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The Biggest Problem With Early Retirement


The biggest problem with early retirementEarly Retirement – mmm…  I bet early retirement sounds great to many of you who are reading this from a cubicle on Monday morning. I have been happily unemployed for 10 months now, but I do miss the regular paychecks. We are doing alright financially and I assume most early retirees are prepared for the reduction in income as well. So let’s skip the finance discussion today and focus on what to do with your time after retirement.

The biggest problem with early retirement

The biggest problem with early retirement is the lack of long term goals. Typically, we have many long term structured goals from a young age. We are expected to go to school, attend college, and progress on a career ladder until retirement. Here is the typical progression of an average middle class white collar worker.

  • Grade School
  • Junior High School
  • High School
  • College degree
  • Graduate degree
  • Entry level office job
  • Get raises and promotions
  • Get more education and training
  • Become a manager or senior level worker

Most of us live quite a structured lifestyle before retirement. At work, I was always trying to complete a project and earn raises and promotions. All that abruptly came to an end when I quit my corporate job. The transition to an unstructured lifestyle can be difficult if you are not prepared for it.

I read many articles and comments on the internet and found that many retirees are unsatisfied with the leisurely lifestyle and actually become depressed. The lack of direction coupled with long empty hours wore many people down after a few years.

Where do you see yourself in 5 years?

One career developmental question that is frequently asked is where do you see yourself 5 years from now? As much as I dislike this question (because who really knows where someone will be in 5 years?), it gets you to consider your long term goals and what you would like to accomplish. This question applies to early retirees just as much as any employee. You need to have some long term goals to keep you going. If your answer is sitting around watching TV or sipping umbrella drinks on the beach, then I think you are going to be bored out of your mind after a year or two.

Luckily, I have a couple of projects that I am working on which are keeping me busy and engaged.

  • Raising a kidBeing a happy stay at home dad is a full time job. My long term goal is to help Baby RB40 succeed in school and get into a good college. He is already a free thinker, so I want to channel his energy into being a good citizen and possibly being more entrepreneurial than I was. This is up to him, of course. This will keep me busy for the next 15 years. For the short term, I’m just trying to encourage him to read more. Once he starts grade school, I should have more time for more projects.
  • Blog – Blogging has basically grown into a half time job. Blogging is taking up a lot of time, but it is a lot of fun as well. The long term goal for Retire By 40 is to build an audience while also being helpful and relevant for early retirees. Many bloggers get burned out and I want to avoid that at all costs. Of course, a little more income wouldn’t hurt.

I was working on these things for a few years before I retired from my career and I urge everyone to do something similar. These current projects will eventually require less time and I will find other long term projects to take on. Being financial independent is awesome, but you also need to figure out what to do with your time as well.

Have a happy retirement

If you find yourself bored or depressed in retirement, then you probably need to find a few long term projects to immerse yourself in. The good thing about retirement is that you will have plenty of time to figure it out.

  • You can pursue artistic interests like painting, pottery, or photography.
  • You can help others by finding a cause that you care about and volunteer.
  • You can get involved in your community or join a movement.
  • You can get in touch with your spiritual side.
  • You can try working for yourself to build the business that you always dreamed about.
  • You can even go back to work part time if the unstructured lifestyle really doesn’t suit you.

The important thing is to have some long term goals where you can make forward progress. Human are most happy when we are making progress toward some goals, so don’t take that away when you retire. What about you?  Do you have any long term goals for after retirement?

Further reading

How to Retire Happy, Wild, and Free

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Joe started Retire by 40 in 2010 to figure out how to retire early. He spent 16 years working in computer design and enjoyed the technical work immensely. However, he hated the corporate BS. He left his engineering career behind to become a stay-at-home dad/blogger at 38. At Retire by 40, Joe focuses on financial independence, early retirement, investing, saving, and passive income.

For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.

Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.

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{ 60 comments… add one }
  • Pauline May 6, 2013, 2:05 am

    I went through the goal-less period, it was a bit weird at first, but I imagine it is even worse when you are 60 and have gone to work every single day then have no agenda. Then I found a few things I was interested about, and now could not even fit a full time job with all the stuff I get to do daily!

    • retirebyforty May 6, 2013, 1:48 pm

      Thanks for sharing. I think it would be difficult at any age. When you’re young, you still have a lot of energy and want to contribute. I guess when you’re older, you’re just set in your way and it would be difficult to change.

  • My Financial Independence Journey May 6, 2013, 2:29 am

    Unless I had a lot of money coming from passive income, I might get bored in retirement. Which kind of rules out early retirement. It’s not that I can’t really think of things to do, but rather that most of what I want to do costs money. I’d love to take art and music classes and travel a lot. I think it would be fun to go to cooking classes as well.

