What is Retirement Really?

I lot of times I talk about retirement. A lot of other sites talk about retiring early. Even in your 20s and 30s. What does this really mean? Does this mean that you retire at 30 and spend the next 50 years sitting in a recliner watching TV? That’s certainly the perception a lot of people have about retirement. That’s one of the questions I got when I started on my financial journey and started talking about retiring.


When I talk about retiring, and when many bloggers talk about retiring they aren’t talking about sitting in a chair in front of the TV. What they’re really talking about is financial independence. Retiring is just easier to say and people understand it means not working at a full time job the way most people do. So what is financial independence? Financial independence simply means that you don’t depend on a job to pay your bills. It means that you have enough passive income to pay your expenses so that you can work or not. It’s your choice. This might include investment income, royalties or anything else that provides them with enough money to last the rest of their years in the lifestyle they want. For many early retirees this means enough money that could theoretically support their lifestyle indefinitely.


Most people that retire early do continue to work. They just don’t work at a 9-5 job that they hate. They work when they want and have the freedom to choose the projects that they take on. Even if that project doesn’t pay them. Instead they work on jobs that they find interesting. This way they can help others or learn something new. Perhaps they’ve always wanted to try something out, like sailing around the world. Because they don’t have to worry about a regular job they have the freedom to do that.


That’s what money does. Once you reach financial independence you have the freedom to create value for the world without having to worry about how much you’re paid. Whether you create that value by working at a 9-5 job or by teaching kids in an after school program is up to you. You can certainly continue in your 9-5 job. If you love your job and love what you do financial independence can help you continue it. It can make it easier to do since you don’t have to worry about making ends meet. You only have to worry about doing a good job.


I firmly believe that everyone should strive for financial independence. Whether you call it financial independence, retiring early or getting rich, it gives you the freedom to pursue the projects you want. It allows you to add value to the world that you might not be able to otherwise, and it greatly reduces your stress.


What would you do if you were financially independent? Would you work, play or something in between?