The path to early retirement before 50 will be fraught with challenges. Family members will look at you with a strange eye. You need to learn to ignore them. Alternatively tell them you are a business owner and that you run an investment management company. You're not lying.
Support from your spouse/partner is especially important. I realized that my definition of retirement was different from my wife's. When I first suggested early retirement, she was dead against it. As her definition was the typical stay at home and do nothing but loaf around all day. As followers already know, from my first post,
My own definition of retirement is very much similar to many other early retiree bloggers out there. Which is to reach a state of life when I do not need to be concerned about my expenses and that I can choose to stay at home and watch tv, idle around, go gym, etc. However, this does not mean that I have to do exactly that. My definition allows me to pursue other interests in life, which include other money making ideas, such as being a gym instructor, setting up a small push cart stall and other income producing activities. The idea is that I do not need these activities to sustain my livelihood but I can choose to do such things just purely for the fun of it.
(This is my blog and I can define retirement anyway I like. So comments of "He's not really retired cos he's still working as a gym instructor" will not be appreciated as that just goes to show how narrow minded you are about the idea of retirement, and yes, I am considering being a gym instructor after my planned early retirement.)
As I've said she can define retirement anyway she wants. So can I. Same as what is a business owner. It's like wine. For the same wine, some say it smells of flowers, some say it tastes like fruits. As long as both like and enjoy the wine, it's really not important. Now that my wife is ok with this conclusion. I have support from my most important partner.
I reckon I would never be able to get through to my parents. Previous generation of Singaporeans had a hard time in the 1970s where Singapore was just a developing nation. Jobs were hard to come by and they worked long and hard to get to where they are. In their minds, the world is still like that. It is unfortunate as they lived through a time of great growth and many investment opportunities were available. Nonetheless, we can't control what others think of early retirees as different people have different values. We're not looking for acceptance from these people. I think I can get acceptance from other's in this community of early retirees. As long as they don't nag at me to find a job, aka they don't disturb me, I don't disturb them. As also previously mentioned, I live with my parents currently. We're looking to move out into a new HDB in the next 2 years when the flat is ready. So it seems like the plan works itself out.
Another BIG concern of early retirement/retirement is the psychological fear of lack of income. Sure you may have a large capital generating SGD5k per mth dividend. However, after 10-15 yrs of work. It is not easy to go into a phase of life where there is no active income and this might actually be a scary idea for many. The maths works out. It's just the faith that is not complete yet. There are a few ways to overcome this psychological fear.
1) Just do it. When you know that you have sufficient capital to generate passive income, one way is to just resign and go into your retirement mode.
2) Point 1 might not be so easy so, I'd probably recommend taking a part time job. Maybe half day work or 3 day work week to get used to a lower pay and lighter work load. After a year doing this and gaining confidence of being able to live off lower income/passive income, you probably will be able to have the guts to move into full retirement.
3) Gain more buffer. If you think SGD1 mil isn't enough, then go work til you have SGD2 mil. There's no point leaving if you will lose sleep over it. BUT there is a BIG BIG flaw in this thinking. That is, it will never stop. When you reach SGD2m you will want more as fear is not overcome by more money. Fear is in your own mind. Assuming the maths works itself out, more money will not help you overcome your fear as the fear stems from the unknown rather than the lack of money. The unknown future without active income, the unknown life which you have never lived before.
Another psychological impact is the Pygmalion effect. Especially if you're living someone else's expectations. The effect is when people expect things from you and to avoid disappointing them you try to live to their expectations. This might be detrimental to your own development as you are living other people's dreams. Many times this could be from parents, peers. But as an individual you need to live to your own expectations. You only live one and you will be in this world about 80 years or so. On your deathbed you will be thinking back and wondering. "Did I do what I wanted to do in my life? Did I waste my life?". All those people who had expectations of you and you living to their expectations, would be already dead or also dying. (No offence intended.) What I'm trying to say is that in the end we are all dead. When you live the life of someone's else, they won't be the one regretting it when they die, you will. They won't even remember they had such expectations of you. Cos they would also probably be thinking the same thing about themselves.
I'm not trying to offend anyone by being morbid and I apologize if this might have brought back memories of the passing of a loved one. But if you take this objectively, it is the truth. In the end, you only answer to yourself. That is IF your family isn't in dire situation and are hungry and need you as an income source. But if the basics have already been provided for your family, I think it's time to live for yourself.
