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  • Nate Carter

Six More Observations from Early Retirement

A few months after retiring, I offered six initial observations. As I reach my one year retirement anniversary, I want to share six more observations. I hope these help in formulating your future retirement plans.

Making the Right Decision

So, my first observation is answering the most common question I am asked. Did I make the right decision in retiring early? Yes, without a doubt! I had a diverse work history which included spending the last 18 years working overseas as a U.S. diplomat. It was a great experience seeing the world and I made many valuable friendships. But, I was ready to move on. And I was grateful to leave on my terms and in a way that opened many doors to new adventures.

More Opportunities Than Expected

As mentioned in part one of this article, I never viewed retirement as a time to slow down or cease working. Originally my retirement plan was to get my real estate license and expand my real estate business. I still intend to do this, but, the beauty of retiring early is the range of opportunities life presents. Some more interesting options presented themselves so I pursued them. And this brings me to the second observation, retirement can open more doors to new opportunities than originally expected.

Once I retired I took a road trip across America. I then returned to New Zealand to accept a short-term contract as a senior advisor working for the New Zealand government. This was an opportunity to draw on my years of Middle East experience working with a great foreign policy team. It was so enjoyable, I signed another contract to stay in New Zealand longer. By the end of the second contract I was ready to head back to the States to be closer to family and friends, but the additional time in New Zealand was a great transition

The next opportunity to present itself was working with some partners to launch a bespoke security consulting firm. This work draws on years of experience in high risk locations as well as a lifetime of entrepreneurial skills. We assisted clients with security vulnerability assessments, expert witness testimony and personalized security training such as learning how to respond to an active shooter in the workplace. (Update: After bringing the business to profitability, I chose to exit to focus on other endeavors).

I am grateful for these post-retirement opportunities and look forward to where they will lead in the future. But, most importantly, I would have missed them had I not retired early. Keep this in mind as you consider whether to retire now or delay retirement.

Beware of "One More Year" Syndrome

The decision to retire makes most people slightly anxious, but if this fear is not managed it can lead to staying in a job, you really wish to leave. Three common fears of retirement are losing an identity that work provides, daily social interactions with colleagues, and living on a reduced income. Such fears can lead to "one more year" syndrome. Workers want to retire, but continue to delay year after year. This is the third observation from early retirement. A few people have shared that they are caught in this trap, afraid to make the retirement leap.

Do not let "one more year" syndrome rob you of the life you desire. Time is precious and none of us know how many summers we have left. Seeing a few friends from high school pass away this year is a salient reminder that our most precious commodity is time. Delaying retirement may make it harder to pivot to a new career or enjoy hobbies. In addition, the stress of continuing to work in a job you don't enjoy takes a toll on your health and happiness.

If you are trapped in "one more year" syndrome, begin by addressing your fears. Make a list of what you are most afraid of and look for ways to address them. If a review of your finances shows a need to save more, look for ways to reduce expenses to maximize your savings rate. If you are financially secure but fear the loss of contact with colleagues, join professional organizations or community groups now to expand your network. If you fear the loss of identity from work, start looking for full or part-time positions that give these same rewards but are more enjoyable than a current job. These steps will make the transition easier. But, merely waiting it out is not a wise strategy.

Financially, Expect the Unexpected and Have Extra Cash

The fourth observation is to expect some financial surprises in retirement and save a little extra cash as a cushion. Financial diversification and good planning mitigates the impact of these surprises. Several months after I retired the stock market went into a bear market and inflation rose significantly. (For those who read Become Loaded for Life, it advised investors to prepare for higher inflation and also offered strategies for navigating bear markets in retirement, hint: they are buying opportunities).

The financial surprises were not only market driven. When I retired I was owed a few months of unused annual leave. This payment should have been made within a few weeks. My former employer did not make this payment for seven months. I was not alone, there are hundreds of retired diplomats still waiting on their payment. Many retirees were counting on these funds to start businesses, pay for major expenses, or to use as a down payment on a retirement home. Some are still waiting on their money.

It is vital to have enough cash on hand in retirement to navigate these challenges. Markets will be frothy and bureaucratic delays can arise in any organization, so have sufficient cash holdings. I also encourage all future retirees to see the article on planning for replacement costs in retirement as these expenses can quickly derail retirement plans.

Healthier Lifestyle and Leave Your Phone Behind

The fifth observation is the health benefits from retiring early. It feels pretty amazing to wake up every morning knowing I will be able to get outside and exercise, a great way to eliminate stress. This also includes having more time to ensure we eat healthy foods. These positive habits pay dividends and keep retirees active. These habits also help reduce long term medical expenses. I focused on maintaining good health during my career, but eliminating work related stresses has been a game changer.

One recommendation from this observation, leave your phone in a locker when exercising. I am amazed at the number of people who sit in a gym for an hour, scrolling through their phones. This is a habit that robs them of the benefits of exercising. It is also not the best way to make friends at the gym as they park themselves on equipment other people are waiting to use.

Road Trips Become Annual

In part one of this article, I talked about the value of making a clean break in retirement by embarking on a specific trip or an adventure. When I retired I drove across the United States, catching up with old friends, seeing new places and revisiting favorite locations. I followed it up this year with a 3,875 mile motorcycle trip on back roads from the East Coast to Idaho. It took me through the famous Tail of the Dragon (318 sharp turns in 11 miles), to the top of snow-covered Pike's Peak and the rapidly dwindling Great Salt Lake. The trip also allowed me to attend the multi-day Welcome to Rockville concert in Daytona Beach and my nephew's wedding. This was an amazing experience.

My sixth observation is to make road trips an annual occurrence. These meandering adventures keep old friendships strong, while learning more about the world through unique experiences. They are the way to stay connected with people and not miss out on life's best moments.

The key to a successful early retirement is proper planning. For more detailed information on planning for retirement and creating financial independence see Become Loaded for Life and the 10 Stages Workbook.

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