Independence Day is one of America’s favorite summer holidays. What is one of your favorite traditions on Independence Day: fireworks, hotdogs, parades? In this blog, I want to talk about another kind of Independence Day, your Financial Independence Day.
If money and time were not an issue, what kind of activities would you be doing over the next twelve months? The day when work becomes optional—when you can choose to stop working and start doing those activities that you enjoy while maintaining your current standard of living—is the day you’ve reached your financial independence day. This day is the end result of a process of determining your retirement income goals, the actions, and the decisions necessary to achieve those goals. Retirement planning is, in essence, preparation for life after paid work ends, not just financially, but in terms of lifestyle choices, such as how to spend time in retirement, where to live, when to completely quit working.
A Plan for Every Stage of Life
People often deny themselves their dreams because they don’t understand the resources needed. This is why it’s important that I get their list of dreams during a discovery meeting in order to explore options and tell them what’s realistic. If a goal is unrealistic based on current net worth, income, and expenses, I can make suggestions for changes to get them to a better place. I can run some scenarios to show if they are spending too much now to retire in their target year, and I can offer recommendations. Financial independence isn’t necessarily just about retirement; it could involve the pursuit of a new career.