This brings to mind Steve Jobs and his Standford speech
Transcript of Commencement Speech at Stanford given by Steve Jobs
Thank you. I'm honored to be with you today for your commencement from one of the finest universities in the world. Truth be told, I never graduated from college and this is the closest I've ever gotten to a college graduation.
Today I want to tell you three stories from my life. That's it. No big deal. Just three stories. The first story is about connecting the dots.
I dropped out of Reed College after the first six months but then stayed around as a drop-in for another eighteen months or so before I really quit. So why did I drop out? It started before I was born. My biological mother was a young, unwed graduate student, and she decided to put me up for adoption. She felt very strongly that I should be adopted by college graduates, so everything was all set for me to be adopted at birth by a lawyer and his wife, except that when I popped out, they decided at the last minute that they really wanted a girl. So my parents, who were on a waiting list, got a call in the middle of the night asking, "We've got an unexpected baby boy. Do you want him?" They said, "Of course." My biological mother found out later that my mother had never graduated from college and that my father had never graduated from high school. She refused to sign the final adoption papers. She only relented a few months later when my parents promised that I would go to college.
This was the start in my life. And seventeen years later, I did go to college, but I naïvely chose a college that was almost as expensive as Stanford, and all of my working-class parents' savings were being spent on my college tuition. After six months, I couldn't see the value in it. I had no idea what I wanted to do with my life, and no idea of how college was going to help me figure it out, and here I was, spending all the money my parents had saved their entire life. So I decided to drop out and trust that it would all work out OK. It was pretty scary at the time, but looking back, it was one of the best decisions I ever made. The minute I dropped out, I could stop taking the required classes that didn't interest me and begin dropping in on the ones that looked far more interesting.
It wasn't all romantic. I didn't have a dorm room, so I slept on the floor in friends' rooms. I returned Coke bottles for the five-cent deposits to buy food with, and I would walk the seven miles across town every Sunday night to get one good meal a week at the Hare Krishna temple. I loved it. And much of what I stumbled into by following my curiosity and intuition turned out to be priceless later on. Let me give you one example.
Reed College at that time offered perhaps the best calligraphy instruction in the country. Throughout the campus every poster, every label on every drawer was beautifully hand-calligraphed. Because I had dropped out and didn't have to take the normal classes, I decided to take a calligraphy class to learn how to do this. I learned about serif and sans-serif typefaces, about varying the amount of space between different letter combinations, about what makes great typography great. It was beautiful, historical, artistically subtle in a way that science can't capture, and I found it fascinating.
None of this had even a hope of any practical application in my life. But ten years later when we were designing the first Macintosh computer, it all came back to me, and we designed it all into the Mac. It was the first computer with beautiful typography. If I had never dropped in on that single course in college, the Mac would have never had multiple typefaces or proportionally spaced fonts, and since Windows just copied the Mac, it's likely that no personal computer would have them.
If I had never dropped out, I would have never dropped in on that calligraphy class and personals computers might not have the wonderful typography that they do.
Of course it was impossible to connect the dots looking forward when I was in college, but it was very, very clear looking backwards 10 years later. Again, you can't connect the dots looking forward. You can only connect them looking backwards, so you have to trust that the dots will somehow connect in your future. You have to trust in something--your gut, destiny, life, karma, whatever--because believing that the dots will connect down the road will give you the confidence to follow your heart, even when it leads you off the well-worn path, and that will make all the difference.
My second story is about love and loss. I was lucky. I found what I loved to do early in life. Woz and I started Apple in my parents' garage when I was twenty. We worked hard and in ten years, Apple had grown from just the two of us in a garage into a $2 billion company with over 4,000 employees. We'd just released our finest creation, the Macintosh, a year earlier, and I'd just turned thirty, and then I got fired. How can you get fired from a company you started? Well, as Apple grew, we hired someone who I thought was very talented to run the company with me, and for the first year or so, things went well. But then our visions of the future began to diverge, and eventually we had a falling out. When we did, our board of directors sided with him, and so at thirty, I was out, and very publicly out. What had been the focus of my entire adult life was gone, and it was devastating. I really didn't know what to do for a few months. I felt that I had let the previous generation of entrepreneurs down, that I had dropped the baton as it was being passed to me. I met with David Packard and Bob Noyce and tried to apologize for screwing up so badly. I was a very public failure and I even thought about running away from the Valley. But something slowly began to dawn on me. I still loved what I did. The turn of events at Apple had not changed that one bit. I'd been rejected but I was still in love. And so I decided to start over.
