Posted by Dave on July 5, 2011
This is a guest post by Dave, who is also looking to retire no later than 45, but unlike Tim has no kids and doesn’t want any. Dave is from Ontario and is working towards his CGA certification.
Last Thursday at about 11 a.m., I started trying to talk myself out of going to the gym. This is about a bi-weekly event and there are times that I actually just don’t bother going due to my persuasive arguments (It’s not fun; I’ll feel sore after; I already worked out twice this week, is a third time really going to do anything? And more). I ended up going and getting it done, but I was thinking that this kind of thinking could easily be applied to my personal finance plans.
It would be so easy to stop using around 75% of my paycheque to pay off my mortgage and ensure a healthy level of savings. It would be easy to have a more conventional financial plan where I would retire when I’m “supposed” to, which if you listen to the news is somewhere around age 70-75 these days (the experts are very worried people will outlive their investments) rather than carrying on with my current plan.
I see a couple of problems with this for me:
1) I would have to work an extra 20 or 30 years
I don’t want to work any longer than I have to, giving up more than one-third of my day to earn money for “stuff”. I was reading the book “Beatrice and Virgil” by Yann Martel a little while ago and the quote “Your days on this earth are counted, you might as well make the best of it” really hit home. For some people, making the best of their days includes working 40-60 hours a week at a job. For me, I have other things I would rather be doing, which do not include waking up 5 days a week to give up most of my waking hours.
2) I don’t know what I would spend the extra money on
I know a few people who make significantly more money than my wife and I and they seem to find a way to spend it, either on big houses, expensive hobbies, vacations or any number of things. For me, I don’t really get a lot of enjoyment out of spending most of my paycheque on items that don’t make more money (or at least the possibility of it) or reduce the money that I owe. I try to ensure that, for the most part, the money I make from work is spent as efficiently as possible, hopefully meaning I work as short a period as I can.
The bottom line is however, I’m sure I would find a way to spend the money (somehow) – I did it for a few years before I put together a financial plan and most people continue to essentially break even (or go into debt) month after month.
I think that once I realized that there is a better way to do things financially and that I could be doing exactly what I wanted all the time (retiring), rather than working at the office during the best hours of the day my goals changed significantly.
How do you keep yourself from “falling off the wagon”, or staying the course of your goals?
Posted by Canadian Dream on April 28, 2011
Perhaps the most frustrating words I hear when talking to people seems to be the words “I can’t.” The nature of the rest of their sentence will vary, but the idea is often the same. Some common themes include: I would like to save more, but I can’t. I would like to retire early, but I can’t. I would like a new job, but I can’t get a new one right now. Then following those sentences people usually have some reason for why they can’t do something.
Now the following isn’t to say everyone does this, but in my experience to date 95% of the reasons that go with the phrase “I can’t” are utter bullshit. Yes, that is right. I’m calling bullshit on just about every time you or I have ever used the phrase “I can’t”.
The more correct phrases that might work better than ‘I can’t’ are:
- I don’t feel like it.
- I’m lazy.
- I really do enjoy complaining rather than making my life better.
- I’m really just a self absorbed prick that can’t see past the end of my nose to realize that problem is really my fault.
By now, I’m sure you can come up with you own equally fun real reason why you can’t do something (feel free to suggest more reasons in the comments). So with that out of the way, why do we keep saying that to each other? I’ll take a guess at this one. You don’t want to accept the fact that changing your life for the better means ‘work.’ Nothing worth doing in life is easy, sorry to break it to you, but saving more, retiring early or getting a new job/career isn’t going to be done with a 10 easy step list. A list might help you get the ball rolling, but keeping it moving is going to take some effort and you will likely have a few patches where to keep going will be hard.
So regardless if you want to lose weight, save more, retire early…or just about anything else might I present the five steps of getting past “I can’t.”
- Stop Making Excuses. This should be obvious by now…you can’t move ahead if you keep running yourself in a loop of excuses. Stop making them and realize that most of them are bullshit.
- Know Your Motivation. Change requires a strong motivation to keep going over the long haul. Decide how badly you want something and how much more important this goal is than everything else. What will you give up to reach your goal? Is retiring early worth more to you than your cable package or perhaps moving to a smaller house?
- Know Your Limits. The other 5% of your reasons for not doing something is likely a limit for you. Good limits should strike you as insane and that you would never do it even with a gun at your head. For example, I will not stop contributing to my kid’s RESP’s so I can retire early. It isn’t happening, so that is a limit on my plan I really can’t get around.
- Make a Plan. Getting from now to then looks easy, until you realize the number of steps involved. You need a plan to get to any longer term goal. For example, to write my book I spend several months with the rule I needed to write one page a day. Yes, that cut into watching movies, or other social events, but in the end I did finish my book.
- Change the Plan. Your first plan will likely have flaws in it. Accept that and change as you move along. I rarely see anything go flawlessly in life, so make a plan and then make some reasonable adjustments as you go. For example, while writing the book I realized some nights it was nearly impossible to get a page done as I was booked sold from 7:30 am until 10:o0 pm, so I decided to allow myself to double up on pages the day before to ensure the progress kept going.
Ok, now it is your turn…how do you get past “I can’t” to achieve a goal?
Posted by Dave on February 1, 2011
This is a guest post by Dave, who is also looking to retire no later than 45, but unlike Tim has no kids and doesn’t want any. Dave is from Ontario and is working towards his CGA certification.
I have never had a super-flashy personal finance plan. I have never been in a significant amount of debt,. Yet even when I met my future wife and she did have some debt, we worked out a plan and got her out of debt as quickly as possible. In a word, my personal finance story is pretty bland. Now, and for the next four or five years, my goal is to get rid of the only debt I am carrying at the moment, which is the mortgage on the house that I purchased in the summer of 2009.
Paying off a significant debt has got to be the least exciting thing to do with money. It would be considerably more exciting saving up for something fun to buy (like a car or a big screen television) or investing in the stock market (which is essentially gambling in a widely accepted venue). My wife and I get excited over every $10,000 we pay off, but there are so many of those crossroads ahead (we just crossed the $130,000 threshold) that right now it’s hard to see the end.
Having a boring personal finance plan is better than the alternative – I’m glad that at some point in my life I haven’t ended up in a $50,000 debt-hole that I had to dig out of. I enjoy reading stories about this topic, I find them both very interesting and educational but I don’t think that the stress involved with those types of situations would be very beneficial.
It was mostly through luck that I didn’t end up in a bad money situation – I wasn’t taught personal finance at any point growing up. The only reason I didn’t end up in significant debt was that I didn’t really want anything extravagant – I bought a cheap(ish) car, didn’t rack up credit card debt and made sure that I paid off my student loans as soon as I got out of school. At the time, what I was doing just really made sense, it wasn’t until I got really interested in personal finance that I realized how lucky I was.
So, I continue on with my boring financial plan. It’s not that I live a boring life, it’s more that I spend my money in a boring way. I don’t really have any plans of changing my plans in the short or long-term because what I’m doing allows me to have fun doing the things I like to do (such as the all-inclusive vacation I went on in December) it just seems very “un-exciting” being in the middle of a long-term goal.
Is your financial plan exciting? If it’s as boring as mine is right now, with a single (although large) long-term goal in mind how do you maintain your financial discipline?
