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Friday, March 31, 2017

I Have a Goal

Posted by Robert on November 1, 2010

Financial planning is about setting goals and setting up a plan to reach those goals. However, life never works out as planned. That doesn’t mean that we don’t achieve our goals, but that life is full of surprises, and the route leading to our goals may take twists and turns along the way. An effective plan needs to be continually updated and possibly modified to account for the detours along the way. But the goal, if it’s well chosen, remains steady and motivates whatever effort is necessary to overcome obstacles.

My goal is to live with my family in Hong Kong. We will live in an apartment in a tall tower, hopefully with a view of the South China Sea. We will live in a large building, with a games room, movie room, pool and indoor playground for the children. We will be within walking distance of grocery shopping and a public library, cheap restaurants, frequent public transit and cheap taxis. We will also be able to travel on discount airlines to visit some of our favourite places in southeast Asia and discover new places: Thailand, Singapore, Malaysia, Indonesia, Taiwan and Australia. My wife and I will work at the Canadian International School, where our children will attend, which will cover our living expenses. Our investments from home will cover our travel and a trip home to Canada every year.

But, as I said, life never works out as we plan. My wife decided to stand for something she believes in and ran in the recent municipal election for public school trustee. She learned a lot, she worked hard, she met some amazing people and had every intention of winning. Election night, however, brought unexpected results. She came in only 2% behind the winning candidate. We had plans, goals and ideas that were wound up in the expectation of being very involved in public education and her trusteeship. After all of the preparation and effort that went into the campaign, we were very disappointed. In talking with other unsuccessful candidates, it seems that many of them had to reevaluate their plans and goals.

We weren’t in that situation, however. We already had a goal of living overseas, and the trusteeship was only a plan for involvement in the meantime. Having a goal seemed to make it easier to pick ourselves back up and keep working for it. It gives us something to dream about, rather than focusing on our recent pain. Now we need to find other ways to stand and work for what we believe in. But in no way has our ultimate life plan suffered a setback.

One drawback is that having an exciting goal makes it more difficult to be patient. While I have my job to focus my attention each day, my wife has been looking at university requirements for the teaching program, at travel around Hong Kong and at luxury apartments for rent. Seeing the amenities and the lifestyle that’s available, that we could enjoy on two teachers’ salaries, makes me impatient to be there. I’m brought back to reality by the fact that we aren’t teachers yet, and there are a couple steps in our financial plan that will take a year or two before we can even go back to school. Still, I would take impatience over directionless disappointment any day.

What motivates you to do whatever it takes to reach your goals? In what ways will your lifestyle be more enjoyable later because of your monthly savings now?

Comments

20 Responses to “I Have a Goal”
  1. Juliana says:

    What a cool goal! I can see why you would be getting impatient. Having such a goal is a great thing, though. I find that one of the challenges of adulthood is that you reach a point where you’ve accomplished all the things you aspired to as a kid (or given up on them – I’m pretty sure I’ll never be President of the United States) and it can be hard to find the kinds of new goals that keep you inspired on a day-to-day basis.

  2. Kirsten says:

    Hi Tim;

    I ran across your blog from the Toronto Star/Moneyville article on October 22, where you talk about (among other things) reduced CPP. I’ve been looking at the government websites and other places, and I haven’t been able to find any online calculator where I can see what the impact is of retiring early. How did you calculate the $650 and $400 numbers in the article? Are there any tools you can share?

    Kirsten

  3. Robert says:

    Juliana, It’s interesting to think of adults who are people who have moved beyond their childhood dreams. I suspect that many people don’t dream because it’s not “realistic”. But I wonder where they find meaning in their lives?

  4. Jon_Snow says:

    Its interesting to see the differences in goals that various people have. Robert, the lifestyle you described as very desirable for yourself is light years away from the lifestyle my wife and I envision for ourselves. I feel uncomfortble in large crowds, and find the thought of living in a Hong Kong high rise very frightening.

    For us, the goal is to retire in our 40’s, splitting our time between our acreage in the B.C. gulf islands, where we will be able to harvest alot of our own food (and catch our own fish), and alot of time in the Mexican Baja (where I am posting this from) where we will escape the Canadian winter. (It’s about 30 degrees as I am sitting here)

    Basically, most of the things we do financially we do to bring about this lifestyle. We figure we are too old to have kids now, and by avoiding buying the big house and mortgage, and not buying expensive toys and vehicles like many of our friends, we are saving more than 50% of our combined salary. At 38 our net worth is just over 1.2 million (450k cash/investments, 750k real estate). We just need to stay the course a little longer.

  5. Robert says:

    Kirsten, There are three authors of this blog, and I (Robert) wrote today. Hopefully Tim will check in and see your question, but if not, ask again on Wednesday.

    CPP pays a benefit based on average income and number of years worked. If you earned YMPE (2010: $47,200) or more, and you worked 1/2 the years expected (age 20 – age 45), you would receive about 50% of the maximum CPP benefit ($934.17 at age 65) or $470 per month. You can find your own history and estimate at http://www.servicecanada.gc.ca/eng/isp/common/proceed/socinfo.shtml

  6. Robert says:

    Jon_Snow, Thanks for sharing your goal. I agree that my goal isn’t “right” or “wrong”, it just inspires me. For you, it’s something different that inspires you. I don’t think I can judge others’ goals, only suggest they ought to have one. It sounds like you are very happy with your goal and are making impressive progress.

