Rethinking retirement lump sum

Two years ago I wrote a list of everything I wanted, and I've now achieved sixteen of those twenty things. By the end of this month, I think I'll be at nineteen.

The Twentieth Thing

The last item is the one I'm furthest from. It was a lump sum for my investment designed to be drawn at the same rate of interest earned so that I can officially "retire". A passive income retirement.

I am rethinking this one.

I don't think I need a pile of cash as much as I need assets. What matters is owning enough that produces a return. It doesn't have to be cash. It could be property, bonds or shares in a business.

So I'm working out how to reword that goal. After years of being a responsible adult managing money, I know myself, and I'm not someone who saves up for things. I don't believe in saving money for the sake of it. Money is there to be enjoyed.

That doesn't mean you shouldn't invest. But I don't want to invest passively and leave it. It feels like its not doing anything even when it was earning good returns. I sold my Berkshire Hathaway shares because I thought its not doing much (6 months later it outperformed the market but I no regrets). I want to do something with my money and have fun with it. If I'm investing, I'd rather put it into a business, or a house I can renovate. I don't want it parked in an account somewhere.

I've done this a few times in my life. Some months I've emptied my savings or investment account because I felt the money would do more good somewhere else. I was after a more immediate return, whether that was a family event, something just for me, or paying off a debt.

Why I've Never Liked Fixed Deposits

I've looked into fixed deposits before, and I've never wanted one. If there's an emergency, I want money I can get to. Yes, credit cards exist, but I want real money I can access without paying interest.

That's my personal view. I want to see my money working for me and producing results, not sitting locked away.

A house is different. You put down a deposit as collateral, and that's fair enough because the bank is lending you around ninety percent of the property's value, and you pay interest in return. Having money tied up makes sense there. But locking up all of your cash for a return that barely beats inflation, with no access to it? I don't think that's a good deal. That's just my opinion.

Compounding Is Real

Most days it doesn't feel like I'm keeping up with my tasks let alone my goals. Sometimes it takes sheer force just to get through the day.

But compounding really works, and not only with money. Two years ago I knew nothing about business. I had no experience running one. I'd never dealt with the management side, like how you handle the statutory requirements, accounts, pay tax or employ and fire people.

Is This the Cost of Achievement?

When I look at my list, compared to 2 years ago I can see how much I've done, learnt and achieved, and it's amazing. But it still feels like it isn't enough. I always want more, and I wonder if that's just the price of being an achiever.

At school I was top of the class for a whole year. The next year I expected the same, with better scores. That's a sign of progress right? Then I hurt my arm in a bicycle accident, came fourth in one set of exam results, and that pulled my overall ranking down to second place for the year. I was really upset about it.

Is that an entitlement mentality? Maybe. But I've been watching Netflix documentaries about world champions, and I get where they're coming from. Someone starts playing tennis at eleven, becomes number one five years later, wins competition after competition, and still wants to keep going. For them, not doing it isn't an option.

It's not that you have to. You want to because you know you can. I could do more. I could do better. I could have more. You get bored of the current achievement pretty quickly. I realised after looking back at my career since I started my job, I average 2 years in a role before moving on. The first year was a learning year, everything is new and different. The second year is about doing better than first because I already learnt it. Third year, if I wasn't assigned a different role in the company, I resigned. When I look back each time I resigned it was for economic reasons (company closed down, company got into financial difficulty, I became a mother and my expenses went up) but I also remember feeling bored and frustrated in each of those jobs.

Back to rethinking retirement. I think I'm going to save up or do a big deal and get a bonus to buy my first investment property. Then transition into a new role as a property investor otherwise I'll get bored in this business!