Please watch the following video:

The video makes the following point:

“It is better to have a short life that is filled with what you like doing, than a long life spent in a miserable way.” –Alan Watts

Financial Independence

I strive for financial independence in order to live an eventual life that is filled with what I like doing, all the time, any time, because I agree with the sentiments of Alan Watts. Living a life of working, doing something that I don’t want to do, forever, is just plain “stupid.” I don’t even buy into the hype of people who claim, “I love what I do, so it’s not work.” Bullshit!

Even if I loved what I did. I would love it more, I’m sure, if it was done on my own terms. For example, I could love being an engineer, but I’d love it more if I have the ability to set my own hours and then leave when I was done for the day, all the while receiving the same amount of income. Yet, there are so many employees who are forced to work an eight or ten-hour day just to show that they are “dedicated” to their job, or to show that they have earned their pay. How can someone love something with such a restriction? Instead of going home or not coming in to work if nothing has to be done, the employee is “forced” to twiddle his or her thumbs in lieu of finding something to do. Again, this is so stupid!

Now, unlike the video infers, I don’t think it’s possible for everyone to just choice a career or lifestyle that’s based on what they truly love, and to neglect the idea that it’s not all about the money. At least not in the beginning of a career. It’s always about the money–period–unless will desire to live a tribal lifestyle.

Finding a career with a proper balance of job satisfaction–doing something that we like that is also challenging and pays well–is necessary to reach that point in life when we can just live a lifestyle that’s based on what we truly love.

Whether I like it or not, I only get one life, and I’d be damned if I spend it working all the time. I’ve talked about my ideal definition of a lifestyle where one is financially wealthy, in my book, “How We Prevent Wealth: A Personal Finance Reflection.”

To reiterate, we don’t need to have millions of dollars to reach a goal of financial independence. All we need is a perpetual monthly income stream that is more than our monthly expenses, with just a little more remaining to purchase the few things that we want and need. If my expenses are only $500 monthly (because I’d have no debts, including a mortgage), hell, I’d really need no more than a perpetual payment of $2500 a month for the rest of my life in order for me to be golden.

The easiest way to reach this state, of course, is to save as much as my income that I can, up until the point where it hurts, and then invest it like it’s nobody’s business. This basic principle will allow me to eventually live off the interest. Again, millions of dollars are not needed.

For example, a lump sum portfolio of $300,000 that yields 10% per year (be it in equities, real estate, EFTs, or whatever) will yield $30,000 a year.  If my expenses only totals $6000 yearly, financial independence will be reached…for me. Done.

Someone who applies this principle in the beginning of their career, and saves at least $30,000 per year, can technically reach financial independence in 10 years. Or, if they saved $15,000 a year, they can technically reach financial independence in 20 years.

Can you imagine reaching financial independence at age 40?

At age 40, this person will have the ability to live the rest of his or her life doing exactly what he or she loves…for real…as long as their perpetual income streams from investments are much greater than his expenses. Money, then, would be no object.

Conclusion

The most important reason to save money and to minimize our expenses from the beginning point of our career is that we only get one life. And, we should maximize our happiness, and exercise our independence to do what we want, when we want, much longer than the status quo dictates. This is the entitlement that we owe to ourselves. This is an entitlement that I wish I learned about way before reaching my epiphany, at the ”old” age of 30 years, in my personal finance reflection, “How We Prevent Wealth: A Personal Finance Reflection.” But, as I concluded, I’m living it now. I will reach financial independence. I will do what I want, when I want. And if it is totally up to me, before I die, I will stop living a life that is “stupid.”

Readers: What would you do if money were no object? Do most people realize that this is truly a possibility, depending on the age that you begin putting a strong savings principle in place?

Here is an article that interviews a couple who retired at the age of 38 and haven’t “worked” since then. And here is a reminder of how Jacob from Early Retirement Extreme lives off of $7,000 yearly, and how I live off less than $36,000 yearly.