Who hasn't heard the astronomical projections of how much financially we need in order to walk out of the office and into a new life? Well, I'm here to tell you, it ain't necessarily so! Here's how a smaller financial base can work when we apply the principle of due diligence analysis long before retirement.
It's not just about the finances, it's also about us -- who we are, how we see ourselves, how we value ourselves; and it's about our legacy. Is it enough, or even important, to leave our children primarily money and the skills to maintain an impression of entitlement?
Nuts and Bolts
At the moment, we may be decades away from retirement so it's easy to keep shoving that prospect into the background. Would we do that with a new business proposition, though? Or would we choose due diligence, examining a number of factors that would impact the venture? Maybe the due diligence would be a better choice for us regarding retirement; this is a great time to start thinking about future opportunities regarding our status as it fits in with technology changes projected for our future lifestyle.
As we evaluate our lifestyle today, we can dissect where our money goes, so that we can select which items to continue later, and which to eliminate. For example, do we belong to the golf and country club and other memberships primarily for business relationships? If so, we can plan to drop those. Ka-ching.
How much do we spend on our business-related image? Clothes, hair, grooming, etc. Much of that can go, too, when we achieve our freedom. Ka-ching. Networking? Dinners, lunches, transportation and so on? We'll be able to drop 'em.
Perhaps, at this point, it is hard for us to visualize not having or wanting to keep up the image we have projected of our material success because, for many of us, that defines our status. In time, though, it becomes amazingly easier and easier to whittle away at them as we carve out a new vision for our lives.
Believe it or not, we may slowly realize that, in our Era of Freedom (retirement), we may wish to redefine ourselves; maybe change business 'friends' for others who share our new vision. Oh, sure, we have wonderful memories with our business-era friends, and some of those friends may transition with us to the Freedom stage. Some may not; we'll be thinking, What do they expect from me? Will they share my evolving viewpoint of life? What does their friendship cost me? Will they be worth it when I'm free? If they won't make our new team, be prepared to phase them out at the appropriate time.
In lieu of the gym membership, we may realize that we no longer need to look so buff in order to compete with younger people; to stay fit, we can take walks and bike rides together, and do much of our home maintenance ourselves. Maybe even start a garden -- and not just a garden -- an Aquaponic Garden! Not only will we save money, we'll enhance the quality of our lives, and our self-esteem.
Are we paying into a life insurance policy? Why not pre-plan and pre-pay for our funeral and disbursements now, gain the tax advantages, and eliminate that expense? We can put the disbursements in trusts, if we like.
How about our home and 'toys'? Why do we have the size home we have, and all the trappings which delineate our prosperity and success? For how much longer will they seem important? For at least some of them, won't it be a relief to eliminate their maintenance and upkeep? What about the memorabilia we've accumulated? Do we really need that to define us in our new life stage? To remind us of who we were? Why? Think about it, and consider beginning to clear out that stuff. Believe it or not, once we start, we'll find it easier and easier to set the stage for the new us.
We'll be wise to anticipate predictable technological and environmental changes before retiring. When the time comes, we could try to pay off our mortgage (assuming ours is still outstanding) and update our home, including appliances; alternatively, we might decide to sell our home in favor of a smaller, newer energy efficient model, thereby reducing monthly expenses even more. Solar-powered homes are quickly growing more prevalent and feasible, as they gradually replace our fossil-fuel dependent homes.
If you can buy a new energy-efficient car when you retire, plan to do so; you will be well on your way to further reducing future expenses. New environmental regulations are on the table, meaning that emissions-free electric vehicles (EV) represent the automotive future, with exponential growth projected comparatively soon. Why not consider buying yours as your retirement gift to yourself?
As you anticipate making changes that may seem radical today but normal tomorrow, it's worth considering also that you will be leading the way for your children and children's children who will consider energy efficiency to be the norm.
Head and Heart
Next step would be a careful re-evaluation of our self-image and self-esteem, along with the short- and long-term plans for the next stages of life. How much of the way we see ourselves relates to our job? Do we identify with our title? Is that what defines us? It wasn't always that way, though. Back in our murky past, we were simply young Jane or John, looking forward to all the possibilities life would offer.
Well, eventually we will transition back from our work title with all its ramifications and trappings, to just Jane or John again -- human being, mother, father, spouse, widow(er). Can we imagine anticipating any changes more profound for the coming stages of our lives? What will we find to define and anchor us through these changes?
I've found that if we have, over time, determined a flexible, central plan to apply to our retirement, and have even written a vision and mission statement for it, we will have a strong life-raft to hang on to, helping us to maintain our feeling of relevance, as we navigate the changes of our life. Our plan will fuel our ongoing passion as we build our self-esteem in our new self-image, and we will eagerly look forward to each day's pursuit of our overall purpose, which will fit flexibly into the ancillary activities we enjoy.
Realizing that three generations or fewer after I am gone, I will be completely forgotten except for the ideas and inspiration I may leave behind, is truly sobering.
My personal plan is simply writing to inspire and support current and future generations in choosing lifestyles that fit more harmoniously and efficiently in the new world they will face. The paradigm will have shifted from 'Winning; No. 1', to globalized collaboration; as a global family we will be working together, solving problems together, and innovating together.
I am pointing out that, although we cannot control the actions (or inactions) of government leaders, we can work around them and create better relations and other life conditions. That will be my legacy.
With our legacy in mind, it's important for us all to make deep-reaching conclusions about the valuable gifts we will leave. Of course, we would like to leave our children financial stability and the tools to maintain enjoyable, meaningful lifestyles, but let's think about it.
How easy do we have to make the path for our children? Didn't most of us thrive on the challenge of finding our own solutions, thereby choosing our own accountability? Why should we give our children less by going into hock (or having them accrue debt) in order to acquire an education to prepare them for jobs that don't even exist at this point?
The education revolution, including the 'pay it forward' mode, in which the institutions will pay until graduates begin earning, at which time graduates will repay according to their income, may be the future of education. We are already seeing some of these schools. At any rate, it seems unlikely that today's unaffordable education system will continue much longer.
Won't we be much wiser to focus more on teaching our children to live with integrity and compassion? To encourage critical thinking, self-reliance and problem-solving skills; strong communication skills including negotiation and conflict resolution as well as collaborative team building?
Planning for our next stage and ultimately for our home stretch is certainly a gradual process, parts of which we may not even notice occurring. As we do realize which parts of our life we can whittle away, sculpting our new selves, we become aware that we may really need much less materially than we had initially assessed and gain much more emotionally and intellectually. Due diligence will lead to the plan for us. The next chapters in our history books are ours to write. Are we ready?