The outlook for retirement in America right now is terribly depressing. The statistics show that very few are saving anymore, instead people are buying bigger houses and luxury cars and trying to keep up with everyone else. As I started looking more closely at my own saving and spending, it occurred to me that achieving financial freedom isn’t just about budgeting or clipping coupons; it’s about understanding and re-evaluating my core values. I have finally found discovered how to make my journey to financial freedom the happiest it can be… I am living my mantra to: Enjoy the Journey!
The basic framework of early retirement is pretty simple: cut down on your spending, and invest as much as possible into your savings, preferably into retirement savings (401k, IRA’s, HSA’s, etc.). Radically reducing spending comes from 3 main costs: housing, transportation, and food and can significantly alter how much you need to save to be comfortable in retirement.
- Housing – While most of America is moving into homes that far exceed their needs, the big savers live well below their means.
- Transportation – So many people want to buy the cars with all the latest bells and whistles, new technology and safety features. The savers walk, ride their bikes, take public transportation.
- Food – Think of all of the convenience foods out there – coffee, drive-thru’s, fast casual pick up, and the cost versus making everything at home.
As you think about these 3 expenses, and find ways to cut back, you may quickly discover what truly brings you happiness and they are things money can’t buy.
A New Lifestyle
Once you stack the different savings options together — moving to a cheaper neighborhood, cooking all your meals at home, biking to work, buying only necessary clothing, cutting out expensive coffees, not indulging your kids, a new ‘frugal’ lifestyle often emerges. Many extreme savers simply love cutting costs, being self sufficient, and developing and tracking to a budget. Once I started tracking my expenses and understanding what I was spending money on, I made saving money a game of ‘how much more I could save’ which made it a fun process for me. I became determined to save more and retire early. I wanted financial freedom!
I recognize early retirement isn’t for everyone. Working less and enjoying life more, sounds great to me, however to others, it means giving up some things that bring enjoyment. If extravagant dinners out on the town, luxury cars, and a large house truly bring you more pleasure than the idea of retiring early, then it makes a lot less sense to retire at 50 or earlier.
A New Perspective
As I have converted to a new lifestyle, I have also revised my perspective on what it means to be successful and happy. I don’t worry as much about what people think of me. I am more focused on who I am and being happy with myself than focused on money, on my career and position in a company. Success now means I am confident and happy with what I have, not what people perceive me to be. For me, my goal of financial freedom has allowed me to live a simpler life, and in doing so, understand my true needs and desires, most of which do not have to be sustained financially.
One of the biggest things I’ve found in my journey, is that I don’t need to spend a lot of money on clothes, shoes, purses, or entertainment to impress other people. Spending money on those things was not making me any happier, I just thought it would make me look “cool” and people would like me more. However, if people don’t like me for who I am, then they aren’t worth having in my life. You need to surround yourself with people that enjoy who you really are and be confident in yourself.
Retirement (i.e. Financial Freedom) implies a lifetime of relaxation and non-productivity. However, that doesn’t mean those who achieve their financial freedom won’t work, however, they don’t need to work. The difference is that it is a choice, and the feeling that you don’t need to work to live your life gives you so much freedom to choose what you do each and every day.
I actually do see myself “working” when I retire from the corporate workplace, however, I plan on the work being something that is meaningful to me. For instance, working on this blog brings me enjoyment because it encompasses all of my passions, strengths and interests – finances, fitness, writing, reading (aka ‘researching), and eating healthy. I also want to work on my own health and fitness which is an important part of living a long, happy life. Additionally, I definitely want to work on fixing up my house as there is a lot of home maintenance work that I can do and have been putting off. There are so many things to do… financial freedom will provide me the time to get them done.
Do what you love and love what you do.”
We all have dreams and goals we want to achieve in life. My goals will differ from yours and vice versa. I enjoy reading and spending time with my dogs; I also enjoy cooking and finding ways to be more frugal and simple with my life. I have fun trying to save more and spend less. These are all things that are fun for me and make me happy. And they will also be the things I enjoy doing throughout my life since they are the values that make me who I am today. I encourage everyone to enjoy their own journey, whether it’s a journey to financial freedom or not, and live a life you love.