  7. Jon_Snow says:

    I agree Robert… I could see how many would view my desire to live on a small island growing my own food and “working the land” as not very appealing. I would never presume to judge anyone in their pursuit of their own goals.

  8. Zhang says:

    As a Canadian expat living in Hong Kong and a keen reader of this blog (after coming across your Moneyville articles) I find it interesting that you would want to retire to Hong Kong.

    I’m saving and investing (I’m 32) so I can retire before 45 as well and I want to get the hell out of HK to retire!:)

  9. Robert says:

    Zhang, it’s funny that our goals are almost the reverse. I think it may be that Hong Kong is different for Chinese than for expats. Either way, we each have a goal that motivates us. Thanks for reading and for commenting.

  10. Tara C says:

    I’m in a similar situation – I am just under 2 years away from moving to a new city where I have bought a condo and am busy building up my emergency fund and investments so I will have good career options (more flexible) in my new city. I have been saving and planning for this for 3 years already and am quite impatient for it to happen already, but I realize that slow and steady wins the race, and I am puruposefully moving towards my goal.

  11. Robert says:

    Tara, Cool! It’s nice to know I’m not the only one impatiently working toward an exciting goal.

  12. Canadian Dream says:

    Kirsten,

    Sorry for the delay on getting back to you. I did see your comment, but haven’t had time to response.

    The only calculator I know you can estimate CPP on is this one: http://www.servicecanada.gc.ca/eng/isp/common/cricinfo.shtml

    You will need an estimate of your CPP pension to use it. See this post for how to use it. http://blog.canadian-dream-free-at-45.com/2009/05/07/the-canada-pension-plan-mystery/

    I hope that helps,
    Tim

  13. Zhang says:

    Robert: have you visited HK before? Looked at cost of living in HK?

    From what you mentioned I assume you have, but to live an ‘expat’ life is quite expensive here, especially housing. I’m Canadian born Chinese so I live more like a local than an expat as I can ‘fit in’ a bit easier than the average expat. If you have any questions or concerns on life in HK, feel free to contact me.

    I am looking to move to Malaysia or Thailand in retirement to take advantage of cost of living that is a fraction of what it is in HK/Canada…I look forward to following your progress. Great blog!

  14. Mike says:

    Hi. I did retire at 49. That was over 5 years ago. Here’s the problem as I discovered. When I was younger, I wanted to be retired so I could do activity stuff, golf, hockey, baseball all day. Problem is the body does not work that way.
    Now I have started a business and have been doing that for about 3 years. It was a lot of fun and very exciting. Now I’m getting bored of it. Its become a job.

    On the other hand I really like the extra income! Its nice to go buy a computer or book a trip without agonizing over it. I have more money now than I did when I was working but just have bigger things to spend it on, so it seems we are still low on cashflow.

    I guess my point to all this is that the goal you set at 35 about what you want to do at 45 can change so much, its almost not worth setting a goal that far away. I believe that changes and new activities etc, are exciting for about 3 years. Been that way my whole life. Thats about how long I plan for.

  15. Robert says:

    Zhang, I understand that expats and locals live differently. I’m sure that’s true everywhere. I also can’t wait to travel (cheaply!) in Thailand and Malaysia. But to live in Hong Kong, my wife and I will need to work as teachers, with the added benefit that our children’s school will be provided at no cost to us. We plan to have enough back home that we could return home and be retired, but we will earn income in Hong Kong to meet the higher cost of living.

  16. Robert says:

    Mike, I’ve noticed a similar pattern in my life, where phases seem to last 2-3 years. As a financial planner, helping people work toward goals, I’ve also noticed that “life happens”. You’re absolutely right that changes tend to take place which make us reevaluate our goals, possibly changing our direction entirely.

    However, I don’t think that means it’s not wise to make goals. My family may never end up in Hong Kong for any number of reasons. But the goal sustains me and that’s enough. Even if we end up moving overseas to somewhere less exotic, or learn to speak some Chinese or just retire early and reevaluate our plans, I still think working toward our goal is improving our life.

  17. Mike says:

    No argument with the idea that a goal sustains, gives direction and purpose. My goal for example is not concrete. I just try to save and make enough money so that when my new 3 year gig comes along, I can take advantage. Ideally it won’t be costly. One perspective about assets, as I grow older, I sure don’t want to part with them and have to start over. Actually my current goal is to buy a resort property that I can “retire” to over winter. Then I will likely find another business venture.

  18. Robert says:

    Mike, That’s really cool. I appreciate hearing about your perspective, especially since it is based on more experience than I have. Thanks.

  19. Why would you retirer to Hong Kong with Thailand so nearby

  20. Robert says:

    Thailand, hahaha. I’ve spent time in Thailand and I look forward to when I can return. However, my wife has family in Hong Kong and our children are learning Chinese at school. For us, Hong Kong makes sense, but I know many others who choose to retire to Thailand. And I don’t blame them a bit!

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