There’s nothing more rewarding than family
Unlike determining the age at which I would like to retire, my idea of the lifestyle I would like to lead at that age is well-formed. Retirement to me does not mean resolving myself to a sedentary lifestyle. No matter what my income, retirement will be an opportunity to explore interests I never had time to pursue while employed. Heck, I might even take some classes at a local college. What matters is that my retirement will not become a fixed routine but will remain fluid as I make the most of every second of my remaining life. Retirement will also give me the chance to spend even more time with family and watch with pride as my children establish themselves in their careers and my grandchildren grow up. There’s nothing more rewarding than family.
Until that day comes, I will be faced with large and small decisions alike. The inevitable major milestones of life will come and go. Getting married. Buying a house. Having kids. We often put so much stock in the financial ramifications of these major events we fail to see the long-term effects of the small decision in life. Because, in a way, it’s the small decisions that are the most important. Do I really need this cup of coffee? Is this an impulse buy or a truly beneficial decision? Those are the kinds of questions we need to be asking. It’s the small decisions that reflect the mentality with which we make all of the bigger decisions. It is a frugal mindset that yields the greatest success.
While I have a good outline for my intended lifestyle after retirement, estimating cost is another issue entirely. Assuming I live to around one hundred, taking into account the marked advances in medicine that are sure to have taken place by then, and retirement at seventy, I will spend thirty years in retirement. I don’t have a good number for what my annual cost might be, but the issue can be obviated entirely through the investment of retirement funds in such a way that return on those funds guarantees a fixed, livable income each and every year. This is the ultimate goal- complete freedom from financial worry. Regardless of how I live, it will take a lot of money to retire. But that’s the thing, having a good understanding of where you’re at and where you’d like to be early on gives you time to achieve your goals. Given the power of compound interest, the right financial decisions today could very conceivably allow me to accomplish my goal. Saving a little bit now can lead to significant income later. It’s the butterfly effect all over again.
Given enough time, any financial goal is possible. The problem most people run into is starting to plan too late in life. Many people who come to this realization enter a state of denial and retire despite having insufficient means to do so. Many continue to maintain lifestyles they cannot afford. Others try their best to spend frugally but still find themselves running out of funds. Tragically, this problem is not uncommon. It could be prevented, however, with early planning. And that’s the takeaway from all of this. Starting early makes all the difference. All it takes is a single decision. A single flap of a butterfly’s wings.