    • retirebyforty May 6, 2013, 1:49 pm

      You should take some music and cooking classes now. Maybe just one at a time. It will help you develop those interests.

  • [email protected] May 6, 2013, 5:20 am

    I think my ultimate long term goal/retirement goal is to travel. So that includes building up passive income and working in some way that gives me lots of flexibility. That also means I am going to need quite a bit of money to travel the way I want.

    • retirebyforty May 6, 2013, 1:50 pm

      Traveling is fun, but I think it might not be a lot of fun if you do it long term. I want to travel too.

  • Rich Uncle EL May 6, 2013, 5:50 am

    I agree that if you do not set goals you will be adrift mentally. The good thing about my situation is that if I ever reach retirement sooner than later, I have kids that give my full attention too just like you Joe, I also have a blog, and I love to volunteer to non-profit organizations. I assume these three things will take up most of my time.

    • retirebyforty May 6, 2013, 1:50 pm

      They will keep you super busy. Sometime I wonder how I ever got anything done at work. Oh yeah, we had daycare. 🙂

  • Kevin @ RewardBoost May 6, 2013, 6:37 am

    I’m curious why you say that you want your child to be more entrepreneurial than you, but you also want to make sure he goes to a good college.

    Did you learn anything in college that helped you become more entrepreneurial? I sure didn’t. In fact, when I start having kids soon I will let them choose their path but to me I think skipping college seems like the best option for a young entrepreneur. Of course if the kid wants to be a doctor, lawyer, or engineer then they will need college. But if my kid doesn’t want one of those professions, I’ll recommend skipping the expense of college.

    • retirebyforty May 6, 2013, 1:52 pm

      I met friends that helped me become more entrepreneurial. I think he should go to college, but if it doesn’t work out, that’s fine. It’s a great place to make life long connections.

  • Michelle May 6, 2013, 6:51 am

    I definitely want to be financially independent, but I would still want some sort of job or my own business. I’ve always been a busy body!

    • retirebyforty May 6, 2013, 1:52 pm

      That’s a great plan. I don’t think you can have a leisurely retirement if you’re a busy body.

  • Kurt @ Money Counselor May 6, 2013, 7:36 am

    “Do you have any long term goals for after retirement?” Yes–to stare out the window and think a lot. 🙂

    • retirebyforty May 6, 2013, 1:53 pm

      Ahh… A philosopher among us. 🙂

  • John S @ Frugal Rules May 6, 2013, 8:51 am

    I think you hit the nail on the head in regards to lacking long term goals. We have a family member who retired about 10 years ago and they do absolutely nothing all day. I’d think it would get boring awfully quickly but it looks like it has not. Seeing that has really opened my eyes to what we want when we retire and it definitely includes more activity than not.

    • retirebyforty May 6, 2013, 1:54 pm

      Doing nothing all day long would get old real fast. That’s a quick ticket to depression. I’d probably find a part time job if the alternative is to just sit around.

  • SavvyFinancialLatina May 6, 2013, 9:12 am

    The best example of someone who retired early is of my boss in high school. He retired as a colonel in the army, chief of staff of one of the biggest army hospitals in the US. He then went and started his own photography business, ran it, and closed it, and he has been running a non-profit for the past two decades. He is always running around.
    Early retirement meant he could do whatever he wanted. No one telling him what to do.
    I want to have financial flexibility. I don’t want to be tied to my job because I “need it.” to pay all my bills and debt. This is a trap most people fall into.

    • retirebyforty May 6, 2013, 1:55 pm

      That’s great! I love it. That’s my goal too and I want to keep busy until I can’t work anymore even if I don’t need the money.
      Thanks for sharing.

  • Pretired Nick May 6, 2013, 11:18 am

    I’m about 11 months since I left my “real” job. Like you, I’m spending the bulk of my time raising the kiddo and blogging (partially to keep my mind sharp). Plus I consult a few hours per week. My problem is my eyes were bigger than my stomach. I have WAY more that I want to do than I have time to do. I’ve been much busier now than I was when I had a full-time job, which sounds weird to say, but is true.

    • retirebyforty May 6, 2013, 1:56 pm

      I know what you mean. The kid takes up so much time, it’s a wonder we have anytime left to do anything. I feel just as busy as when I had a job and much more productive.

