Wednesday, 25 January 2017

It was the best of times, it was the worst of times

This time a month ago was Christmas Day! I know, seems like longer.

In some ways Christmas is the perfect storm of conspicuous consumption, socially obliged spending and unnecessary unhealthy excess. On the other hand it’s a way to get two to three weeks off work easily with all the bank holidays and if you manage your family duties then you can spend a good majority of that time doing whatever you like.

A lot of the focus of PF blogs is about what you would do with the extra time if being a wage slave wasn’t a necessity. Well, what did you do over Christmas? Have a nice long break at home, not spending much by seeing friends for walks in parks or taking advantage of the quiet time by going to the gym when you want and taking in some free museums or other attractions in town? Did you work? Aiming to add some extra capital to add to the freedom fund?

Or did you go for it a bit and think, well, it is Christmas after all? Some FIRE’y types might say it should be cheap outings, enjoying the down time doing things in your way. Others might say unless you’re already rich you should stay working as hard as possible.

Assuming that you’re on The Path and have a good knowledge of personal finance I say, for what it’s worth, that you have to do what you want to do whether working or early retired. Taking Christmas as the example, if you are a massive fan then why deprive yourself of the things you love doing? Surely the point of aiming for an early retirement is to be able to focus on the things you love.

Not only that, but as I’ve said before, it can be counterproductive. If you’re driving your spending so your savings hit x25 annual costs but in so doing deny yourself the pleasure of those interests it means you will face extra costs post work… so your x25 figure must get bigger and  you risk running out of capital sooner.

I think you need to continue to indulge and work on your hobbies, interests and passions during your work life so you are better set up for your post work life and in a better place to pay for it. What would be worse; thinking you're signing out of the office for the last time, only to realise a year later you actually have to go back to work as you don’t have enough cash? Or working a bit longer, knowing really what makes you tick and that all your costs are genuinely covered allowing a smooth, stress-free, transition to early retirement whilst having enjoyed life more in the lead up?

So if your credit card bill is a bit bigger than normal, don’t let it get out of control, but don’t admonish yourself either, just factor it in to the bigger plan.

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