Retirement; like your parents, but way cooler
In 1991 Billy and Akaisha Kaderli retired at the age
of 38. Now, into their 3rd decade of this
financially independent lifestyle, they invite you
to take advantage of their wisdom and experience.
No Guarantees in Retirement
Billy and Akaisha Kaderli
People often tell us they are going to wait a few more years to
They point out that by waiting, they will have
health care provided for life and
a pension that will let them afford the same lifestyle to which they've become
accustomed. They won't have to
back on spending or make awkward choices
concerning their budgets. Not only will they not need to relocate to a city or
state that is more affordable, they will be able to own two houses: one at home
with their country club membership, and another on a lake, near a beach, or in a
These people have worked their entire lives for this remarkable retirement plan.
They have made personal sacrifices throughout the years such as spending time
away from the family, not pursuing their hobbies, and not taking long
sabbaticals. They have made these choices because in doing so, their retirement
plan will be fully guaranteed.
After investing 35 or 40 years of their working lives, saving their money,
raising children, and putting their own personal wants on the back burner, they
now look forward to that day when they can relax and finally enjoy
the life they
No tough decision making, no cutting back on their consumer habits.
Or at least, that's how they think it'll be.
There are no guarantees
What we have learned in our
decades of financial independence is
that the perfect time for retirement simply doesn't exist. Things change, and
Perhaps your personal plan for retirement was to take big amounts of equity out
of your home. But then the
housing market takes a dive or your home or is
affected by something out of your control. Oops.
Natural disasters can come up, affecting your lifestyle and investments. Forest
fires, floods, hurricanes, earthquakes, drought can all threaten your home
whether you have insurance or not. What an upheaval! It's a financial and
emotional storm no one wants to go through.
Financial markets have their earthquakes too. While the market over the
years has performed at about a 10% annual return
including dividends since we retired in 1991, those of us who are older
now and receiving
Social Security might not have the
time to recover from something drastic.
We have a myriad of friends who, as they worked and aged, have had health
problems affect either them or their spouses. One man wanted to travel through
Europe, but now has developed claustrophobia (due to an earlier trauma he
suffered) and can no longer fly, or take a cruise in a tiny cabin, far from
What if you or your spouse find yourselves with a medical condition that doesnít
allow you the freedom you fought so hard to achieve? What if your grandchild
special needs and requires assistance, time, or your financial help?
Where can you look for comfort in circumstances such as these?
Reap reward from your self-reliance
If you have learned to live below your means, have kept your monthly expenses
reasonably low, and have not loaded up with huge amounts of consumer debt, the
above scenarios could be an uncomfortable bump in the road, but not a
If you find yourself awash in a
storm and the days down the road seem
dark and menacing or if your
dreams seem to be permanently shelved,
try some of the following steps to regroup:
People retire every day, in good times and bad. Like deciding to have a child,
it's never the perfect time. Realize that it's normal in life for unforeseen
events to rattle your confidence level, so try not to let it faze you. Above
all, do not make a reflexive emotional decision about the rest of your life by
making a bad trade, or an impulsive decision about your home.
Make your own retirement investments independent of your employer's plan. Don't
rely solely on your employer for your retirement, whether it's through a
traditional pension or with company stock in a 401(k). This way, if your company
goes under for reasons you cannot see today, you'll still be in control of your
Know where you stand.
Get support from your past good behavior. If you have been
your spending and living below your means, you know exactly where you are
financially. The confidence and discipline of controlling spending should give
you great self-assurance that you can weather any storm. And you will know
exactly where to make spending changes if need be.
Look for buying opportunities.
Itís always a good time to review your portfolio to see whether you have been
over concentrated in one stock or in one particular sector. We recommend no more
than 4% in any particular stock, and that includes the companies you worked for.
portfolio with roughly 50% equities - 50% cash bonds and equivalents for those in or
nearing retirement is a good approach.
Invest in no-load ETFs (Exchange Traded Index Funds)
such as VTI, Vanguard Total Market Fund or SPY, S&P 500 Index, that you can buy
or sell in real time,
instead of the market price at the dayís end and use weakness in the market to
add to your positions.
If the idea of fully retiring frightens you, consider working part time, cutting
back the hours at your current job, doing consulting work, or starting a second
career. You'll still earn income, but you may not have the same work demands
that your current job makes of you.
Consider other alternatives for the expression of your retirement life.
Perhaps you now have the incentive to think about
relocating to a smaller home,
a more affordable city, or to own
one vehicle instead
of two. You don't need to
shelve your future plans entirely. Find other ways of scaling down pressure and
fun, relaxation, and new ways of self-expression.
a free forum.
You are not alone. If you find yourself in a financial or
challenge, there are others who are facing something similar. They may have
an answer for you, share some tips or point you in the right direction to
receive the help you are looking for.
No matter what your circumstances, there are always opportunities, there are
always options. Be open to them and make the most of where you are!
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About the Authors
Early Lifestyle appeals to a different
kind of person Ė the person who prizes their
independence, values their time, and who doesnít
want to mindlessly follow the crowd.
Retire Early Lifestyle Blog
About Billy & Akaisha