A plan to examine the possibility of shifting the goal posts

I want to do better. It seems a bit pointless to write post after post in this vein but I really want to do better and there is currently a disconnect. When I first started this financial journey, I was in a dire state. I had no savings. I had over £30,000 of debt and was unsure about how much I owed. I didn’t have a place to stay because I was subletting my room to pay the bills. I had a frayed relationship with my family because they were tired of my irresponsible behaviour and frivolous spending. My 2 closest friends were barely speaking to me. I’d lost my girlfriend. My life was fraught with the direct consequences of poor financial decisions. It was kind of easy to make changes because I needed to change to survive. One year on, things are better, more stable and there isn’t a burning need to change further.


Celebrating life in Madrid last year

I have done the basics. I’m better than average. I can afford a minor emergency. I could survive the loss of my job. I can fly home at short notice. If I carried on with the way I’m spending and saving today, I’ll be OK. I’d put away over £550,000 by my retirement age of 68 – and this assumes that even when I stopped paying off debt, I wouldn’t save any of that. That would be more than enough money for me to have a decent life in the UK and a lush life via geographical arbitrage (check out Get Rich Slowly for more information).

I don’t want to be ‘normal’ though

When I first discovered personal finance blogs, my mind was BLOWN by the realisation that there were people who had retired early at spectacularly young ages in the world e.g. Mr Money Mustache. There are people that have a work-optional life e.g. Ms Montana. There are other people somewhere else along the FI/ER (financial independence / early retirement) spectrum – digital nomads, older but still significantly early retirees, fully funded lifestyle changes etc. Regardless of how these people changed their lives following financial freedom, I was impressed. I also wanted to change my life spectacularly. I evaluated my life and decided that it would be great to achieve retire early (via geographical arbitrage) by the time I turn 45. This requires some pretty bold moves.

  • Get rid of all debt by the end of 2018
  • Invest & increase pensions contributions steadily year on year – especially remembering to funnel the money currently targeted at debt/support.
  • Achieve a 55%+ savings rate every year, hitting 70% just before retirement.

Judging by those metrics, I’m FAILING. I’m failing hard.

Maybe I need to change the target

It’s October and my savings rate (including employer match) is just under 41%. When I look at that percentage, it doesn’t seem so bad. It’s pretty damn good even. Except I keep thinking, it should be closer to 60% based on my current goals.

I’m practical. Maybe there’s no point saying that I’m aiming to retire early at 45 if I can’t rein in my spending. Or maybe I need to thoroughly research how much I can grow my income (while maintaining this level of spending) to retire when I want to. I could also just keep spending as is and work out when I will retire (assuming that £12,000 debt spend is ploughed into investments). I could aim for that instead and quit feeling like I’m a bit of a failure. I could just embrace retiring at 65 and celebrate being on track to hit that. Something has got to give.

So……for the rest of 2017, I’ll keep tracking my spending. I’m going back to weekly spending updates here to (perhaps) provide more accountability because I’ll be disclosing what I spend on. Last year when I was doing that, it seems like I spent less overall. If, after I’ve done that, I’m still spending at the level I am now then I shall re-plan my FI/ER date accordingly. There’s no point feeling bad about something I can’t achieve. And if, somehow, I manage to hit ER at 45, then I can only be pleasantly surprised.

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