We live in unprecedented times. And times like this lead to interesting insights about various aspects of life.
I came across a tweet yesterday (link), which said:
Realized one thing in this Lockdown. Normal living expenses are very low. It’s just the show-off and lifestyle that makes it expensive.
Couldn’t have said better.
It seems like old times. We all are in our homes ‘together’ and trying to live a basic life these days (under the nationwide lockdown due to COVID-19). And if you think about it, it is indeed true that many of our expenses are just the froth in a mug of beer.
I just wanted to use this idea of low expenses to highlight why its important for people looking at an (early) Financial Independence.
Sometime back, I had written a post on this aspect. In light of the statement made above, i.e. “Normal living expenses are very low. It’s just the show-off and lifestyle that makes it expensive”, I strongly suggest you read this post if you are serious about ever being financially independent:
But here is a fact too.
Not everyone is programmed to think on the lines of F.I.R.E. (Financial Independence & Early Retirement). Financial Freedom is elusive and it is really not for everyone. I do aim for it (link 1, link 2).
But I also understand that this a goal that should be handled very carefully. You wouldn’t want to live a super frugal life just to become financially independent when you are older. There has to be a balance. And sometime back, I tried addressing this aspect at Is going very fast towards F.I.R.E really good?
With that said, I still aim to be financially independent (but not retire early). But I don’t want to reach there too fast. I don’t want to miss enjoying the journey just to reach the destination faster. It’s not really a competition that is about winning or losing.
And why do I say what I say about enjoying the journey as well and not run blindly towards the goal? I am sure most of you know it. But for those who don’t, here is what we shouldn’t forget – We always know how much money we have but we never know how much time we have.
And another reason that you should consider saving for some level of financial independence is that you may not want to retire early, but you can always end up being forced by fate for involuntary early retirement. And you wouldn’t want to be unprepared if and when that happens.
* By the way, there is a difference between Financial Independence Vs Early Retirement even though both terms are used interchangeably.
That’s it. Not much to say here.
Maybe this a small lesson that we need to take from this pandemic. Maybe this is what the real algebra of financial happiness is.