November 9, 2007

Ground Rules

Like all big plans in life, I feel it is important to map out the strategies and not just charge blindly into the future. In my earlier post, I laid out what I needed to do to achieve retirement which was to get about 25% return each year on what I currently have. Now, I want to set some ground rules for myself so that I actually have a purpose behind doing this. After all, I could just get a part-time job as a waiter and say that that my 25% goal has been reached but if I have a job, thats not really retirement at all.

The first thing I looked at since being retired is what I'm going to do with my life. Most retired people do things like sit on their porch and watch the cows herd by or take hikes early in the morning and other things that sound extremely boring to a young guy like me. However, the bottom line is that retired people do what they want to do. For my retirement, I'm going to do whatever I want to do. And as a young guy, I'm not very sure what that is. I'm going to spend the large amount of free time I have trying new things I always wanted to try.
This leads me to my first rule:
1. Any source of income must come from something I would have been doing on my own time for free anyways.
This makes sense to me. For example, if I play music on my free time and turned that into a paying gig at local venues, I don't see that as a conflict of interest to retirement. This will also let me turn some of my hobbies into contributing factors for the 25% return I need each year. With this in mind, I have listed out a few of my hobbies that could potentially turn into a source of income.
1. Advertisements from blogging.
2. Guitar teacher
3. Music Performer
The first step for establishing a routine in retirement would be to turn these hobbies into a small source of revenue. I have networked a few musicians and we'll be practicing these coming weeks. I put up advertisements to be a guitar teacher on craigslist. And finally, I got a Google Adsense account (with more coming) to leverage the help of my wonderful readers.

Now the next ground rule I have comes from making sure that while transforming my hobbies into sources of revenue, I do not commit to anything long term - i.e., a job. One of the most attractive benefits of retirement is the freedom to do what I want, when I want. If I were to rely on blog ads or having a weekly paid gig as a source of income, then I would have to make sure I blog X amount or make sure I book a gig every week. What if I wanted to go camping without internet in Seattle for a week? I would not want to be dependent on those hobbies as if they were a job.
2. Any source of income must have at-will commitment.
I would not want to be responsible for too many things while retired. This rule would allow me to move quickly between things I want to do. If I wanted to play music one week, then travel the next, I would want to make sure I have the freedom to do so. Of course, some responsibilities and commitments are important and unavoidable but I feel this rule will help me curb the amount of commitments I have. Retirement is about maximizing the freedom of choice.

Finally, the last rule I can think of for now is to make sure I am productive in life. Many young people fall into the downward spiral of being lethargic when not having any responsibilities. I want to make sure, moreso from a philosophical standpoint than a financial one, that I can look back at my life and be satisfied. That's not going to happen if I sit around on a couch all day.
3. All actions in retirement must contribute to personal growth or the community.
I developed a strong set of ethics growing up. I want to make sure I still stay true to these principles especially if I am going to live a life lavished by temptation to the contrary. This rule is probably the most important one because even if I successfully achieve a 25% return every year but I just end up watching daytime television and sleeping 12 hours a day, it will ruin the whole point of retiring.
Society has jobs to make sure people contribute to the community. Instead of forcing me to contribute, I want to willingly contribute. When people are forced to do something, they do a poor job and contribute minimally. When people willingly contribute, they go above and beyond and receive a sense of satisfaction. I would much rather do the latter than the former and retirement allows me to do so. I realize that this line of thinking is Utopian and would not work for everyone (some people just can't help being lazy unless they are forced to work), but with this third rule, I hope that everything will work out the way I want for me.

So now with a goal to reach and a creed to follow, I start my retirement! Wish me luck, readers.


E.C. said...

I find your plan interesting, idealistic, charming, but ultimately unrealistic. Rules one and three are somewhat appealing. I can envision a life as a teacher because it seems to meet precisely those two criteria.

Rule two troubles me a bit. Contributing to either personal growth or the community in any meaningful way requires time and commitment. Part of growing up is recognizing that delaying gratification in the service of larger goals can be fulfilling.

I wouldn't want to live like you. I'd worry too much about not saving for the future, and I'm generally much more content and productive when I have a schedule to adhere to. However, if you find a way to make it work for you, that's great. I wish you the best in your endeavor and look forward to reading more.

Soup Parrish said...

E.C. - Thanks for your comment. I agree that this plan does not work for everyone. I am idealistic when it comes to the philosophy of life but not entirely unrealistic either. At this time, I do not worry about saving for the future for a number of reasons:

1. Many things can change over the course of my life on a national scale. Imagining myself growing up as a baby boomer, I could not have predicted how the 90s and the 21st century would happen.
2. I feel that worrying about money and the future comes from the fear of the unknown. Everyone is scared that some uncontrollable event will occur and destroy their lives. But having traveled the world and seeing what people have and don't have, the struggle to survive is worldwide. We may be in the richest and most powerful nation in the world, but while we don't fear malaria and lack of clean water, we fear taxes, public safety, job security, health insurance, etc. I feel that for me, everything will work out for the best as long as I am working hard and adjusting to life.

I really do agree that time and commitment is a necessary part of longterm gratification. However, at my age, I feel now is the time to explore my goals and try to achieve self-actualization. Goals change, and maturity grows and this only happens when we have a chance to explore and discover what we want in life.
I disagree that people who commit to one thing at a younger age are growing up faster. I feel that many young people commit to what they do out of fear and societal/parental influence and their adulthood would result in a lot of what-ifs and might-have-beens. If I make my mistakes now, it will be more fulfilling than if I have a few more grands in my twilight years.

It really is just all about perspective.