200 days has passed since our FI declaration in October 2017 and life has never been better. Technically, it also means that we are 800 days away from our FI target. We have yet to establish concrete plans as to what we will be doing once we reach that point but with sufficient FU money in our coffer then, there is always the possibility that we might explore a mini-retirement before deciding on anything further.
You should always strive for Financial Independence, Early Retirement is optional
Whether we will be retiring in its entirety is still something that we are not sure of at this point of time. However, we are glad that we will have the option of choosing “not to work” if circumstances do not allow us to do so, or if we want to take a break from the “crap” at work (comes in all forms and sizes). Many would be familiar with this concept of “FIRE”, acronym for Financial Independence, Retire Early and would perhaps associate both concepts together. On the contrary, they are in fact, mutually exclusive. It does not mean that you need to retire once you have achieved financial independence. It simply means that you have the option to do that. And the option to choose to retire at any point in our lives without the financial burden should be something that we should strive for.
On a personal level, achieving financial independence would allow me to allocate my time on things and issues that matter to me more and choosing to engage in activities that is more meaningful for me, perhaps such as blogging more regularly, engage in some community work or perhaps taking up a couple of courses (decluttering maybe?) In a nutshell, the focus will shift to one that allows me to engage in activities that I am interested in from one that is simply trading my time for money for the sake of paying the bills.
It is especially heartening to read comments and emails from readers that share with us how our blog and perspectives have helped theirs in their own ways and we are glad that they find some of these to be inspiring.
Having said that, many of our friends and family around us are still fairly skeptical on this concept. With continuous rising cost, they do not see that this (FI) as something that is readily achievable. Secondly, they tend to think that it is more of a linear relationship in the acquisition of wealth via trading time for money until retirement age (whatever that might be to them). And lastly, retiring early might insinuate that they will have nothing else to do, embracing a “if-I-am-retired-I-will-be-bored” mentality.
Sometimes, I do wonder if that might be reverse psychology on one’s part to create a make-believe scenario so that you can continue to trot to work every morning. I have heard of some people who love their jobs, but unfortunately, I do not know any of them personally. The people around me have all indicated either subtly or outrightly, that they do not enjoy what they are doing at work. It might be the work itself that they do not enjoy, or it might be the politics, culture or people at the workplace. Regardless of what the reasons may be, more often than not, I have heard people telling me that they are working just to pay the bills and that they cannot afford to lose their jobs.
The fear of losing your job
The above subject probably strikes a chord to most working Singaporeans. Many are working towards funding their dream lifestyle, saddled with mortgages, car loans, exotic overseas travels and a myriad of other things. If the main source of income is from their job and should they become unemployed, most will find it hard to keep up with their lifestyle. Commonly termed as wage slaves – this is defined as an individual who is wholly dependent on sole income from employment.
Prominent local blogger AK had also recently posted something similar “Husband lost his job and my savings is zero“. Basically, it illustrated a couple in their mid thirties with two kids who are not financially savvy. They do not have an emergency fund nor much savings. When the husband was asked to leave a good paying job, the wife had to dig into her savings to pay for their monthly expenses which eventually depleted her account. This had caused quite a bit of ruckus in the household and she desperately wants to improve her financial literacy to stay ahead. This is a pretty common problem when people are depending too much on their day job and the problem arises when you lose your sole source of income. They will not be able to fund their lifestyle anymore when that happens.
In 2017, there has been a considerable number of changes at my workplace, including one involving the sale of a certain business unit due to consolidation in a saturated market. Processes were streamlined, including the management team, although we were given the assurance that things will remain the same. In such situation, I think one can remain a skeptic until the roll-out of the implemented changes.
Some of my colleagues from the sold business unit were either offered a severance package or a position with the acquiring entity. As the positions on offer are rather limited, many took up the severance package which from my understanding, amounted to one month’s pay for each year of service, with a maximum cap of up to 18 months. Considered a generous package by most, many were happy with what they were being offered, even though that might mean they will need to find another job.
