It seems like many in the financial independence movement have the same goal – to quit their jobs and travel the world at 30 or 35. Now, there’s nothing wrong with that goal. If that’s what you’re working toward, I encourage you to follow your dreams and go for it. But I wanted to put in a good word for those of us who might have different goals and dreams.
As they say, “personal finance is personal”? It may be cliche, but it’s cliche because it’s true. Personal finance is unique to every single person and family. My financial situation is unique and is different than yours. My goals and dreams are different too. And different doesn’t mean bad, or wrong, or that you don’t fit in to the financial independence movement – it just means different.
Too often, I think, those of us in the financial independence and personal finance community get wrapped up in an “ideal” vision of what early financial independence/retirement might look like. It looks something like living very frugally and inexpensively so you (and possibly a partner/spouse, maybe very young family) can do nothing but travel around the globe all year, seeking out exotic destinations for the rest of your lives.
But what if that’s not what you want? Is that OK? Do you still “belong” in the financial independence community?
I say yes, you do.
Living The Life You Want While Seeking FI
Maybe you don’t want to live on beans and rice, while living in a 500 square foot tiny house. Or biking isn’t really an option where you live unless you want to get run over, and your job is 45 minutes away. Move? Sure, you could move, but then your kids would have to switch schools right in the middle of elementary/middle/high school, and you would have to leave your extended family behind. And homes closer to your job are more expensive. Also, maybe you don’t want to quit your job. You like what you’re doing, you like your co-workers, and you just want to keep on working as long as both those things are true.
To me, the journey toward financial independence is a deeply personal one. You need to balance living the life you want today – making sure it’s an optimal life in alignment with your long-term financial goals – and investing for the future. I posted before about how living on lentils can free you from subservience in your life, but I didn’t mean literal lentils. I mean that you need to experiment to find your personal optimal level of spending, where’s your spending on priorities and still have a financial gap to save and invest for your future goals.
Yes, the lower you can get your spending, and the higher you can get your income, the faster you can reach financial independence. But maybe your life isn’t solely about the pursuit of financial independence. It’s also about other priorities, and sometimes those other priorities cost money. It may sound morbid, but we can all die anytime (and I would know). Once you realize that – truly realize it – you’ll know that a life lived out of whack with your real priorities doesn’t make any sense. Just take a look at this actuarial table and remember that every single number on here was a real person.
Reaching financial independence isn’t just about stopping all living and spending until you reach a goal, and then continuing spending next to nothing so you don’t run out of savings. It’s about getting to know your goals and dreams, and then living your current live aligned with them while setting money aside for the long term.
It’s All About Priorities
In order to achieve the life you want, it’s important that you figure out first what your priorities are. Now, this doesn’t mean that people should just live paycheck to paycheck and buy stuff they can’t afford because YOLO. Nor does it necessarily mean that everything in your current life is a priority – maybe you’re paying for cable, or an SUV, or something else that isn’t really adding value to your life. If so, cut it out and use those extra savings to further your real goals and dreams.
You might decide to spend on something that someone else thinks is a waste of money. Conversely, it means that other people get to decide to spend on things that you think are a waste.
Once you determine what’s a true priority in your life, then you can optimize your spending to achieve your short-term goals, while still leaving financial room to fund financial independence (FI). A dollar can only be spent once – once it’s gone, it’s gone. You need to treat both your money as precious resource that you can either use to get you closer to your dreams, or you can waste and stay stuck where you are.
So what are your real current priorities, and how can you optimize your spending around them? Take some time this week to sit down and really think about what your current priorities are. Health? Family? Career? Starting a business? Then cut activities that don’t align with your priorities. Get rid of spending that doesn’t move you toward the life you want. Then save and invest the gap between your income and your spending for your longer term goals and dreams.
Your Personal Vision of FI – And What Mine Is
When setting your own FI dream, don’t just adopt someone elses dream for your own. Just because “quitting your job to travel the world in your early 30’s” is what other people want to do, doesn’t mean that’s what you want to do. Maybe you don’t like traveling and you’d rather spend your free time around your home. Perhaps your kids wouldn’t do well moving around so much. You could be caring for an aging parent, or a disabled sibling. Or you could want to do a bit of traveling, but not full time. Maybe you’re already well past your early 30’s but you still want to reach financial independence.
You know what? That’s all OK. Our lives aren’t the same, and our goals, dreams, and priorities aren’t the same. That means that our vision of FI won’t be the same either.
What’s my vision of financial independence?
- Being totally and completely debt free. I don’t want to owe a single dollar to anyone. I have no debt right now except the mortgage, and I want that completely gone-ideally before I’m 40.
- Helping my kids with college according to our college compact. I’m not writing a blank check to college. But I had a rough time working full time and going to school full time to get my undergrad, and I have a set amount I’m targeting to fund. My oldest son will start college in just over four years, so this is a short-term goal for me.
- Have enough in retirement fund investments to fund my post-59.5 life – currently maxing out my 401k for this goal. I’ve been investing for a traditional retirement since I was a teenager.
