Sounds ideal.

Your cost of living must be quite low if $250K will provide needs for life after allowing for inflation. Would this still be the case if your circumstances change (marriage, kids, a desire to travel the world, go to university etc etc)? If the answer is no, then a few years working to put aside a a bit more money may not be a bad idea.

@traineeinvestor – Yeah, here 250k would provide 7.5k/year (in present dollars) forever which would be enough for marriage (I can attest to that, I am married and I spend less .. in fact marriage with the right partner drives costs down through scaling), kids have been discussed before (they cost as much as you can afford), many people sail the world for less than this, but paying 20k/semester at a university, no way—I got enough schooling as it is … a library card is free though, so.

@tracysimplylivinginspain – No, I wouldn’t consider (my) freelance work a career although I guess it could be. This blog is probably closer to a career if one can call it that, but I wouldn’t call it that either, at least not at this point. When I think of career I am thinking of some job related progression where each step builds on the previous. I’m not seriously toying with the idea of “going back to work”. This post, like several recent ones, was written more to “bring balance to the force”. Now, hypothetically though, could I go back to work? I find that I don’t make for a happy employee. I am too independent for that. I am also very interested in learning things, so I am willing to put up with a lot as an apprentice … or as long as I feel I get something out of it. Otherwise, I would really only work as a partner on a project or solo.

I once had a patient who was a relaxed, aging hippie kind of guy. He was healthy.

Then, he got promoted at work and put in charge of a major project. He stated wearing a suit and working long hours. He developed a health problem that I couldn’t treat, so I referred him to a specialist. The specialist kept the problem from getting worse, but it didn’t get better either.

The guy eventually finished the project, retired, and took up an interest in ethnic music. The health problem went away.

I do believe that voluntary work is good. That’s why I still see patients. Frugality is necessary because it lets us choose the kind of work we do, the amount of work we do, and the amount of stress we take on.

All the people that are passionate about their careers that I’ve met wear whatever they want to work (typically t-shirt and jeans), many of them work a short bike or bus ride from home and none of them spend their day following procedures and filling out spreadsheets and forms.

They’re all programmers working at startups whose mission they believe in. And they typically make a lot less money than their skills and experience would get them elsewhere.

Even if I won 32 million in the lotto (pretty much the ultimate in financial independence) I’d still try to have a job. I’d just be much more selective about which job I take and how long I stick around.

Admittedly this is a bad time to try to find a job. But is there any harm in going back to work? Jacob’s view is a pretty pessimistic idea of work. I’ve had jobs that were worse than he describes and I’ve had jobs that were way better than he describes. Just because it is a job doesn’t inherently make it bad.

The whole point of financial independence and early retirement is to be happy and have freedom. Maybe you are the kind of person who needs a job to be happy. Maybe you’ve got too much free time and need to fill some of it up. Maybe you’d like some extra spending money. Or maybe there is some field of work that you are passionate about.

If you are financially independent and the job is bad, then walk. At least you have that option.

> How much would you be impacted in the stock
> market dropped 50% or so?

That’s a very valid question to ask! In my own portfolio, I can say that the 2008-2009 market drop of 30-40% caused my investment income to drop by about 10%. The portfolio has more or less recovered its value and income from it has increased above the 2008 levels (I’m not including the continued deposits into the portfolio and their effects that have elevated everything much more).

The key element that resonated with me from this post is your statement that “passion is an internal quality rather than an external quality. If you are not a passionate person, it is unlikely that you will be passionate just by taking up some career.” I agree. I find that I am not a passionate person, except when I grow angry at overt idiocy. Regrettably, there are too many opportunities for that in our society today. And often my anger is, as Shakespeare wrote, “sound and fury signifying nothing.” So we can leave that aside for now.

Instead of passion, I operate on curiosity. I like to solve problems. This only becomes a significant challenge when the solutions become routine and uninteresting. I sometimes think that I have a problem-seeking mentality because I need ever-more-complex problems to satisfy my curiosity and avoid frustration. I enjoy reading about subjects that I am entirely ignorant of because even the basics are new to me.

Life, with or without a career (particularly as Jacob defines that concept above), should provide sufficient problems to keep me occupied. And the first, and most pressing, problem is to satisfy my needs. I have solved this problem for all necessities but health. I have an intractable, chronic health problem that challenges me to find a solution other than allopathic medicine because the cost of doctors and drugs puts too great a strain on my capital. Or perhaps the solution is to cultivate a spiritual/psychological outlook that does not fear death, even if it comes earlier for me than for others. I am drawn to Stoic philosophy and the Japanese bushido because they both foster such an outlook.

I have to confess that I don’t fear the collapse that peak oil might bring. It promises to be an encounter with the most compelling and fruitful sources of real, life-at-stake problems that someone in the post-modern era can envision.

Frank and I prefer you retired, content, and occupied with your numerous side projects. I think you are too busy currently for a “career”.

I think Mo and George already covered most of what I was going to say wrt market drops. A 3% withdrawal rate has historically survived a couple of world wars, a decade long depression, an oil crisis, and a bunch of other stuff. Now, I prefer dividend stocks which provide an ever steadier source of income some of which is reinvested to cover inflation. Hence market drops are actually quite welcome as they allow buying in at a higher yield.

The question of peak oil is important. The historical numbers are based on a period of ever increasing oil production. Will they also hold for decreasing production? My opinion is that the market will be more resilient than the jobs, in particular certain sectors will be more resilient than others. The market may drop a lot but that’s only because the whole market includes, say, car manufacturers and McMansion producers and individual investors do not not need to own that.