  • Retired Syd May 6, 2013, 11:49 am

    I agree, although I like to say you should have some current obsessions, rather than goals. I hate that word goals–I don’t really know why. I’m with Preretired Nick on this one, I have way more that I want to do than I have time for. But the bottom line is what you are touching on, you have to have something you are really passionate about in retirement. After all, most activities are elective in retirement, so you’re going to need activities that really engage you.

    I have been spending 2-3 hours a day playing the piano the last couple of months since I started lessons. I love it. It’s one of the few things I’m involved in where my mind doesn’t wander to something else. It’s totally engaging me. You could sort of say it’s a goal of mine to get better, which I assume if I stick with it, I will. But mostly I do it for the way it engages me here in the present.

    • retirebyforty May 6, 2013, 3:01 pm

      I can go with obsessions. 🙂 I am so busy too. It’s different than what I imagined, but in a good way. I have been spending a lot of time reading, but that’s not good because now I’m not getting enough sleep…

  • Fred May 6, 2013, 12:40 pm

    I am not there yet, but some of my goals for retirement, in addition to what has been said by others, and provided I’ll be in reasonably good health, are:
    1. Energy independence – build and use solar and other alternative energies.
    This is a great hobby, will certainly keep me occupied, and in the long run save some money too.
    2. Partial food independence. I distrust quality of all the processed foods and would argue with anyone that they are unhealthy too. Similarly, I distrust quality of restaurant foods, at least those I can afford. My Mom always said: I rather cook for myself, at least I know what I put in there. She is currently 89.
    Food independence is not easy and may not be even possible. However, with a little backyard, you can e.g. grow some vegetables and supplement your diet. Depending on a location, you can consider a greenhouse in winter. This all is quite a bit of physical work, which is healthy, and will keep you busy. And you will need to do some planing for future seasons and years. You can also design automated watering systems, use soil heating cables etc, so you will not have to work so much in later years.
    Then if you add cooking from scratch for yourself and your family, this not only can be a great fun, but as mentioned above, you’ll know what you eat.
    3. Consider inventions if you are so inclined. There are many things that can be improved. And there are many patent lawyers who would consider your invention for free, provided they will benefit from it later if successful.
    4. Consider writing about your experiences or perhaps write fiction stories, if you are good story teller.
    5. Consolidate finances to become more financially secure and independent. That may take some serious planning, especially long term planning – getting rid off useless junk, moving to a smaller, more energy efficient house, getting a car with better gas-mileage etc.

    • retirebyforty May 6, 2013, 3:05 pm

      I love “invent something”! I always wanted to be an inventor when I was a kid, but that got squished by the real world. Now, I watch Shark Tank and it’s quite entertaining. I’ll add this to the post. Writing is good too.

  • krantcents May 6, 2013, 1:13 pm

    I will never retire in the traditional sense. I always want goals, projects and interesting things to get me up in the morning. I want things that will keep me engaged in life. I outlined a lot of this in an article called I Will Never Retire!

  • Evan May 6, 2013, 1:37 pm

    Why not focus on shorter goals? That keeps me pretty engaged. Like save $X into Y account or invest Z into ABC company?

    As far me if I am retired, truly retired, my goal is only to live life to the fullest.

  • Laura May 6, 2013, 1:55 pm

    I always plan to work part-time so I’m always on the lookout for job ideas that I can do part-time – teaching, nonprofit, income properties, etc. I like to be around people and working part time is perfect. I’ve closely watched my parents who retired too early and had a really difficult transition. Also, we notice that many people who retire early suddenly start to have more/focus more on health problems.

    • retirebyforty May 6, 2013, 3:06 pm

      Working part time is a great compromise. If I wasn’t so busy, I would probably do that too. Part time is just enough to keep busy, but not too much to stress you out (hopefully.)

  • SB @ One Cent at a Time May 6, 2013, 5:31 pm

    Boredom and lack of proper direction are two most important factors to me. I never seriously think about early retirement because of these. I have enough saving to retire now and go back to India, but I’ll suck in that life. Till there’s constant challenge and lot of faces to encounter every day, I am happy.

    Even if my job suck in future I’ll try to change not quit because I like corporate environment…nothing against your decision, but that’s the way I am.

  • Financial Samurai May 6, 2013, 6:02 pm

    I agree with this one “problem” of ER. I’ve rolled up my passion for photography and adventure into my site with personal pictures. Everything seems to fit with my site and my interests. How about just write more?

    I’m spending a lot more time researching investment ideas, which is fun. And that resulted in a China Stocks post and some more posts on my IRA. But, to get away from blogging I went to Hawaii for two weeks in April and went on some awesome adventures.

    I’m really getting used to early retirement and I think it’s really wonderful!


