When I talk to prospect, I have two kinds of women come through the door:
Women who want to make sure they will be ok
Women who want to crush a goal, like retiring early
These are both good reasons to meet with a financial professional but there are definitely different paths you can take. The women who want to make sure their life can stay at the level that they are for the rest of their lives can take things slowly and take their time. The women that have a very detailed vision of their lives tend to want to move a lot faster because they don’t have time waste. Neither is good, neither is bad. It’s personal choice.
Have you heard of the F.I.R.E Movement (Financial Independence, Retire Early)? It seems to almost be a fad now. I just call it Financial Independence. Financial Independence isn’t new. It’s what I have been talking to client about for over 13 years, but it’s just now people have decided to focus on it.
You might ask, what is Financial Independence? It’s very simple. I know a client wants financial independence when they say these words, “I want to do what I want, when I want and not have to worry about money.” Often, clients will say it in different ways. I had a client tell me that he wanted to spend more time with his wife and he’s not able to do that working where he is. Another client told me she was tired of what she was doing and wanted to go back for some education but didn’t want to put them in a financial strap. You want to define it for yourself, but retirement and financial independence can be interchangeable in most cases. One just implies stopping working and the other says that they have the choices in life that they’ve always dreamed of.
When women don’t have kids, they start thinking about what they want to do and how they want to make an impact. They want to do it faster because they have the opportunity. Although I specialize in working with childfree woman, anyone can get to financial independence if they know that it is what they want. This dream is open to everyone who will take on the challenge.
Maybe financial independence just doesn’t light a fire inside you, and that’s ok. Financial Independence isn’t something that everyone relates with before the traditional retirement age of 65, or really if you want to go to full Social Security retirement age for most around age 67.
If you don’t plan on retiring early, here are three things you can do:
1. Save only to your 401K.
If you are a working professional, like most of my clients, you should have a 401K available to you. If you are a business owner, you can open one for yourself. A 401K vehicle can delay taxes on some of your income (or not if you are doing a ROTH 401K) and putting away for the future. You won’t be retiring before age 59.5 so having it in the 401K that is hard to access before then is perfect for you. It comes out of your bi-weekly check every week without you thinking about it and gets invested in some investments. Your savings for the future and you are getting it to grow. What else do you need?
Since you are not retiring early, you don’t need to think about how you will access funds from age 55 to 59.5. Saving outside your 401K isn’t necessary, right?
2. Spend without awareness.
You work hard for your money, and you are in pretty good shape financially. You pay off your credit cards every month and you don’t have any debt (well, except your mortgage but that’s good debt and your car payment but you need a vehicle). You have your three months of expenses in cash at the and you are contributing to your 401K. If you are doing those things, you are set. You can spend as you need and buy all of those $25 “things” from Instagram ads because it’s only $25 and what if that green juice can actually help me lose those last 10 lbs.?
You aren’t retiring early and 20 years until retirement is a long time. You are saving in your 401K and so having a conscious spending plan doesn’t really fit for you.
3. Don’t find your number.
When you want to retire early, you have to have a goal for savings to have true financial independence and retire/have choices early. Is it $2M or $5M? For those who retire early, they need to know the number and all the scenarios that could derail their plans. For you, you don’t need to have a target number because you’ve got time on your side. You’ll make whatever number you have in retirement work when you get there.
Now, you might be reading this and thinking, wow, Lisa’s being pretty harsh. Just because I don’t want to retire early doesn’t mean I don’t care about my future. Absolutely, it doesn’t. Why I’m writing this is to make a point. When we don’t have a specific goal, like in this case retiring by the age of 55, our minds start to play tricks on us.
As example, have you ever said one of these things to yourself about your money:
“I have time.”
“It doesn’t really matter. $10 won’t make a difference.”
“I’m saving to my 401K. That should be enough.”
If you have, these are comfort statements. Our brain is trying to keep us calm, so we stay comfortable and status quo. Status quo is fine but if you want extraordinary or to do something different than the norm (like retiring early), you must take dramatic action.
Peaked your interest, we help people get to financial independence with less confusion, more security, and accountability so they do take the actions that will get them to what they want. One Vision Retirement is about the client’s vision for their life. We are just there to keep reminding you what you want and pave the road that works best for your vision of life. If this is you and you have a vision of your life that you need help achieving, set up a no-obligation, Get to Know you Call today: https://calendly.com/onevisionretire/gettingtoknowyou You will be glad you did.
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Investment advice offered through Integrated Financial Partners, doing business as One Vision Retirement, a registered investment advisor. The information in this material is for general information only and is not intended to provide specific advice or recommendations for any individual. Integrated Financial Partners does not provide legal/tax advice or services. Please consult a qualified legal/tax advisor regarding your specific situation.