Why do you have money in your investment and bank accounts?  Why do you own assets?  What is all of that for?  Why, why why?

I should allow for a 5-minute pause here.

Right after I typed that first sentence, I realized I needed to think about this concept more. 

In the past month, I have made some significant changes to our Fun Bucket concept to the point of funding the Fun Bucket with a massive amount of funds.  I wanted the Roaring 20s/MoJo decade of money set aside in its own account (literally) ready for spending without the need to sell assets. 

I don’t want to have to decide over the next 5 ½ years when, how, and how much to sell to have MoJo money ready for use.  Worse, I don’t want to think, “There’s a $6000, $10,000, or $34,000 fun mojo expense coming, I need liquid funds to pay the credit cards.”  That level of planning, organizing, calculating, processing, and worrying sucks.  Fun cash ready to spend—Done!

Back to the point of this post.

Plan Success Probability

Let’s say you have your retirement planning calculator/website/software all loaded up with your assets (liabilities?), spending needs, future planning expenses, contingencies, other contingencies, what-ifs, etc, and you run all that through their analysis and/or Monte Carlo engines.  You will get a score of some sort.  Usually, a percentage of success is based on past performance (projecting future success) of having enough money.  More specifically, that your assets don’t drop below zero.

Note: if you have a projected failure after 30-40 years, you have to look at when they drop below zero and then how much over the projected time until End of Plan.  This could mean your current asset vs spending plan will need adjustments now or along the way due to life/market conditions.

Now, if you were a great saver, a good investor, and project a logical spending pattern (inflation-adjusted) you may have a fantastically high probability score that your plan is solid and your money/assets will survive through End of Plan.  (it’s strange how much I enjoy typing “End of Plan,”—that’s not right)

Here’s my newest realization.

If you have a 99% Monte Carlo Probability of plan success score, AMAZING.  You have saved great, invested great, and have a spending plan that probability-calculated has an almost perfect chance of never running out of money.  GREAT JOB (saving).

The Oops:

So, if that means there’s a 99% probability that you won’t run out of money, isn’t the flip side of that saying there will be money after your End of Plan?  Yes, of course.

So that means there is a 99% probability that others will be spending your money—all that money you saved—saved for YOUR future (i.e. did not spend upon earning)—will be blown out by others.  THAT SUCKS.

The HOGs

I love discovering different angles and terms, but not in this case.

Heirs, Organizations, Government.

The HOGs will take your life savings, your lack of spending, and your remaining assets and just let it flow like all your efforts were meaningless to them.

Heirs – It’s totally reasonable you want to leave money to the people you choose.  80% of people have children.  Most have siblings and niblings.  If you have enough money that you couldn’t spend it all, you probably have friends 😎.  You can help others with your extra.  Nice, Great.

Organizations – Many people give through life, and leave money to charity, to spiritual organizations, to education scholarships, to building, etc, etc.  Nice, Great.

Government – SO MANY people leave assets with Uncle Sam as implied bills.  After End of Plan the estate must settle up with our lucky-to-have uncle.  It’s good to give our uncle what’s required to keep our amazing country running, but most don’t want to tip our uncle.  We have very little say in how Uncle Sam spends our deferred spending.

I don’t have to belabor the details of each HOG, but I did want to share that you definitely should allow your life savings to benefit you as much as possible/probable/logical so the HOGs don’t take it all and blow it.

How’s that for my 199th post?   SLAM!

*** 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.

Do people leaving a career and venturing into the amazing world of FIRE, retirement, freedom, fun, and the unknown accurately believe they will become a great new person?  Does one’s purpose lie just beyond that final pay period?

The Monday after a long multi-decade career doesn’t energize someone into a magical new being.  There is no victory lap and no celebration parade on Monday.  There is no amassing of grandeur.  It’s just a Monday without work.  It’s not much different—yet better— than a Monday holiday.

On this very first Monday life will and should feel great.  The first week will be great.  For many people, paying attention to their feelings on Sunday afternoon will show a relaxed—no work tomorrow—perspective. 

Over the weeks—or months—this feeling may lessen for many.

I have a theory from the many people I’ve talked with who’ve retired/left their careers.

Theory:

Who you are before retirement is probably who you will be when you start retirement.

The good: 

If you are a happy, curious, active, or energized person during your career life, then as you enter retirement you will maintain many of the same traits.

The bad: 

if you were anxious, bored, looking for something more, pushing yourself to meet the next goal, then after your career life you may possess (be possessed) in much of the same trails.

Retirement is not a magic day of personal change.  It is a HUGE day of working/employment change, but you are not a new person because you turned in your badge.

Consider the person who was laid off.  It’s pretty clear that most of those people may not be happy.  They will be inserted into a possible retirement mode against their will, and possibly far from their target timeline.  This consternation is understandable. 

I want to talk about retirement by choice.

Planning for life without work is more than just daydreaming.  While daydreaming before retirement is good—and daydreaming in retirement is great—it’s a good idea to have a plan of action.  Actions that you want to take during your hundreds/thousands of weeks.

You can make your life what you want:

The idea of retiring to something, not from something is mostly valid.  In the same sense, you make a plan/route to drive somewhere for a reason.  Retirement should not be similar to the act of stepping out of a car at a location/destination and wondering why you are there.  It’s very, very helpful to know why you want to be somewhere/somewhen.  Your timing is an important aspect of “when.”

You are who you are…you’ve been this way for a LONG time.  That’s OK.

You do have the opportunity at any point in your life to attempt to change, improve, and even experiment with almost anything.  These changes can be internal or external. 

Imagine the opportunity to change your stressed-out-get-off-my-lawn-because-I-had a bad work-day personality for a relaxed, no worries type perspective.  Imagine how your ticker and blood vessels may thank you for this pressure shift.

I don’t believe these shifts have on day one of retirement.  I believe you are, who you are/were, but you can shift, with intentionality in an attempt to be/feel better.  THIS IS NOT AN AUTOMATIC, MAGICAL CHANGE.

One other random thought I have; you don’t have to grow everything.  You can shrink some things.  You can look at what aspects of your weeks/life you don’t love and probably let some of those go.  You can lessen your commitments.  You may be able to assign away tasks you dislike.  You may shift physical, mental, or emotional tasks to others who have time, are specialists, or, at least are not you.

You are in (mostly) full control of your ship.

*** 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.