The Complicity of Enough
The Complicity of Enough
We are complicit. All of us in the personal finance community. We talk about enough as if it is a static goalpost. A place we arrive at after years of struggle and conservative planning. We then make life decisions based on this calculation. I will quit my job in X number of years. I will stop traveling for work when I reach Y balance in the bank. The calculations go on and on. But within this complicity of enough we are being ingeniune. Enough is a false prophet. A never-ending mirage.
There is no enough.
There are just varying degrees of adequate.
Enough Money
How much is enough savings? Usually somewhere about double of what we currently hold. We are kidding ourselves with the 4% safe withdrawal rate. Almost everyone I know who considers themselves retired is still making some sort of money or other. They are either consulting, making money on blogs, or collecting real estate rental income.
The complicity of enough is that some figure can be calculated and then be guaranteed. There is no guarantee. No one knows what sequence of returns risk will be in the future. No one knows when the next world war is coming. We need to stop trying to comfort ourselves.
And for g-d sakes, we need to stop raising the bar. How many hardcore 2% SWR fans are there in the blogosphere?
Life is full of unknowns. Too conservative and you may die the richest man in the cemetery. Too liberal and you might die a pauper.
After a reasonable amount of planning, the thing that will most likely affect your outcome is the thing that you will be able to control the least.
Dumb luck
Enough Time
The complicity of enough is no more apparent than when we talk about time. You can’t commoditize time. There is this strange perception that time can be manipulated, bought, or sold. There is the belief that by working less we are gaining more. But again the caveats rear their ugly heads.
Time passes no matter how you “spend” it. You will not escape life without doing work. Some of that work you will enjoy. Some of it you will loathe. But either way you will spend a great number of your minutes on this earth doing inane things like sitting on the toilet.
Shit happens!
You will never have enough time. Stop trying to make it less so. Better to attempt to enjoy whatever task you are doing at a given time than to try to weasel your way out of the space-time continuum.
It won’t happen. You won’t create extra minutes.
Enough Happiness
I will be happy when I reach financial independence. I will be happy when I no longer have to go to my tiresome W2 job. The once I have syndrome takes over and the goal gets farther and farther away. The complicity of enough is that there is such thing as continual happiness.
Contented people tend to find happiness regardless of their daily surroundings. I believe it is a state of mind more than anything else. One can make decisions that have short-term effects one way or another. But ultimately our best shot is to minimize the bad, and try to grasp some bit of gratitude for the rest.
Risk Management
As my friend Gasem noted in the comments of yesterday’s post, the answer of course is risk management. The complicity of enough is that some figure or concept actually exists that meets this impossible standard. In actuality, there is just varying degrees of adequate.
We hedge our bets with adequate by managing risk. We put in place financial systems to guard against running out of money too soon. We manage our time zealously by divorcing ourselves from those tasks we despise.
And we manage our happiness by building purpose, identity, and connection into our lives and abandoning that which inhibits freedom.
While I don’t believe continuous hapiness can exist, I do believe we can remove the effort to get to hapiness and smooth the lows by following our values. To me that’s the goal. As for how much money reaches that goal, I’d argue depending on person money may not even be involved. Money buys options on the way to your actual goals.
I think a certain amount of money is necessary as a base. After that it may not matter.
We definitely lose some amount of joy always worrying about whether we have enough. FIRE people especially are notoriously hard on themselves running mental calculations of pretty much worse case scenarios and increasing their worry that their portfolio won’t last. This causes us to work longer at something that we may not enjoy. At some point I know I am going to have to seriously sit down and say this is the trigger event to pull the plug on work and retire. I guarantee you that I will have much consternation playing out the very worst case scenarios that have been plastered throughout the blogosphere.
I hope that my goalposts don’t keep moving forward and that I finally can say I have enough. At the end most likely I will have worked a couple of extra years I didn’t have to, but I guess peace of mind with padding my nest egg because of that carries some weight too.
I think most of us work more than needed because we are conservative.
Fear of failure drives so many things and a desire for perfection will never be satisfied. What we really have to work on is being out of our comfort zone.
And finding some sort of peace.
Happiness comes from actualizing potential. It comes from doing something until you realize a pleasing result.
Enough time? In some respect time is not a commodity. The past is merely a memory. The future is unknowable. The present is happening and that is what you have some control over. I believe humans work on probability functions. They don’t plan for the future, they plan for future likelihoods. If you’re a man married to a younger spouse you have a 48% decrease in the likelihood of death compared to other cohorts. If you’re a man and your wife dies you have a 30% increased likelihood of your own death. Women on the other hand who loose a spouse only suffer a 15% increased likelihood of death. The point? If you’re a single man you don’t need much of a retirement, if you’re married to a younger woman plan well. If your wife dies before you, make a will. Those are the likelihoods. Time on it’s own is relentless and it will happen regardless, however every new day has its own potential waiting to be actualized. If you view time as something to be actualized the possibility is endless. It is also why retirement is not boring.
On money: in my opinion money is not directly related to time or happiness. Money is about security. I have always viewed my portfolio as a product I purchased. It’s a product to provide for my future security and for my wife’s security. The idea there is something wrong with dying as the richest man in the graveyard does not compute. When you’re dead you won’t care because you’ll be dead, and the next year you’ll still be dead. What you don’t want is to die the poorest man in the graveyard, because that man never knew the comfort of security. He could never freely actualize his time because his lack of security would enslave him. He could never enjoy his happiness to the fullest because of wondering where his next hamburger is coming from. Security is also described by a set of likelihoods, a set of probabilities. It is no different than any other future oriented probability by which you live your life. Security as a probability has an advantage. It is something you can “math up”. It is something that actually lends itself to statistical analysis. It is something that has a mean prediction and a range of less likely predictions, some above the mean and some below the mean. Security in other words has a normal distribution of outcomes. Security is 2 dimensional. This is immensely useful because it allows you to plan in a way that allows you to avoid failure (the opposite of security) to a large extent. That plan is called risk management. That numerical analysis allows you to understand the likelihood of failure and become comfortable with that probability. That is the numerical definition of “enough”. Enough is a level of security that has a failure rate you can live with, a rate that doesn’t terrify you. If that plan includes some real estate empire s o be it. Real estate comes with it’s own risk. If that plan is to become king of the bloggers so be it blogging has it’s own failure rate and risk. For every success there are probably 100,000 flame outs and a normal distribution of people heading into the ground. If your plan is to consult that works fine until the stroke happens. The point being if you truly understand the reward and the risk in a real way, then and only then can you possess security. If you forgot to include the taxes into your cost of living you really didn’t understand your security. If you fudge on your budget you really don’t understand your security. Freedom of time, happiness and finance is about understanding probabilities of security.