I’ve noticed there seems to be a rift in the personal finance world when it comes to the idea of early retirement.
You have one camp that is pursuing early retirement with gusto and saving and sharing their plans, and then you have the camp that is somewhat cynical about early retirement.
To out myself, I think I used to be in the latter category. It is not because I didn’t believe people can retire early, but because it didn’t seem to me like the people who claim to be ‘retired early’ were really retired. I did believe they may be financially independent, but truly retired?
Many of these people left work to raise children, or write books, or volunteer, or pursue passive investment business ventures. Ask any stay-at-home parent and they will tell you they work very, very hard. And ask a full-time author if they don’t work… they would tell you that they also work very hard indeed. I knew other stay-at-home parents who did not consider themselves retired so what was different between them and the early retirees? Is the distinction simply that those who call themselves ‘retired’ have more money in their bank account to fall back on?
Maybe the more relevant question is, “What does it mean to be retired?”
I don’t ask these questions to be obnoxious or disrespectful. Many of these early retirement bloggers introduced me to the world of personal finance blogging and I admire their work and their success greatly. I believe their success is legitimate and hard-earned. But, I am also genuinely curious about what this means to be ‘retired’ and I’m finally gathering up the courage to voice my questions.
Our culture has a definition problem when it comes to the word ‘retirement’. In its simplest definition, retirement means ‘to cease work’. But is it even within human nature to cease ‘work’ for decades at a time?
Maybe to define retirement, we need to define work.
To illustrate some of the difficulties with these terms, here are a few scenarios for you to ponder:
- Is a 70-year-old man who regularly volunteers building houses with Habitat for Humanity retired or working?
- Is a 32-year-old mother who earns some income from freelance writing but spends most of her time caring for her children retired or working?
- Is a 54-year-old guy who quit his corporate job to purchase a money-making website retired or working?
You want more information, right? You don’t want to base your decision on just their age and what they are doing.
To work used to mean leaving your home for 40 hours a week, being loyal to a company for 40 years and then quitting in exchange for a pension and playing shuffleboard in Florida or wintering in an RV in Arizona. That definition of work was not sustainable for many people through their later years.
However, nowadays work may have a more fluid definition that can include more flexibility, autonomy, and longevity. Self-employment has never been easier.
The changing nature of work has largely been driven by the technological era. The idea of location independence has sprung up in less than a generation and new technology has created countless jobs that didn’t exist previously.
How many app developers did you know 15 years ago? What currently unimagined jobs will exist when my 1-year-old graduates high school?
If work no longer has the same meaning, perhaps retirement no longer has the same meaning as well…
Even so, I don’t know if I ever want to retire! I want to create a life from which I don’t feel the need to retire.
Is that realistic? Is such a thing even possible?
Maybe that is the actually the new definition of retirement: living out the rest of your life on your terms.
It definitely does not mean I’m going to stay at my current job forever. And it doesn’t mean you don’t need to save or have a long-term financial plan. My job is fine for now, but I do want many of the perks that traditional retirement includes: autonomy over my time, flexible schedule, the ability to travel and pursue leisure activities as I see fit.
My goal is to find that through self-employment and passive income. I want to pursue meaningful work ventures as long as I am able. I think there is a great value to be found both personally and for your community from meaningful work.
That doesn’t answer my question about how much money you need in your bank account to call yourself ‘retired’ if you’re doing the same work as someone who doesn’t call themselves ‘retired’, but in the end that question doesn’t even matter.
Perhaps ‘retirement’ is a subjective term
Some people may call my vision of lifelong work ‘retirement’ at some point, while I may look at someone else’s retirement and think it looks like work. Neither is right or wrong. We may both be ‘retired’ from one activity and have simply moved on to another.
So this is the point where I need to take back what I said in the beginning. If someone wants to consider themselves retired, who am I to judge? I have no right to be cynical about it because their interpretation of retirement is probably different from mine. After all, we don’t have a consistent definition of what it means anyway.