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Monday, May 1, 2017

Retirement Transitions and Symbols

Posted by Tim Stobbs on March 8, 2017

Perhaps it was odd, but never the less, the other day I was considering some of my major transitions in my life.  The reason was very simple in some respects I wanted to consider how things had changed and how well did I adapt to that change in order to prepare myself a bit better for when I actually quit my day job.

What I realized in a lot of cases in life we mark notable events and transitions with symbols and/or ceremonies.  When I finished my engineering degree I got a ring and attended a little ceremony.  So to this day, a lot of people know what I do for a living by looking at my right hand pinky finger.  Or when you get married you often have a ceremony with family and friends and you also get a ring.  Somewhat ironically I got both of my rings in the same year.  Thus the rings are reminders of part of my identity they tell me and often anyone who looks at my hands that I’m married and an engineer.

Another transition that can happen is when you become a parent, while I didn’t get a ring for that we did receive numerous cards saying congratulations and a fair number of gifts.  Some of the gifts were also more mementos rather than practical gifts which we can keep to again remind us of this fundamental change to our lives of becoming parents and forge another part of my identity.

Yet when it comes to retirement, there often isn’t much for a symbol or ceremony involved anymore.  In days past there used to be a bit of formally around leaving a workplace to enter retirement.  Often there was a gift (ironically it was often watch – when of course you no longer need to look at a clock so much) and a short little speech by your boss during a lunch with some co-workers.  It wasn’t much, but it did mark the end of one phase of your life and moving to another.

Today, while often there is still some kind of gift involved it may not be anything in particularly symbolic.  Some companies will even let you pick out something up to a set dollar value from a catalogue and you may or may not have any particular party at work.  Yet for the early retiree things get even more unclear as most corporate polices won’t even cover that situation and for those doing it on the stealth side of not telling anyone you won’t have anything goodbye gift or party at all.

But it’s just a watch or something, do you really need to get something or have a party to mark the occasion?  Logically speaking no you don’t need a gift or party.  Emotionally speaking, I HIGHLY recommend you do get yourself a gift and throw a little party for yourself.  Pardon, did a personal finance blogger just tell me spending money on a party was a good idea? Yes, freaky I know. ;)

You have to consider that there are really two parts to your mind at play here: the conscious and subconscious mind.  The conscious mind can be reasoned with, you can think about your plans and make the transition in a completely logically fashion and think you are fine with everything.  Until your subconscious hits you with all your repressed emotional content and you have nightmares for a month after you leave work and break out in tears for no good reason one day.  The good news about the subconscious is it responses well to symbols.  Thus it is entirely possible to help your subconscious process everything by having a nice little ceremony with symbols about your transition.  What those symbols should be will be a personal thing: you could burn something you took to work each day or toss it in the trash or bury it in the yard.  Or get something new to remind yourself of your big change to your life.

You have to recall that retirement is a major life transition.  Even for me moving to a semi-retired state is a bloody big shift in my lifestyle and I’m going to be going through a lot of emotions as I adjust to live without a full time job.  You may logically understand it, but you may not emotionally be ready for it.  So having a little reminder as a gift and ceremony can help you emotionally process what is happening and make the shift just a bit easier.

In my case, I’m not expecting anything from my workplace as a gift or even a going away lunch.  If it happens, well great, but I’m taking things into my own hands.  For my gift, I’ll be honest and state I’ve already been thinking about this for a while.  I’ve decide on getting a ring.  I certainly don’t need it but given the importance of some of the other rings in my life the idea just felt right.  Then I started looking online at various designs to get an idea of what I may want and by happenstance I found one on Amazon of all places.  I saw it and it instantly reminded me of a quote from Neil Gaiman

“Fairy tales are more than true: not because they tell us that dragons exist, but because they tell us that dragons can be beaten.”

Early retirement is like beating a dragon; it seems like an impossible task until you have done it. Getting there is worth celebrating and reminding yourself that just because 99% of people won’t do it doesn’t mean it is impossible.  Rather it is just an unusual feat.

My new retirement ring that I’ve already ordered and it arrived, it’s not very expensive, but it does have a sort of Celtic knot work dragon on it. See below for a picture (the middle one).  Also the ring which is made of tungsten  should go rather well with my current rings which are stainless steel (engineering on the right) and white gold (wedding on the left).  As to the ceremony bit, I’m not done planning that out yet, but I will let you know when I figure it out.


The Three Rings of Tim

The Three Rings of Tim

So would you get yourself a retirement gift and/or do a retirement ceremony or not bother?

A Million Isn’t What It Used to Be

Posted by Tim Stobbs on February 6, 2017

I sort of find it bit odd that people have a fixation on being a millionaire.  While it sounds like a lot of money you have to keep in mind that over the years inflation keeps dragging down that benchmark so it gets more and more diluted as being a lot of money.  After all I had to even look up what is a millionaire and there isn’t even a standard definition.  Anyone with a million dollar net worth technically counts, including myself.

