Life Beyond Retirement: Embracing New Beginnings
Good morning! Today, I have a post from Maria, the blogger behind The Money Principle, a personal finance blog that aims to make your head hurt and your wallet sing. She writes about money management, wealth, health, and anything else that catches her fancy. Enjoy!
Retirement used to be pretty straightforward and mostly automatic. You’d work for about forty years, then retire, and typically spend your days puttering around the garden, looking after grandkids, living a life of routine, and eventually passing away. This was when the economy was dominated by big corporations; people had lifelong jobs, and self-employment was mostly for artisans, tradesmen, and creative types. People saved what they could, patiently awaited retirement, and often aged early.
But those days are over! The economy now includes a mix of small businesses and networked individuals. The concept of a ‘job for life’ is outdated, and self-employment is on the rise. In the UK alone, there were 367,000 more self-employed people in 2012 compared to 2008, which is a 10% increase.
Do I miss those predictable times? Not at all! While there was security, it came with boredom. Whenever I read or watch The Hobbit, I totally understand how Bilbo Baggins feels: the Shire is lovely but dull for anyone craving adventure.
The best thing about this change is that we don’t age so quickly. I couldn’t imagine my mom running a marathon at fifty, let alone planning to dance Flamenco in Granada. Nowadays, retirement is no longer a fixed point in life; it’s become flexible, allowing people to retire whenever they want and pursue their dreams—making early retirement even more feasible.
Personally, I don’t dream of retirement in the traditional sense. I still link retirement with sitting in front of the TV in old cardigans and twisted stockings. What I want, once I’m fifty-five, is the freedom to not work if I don’t want to, and to live the life we desire without needing to be employed.
Here’s what I’m aiming for: financial independence, not just the ability to stop working. John and I could achieve financial independence quickly by making some drastic choices:
1. We could sell our house, downsize, and live off our passive income and side hustles, though it would require careful budgeting.
2. We could sell everything in the UK and move to Bulgaria, where we already have property. This would allow us to be well-off while being financially independent.
But why settle for that when we can strive for our dreams? For us, that means traveling, learning new languages, exploring different cultures, and keeping our home as a place for future grandchildren to visit. According to our retirement calculator, we need about £2.5 million ($3.7 million) to achieve this. Sounds impossible? Great! I love a good challenge. We aim to reach this goal by October 31, 2018.
We have a plan that involves rapidly accumulating wealth, investing wisely, and building businesses:
1. We expect an increase in our cash flow due to salary raises, new online businesses, and offering short-term accommodation to academic visitors. Three months after paying off our consumer debt, we’ve saved nearly £15,000 ($22,000), mostly invested in a Nutmeg ISA, which returns over 20%.
2. By next March, we conservatively estimate having about £60,000 ($90,000). This will help us invest in larger opportunities.
3. We are mobilizing our existing assets and exploring investment options, including selling property in Bulgaria. We plan to invest some of our ‘nest egg’ in higher-risk ventures that don’t jeopardize our livelihood.
4. Business building is crucial for fast growth and automation. It doesn’t need to be in cash; the equivalent will do for our financial goals.
In summary, we have a dream and a plan. We know from experience that things don’t always go as planned, but we won’t abandon our dream. We’re determined to achieve our goals, and if you hear a motorbike passing by, look for me!