What will you be doing 3 months after you retire?
For most of our lives, our time is filled with obligations, but what do we do when we’re no longer obliged to do anything much? For many of us, working for money occupies our time and energy for most of our adult lives. We may be in different types of work. We may be employed or self-employed. We may care about career advancement or not. We may enjoy our work and find it inspiring and rewarding, or resent it and begrudge every minute, or simply consider it a neutral necessity. What ever our feelings about working, while we’re in the midst of it we rarely stop to think what happens next? What will I do after this?
I think this may be one reason why so many people don’t save enough for retirement*. They simply can’t picture themselves without their work. That’s not to say people don’t want to stop working. If you ask people what they’d do if they won the lottery jackpot “quit my job” or “never work again” come high up the list, but that’s usually about getting away from stress and frustration, not moving towards a more desirable life.
To put it another way, many people can imagine vividly what it would feel like to tell Cherie that she can staple her own damn expense reports, Derek that his reheated mackerel is a form of air pollution, and their line manager to get ****ed because they are outta here, suckers!
But what happens next is a mystery.
Financial independence doesn’t require a lottery win. Regular, diversified, tax efficient investments plus time will get you there. Even if you don’t make plans to fund your life once once your stop working, at some point you probably will. It’s worth taking the time to understand what you want your life beyond work to be like.
Once you’ve successfully built wealth throughout your working life, how will you spend it?
The interesting thing is that many people can name the things they will do in the first few weeks of freedom, because that’s really just like planning an extended holiday. The bigger question is how will you spend your day-to-day? What happens next? And what about after that?
This is a deeply personal question. Everyone has a different answers. Some may want to take frequent holidays. Some will spend time learning, volunteering, pursuing hobbies or creative projects. Some want to spend more time with family. Some want to focus on their wellbeing and staying active.
Most of us only have quite vague answers to this question and that’s an issue on two fronts.
Firstly, because vague goals are not motivating. Why would you save and invest for a life that doesn’t exist? Having a clear vision of your life beyond work helps you understand how much money it will take your to get there. It also makes that goal more desirable. Once I can really imagine my future, every pound I put into investments is no longer “for my pension”, it’s for my “learning historically accurate calligraphy and bookbinding” fund. Or my “weekly one-to-one yoga class, sauna and mani-pedi” fund. Or my “hiking the world, from the South Downs to the Appalachians” fund. Or whatever floats your boat. (A catamaran fund?)
It’s more obviously worth being frugal now in order to invest towards these dreams than the generic investment goal “for retirement”.
Secondly, you may be able to put plenty aside for your life beyond work, but if you don’t know what that looks like, you could get there and find you’re feeling kind of flat and nonplussed. It’s common to struggle with the transition out of work, and the change in identity that comes with it. Thinking about what you want your life to be like can make that transition smoother. It’s psychologically easier to let go of a past identity if you have a future to reach towards.
For me, I’d like to have a studio space and make all sorts of art without caring if it’s any good, at least three holidays every year, and the option to pay for massage and physiotherapy immediately if any part of me starts feeling creaky.
What would your ideal life beyond work look like?
You can learn more about financial independence and investing to make work optional on my podcast, Squanderlust.
*Or protect against serious illness and injury for that matter, but that’s a whole other topic.