This is the first post of the Wise Money Decisions blog. I want to lay out the purpose for this blog and set the stage for what’s to come.
My Big Goal
When I started my career, I set the goal to be in a position to retire within 20 years. Not that I will retire. But that I will have the choice. And I don’t mean retirement in the geriatric-Florida-Medicare Plan B kind of way. For me, retirement means freedom from the need to work. If and when I achieve my goal, I would thereafter work only if I enjoy it and not because I need the money. I would spend more time doing things I choose to do, and less time doing things I have to do. I would spend more time with my family, reading, traveling, writing music, and helping others. I would spend less time working. And I would never have to tolerate a job just because I need the money!
In order to retire in 20 years, I need to have enough saved up that I can generate a lot of passive income from things like interest and dividends. When most financial planners calculate how much you need to save for retirement, they assume you will draw down a portion of your savings each year.
I make my retirement projections a little differently. I don’t intend to draw down my savings in retirement. When I kick the proverbial bucket I intend to leave to my kids about the same amount that I retired with. If they’re lucky.
What are the pros and cons of calculating my retirement this way?
Advantage: I can live until 100 and never run out of money. I can invest more aggressively during retirement because I have a large cushion.
Disadvantage: I need to save more for retirement than most people.
And there’s one more upside. I’ll have something to leave to the world when I die. I’d like to leave enough to my wife and kids that they’ll always think kindly of me, but not so much that they’ll pull the plug early.
All Roads (Topics) Lead to Retirement
I have spent a great deal of time optimizing my own personal financial situation to accelerate my retirement goal. I have learned as much as I can about investing in stocks and funds, investing in real estate, income taxes, property taxes, life insurance, health insurance, health savings accounts, long term care insurance, owning versus renting a home, estate planning, rewards credit cards, cost of living, interest rates, social security, 401(k)’s and IRA’s and Roth IRA’s, donating to charity, and the list goes on. If there is anything you would like to see discussed, please mention it in the comments. It is likely I will post on it, especially at the early stage before I have many readers.
I look forward to thinking and writing about many important topics. To the extent you find them useful, I hope you will put them into practice. I also hope you will share your ideas. To the extent I find your ideas useful, I fully intend to put them into practice to achieve my 20 year goal.
By the way, if I’m still blogging when I reach my goal, and any of you are still reading my blog after 20 years, I hope you seek me out so I can buy you a nice lunch.