- Once the first two bullets are taken care of, turning my focus to my pre-59.5 life. Once the mortgage is gone, my monthly expenses will go down significantly. Then once college funding is all set, everything that used to go to the mortgage and college investments will go to this goal.
- Once I’ve reached financial independence, I’m going to continue working. I don’t want to leave my job and travel the world permanently, although I do want to do some travel. I like to work in some capacity, and I don’t like traveling all the time.
There are some non-negotiable items for me on this path. I won’t move out of my house, which means that I need to deal with the commute (45 minutes each way) and need to plan to pay off my current mortgage instead of a smaller one. That also means we need two cars (both paid for and will be driven until they die). Our older boys are in Boy Scouts, which costs money for dues, camping trips (sometimes), and summer camp (optional but we like my oldest to go).
We’re also clear on what we don’t need. We don’t need a bigger house, despite having grown from a family of three to a family of five since we moved here. We don’t need SUV’s, expensive cars, or trucks – a Honda Accord and a Ford Focus suit us just fine. We don’t need the boys in a ton of expensive activities that they don’t want to do and that would suck up all our free time. We like hanging out together as a family on weekends better than crazy rushing around. I don’t need expensive hobbies – reading (library), gardening, baking, and writing are mine. The boys don’t need “stuff” – outside of Christmas and birthday gifts, they get a small allowance that they can use for whatever they want (because I’m not buying it).
What Are Your Priorities?
I’m clear on my short term priorities and goals, and what I won’t give up on the path to get there. I’m also clear on what things other people might value (expensive cars, new clothes, etc.) that I don’t care about. How about you – what have you made a priority in your life today? And what have you given up that other people might value, but you don’t care about? Let everyone know in the comments.
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Thanks for writing this, CMO. I find myself wanting to retire early because that is the hot buzz that everyone is writing about. Like you, I enjoy working. I don’t necessarily love my current job, but it is good enough and I make great money, which helped me eliminate debt. So when I get closer to achieving FI, which for me means eliminating my remaining debt, our mortgage and maxing out retirement accounts, I can pursue something that I am 100% committed to. I’d love to get back into a design engineering role – maybe consulting so I have more control over my schedule.
Sounds like a great idea! That’s what I love about reaching FI-the flexibility. You could decide to travel the world, but you could also decide to shift into a different role, work part time, start a business, or whatever else you choose.
Traveling the world sure makes it a lot easier to get interesting pictures for the top of your blog though.
True! 😄
I think you read my mind this weekend when you wrote this! Mr. Adventure Rich and I were just discussing the idea of FIRE and travel. For us, while long-term travel could be an amazing experience, we see a beauty in investing time, energy and resources (both pre and post-retirement) in our local community. We have an incredible example of this in my grandfather’s life and his legacy in the area. It has inspired us to focus more on “deep roots” here vs. a wide-range travel approach. Definitely a personal preference and one that each individual/family needs to make for themselves 🙂 Thank you for another thoughtful post!
I think that sounds like a great post-FI dream! Similar to Benjamin Franklin, in a way
I think many people flock to the travel full time idea because it represents the ultimate freedom. And that’s what we all strive to do, right? Do whatever we please!
However, many others have different ideas about what their early retirement / financial independence will look like. There are so many possibilities out there and there is no one-fits-all idea.
Just make yourself happy! That’s the best type of independence 🙂
So true-financial independence is all about the “independence” part! 😄 It’s the freedoms to do what YOU want, not what other people might want
Most definitely in agreement. You’ve seen my frugal post about my car choices. On the flip side I’m rapidly building towards financial independence. On the final side I don’t even intend to retire when I hit my number. And yet I still identify with the fire community. Why? Because I care about my financial future and my options. My path though is only my own, as is yours. Every day presents a new possibility I intend to seize, with the future something I intend to setup to bring additional possibilities. You only live once, but opportunity favors the prepared.
It’s so true. If you weren’t prepared, then how could you take advantage of any opportunities that might come along?
Words can’t describe how much I love this post 🙂
I like to travel but find that 10-14 days is my limit and then I just want to be home again. It’s fun to read about those who travel full time but that’s definitely not the life for me.
While the PF community is generally very supportive, it does seem like there are certain “rules” that are supposed to be followed (i.e. short commute (biking is best), used cars only, etc.). However, many of these don’t work for me yet I’m still able to save over 50% of my income.
Couldn’t agree more that it’s about aligning your spending with your values and priorities. We need to live today and not just down the road when we’re retired.
Thanks for a great post!
Thanks Kate! It’s true there are parts of the community that can be judgmental, but I’ve found most people know there’s more than one path to freedom. As long as you’re able to save enough to reach your goals and dreams, does it matter whether or not you got there the “right” way? Heck no!
Well said.
One thing that makes me wryly grin is the irony of the post-FIRE travel cliche. The blogosphere is full of voices echoing an anti-consumerism/anti-keeping-up-with-the-Jones message on the one hand, while simultaneously applauding conspicuous consumption around anything based upon an experience or travel.