    • retirebyforty May 7, 2013, 9:45 pm

      I’m glad to hear you are enjoying it. It’s great that you can share your research. I’m kind of nervous with China though.

  • Squirrelers May 6, 2013, 6:16 pm

    I’m a long way from retirement, so that’s not a question for which I have a well thought out answer and plan. That being said, when that time comes, I’m sure I’ll have spent the few years prior to coming up with some meaningful goals – since I’m oriented that way.

    I think that it’s often a matter of understanding our sense of purpose, which might change a bit as we go through different life stages. My goals in retirement will likely flow through from that bigger purpose.

  • Mike May 6, 2013, 7:12 pm

    My biggest thing in this self-employment journey is doing the discipline to grow the income and diversifying. But I try to keep myself busy at all costs! Perhaps you could do what I did for myself: set a goal that you want to achieve and how you want to achieve it (Ex. Goal 1: $1800+ a month, write 3+ posts weekly and have 10+ comments made on blogs forums daily).

  • Chris May 6, 2013, 8:31 pm

    I think of early retirement when I hear songs like Tim McGraw’s “Live like you were dying”. While it’s not a song with that direction in mind, it is certainly a couple of things someone might want to add to their bucket list. 🙂

  • Olin May 7, 2013, 3:53 am

    I plan to retire in 5 years on my 42nd birthday. However I see this as the start of a new life not the end…I have som many projects I want to get going and there is so much to learn. I have no previous experience with building but would like to learn, I would like to develop my writing skills and I want to read a whole lot more. I would like to take up small scale farming to be self sufficient on vegetabels in summer and would also spend significant amount of time out in nature. Some of these projects will cost money, some will save money and some will even make money. However being retired or financially independent I can work on the things I love and any financial impact comes as a side effect rather than as the driver for the activity. Forgot to say also that I have 2 small kids with a third one on the way….so there will always be plenty to do:-)

  • Daisy @ Prairie Eco Thrifter May 7, 2013, 6:12 am

    If I were to retire early, I think I’d keep busy. I think I’d run out of things to do if I retired before 55 though. I would volunteer and definitely have a bunch of web projects on the go.

  • Little House May 7, 2013, 7:03 am

    I’m no where near retiring early, but I like my very structured, goal oriented life. I can see that if I go into retirement, no matter what age, without a plan, I might be very bored. Things on my retirement to-do will probably include gardening, volunteering, and continuing to blog. Perhaps I’ll get back into photography as well. I’ll figure out a more formal plan in 20 or so years. 😉

  • [email protected] May 7, 2013, 7:30 am

    Staying engaged and involved in a community seems to be the best way to stay “healthy” during retirement; especially during the transition period.

  • Michelle May 7, 2013, 1:18 pm

    I just retired at 42 and am looking for ways to occupy my time. I have had a structured job for 20 years and have been looking forward to my retirement. Now that I am finally here I’m not sure what’s next. Reading these comments I have realized I should try to do things that I am passionate about. Thank you all for helping me to decide to try blogging and even start a garden.

    • retirebyforty May 7, 2013, 11:10 pm

      Congratulation! Take your time and find something you can be passionate about. You might have to try a few things, but I’m sure it will be a lot of fun.

  • Buck Inspire May 7, 2013, 10:20 pm

    Great post Joe! Funny we are all trained to follow the schedule you outlined, many are lost without it. Nice list of suggestions. I would add use the time to conquer anything you fear, visit places around your town you never been, and take on things you always wanted to try, but didn’t.

  • CF May 8, 2013, 6:17 am

    Travel is a big one for me. I want the flexibility to go to different countries and live there for a few months. I also want the time to write more and study topics that are interesting to me. And lazy days at the coffee shop…

  • Mark Ferguson May 10, 2013, 2:47 pm

    I haven’t retired yet, but I recently started writing all my goals and plans down. In fact I wrote a blog on my goal to purchase 100 rental properties in the next ten years. That should give me close to 1 million in yearly cash flow without accounting for inflation.

    • retirebyforty May 11, 2013, 4:09 pm

      Wow, that’s great! I’ll check on you to see if you can do it. Good luck!

  • Anton Ivanov | Dreams Cash True May 11, 2013, 7:51 pm

    I like your emphasis on setting goals after your retirement to “keep your sanity”. I think most people are happier and more productive when they have goals in their lives. The problem may be that before retirement, the goals are pretty straight forward, as you describe – the so-called natural progression.

    It is after retirement that you need some creative thinking and soul searching to keep you going! I’m still not close to my retirement, so no clear goals have been set, but definitely food for thought!