I tell you what I mainly own: phone companies, big banks, energy/infrastructure/industrial, and drug manufactures and dealers, excuse me, retailers (cigarettes and prescription). All of these are pretty vital to keeping up a functioning society and/or in very high demand (during a depression).

If such companies have failed at some point, then having a career in marketing, business administration, advertising, or research will have failed long before that. That’s probably most people’s careers right there since there are not that many people anymore doing “real” work anymore. (Def. of “real work”: When you can put the product you made in the hand of any person and the response is “I get that. I can use that.”)

Keep in mind that the market is not just a magic way of getting 10% returns forever. I think we often forget that it actually does represent underlying companies where people have their careers. No market, no careers.

Thus the main thing I worry about is some kind of communist takeover or the death of the capitalist way of arranging matters.

I say keep an eye on your investments and do what makes you happy. Do not go back to work because other people are making a big deal about it.

If you want to have a career then go ahead and do it for you…not because everyone else seems to think that you are missing out.

At the very least go ahead and try some part time work to ease back instead of looking for a straight 9-5 right away.

Another alternative is to do what we’re doing. Specifically, take some time to do whatever it is that you enjoy. Live frugally during that time, and spend a portion of it trying out different start-up ideas that excite you. To us, a career isn’t important. Doing what you love and being able to do what you love is.

@20smoney – Maybe I am not pricing ebooks optimistically enough. What would be an optimal price point?

@Jason – I could do that. The problem I think would be in obtaining critical mass, but you’re not the first to ask. Let’s query (next post).

Don’t forget to include as an option working part-time. This way, you can still maintain an income while freeing up additional time to do what you want. I worked P/T for 7 years (2001-2008) before I retired fully 15 months ago at age 45. I kept my health insurance and pension eligibility (for one year; it got frozen in 2002), and added to both my retirement and non-retirement savings.

I don’t think $250k is enough to retire on at age 34, either, even if you are single and childfree like I am. You will need to live off your non-retirement investments for at least 26 years before you can tap into any retirement ones, and then a few more years until Social Security (if you are in the USA) kicks in.

For me, health insurance has now become my biggest (and fast rising) expense, as I don’t want to endanger my fiscal situation should I become ill and have to shell out too much money and ruin everything.

I was very glad to be rid of an awful commute, even 2 or 3 days a week, when I retired. While I liked my work at times, I do not miss it a single bit. Nor do I miss any of the interaction at the office. It seems like another life I lived for 23 years.

Hi Jacob,

Thank you for all the great articles. I have been reading and reviewing this blog since Oct and really appreciate the help you have given my family of 5. We are now debt free and living on 50% on our way to semi retirement in 4 years.

I have read about 20 of the books you have suggested….only the textbooks types have been a challenge.

One area I (and maybe others) could use help on is in the area of getting started picking dividend producing stocks. I know you say that returns during the time of building up your portfolio give minimal difference during the short run (say 4 years). I need to start educating myself on the whole process with hands on step by step method. However I must admit it is depressing to save half of our families income and only feel comfortable with 1-2% growth thru CD’s.

I assume you don’t feel comfortable listing your picks but maybe you could lead us thru some kind of exercise that you walk us thru a process, give us research to do, and then as a group we could share what we came up with?

Anybody with me on this request?

@chris – See this post for _my_ strategy. It might not make you sleep well at night but it works for me http://earlyretirementextreme.com/2009/01/day-14-investing-for-early-retiremen.html
Actually, I would recommend using real money. It is much different from paper trading due to the emotional component.

I am probably doing you a disfavor by telling you what I have (bad analogy: telling a beginning motorcyclist that they ride a Ninja Z1000, say; not a good first bike and probably not a good second bike either for that matter), especially if you just go out and buy them (because you wouldn’t get the same price as I paid and how would you know when to sell?). Here’s my current list: BEE, COBR, CUZ, DD, EHI, EOS, FTR, GE, MO, OLP, RYN, T, UPS, WAG, WFC, WIN, WWVY. Some I’m selling, some I’m holding, and some I’m buying more of.

What I am recommending to DW, who is just starting out, is to follow the dogs of the dow strategy (see part 2 of the link above). It gets your feet wet and you could do worse (e.g. sp500 index funds, zing! 🙂 ).

I like the more relaxed him better, he’s always pensive and questioning 😀

There would be certain circumstances under which I would suggest you go back to work in a career.

If you wanted to make a contribution to society and felt that the structure of a career was the best way to make a large contribution, then I would suggest a career would be good for you.

@Moneymonk – If you were a multi-millionaire, you’d still work for group insurance?

Thanks for answering the peak oil question — that’s an interesting POV and it’s given me something to think about.

If you sometimes miss going to work a good idea is to pick up a temp job. It will introduce a whole new business or work routine to you and for a few weeks it will really be exciting and interesting. You will learn new skills and perspectives and also make some extra money. After a few months the whole idea of showing up every day to work starts to get to you and then it is time to quit.

I work at a gift store over the xmas period for a few weeks. The money is not much but it makes the gray cells work harder, the change is invigorating and I have learned to use a cash register, something I had not picked up in my 60 years before. It also makes me a lot more patient at the supermarket checkout.

I think most people’s jobs are not that fulfilling. We hear from the people online who are happy with their jobs, but when I look around, I don’t see a lot of people with careers they are passionate about. In fact, most people I know who work seem downright unhappy.

It’s our responsibility to find our calling. Most people’s callings is probably not to minimize their potential, but maximize their potential. This is why you have an itch to go back to work, not because you want to buy more things.

Good luck!

Shouldn’t a career be something you are passionate about? If you are not happy pursuing a particular career, you should change. Didn’t you just do that?