Fortunately, the business unit that I belong to remains one of the more profitable ones within the organisation. Having said that, earlier this year, we had welcome a new boss. She had a restructuring plan in place which created quite a bit of uneasiness among my colleagues. But as for me, I felt pretty indifferent about it, perhaps because I had a bigger goal in place and I thought such restructuring plans are also pretty common in organisations nowadays, and did not see a point in fretting over it.
A colleague who is in his early thirties had confided to me recently that he had felt really jaded at work. He mentioned he had been working very hard for the past two years but was extremely disappointed when he received his bonus last month. He is a part of a team of three (excluding their direct superior) and the other two colleagues were promoted concurrently, except him. He told me that he was desperately eyeing the promotion as he is getting married in a few months’ time and will also be getting the keys to his new condominium (a good guess that it should cost at least $800k?).
I had shared with him that it might be more realistic to move on to another job for a bigger paycheck or better job title. Although not true at all workplace, sadly, this seems to be the norm in the corporate world, where there is little incentive to be loyal to your organization.
A few weeks back, another colleague in his 40s had confided to me that he is frustrated at work. He cited reasons like the lack of recognition for his efforts, and low annual increment and bonuses. He then showed me this article from dollarsandsense.sg which reported a projected average increment (in Singapore) to be slightly lower than 4% in 2018 which prompted him to think that the company is paying him below market rate (he received less than 2%). His wife had also recently given birth to their second kid and he is contemplating to quitting without a job. I told him he could probably take a short break and look for a new job if his finances allowed him to do so. But the truth is, he still needs the money to pay for his car loan, condominium mortgage, expenses for two kids and not forgetting the domestic helper. All these all sum up to be pretty substantial and I had advised him to think objectively before he really quits without a job.
Work-related depression and unhappiness in your workplace
Recently, there was a ChannelNewsAsia article regarding a rising number of workers facing depression at a relatively young age. The thing is, most of them were unaware that they have depression. (7% of the local workforce had a history of mental illness, only 2 out of 10 sought any treatment.) Most people do not acknowledge they have depression for various reasons. There is also a risk that it will affect their employability as their employers will think that there is always a chance of a relapse.
Singaporeans clocked 2,371 working hours in 2016 which is much higher than Japan (1,735 hours) and South Korea (2,193) hours according to this Straits Times article. So I’m not really surprised that Singaporeans have a higher chance of encountering any sort of work related stress as compared to any other Asian counterparts.
I also noticed that most people at my workplace were not really happy with their job but choose to stay in their comfort zone. Most of them are just working for a living and hoping one day they could retire. This article by Jobstreet might be able to back up my observations citing that almost 1 in 2 Singaporeans are unhappy at work.
SG Young Investment recently posted on “Everyone hates corporate world but what can we do about it“. He mentioned that we could plan early with the final objective of leaving the corporate world by having enough passive income to support your basic needs and work a freelance job that you enjoy. The key is to plan early and be discipline enough to follow through the whole plan.
Sometimes, our circumstances is not within our control but striving for financial independence could still remain a possible option. That might involve some sacrifices no doubt. You might love your job now but there will be a day where colleagues might leave, new people come in, or a change or boss, leading to a change of culture and direction. You never know what might come next.
Perhaps it is time for us to look forward to everyday instead of just the weekend.
Life is all about choices
I feel comforted knowing that we do not need to depend too much on our day jobs. If I were to be let go by my company for any reason, I would have felt that it might be a good time to have some time off from work.
Our recent interview with Thomas from My15hourworkweek also provided a pretty interesting perspective on taking the route less travelled. Thomas became a full-time tutor after leaving the government sector. Being self-employed, he felt more in control and also reaped more satisfaction out of life as compared to working in a corporate.
There are many other similar individuals like Thomas out there. Those who choose to be the outliers, and some, already retired, or enjoying their mini-retirement.
But they still pay taxes. They are still contributing to nation building.
Some still continue to work. It doesn’t mean that you need to retire once you reach FI.
But you see, once you reach that point, you have a choice.
And that is your choice.