Retirement Update July 2023
Someone offered me a job this week and for a few minutes I actually thought about taking it.
Then I came to my senses and realized how little I actually want that.
Having to be at work by a certain time, five days a week, 200+ days a year? Needing to ask permission to do a talk, publish a book, make a video? Putting on work clothes again?
Nah, not for me. Not at this point. Being retired (or unemployed, as my wife puts it) has almost certainly spoiled me as an employee.
The thing that made me consider taking the job was cashflow. The one downside to being retired is not having that regular income coming in, that dependable river (or trickle!) of money every month.
Not having a regular income is stressful, even if you have savings and investments.
Transitioning from saving every month to spending every month is a huge leap, one that I haven’t managed to make yet. We still save and invest every month.
That’s not my only worry.
I am also worried about the existence of money itself (this is a somewhat less likely concern).
If AI fulfills its potential and eliminates most jobs, will our economic system collapse? If our economic system collapses, will our money and investments have any value? If climate change wreaks havoc to the world food system, will something similar happen?
Being (theoretically) financially independent does not eliminate all your worries and concerns, just (most of) the money ones.
Boo hoo, right? Why should you care? Most people reading this are likely not financially independent yet, and for many the very thought of it probably seems ridiculous. It still does to me, a little.
But getting here is not difficult. There is no special formula or secret investing strategy.
It starts with not spending everything you earn (I discovered this step in 2008).
Then you save up some emergency money for peace of mind and to avoid financial damage (3-6 months’ worth of expenses).
Then you invest your monthly excess in something reasonable (I chose the world stock market).
And you do this for a long time (for us, around 15 years).
Really simple. Not easy to stick to, but worth it. Probably worth it.
The good news is that doing any of those things will make your life better, even if you don’t end up doing them as much or as long as we did.
Having some money left over every month is a good thing.
Having emergency savings is a good thing.
Having some of your money working for you and growing is a good thing.
And keeping up healthy financial habits is a good thing.
But you have to choose to do it.
If you have questions about the details, that is what the forum is for. Or our annual live cohort-based course (next one in 2024). Or our Guides to iDeCo and NISA.
Yes, agree 100%. Don’t work, at all, if possible. The freedom is priceless. But now there are new challenges for you. Finding purpose is the main thing, which I think you have … this channel, the blog, the FB, Twitter, YT, pls keep doing that! I’m not retired yet, and a little bit older than you, but I find your messages and the people you interview very real, and helpful. Preparation relieves stress … maybe you can find a small abandoned homesite not too far from where you live, up in the mountains, where it is cooler, where there are streams, and if that abandoned property has some old gardens, some old fruit trees, you could revive them, and restore the property, to some degree. It’s another type of preparation, and your carrots and potatoes will grow even if money disappears. 😉
Actually, my wife’s parents’ place is exactly like that. On a hill, next to a prefectural forest, lots of shade and breezes, some land for a small garden.
We renovated it a few years ago and put in excellent insulation, a mechanical heat exchange system, etc.
If all goes to plan we will inherit it at some point, and then put in solar panels, batteries, rainwater catch tanks to make it more resilient.
That’s perfect! And it’s what my wife and I want to do too. Exactly that, and also have a studio in or near Tokyo. So if one of us wants to ride the train into Tokyo, do fun things, and stay, we can. 😉 I have been volunteering at local organic farms to learn tips and get advice for the last 15 years, and I’ve implemented it here in my suburban backyard. But at some point we will leave the USA for Japan … and hopefully we can find the right property, location, elevation. My nihongo needs to improve though …
“We renovated it a few years ago and put in excellent insulation, a mechanical heat exchange system, etc.
If all goes to plan we will inherit it at some point, and then put in solar panels, batteries, rainwater catch tanks to make it more resilient.”
Sounds like a good idea for a blog post Ben 🙂
Will definitely be making videos and blog posts about that nearer the time 🙂
Hi Ben,
Always nice to read your write-ups.
You are a bit ahead of me, because I still have around 6 months to go until retirement (at 60).
Although I (think I) have firmly decided about my retirement, I keep thinking about multiple points.
One challenge is whether I (actually my wife and I) will have enough money until the bitter end. I have an extensive Excel sheet to give me some level of comfort, but it cannot deal with everything that possibly can go wrong. So, risk always remains. For instance, future Japanese and foreign cash flows & funds, and the related currency exposures throw in an extra challenge, but also some sort of a risk hedge.
I also keep thinking about whether I still want to do some interesting/useful work and not let my years of experience completely go to waste. This definitely has to be some less structured (project, interim) and your comments about not wanting to go to office every day, dress up for work etc. are very recognizable.
For many foreigners, that have not been in Japan their whole life, the whole retirement topic can be a bit complicated, involving multiple countries, and currencies, different timing of pension flows, tax implications etc.
Anyway, just wanted to send a quick note, to say thanks and indicate that can completely related to your story.
Regards,
Hans
Thanks, Hans! I also struggle with the limitations of the spreadsheet. Not sure that ever ends though. Right now we have 30-50x our annual spending in investments, which is basically enough money under most normal scenarios.
But it doesn’t feel that way.
Ben — You made the right call. As you are well aware, your most precious commodity is your own time. Life is full of trade-offs, and you simply cannot do everything. I am acutely aware of this dilemma, having been in the same situation multiple times since becoming semi-retired (notice that…I still have several part-time gigs to keep it interesting and earn some extra spending money). Keep it up! The series of new videos and blog posts are really taking Retire Japan to the next level.
Thanks, Mark! Trying to figure out how to 10x the site 😉
Well written blog, Ben. Agree with some comments that having goals and ambitions to wake up to is crucial in retirement. I think you’ll be fine there. Thanks for the read.
Thanks! So far so good. Still feeling things out.