The Isolation Of Financial Independence

The Dr. Seuss classic, Oh the Places You’ll Go is one of my favorite books to read my young child. It’s an amazing synopsis of what a kid can emotionally expect to experience in the future. In just a few pages it captures the ambition, thrill, excitement, boredom, trepidation and isolation of life.  

So many of the lines are pertinent, even for adults. It’s this one, discussing loneliness, that always stands out to me:

“All Alone!

Whether you like it or not,

Alone will be something

You’ll be quite a lot.”

It’s true. As we become young adults, and move into our careers, it’s this isolation that we try to avoid at all costs. It can often lead us to spend more than we want. It’s often why we go out to the clubs, restaurants or extravagant outings. It’s often why we purchase the nicer car, the bigger home, the better jewelry. 

We want to show people we have value so they will want to remain near us. We want to outrun – or outspend – this loneliness.

As you take your initial steps towards financial independence

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Sequence Risk Is Like Your Drunken Friend

Whether you’re retiring in your 40s or 70s, the biggest risk to your post-work wealth is what’s known as sequence risk.

It’s the threat that a recession or downturn will hit at the beginning of your retirement, instead of a few years in. Experiencing a downturn right as you begin to tap your portfolio for funds can deplete its ability to grow at the rate you need it to during your retirement. 

Say you and your friends decide to go out to the bars. You know you plan to have a few drinks, mingle with your buddies and maybe meet some new people.

As you enter the bar, there’s the risk that one of your buddies started much earlier than you. It’s possible that they’ve already drunken far too much, causing a disturbance, bothering people and getting sick. Right as you enter, they’ve already sabotaged your night. Instead of having a few drinks and laughs, you’re stuck…

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It’s Hard to Imagine

It’s hard to imagine when you’re earning your first paycheck, loaded with debt, waiting for the future, struggling to pay your bills, desiring everything your friends seemingly have, that this is the time to think about what you NEED for your future.

If you know what you NEED then you can pinpoint the amount you must make in your career to quit.

The sooner you understand your number, the easier it will be to determine what matters to YOU. You’ll shed the expenses that you accrue living up to an imagined life, focusing on the costs that actually fulfill you. Your car, restaurant and bar expenses will likely fall while your enjoyment…

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