Setting ones 55th birthday as the day they achieve financial independence isn’t exactly exciting and frankly I’m fine with that. You have to ask yourself several 4 questions when choosing a life-altering event like your Findependence Day:

Am I content with what I’m doing and can I continue to do it for X amount of years?

I didn’t want to use the word happy because quite frankly, most people don’t have the luxury of doing something that truly makes them happy. People are tied to jobs because they have financial obligations, spent a fortune on an education, or just have a plain old fear of the unknown. However you do need to be content with what you are doing. There is no way you’ll be able to work effectively in an industry/field for 20 plus years if you’re not at least content with your job. The key here is to be able to recognize that even though you’re not happy, you are content. I wish I could give definitive parameters to determine if you are content with your job but that’s something each individual person will have to decided. However, I think it’s safe to say if you only consider quitting your job once a month then you’re probably content but you’re not happy.

Is it feasible?

Saying you’ll retire when you have a million dollars in the bank is fine, but is it feasible? If you make minimum wage or live month-to-month off your credit cards then it’s going to be extremely difficult to make it happen. You have to develop realistic plan with practical numbers, set sensible goals, and then have the determination to put it into action.

What will I do when I reach financial independence?

You don’t need to know exactly what you’ll be doing during your first retirement when you set your financial independence day but the more time you give yourself the better. This is important for several reasons:

– You won’t spend a large chunk of your nest egg trying to “find yourself”.

– You can start developing skills that will help you in your first retirement like learning how to knit if you wanted to open a knitting cafe.

– You will be open to opportunities for implementing your first retirement plans sooner than you expected, like finding the perfect location at the right price for your knitting cafe.

What about the people around me?

This is by far the most important of all of the questions. You need to know the kind of impact your findependence day will have on your loved ones. When does you wife plan to retire ? Will you be living the high life without her? Are you looking to spend more time with the kids before they leave the nest? Perhaps you are looking to have them packed up and out the door so you can have some peace and quiet? These are the kind of things you need to consider because they will affect the people closest to you.

For myself, I’ve come up with the following answers:

Am I content with what I’m doing and can I continue to do it for X amount of years? Happy for me would be having $10 million dollars in the bank and working for free under the world’s greatest chefs. Unfortunately this isn’t going to happen and I’m fine with that. Right now I’m content with my job. I come into work and do it the best I can. I take initiative to try and make things better. I enjoy the people I work with and the job pays enough that it makes my findependence day achievable.

Is it feasible? 55 is a very doable number with the way we have our finances setup. I can easily continue to put $15k/year into my RRSP’s, $10k/year into the TFSA and still have some money left over for individual stock investing. I’ve also run the numbers at age 50, 55, and 60 using a conservative return of 5%. At 50 I will have a nice nest egg but I won’t be able to live the life I want. At 60 I will have an excess amount of cash but I feel I won’t be young enough to enjoy it. At 55 I will have enough money to do most of what I want and will hopefully be healthy enough to still be able to do it.

What will I do when I reach financial independence? I’ve gone to several B & B’s over the last few years and have enjoyed the stay. I’ve also come to enjoy the thought of running my own. It will allow me to test my cooking skills on our guests having breakfast and provide an additional stream of income in retirement. I also enjoy interacting with people from varying backgrounds. During the low season we can shut down and travel. At 50 I plan to start looking at properties so I can be ready to pounce if the right one comes up.

What about the people around me? My retirement goal of 55 will coincide well with my fiance’s retirement age as a teacher. The kids will be grown and gone by then. This will leave my fiance and I to enjoy the ourselves until the grand kids come along.

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