In our amazing country, we have a set of norms that encourage us to go to school, get a good job, get married, take out a mortgage, have 2 1/2 kids, get a bigger car with a bigger auto loan, and work and work and work until our debts are paid off and we have enough in our 401(k) to retire. If we do all these things and achieve this “American Dream,” we will be able to retire by 65. This is our mindset and we have been doing it for so long, nobody sees anything wrong with it. The mindset that “as long as I can afford my monthly payments, I’ll continue to buy [insert unnecessary purchase here] because I want it and I deserve it!”
We’re Losing Balance
The US has the highest GDP output in the world accounting for close to 25% of the world’s productivity. With that increased productivity, we make up for it with time away from our families and less time enjoying our hobbies. We increase our material possessions by spending all that we make, or taking on debt because we count on our stable incomes to pay for these things we add to our lives.
Too many times I hear people say, “I can’t stand my job,” or “I don’t want to go back to work!” Shouldn’t we enjoy what we do? And if we do enjoy our jobs, should we not be so overworked that we dread returning because we didn’t get enough time to unwind? I also hear a lack of urgency when it comes to saving. “Oh, I have until 65 to save. I’ll be fine.” The truth is that it sneaks up on us and it’s almost like we’re waiting for the older, more responsible, future-version of ourselves to get us on track. We are missing that balance, we are missing our siestas!
Find Your Joy
We have to change our mindset. We have to change our lifestyles. We have to stop living outside our means. We have to stop thinking that retirement is age 65 and we have another 30 years to save up for this far away, almost mythical idea of retirement. Instead of thinking about retirement, we need to start thinking about what financial independence looks like for us.
For me personally, financial independence means not being indebted to others. It means spending more time with my family and doing things that truly matter to us, like seeing the world. It means doing what I’m passionate about but not overworking myself to the point where I no longer enjoy my work. It means giving back to others because it truly does bring so much joy!
How to Get Our Balance Back
Retirement, or in other words … financial independence, is not an age. You can get there at 45, 50 or 55! There is no rule that you have to wait until age 65 to retire. Sure you can’t take Social Security until age 67 or pull from IRA accounts until you’re 59 1/2, but you have other places where you can be saving and other places where you can be creating streams of income.
When you live within your means, you may not have the same lifestyle as your neighbor, but whose to say they’re not struggling to keep up with all that stuff they’ve acquired? When you live within your means and you have no debt, you have what many don’t and that is peace of mind. And this is where you can focus on saving, creating and growing wealth, and getting to that number (not age) that is going to bring your financial independence, your balance, and your joy.
International Monetary Fund World Economic Outlook Database, Apr 2017
