Monthly Archives: February 2021

FIRE.121 Mojo Phase

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BOOM— like you’re shot out of a cannon—you’re flying, off into your retirement.  After the initial shock (think retirement party confetti/smoke) you realize you’re flying above the ground, arms flailing, no safety net, you are all on your own.  That’s SCARY…at first.

That was a strange analogy that jumped from my keyboard, I have no idea where it came from, but honestly, at some point, you settle into the adventure.  You look around and realize—I’m flying free.  Maybe you are literally flying and off on some travel adventures, or maybe your mind is flying free to take on new tasks and interests.  Hopefully, you have released the ball and chain (of WORK, you know—your job, the daily grind—what did you think I was talking about?) and feel the freedom.

I love the Michael Stein retirement phases of  GoGo, SloGo, NoGo.  I think the years are roughly assigned as 65-75, 75-85, 85+, respectively.  Yes, I see those numbers overlap a little, and that is perfectly correct.  There will be some overlap in your own “Go years.”  But…

MoJo = GoGo+

Recently I checked in with a cohort who had progressed from the “retiring soon” phase, to the “finding a home in Fort Lauderdale FL” and being too busy with their scuba diving lessons and running around doing all sorts of activities in their new life/style to even keep up with themselves.  In talking with them, I felt like they had turned on their mojo.  They are absolutely loving their new home, new activities, and new lifestyle.

This made me think about being young and active, and how we will never be younger or healthier than we are today, right now today!

Shouldn’t we take extra care to fully maximize our “best” days that we will have into our futures?

Last year my wife and I decided to kick our retirement into a higher gear and live it up a little.  We figured it was the start of a new year, a new decade, etc.  I dubbed it the Raving 20s, sometimes Roaring 20s.  

To be more transparent, I wanted us to spend an extra $1000 per month living it up.  It seemed to me that $1000 per month—or more accurately $12000/yr—just assigned having a blast would be a significant increase in spending.  It also seemed like $120k over a decade, our youngest years of age decade would be doable.  It also seemed if we lived it up for the decade of my 50s, I would be able to take the “GoGo decade” of my 60s a little slower if required—having already lived an amazing decade.

So our MoJo decade was going great, right on plan, for TWO MONTHS, then the world stopped and then opened back up to slowwww pace.  After a while of no mojo, I realized we were actually living in the SloGo phase.

OK, so now it’s 2021.  For the truly detailed person, this is the actual start of the new decade.  How’s that for a positive slant?  As I usually do, I was crunching numbers back and forth, left and right, tool A to tool B (actually tools C, D, E, F, etc), and there have been crazy returns that past few (many) years.  Time to rethink the MoJo Roaring Raving 20s decade, right?

So here we are with a new and improved plan to take MOJO to a full-caps SHOUTING level.  We’re going to increase our monthly spending more.  We’ve planned the new increased amount over the next 9 years and the hit of just the increase to our investments is less than the growth of just the past couple of years.  [note: there is a whole; bucket/safe withdrawal planning opportunity here]  We will revisit the investment portfolio balance/net worth statement each year to be cautious, but I want us to go for it for a decade.

Thought: it seems so crazy for me to type out what I’ve been processing in my head (spreadsheets) for the past month or so.  Carefully planning an increase in MoJo should not be too crazy as long as we monitor and make little agile adjustments along the way.  To be clear, going from mojo to MoJo or MOJO level spending is based on reviews and agility.

So much of our MoJo plan is based on a pretty low base floor cost of living lifestyle.  I think of it as “living large in a tiny home/lifestyle.”  Maybe a step below (or different than) “upper-middle-class.”

Airborne

Back to being shot out of the cannon, flying through the air without a safety net.  I feel like we’ve launched airborne.  However, I do feel like we have a safety net.  I feel like we could land our “flying” at any point by slowing or stopping our extra spending if required  I also believe we could increase our spending again and fly some more if appropriate.  It’s almost like interval spending with recovery periods in between.  (my wife would understand that based on her drop-saddle spinning classes—but she doesn’t read this because she’s stuck listening to my babble all the time anyway).

What is your mojo?  How are you optimizing and maximizing your current best, youngest, hopefully healthiest years, right now? 

