So if you follow my blog, you know that I’m not a big fan of F.I.R.E. (Financial Independence and Retire Early). For those unfamiliar with the topic, followers of the F.I.R.E. principals live very frugal lives using the money they save to pay down debt and invest. The goal? To have enough saved that they become financially independent and retire early. Although if they don’t want to run out of money, retirement will also have to be very meager!
Why don’t I fully embrace this lofty goal? Well for starters, it depends on what you personally value. I enjoy vacations, once weekly dining out, and going to music festivals with friends. These are all things the F.I.R.E. folks would associate with squandering money. Certainly I could cut all this out and take that money and invest it so I could retire early and live a frugal (read: boring) retirement – but why would I? I enjoy what I do for a living and am in no rush to stop. Also, I value friends and experiences such as traveling. And what would I do in this early retirement living very frugally? I suspect that the retirement F.I.R.E. folks are planning for is probably not the same one that I’m envisioning!
How can F.I.R.E be dangerous?
Look, I do live relatively frugally. I brown bag my lunch. I make my own coffee to-go rather than stop at a coffee shop. For an automobile, I drive a Kia. I do my own pool maintenance. I even learned to repair a salt cell – thanks to “YouTube University.” But there are things I enjoy and I’m in no rush to retire early. Now there is evidence that retiring early is actually detrimental to ones health. A study out of the Center for Retirement Research at Boston College followed population data from the Netherlands before and after a policy change that encouraged workers to retire later. The results are surprising.
Essentially, the Dutch government offered a reduction in income taxes for each year a person worked after age 62. Workers at age 62 would essentially see a 5% increase in income, a 7% increase at age 63 and 10% increase in income at age 64. The effect of this policy change was that there was an increase in workforce participation for workers aged 62-64. Conventional wisdom would suggest that the stress and rigors of working later in life would lead to increased morbidity and mortality for these older workers. What really happened was quite different. Working later in ones life was associated with lower mortality, depression, and diabetes risk for both men and women. In fact, delaying retirement reduced the five-year mortality risk for men by up to 32%.
But is not just physical health!
The negative effects of retiring early extend beyond ones physical health. Although retirement would seem to give one an increased opportunity for social interactions, according to at least one study just the opposite happens. Retirement can be damaging to ones social network which is associated with a reduced satisfaction with life and a decline in mental health. And while on the topic of mental health, it has been shown before that retirement can lead to a decline in mental health as one is no longer challenged at work.
Why retire early?
So perhaps the real question is why would you up life’s’ little pleasures in order to save every last dime and live a meager existence? There was a time when I worked for an organization that could only be considered toxic. I hated my job and dreamed of retirement. Then I did the most important thing in my adult life – I found a job that I loved. Today, I work for an organization that is professionally and financially rewarding. In short – I love what I do. Retirement is the last thing on my mind, although I still actively save for it.
If you really think life would be more fulfilling if you retired, then maybe it’s your job! Its not hyperbole, you have one of the most powerful degrees on the planet. Opportunities for DVMs (VMDs) are almost limitless. You can work in education, government, industry, clinical practice, research just to name a few! If work isn’t fulfilling – then find a job that you love. Then ask yourself: do I really want to retire early? The answer is probably not and if you dont, you just might live longer, be more satisfied with life and maintain your mental alertness!