poker so that’s sort of my retirement plan at the moment.
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I think these discussions often focus way too much on spending less and not enough on earning more. It is so much easier to save if you’re constantly getting raises and saving/investing some large percentage of each raise because you still get the mental reward of a higher standard of living.
Separately, the “you don’t get happier after $70k” study has been debunked. While relationships are of course the most important factor in achieving happiness, recent research confirms that yes, duh, having more money does make you happier all other things being equal.
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Yeah. One strategy I try to do is put half my raise into my 401k. I started doing this in 2016. I didn’t get a raise til 2021.
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An abstract but (possibly) useful way to think of this is that when you are, say, 20, the largest financial asset you have is actually the present value of all your future labor. That may sound depressing but it’s actually quite a useful thing to understand, because then you can view things like training and getting licenses as increasing the value of your largest asset. This clarifies a lot of decision making and provides a good perspective on how if you want to, say, get a house, then what you have to do is trade some of labor value for it.
Like I said, this kind of pedantic and abstract but I always found that it makes a lot of sense and makes the results of people’s lives make more sense as well.
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I had a really disturbing conversation with a coworker of mine. We’re pissed about our pay not being enough right now (mgmt is paying per diem people 1.5x their normal pay but not letting us pick up extra shifts at 1.5c) and he told me about how he’d rather hang out with someone making 80k/yr because it makes him look better in comparison. Was wild to me, but I think a lot of other people are like that
One of those things is much more in your control than the other.
Can you give me a cite or two so I don’t worry I get called out for saying this too loudly
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Too many people I know died relatively young. Some with a big balances for early retirement that went to their children. That is why I focused on doing all the things on my bucket list before I retire. It does mean that at 50+ my retirement is still far away but I had a blast and no regrets.
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I think the real insights that come from this stuff are that having material wealth doesn’t usually in and of itself make people happy (if you have money and expensive toys but terrible relationships and no capability to feel gratitude or awe then you won’t be happy) BUT having more material wealth gives you a much better opportunity to develop those actual keys to happiness (it’s a hell of a lot easier to feel gratitude and experience awe when you aren’t worried about missing rent and you aren’t working 80 hours a week just to make ends meet).
The adage “money can’t buy happiness” is a correct statement if understood correctly, but it’s broadly misunderstood. The median person just doesn’t think in terms of probability distributions so they don’t instinctively think of things like “money makes someone more likely to be happy”. They just want a simple narrative A → B. I’ve even heard people assert that more money makes you less happy because they so badly understand all the actual findings in this area or research.
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A simpler way to put it might be “money can’t buy happiness but very often lack of money can ensure misery.”
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