I didn't see it then, but it turned out that getting fired from Apple was the best thing that could have ever happened to me. The heaviness of being successful was replaced by the lightness of being a beginner again, less sure about everything. It freed me to enter one of the most creative periods in my life. During the next five years I started a company named NeXT, another company named Pixar and fell in love with an amazing woman who would become my wife. Pixar went on to create the world's first computer-animated feature film, "Toy Story," and is now the most successful animation studio in the world.
In a remarkable turn of events, Apple bought NeXT and I returned to Apple and the technology we developed at NeXT is at the heart of Apple's current renaissance, and Lorene and I have a wonderful family together.
I'm pretty sure none of this would have happened if I hadn't been fired from Apple. It was awful-tasting medicine but I guess the patient needed it. Sometimes life's going to hit you in the head with a brick. Don't lose faith. I'm convinced that the only thing that kept me going was that I loved what I did. You've got to find what you love, and that is as true for work as it is for your lovers. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work, and the only way to do great work is to love what you do. If you haven't found it yet, keep looking, and don't settle. As with all matters of the heart, you'll know when you find it, and like any great relationship it just gets better and better as the years roll on. So keep looking. Don't settle.
My third story is about death. When I was 17 I read a quote that went something like "If you live each day as if it was your last, someday you'll most certainly be right." It made an impression on me, and since then, for the past 33 years, I have looked in the mirror every morning and asked myself, "If today were the last day of my life, would I want to do what I am about to do today?" And whenever the answer has been "no" for too many days in a row, I know I need to change something. Remembering that I'll be dead soon is the most important thing I've ever encountered to help me make the big choices in life, because almost everything--all external expectations, all pride, all fear of embarrassment or failure--these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.
About a year ago, I was diagnosed with cancer. I had a scan at 7:30 in the morning and it clearly showed a tumor on my pancreas. I didn't even know what a pancreas was. The doctors told me this was almost certainly a type of cancer that is incurable, and that I should expect to live no longer than three to six months. My doctor advised me to go home and get my affairs in order, which is doctors' code for "prepare to die." It means to try and tell your kids everything you thought you'd have the next ten years to tell them, in just a few months. It means to make sure that everything is buttoned up so that it will be as easy as possible for your family. It means to say your goodbyes.
I lived with that diagnosis all day. Later that evening I had a biopsy where they stuck an endoscope down my throat, through my stomach into my intestines, put a needle into my pancreas and got a few cells from the tumor. I was sedated but my wife, who was there, told me that when they viewed the cells under a microscope, the doctor started crying, because it turned out to be a very rare form of pancreatic cancer that is curable with surgery. I had the surgery and, thankfully, I am fine now.
This was the closest I've been to facing death, and I hope it's the closest I get for a few more decades. Having lived through it, I can now say this to you with a bit more certainty than when death was a useful but purely intellectual concept. No one wants to die, even people who want to go to Heaven don't want to die to get there, and yet, death is the destination we all share. No one has ever escaped it. And that is as it should be, because death is very likely the single best invention of life. It's life's change agent; it clears out the old to make way for the new. right now, the new is you. But someday, not too long from now, you will gradually become the old and be cleared away. Sorry to be so dramatic, but it's quite true. Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma, which is living with the results of other people's thinking. Don't let the noise of others' opinions drown out your own inner voice, heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.
When I was young, there was an amazing publication called The Whole Earth Catalogue, which was one of the bibles of my generation. It was created by a fellow named Stuart Brand not far from here in Menlo Park, and he brought it to life with his poetic touch. This was in the late Sixties, before personal computers and desktop publishing, so it was all made with typewriters, scissors, and Polaroid cameras. it was sort of like Google in paperback form thirty-five years before Google came along. I was idealistic, overflowing with neat tools and great notions. Stuart and his team put out several issues of the The Whole Earth Catalogue, and then when it had run its course, they put out a final issue. It was the mid-Seventies and I was your age. On the back cover of their final issue was a photograph of an early morning country road, the kind you might find yourself hitchhiking on if you were so adventurous. Beneath were the words, "Stay hungry, stay foolish." It was their farewell message as they signed off. "Stay hungry, stay foolish." And I have always wished that for myself, and now, as you graduate to begin anew, I wish that for you. Stay hungry, stay foolish.
Thank you all, very much.
What have you experienced? Are you living someone else's life? Based on their expectation of you? Are you happy? Do you fear the unknown? Are you ready for retirement but can't seem to take the last step due to fears or lack of support from your partner?
Leave your comments and share your concerns, we should all be there for each other.
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