When I started the blog I debated what would make for a good blog name. One of the names considered was “Extreme Early Retirement” but I found that that name had already been “parked”. Early Retirement Extreme was free though and ERE also made for a better acronym than EER.

In retrospect, here slightly more than 3 years after starting the blog, the R-part of that name has turned out take have some annoying side-effects.

I found the crux of the matter to be that people have different and preconceived notions about what retirement means. Retirement has traditionally meant the part of life that followed a life-time of work. Retirement was for those workers who were broken down physically and sometimes mentally and unable to work further. The way industry had been set up meant that they could be replaced by a younger functional version much like a part in a machine.

As a more robust financial system replacement family dependence of having children, some people who managed to accumulate enough capital became able to retire a few years earlier than usual. A person could stop working even while being capable of continuing work. This was the first paradigm shift.

Traditionally households had a single income which meant that there were enough savings to support the household.

Recently, the idea of retirement has begun to change.

First, as households became poorer in real terms, single income households turned into dual income households. This now means that one person can retire while the other keeps working. This is the second paradigm shift. Here one person could retire several or even many years before the other.

Some people have also been able to push the age of retiring, that is, the age of no longer working for money far down. This is called extreme early retirement. This is somewhat different from using up one’s money until the pension rolls in. This is more akin to a lifetime of cash flows from investments that are not drawn down in value.

This is what I am talking on on this blog. This is the third paradigm shift. We have come pretty far away from the original definition of retirement: from someone who is too worn out to work to someone who has enough money so as not to need to work.

This is why early retirement extreme is a bad name.

Maybe financial independence extreme would be a better name?

Well, here the problem is that financial independence also has come to have many different meanings. For me it means having enough savings to pay for (finance so to speak) all my needs over a lifetime. Yet, for some it simply means not having any debt; for others it means having enough income to pretty much purchase whatever they want.

These definitions are even further removed from what I intend.

Another suggestion is “Independently Wealthy”. This is actually pretty accurate, except many people confuse “wealthy” (having money) with “rich” (spending money).

Consequently, I’m stuck with Early Retirement Extreme. Just make sure you don’t get stuck on your personal interpretation of what that’s supposed to mean, okay? πŸ˜‰

Originally posted 2010-12-12 20:48:47.