I feel like you can be risk averse or cautious and still push yourself outside your comfort zone safely.  Maybe I’ll revisit this post in 9 years, or 3 years and realize I was clueless.  That has happened before with some of my plans, but honestly, I’ve found that well-thought-out plans, monitored closely, tend to do pretty well.  Professionally, I found catching the problems early allowed for the easiest reorganizing and ability to continue onward in the project (where feasible).

Here’s to your MoJo!

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice. This post is not a piece of literary mastery, just a random thought I had.

FIRE.120 Income Satisfaction Fallacy?

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Why do we keep hearing that life satisfaction perception levels off at $75k of income?

What is the core?

Is that research statement related to spending all of your take-home pay?  Are they really saying that having a salary higher than 75k only delivers incremental satisfaction?

I wonder if that amount is a target for a household to live nicely—living from paycheck to paycheck —thereby eliminating the extreme stress of being able to pay one’s bills.  Thinking back to when we were both in college and working (I had three part-time jobs at once, for years) we made far less than $75k, yet we managed to live well, travel, and save.  Even with inflation adjusting, I have to believe our incomes were 20% below that threshold.

Our perspective

On to our professional careers, we made less than $75k starting out and we still lived well and saved.  But when I think about it, we lived in a small 1000 square foot home (still our home) and drive older used cars that work perfectly fine.  Maybe we just didn’t inflate our lifestyle to match the lifestyle of others?  Maybe we didn’t have instragram and facebook (aren’t they the same?) to judge our lifestyle/success against others—other’s glamour posts.

So did our lifestyle increase multiplicatively when our salaries multiplied over the years?  No, it did not, not at all.  Yes, we did grow our spending some, but our home and cars remained extremely constant for a decade at a time.  That in and of itself kept our inflation adjustment quite low and in our control.

Did our not upgrading everything give us a sense of lacking, a sense of wanting?  No, not really.  If we wanted something—needs were always taken care of—we just planned for the want.  We determined the best item for us and then purchased it when the time was right.  We have always been satisfied with our purchases because they were thought out in advance.

Satisfaction

So did I feel more satisfaction as our salaries grew beyond the magically $75k.  I’d say with absolute certainty, yet.  It wasn’t a “spending” thing.  It wasn’t an “I make XX amount” statement.  It wasn’t status, or value, or accomplishment.  I think it was the deep-down understanding that we had control of so much of our destiny at any given time.  Even related to a health issue, we had the funds to attempt resolution of such an issue.

I believe part of that comfort is that I personally get an immense amount of satisfaction saving and investing the top portion of my income.  It is the act of putting my money into a protection mode.  I get plenty of satisfaction seeing my net worth—hard placed planning/savings effort—grow and progress.  It’s not the dollar amount, it is by far the freedom of everything that amount may entail for the future.

There is a reason many surveys ask people “do you have $400 for an emergency” or “do you have $1000 saved for an emergency?”  Those amounts may allow someone to resolve an issue before it turns into a crisis, or worse, a downhill financial spiral that can be extremely hard to escape.

So is “satisfaction” the ability to fulfill one’s needs?  Is satisfaction the knowing you can handle an upcoming incident?  Is satisfaction the feeling of working towards an all-encompassing goal?  Then how would you define your personal increase in satisfaction, and can a salary over $75k provide that increase?  In my personal experience, yes, a higher household income increased our ability to progress to all our goals.

No Salary Slant?

Here’s a different take on the $75k life satisfaction analysis.  Our current “salary” is $0, and our “income” has been in the $20k range yet our satisfaction is extremely, magnificently high.

Living a lifestyle that ties closely to your personal beliefs is quite core to feeling purposeful.  A life of purpose seems to present satisfaction.  It’s even possible that a life of leisure—that contained previous amounts of purpose—can provide satisfaction.  It’s entirely possible that if you are intentional in how you live each day that you are increasing (compounding) your life satisfaction. 

Maybe all of this just comes from someone how worked through college degrees, to then develop a career, while living below their income level and taking an opportunity to leave their career to do something different.  In this case, to do whatever we want, whenever we want.  And yes, some of that includes giving to others, because that’s what we choose to do.  That’s how we get our life satisfaction.

So, others have found the same conclusions I’ve come to. Those are some serious high-incomes.

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice. This post is not a piece of literary mastery, just a random thought I had.