I’m all for a good holiday, but I’m not convinced blowing ten grand on a round the world trip is any more noble (or even fundamentally any different) than spending the same ten grand on a big screen television or (used) sports car! The money is still gone, the enjoyment is just as fleeting.
I worked my way through school in a one hour photo shop, which (back in the olden days) involved endlessly developing badly taken happy snaps of people posing in front of the same clichéd postcard sites from around the world. It quickly became apparent that travelling is the ultimate keeping-up-with-the-Jones!
For mine people need to have something to “retire to”, and while travel may provide a welcome diversion for a little while (or occasionally a long while), it is unlikely to fill out the full 30-40-50-60 years of their retirement. So people should have something in mind for their post-travel retirement also.
My wife and I are travel nuts, and I used to think long-term travel was in the cards for early retirement. But starting a family has tempered those FIREy plans a bit.
Some families make full-time travel work. I think my wife and I could really enjoy it, but I worry it would be challenging, or even detrimental, for a child to spend many years constantly on the road. Oh, we will still travel a lot with our kids—maybe for a month or two at a time—but we want them to feel that at least one location is “home.”
This is how we feel today, but we already changed our mind once, so who knows what the future holds.
Thanks you for the thoughtful post!
Dr. C
It’s true that kids change the equation. My older kids are entering high school and finishing elementary-not an ideal time to have them out of school traveling. They’re also homebodies, as am I. Maybe it’s something I would do more of when they’re grown!
ER looming and I’m not planning to travel the world either! I am looking forward to dialing back my ambition somewhat and slow down my life’s pace. I am most looking forward to being a more active member of my neighborhood and community since I won’t be spending a large portion of time doing the work thing. But here is what I think: I think that *some* of my ideas and priorities will change over time, maybe I’ll want to travel more, maybe less, maybe I’ll consider selling our home at some point. I think that the underlying values of living the life I want to lead on my own terms in a more deliberate way won’t change, however. Of course, I might be typing a comment 3 months from now that is completely different once I get there. 🙂
I love how you & the Adventure Riches are both making community a priority. It’s definitely something that can be hard to prioritize while you’re working. I know in my town it seems like all the events start before I even get home from work
I know for sure that I want to quit my job. I also know for sure that if I don’t find something else to build or create, I’ll be filled with regret on my death bed. My early retirement (after the initial crazy celebration, with much dancing in the streets and an irresponsible amount of drinking) is going to be, I hope, a journey in creativity, coupled with some actual literal journeying. I want to experience slow travel for a while, but unless we fall completely in love with it, I think we’ll end up with a home base somewhere.
I think that sounds wonderful. I definitely wish I had a lot more time for creative pursuits-writing, drawing, painting, jewelry making, and so on. That would be a huge advantage to cutting back at work
We are interested in travel, but not world travel – and not year round. We want to do some slow travel in different places, but have no desire to live “on the road” either. We don’t value expensive cars or fancy restaurant dinners. We value time right now since we are a little older than many people who retire early. It’s all about knowing your priorities and aligning what you do with them 🙂
That sounds like a lot of fun!
We do plan on doing a fair amount of traveling once we leave the 9-to-5 world. We were married at 23 and had two kids by the time we were 26. So we didn’t get much chance to travel as a couple before having kids.
Like you, one of our primary goals is to have absolutely zero debt. We should be able to reach that in the next three years or so. Although I generally enjoy my job, there are just so many other areas (in Engineering / Computer Science) that I’m interested in. So I’m looking forward to the freedom to dabble in those areas without being concerned about needing to be compensated.
I’m with you on not having a lot of pre-kid opportunity to travel. I was 21 when we got married and my oldest was born when I was 23. It’s a lot harder to travel extensively when you have kids so young
That was an awesome post. As you stated, we are all on our own journey towards FI. We all have different target numbers, family obligations, family sizes, interests, and dreams. To be successful, we have to be honest with ourselves. I like to travel, but not for months at a time. My family requires two cars. Also, I like my 1500 sq foot house. Identify your own dream and work towards reaching it.
Right on!
CMO — I’m seeing more and more of this line of thinking around the personal finance blogosphere. While I see the appeal of very early retirement (as in pre-50), for most people it’s either not possible or not desirable or some combination of the two. Everyone has their reasons.
So there’s a middle ground that revolves around financial responsibility, intentional choices, realistic planning, and good living. It’s not as free wheeling as YOLO or as radical as FIRE. But it’s still smart and just as inspirational.
To me, financial independence has always been primarily around the independence part. That can, but doesn’t necessarily, mean stopping paid work.
I just want the freedom to do with my time as I please. I am not looking to change or travel the world at 41. I’d like to be able to sleep in or spend more time with my wife doing fun things or even chores.
I also noticed many in the FIRE community are on some kind of world mission. I am not, I simply want freedom. Freedom I should have come 7/5, my last day of normal, corporate FT employment. #severanceRocks
Freedom!!!! (Said Mel Gibson style)