What To Do When You Retire Early

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Published on February 12, 2023

What To Do When You Retire Early

How To: Live your best life in retirement

person on waterfront after retiring early

Photo by Roberto Nickson on Unsplash

While I haven’t retired early just yet, I have spent a lot of time exploring what I want to do with my spare time. I’ve also observed how friends and family transitioned into retirement, and my key takeaway is to plan ahead to avoid disappointment, boredom, and regret.

This is particularly important for individuals who choose to retire early, i.e. in their 30’s, 40’s or early 50’s. The popularity of early retirement is rising with the growth of the “FIRE” movement, short for Financial Independence, Retire Early.

Step one of this approach is to achieve financial independence, whereby all expenses can be met without relying on a traditional job. This can be achieved through a combination of investments, passive income streams, and reduction of annual expenditures.

Step two, retire early, is to ditch the job entirely and retire early, spending the rest of your days living off your savings, investment, and other income streams. This is when most retirees confront a challenging question: how to spend time to maximize happiness instead of income?

Mr. Money Mustache describes the philosophy best in this World Domination Summit presentation below and this article: The Shockingly Simple Math Behind Early Retirement. It is important to note however, that this math often ignores cost of health insurance, and potential future increases in housing, energy, and food prices.

What one can do post-retirement depends on the level of FIRE achieved and how much cushion one has against unanticipated future needs. “Fat” FIRE allows for the most flexibility and expenditure, whereas “Lean” FIRE requires a minimalist lifestyle. “Barista” FIRE lies somewhere in the middle, allowing for higher monthly expenditure but also requiring monthly income from part-time or side-hustle work.

At every level of FIRE, the idea is to disconnect from traditional career and income pursuits in favor of a new lifestyle. Below, we share our hopes and dreams for a fulfilled life when that day comes.

Entry Level:

As the euphoria of leaving the rat race sets in, many new retirees spend early months of retirement exploring the “entry level” activities below:

Hobbies: These can include arts, crafts, sports, music, photography, or gardening. Community based adult education courses can help introduce a new hobby or get reacquainted with something you used to enjoy in the past.
Health: Retirement is a great time to reprioritize your health with regular exercise and healthy eating. Fitness classes at your local gym and cooking classes are a great way to dive into these goals if you’re not sure where to begin.
Volunteering: There is no shortage of opportunities to volunteer at schools, shelters, hospitals, libraries, religious institutions, and community centers. Volunteering helps connect you to your community and expand your social network.
Travel: Travel is a common retirement goal, and retirees often dedicate time to visit friends, family, and bucket-list locations. Without a regular job, retirees can travel “slow”, extending stays in different locations and avoiding weekend or holiday travel to score the best deals. Barista FIRE related part-time jobs may make extended travel difficult, though it can still be possible if the work can be performed remotely.

Level Up:

Once the first few months pass, you can “level up” any of the activities above. The key here is to consider what makes you happy. Buying things and taking vacations is fun for a while, but ultimately this “consumption” is unlikely to fulfill your emotional and spiritual needs.

Leveling up retirement activities could include picking up a new (or long forgotten) musical instrument and devoting an hour a day to practice. Or learning a new (or long forgotten) language, setting aside time every day to study and joining local language practice groups. Language learning could inspire a future vacation travel destination, or even a several month long language immersion experience!

If you’re enjoying your initial volunteer experiences, you make it part of your regular weekly schedule. Local volunteer organizations often find it helpful when volunteers commit to certain hours or days of the week. This might also open up new opportunities for training so that you can take on more responsibility over those hours.

Advanced:

Retirees with the time, resources, energy, and life experience for deeper involvement in an activity can consider the following:

Join a local university or community college as adjunct faculty and teach a course. This has the added bonus of a modest salary during the months that you teach.
Retirees with an entrepreneurial spirit can launch a business, side hustle, or consultancy. Consulting works well for individuals with an extensive professional network since those relationships can be leveraged as a pool of potential clients.
Join the board of directors of a charitable non-governmental organization (NGO). Remember that volunteer work you were doing? How about lending your time to the management of the organization? Members of organization boards oversee the organization’s executives and provide strategic guidance.
Sitting on a pile of cash? Retirees can also consider angel investing, lending both their financial resources and years of experience to business startup founders.
Frustrated by an unmet community need? This is the perfect time to run for local office (school board, city council), organize a meetup group, or organize fellow citizens for local projects.
Some people decide that retired life doesn’t suit them, so they launch second careers! Doing this from a place of financial independence provides “retirees” the opportunity to explore new industries and learn new skills.

Photo by Clark Tibbs on Unsplash

Conclusion:

Experience through the pandemic has forced us all to reevaluate our priorities and how we envision our lives in the future. The ripple effect of this since 2021 has been called the great resignation or “great contemplation” as individuals retire early, scale back working hours, or change industries.

Behind all this is the realization that we each must decide how much time we sacrifice for income, and think about what we would do with our time if we no longer needed a job to meet that income goal. These are both questions to consider at every stage of adult life.

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