  • Harry @ Smart Money Junction May 12, 2013, 8:39 am

    Even though I want to become financially independent and be able to retire early, I would always try to be involved in some sort of side hustles, as it can become quite boring for one to be directionless once one retires.

  • Dan May 14, 2013, 7:17 am

    Hi, I know you think you are retired, but my wife is a stay at home mom and she would never call herself retired. It is cute that you are a stay at home dad, but as long as your wife has to work to support you, neither of you is retired or financially independent. Why not just call this a daddy blog? I do joke around that my wife is “retired” when people ask me where she works but we both know that we are dependent on each other until the short term money is high enough for us both to early retire.

    • retirebyforty May 14, 2013, 3:30 pm

      It’s really just your state of mind. Is your wife planning to go back to work at some point? I’m never going back to work for someone else and that’s good enough for me to call myself retired. Oh well, you can have your opinion. My online income and passive income contribute 50% to our household income. Why should my wife quit her job if she likes working? 🙂 Cheers.

  • Felix Lee May 16, 2013, 5:02 pm

    I would love to have an early retirement and focus more on my family, especially guiding my kids. It will make me more satisfied with life.

  • thepotatohead May 29, 2013, 5:27 pm

    For me early retirement is really just retirement from the cubicle. I’d still want to work and do something, maybe start a non profit, but I wan’t it to be what I want to do and not what my boss wants me to do.

    • retirebyforty May 30, 2013, 3:22 pm


  • davidmichael June 29, 2013, 11:25 am

    I’ve been retired for about 20 years. It’s been an amazing journey. The first ten years was spent building a dream house and living off the land from our three acres overlooking the Willamette Valley in Oregon. It was great! But the house was a money pit requiring too much of our retirement funding. Sold it ten years later and decided to start over again at age 65 by going back to school to get another master’s to teach ESL overseas, which we did for five years in the Middle East and loved it.

    On reentry back to the USA we bought a motorhome and have been exploring the National Parks and National Monuments. Five years later I am preparing to start another career in travel photography at 76. So…the point is, as long as we have our health, there is no end to the possibilities of retirement. Just…1) Live beneath your means, 2) Don’t lose money on your investments, 3) Remain healthy and active. Oh yeah! Don’t read the newspapers or watch the news on TV.

    • Retired Syd June 29, 2013, 12:52 pm

      @davidmichael: Wow, you are an inspiration! What a lovely journey your retirement has taken you on so far!

    • retirebyforty July 1, 2013, 12:01 am

      Wow, what an adventure. I wouldn’t mind teaching ESL overseas at all.
      I plan to have an active retirement too. It’s a lot more fun to have some goals.
      Good luck with your new career.

  • Dave January 24, 2014, 8:03 pm

    I too retired at 41. Over the past three years I have found it to be quite a challenge. The first 18 months were spent renovating a house but that became very expensive. The last 18 months have been spent traveling the world. Until recently, I did not have long term goals but I too started a blog. I can only hope for it to be as nice as yours in the future. Slowly but surely I am working towards making it look professional vs the mess of raw data it is today. Please take a look and let me know what you think. Any advice is welcomed. http://imup2.com

    • retirebyforty January 25, 2014, 3:52 pm

      Nice site. Keep at it!

  • Gerry April 6, 2014, 3:03 pm

    Hi all, 50 is just a few weeks away! Found this site very interesting, I work hands on technical job. Work is not physical or demanding on me, I hope to remain working till I drop. I fear stopping work , as I find winters very long (Scotland) and feel I would get depressed very easily. I feel the sense of structure work has, is becoming more important, long term goals ,like paying my mortgage off are now complete, the need for money is not the same, and I chose to leave my old job 18 months ago and do a job more for the pleasure and satisfaction. In a way I probably feel like I retired as I find it a pleasure to go to work now, stopping this job now I think would not be good. I work with a young workforce and also find a sense of passing on my knowledge / experience feels rewarding. It helps when my hobbies are motorsport related, as this also creates some interesting chat during tea breaks. I feel I would miss this by retiring. I appreciate all the previous comments on here, and I guess its made me think I am not afraid to admit , I don’t really want to retire. I am glad that the people who have are enjoying it, I guess that’s why we are all different. Thank you all for the interesting ,honest comments I enjoyed reading on here.

    • retirebyforty April 7, 2014, 9:18 am

      Hey Gerry, Congratulation! It sounds like you found a sweet spot in life. I don’t really want to fully retire until I’m in my 70s as well. As long as part time work is enjoyable, I’ll keep doing it. Working in a job you like is the way to go.

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