Pardon? Yep, I don’t really pay attention to the millionaire target other than it happens to be roughly around my retirement amount.  Yet I also tend to ignore our true net worth as it includes our kid’s RESP account balance, rather than what I post on the blog where I leave the RESP balance out.  Yet the other day while I was on Mint cleaning up our transactions from over the holidays I happen to look down at our true net worth and was a bit shocked to see a seventh digit.  So without really meaning to or even paying attention we drifted over that imaginary line in the sand.

Of course the issue is people still tend to consider a millionaire rich, when in fact, as I noted above it becomes less and less meaningful as time goes on.  For example, my father retired roughly ten years ago now.  Let’s pretend he had exactly a million saved, even with a modest degree of inflation over the last ten years that money would be worth $1,177,655 today.  So even if I wanted to retire I would technically be doing it with less money than him.  The further you go back the worst this gets, so 20 years ago a million would now be worth $1,433,667 when you adjust it for inflation.  So in general the older you are the more likely you are to think a millionaire is something impressive.  So your grandparents might find that impressive, but your kids won’t really care at all.

But on a functional level in your everyday life it is utter meaningless.  It really just is a number or a line in the sand that mainly for popular culture references gets a lot more attention than it should.  After all, what happened the day after I found our we were a millionaire? I went to work.  Yes, totally anticlimactic.

Yet on the other hand, getting here is a big deal.  As there is only 1,117,000 millionaires in Canada (according to this story) out of population of 36.4 million or just 3% of the population.  So crossing that threshold tells you that you really are well off compared to the majority of people.  But I don’t consider us rich.  Perhaps well off, but not rich.  After all ‘rich’ is highly subjective.

Another problem with the word millionaire is it ignores the quality of your assets.  After all there are a number of millionaires in Toronto and Vancouver just based on home equity, but selling a home isn’t easy or quick.  Thus some people think the term should only be used with those with investments of $1 million or more excluding home equity.  Which is sort of a logical but doesn’t tend to ignore the popular culture references which dominate the word: millionaire.  Beside the banks solved that issue years ago with the term: High Net Worth Individual.

In the end, a millionaire title is a bit of fun, but I don’t take it too seriously.  If nothing else, it tells us we are heading the right direction for my retirement plans.  So what do you think of the term millionaire? Useful or meaningless?

What Do You Want?

Posted by Tim Stobbs on December 21, 2016

During the holiday season I tend to get asked a lot by well meaning people: what do you want?  So I prepare for the question by working on a ‘wish list’ over the last several months prior.  Months?  Yes, making a ten item list takes me months now because of a very simple reason: I already own just about anything I could really want from a store.

When I was a kid, I used to think that older people were nuts for saying: I really don’t want anything.  Now that I’m a bit older myself I actually understand that a LOT better.  After earning a good income for a number of years and having a lot of saving the reality is the phrase ‘I can’t afford that’ is laughable.  Now understand that a good life really isn’t about the stuff anyway.  So buying everything that you may passingly think about wanting is rather pointless.  Most of the stuff you won’t really use or like anyway, so why bother getting it all in the first place.  Hence, figuring out a few items I really do want to own takes some time since I need to determine if this is a passing want like I could go for a doughnut right now or something I really could use like a new tie since my oldest one is starting to fall apart after 20 years of use.

Then after watching a few Christmas shows you really do get it hammered home that it really isn’t about the stuff anyway.  What do I really enjoy about Christmas?  Visiting with friends and family, eating a good meal together, and doing activities as a family.  Most of that doesn’t actually cost a lot.  After all sledding is largely free after the initial purchase of the sled.

So while everyone sort of gets this, I find it funny we don’t extrapolate the idea to your retirement dreams.  Why does your retirement ideal consist of travel for six months of the year?  Do you really want to own three different properties (a city house, summer lake home and a winter getaway)?  Do you think getting every possible want in your head is going to make your retirement that great?  Come on.  Just think about your yearly reminder that getting everything you want under the tree doesn’t make you happy in the long run.

No the harder question is what do you really want to do with all the time in retirement?  Do you want to start a small business?  Do you want to help others in some way?  Do you want to turn your current hobby into a part time job?  What do you really want out of your life?  Those shouldn’t be easy questions to answer, but at the same time allowing yourself the time to figure that out is a good investment of your time.

For me, I’ve always wanted to write novels.  I actually keep trying to draft them even if I don’t have any of them published yet.  I know I won’t make much money doing it, but I love telling stories so that is what I want.  I also know that trying to do that is going to take a significant amount of time (like five years) to get okay at doing it.  So that is why I’m going after early retirement.  I’m going after an old dream of mine which may turn out to be a failure and not sell many books, but I don’t really care.  The point is I’m going to try and live a dream and that a worthy want for me to go after.

Writing novels may not be for worthy want for you and that is okay too.  Yet we all have our wants…perhaps it’s time we start looking past the stuff to those wider and harder dreams to fulfill.  It can be something odd, or something that is kind of pointless to most of the world, but if you really love it, who cares?  It’s your dream, no said it had to be approved by others.  So take some time to figure out what you really want in life.  You just might realize you can start working on that today rather than putting it off for 20 years.  After all, I’ve already finished the first draft of five different novels over the years and I’m not even retired yet.

So what do you want that doesn’t come from a store?