When Should I Retire

People pay me a lot of money for advice. It’s called consulting. Questions on taxes and money are what start the conversation. But once we get under the hood it becomes clear there is another motive. The real questions involve medical issues, raising children, starting a business and retirement.

It would be easy for me to give a short pat answer. It wouldn’t do much good, but I could do it. Instead, I ask a series of questions helping the client to come to her own conclusions. Some crazy tax guy from the backwoods of northeast Wisconsin will never have clever enough words to convey the right message. I have to help the client find there way there  on their own. If I say “Yes” to the best business idea ever and the client is not ready or in the right mindset, they will fail. 

And it always comes around to the finish line, aka, retirement. When can I retire? Should I retire? 

I could give you a simple formula if you want. Better yet, skip the whole post and scroll to the bottom for the quick and easy answer, for all the good it will do you. 

However, it might be better if I share a story and ask a few questions first.

 

Old Man Take a Look at My Life

I’m feeling old this tax season. At 56 years of age my eyes stray to the horizon. I’ve seen a lot over the years and this tax season is already one for the record books. 

I entered the profession full time in 1989. Since 1982, my senior year in high school, I have been stenciling in numbers on tax returns for side hustle money. I am at a total loss when I look back and realize I have nearly {gulp} 40 years into this career. There was no clue when I planted that first number on a 1040 for a quick twenty bucks how much it would dominate the remainder of my life.

After 40 years it might be time the cleats get hung up. There are entire communities dedicated to early retirement. I was nearly sucked in all the way 5 or so years ago when I met Mr. Money Mustache, a guy whose claim to fame is retiring at 30. The falling out is totally my fault. I found nothing familiar in the lifestyle presented so we had nothing to talk about. We came from different worlds.

So, if I’m going to help people reach retirement, shouldn’t I have a clue about my own? Well, I think I am more than qualified to help people attain and transition to retirement without ever planning on doing so myself. The best sports coaches are not always pulled from the greatest players of yesteryear. Sometimes, but not always.

If my retirement plans are a fantasy, why do I feel so old? Is it the clock and its incessant ticking? Do I think my skills are waning? All good questions. 

Tax professionals are a unique crowd. I belong to several Facebook groups dedicated to tax professionals only. The crowd is quite friendly until mid-February when things take a left turn. Normally quiet individuals start complaining about clients and their behaviors. Mid tax season changes by Congress and the IRS adds to the stress, and don’t think the folks with pocket protectors don’t let the rest of the crowd know about it.

To the best of my ability I do not complain about the tax code and especially clients. This tax season, only half over, has provided ample reasons for complaint. But it doesn’t help so I focus on what does; the things I can change.

You don’t live long in my profession before you notice strange things. Things most people never think about. 

You can’t imagine — unless you’re a tax professional — how many clients die every year.

It is rare for a tax season to pass where I don’t hear of a client that has lost a child. If not their child, a nephew or niece. I have at least two clients with a child that committed suicide. Clients that had a child drown, killed in an automobile accident and one that died playing a choking game. 

I prepared two decedent returns (a person’s final tax return) this year already. The first was for a 26 year old woman. I never know what to say to the client. The pain must be unbearable.

The second decedent return was picked up last night late. He was 38 when he died. 

In both cases medical issues were involved. They were sudden issues so no one had a chance to prepare or even say goodbye. The wounds are deep.

When should I retire? Reflect on your life and what matters to you. Do the things you most love. Never give those thing up.

Love Lost, Such a Cost

You can’t understand how much I love my work. This morning I was at the office at 4 a.m. Instead of knocking a few more tax returns out I decided to write and publish this post after a few months break due to medical issues in my family, still ongoing. 

With the exception of one tax return stalling me out, everything on my desk is fresh. I’m getting my work done and in a timely fashion so I had the luxury of writing for a few hours. Lucky me!  

I often get to the office early. It allows me more family time later in the day. I have the great fortune of satisfying both my great loves as a business owner.

But there is a cost for not retiring! Every time I walk in the door I take the chance the news of another dead client will reach me. So many of my clients from the early days of my practice have left this world.

A few weeks ago an elderly client came in with her son. She couldn’t get out of the van easily so we took her papers, prepared the return and brought her a copy of the return and signature pages to the parking for her to sign. She is 81 years old. She doesn’t need to file anymore, but worries so we file for her anyway.

We charged her $25. She has no money and was struggling to put food on the table. She asked for time to pay and we granted the offer. When Dawn, the preparer, brought this to my attention I told my assistant to delete her invoice. Dawn called to inform the client. The client cried. You see, people are good; all of them. They have pride. They are okay with a discount, but free makes them feel like they have taken advantage. It hurts no matter what you do. 

I am feeling very old.

A former employee is good friends with Dawn. The former employee visits a Feeding America food bank weekly to bring food to people shut in. Dawn asked for two packages. She delivered the food to the client. She cried again. 

I don’t know how long before the client will no longer need my services (dies). She has a son. Her husband died long ago. All I know is it makes me feel old.

 

Beyond the horizon of the place we lived when we were young
In a world of magnets and miracles
Our thoughts strayed constantly and without boundary
The ringing of the division bell had begun

 

When you practice as long  I have something else happens. I prepared taxes for young people back in the 1980s and 1990s. They got married, had children and sometimes retired themselves by now. Their children are now old enough to file a tax return and are having children of their own. Those children are starting to grow up. If I last much longer I will have filed tax returns for three generations in some families, if I haven’t already! 

And this is the part that hurts.

A husband and wife have been clients since about 1990. They worked with me many years ago when they and I had rentals. They were more than clients; they were friends. The husband’s health has deteriorated for years. He was admitted to hospice and was given less than six months. He is down to just over 100 pounds. It breaks my heart. The wife is suffering from dementia. 

Their daughter brought the news when I prepared (actually Dawn prepared) the return. A few days ago they had a fire at their home. It made the news. I don’t watch TV so I missed it. Dawn informed me the next day. I’ll never complain about bad luck ever again.

Ambition to reach the dreams of your life. Know what you are retiring from and retiring to.

When Should I Retire

The answer is different for everyone. There is no disgrace in wanting to keep doing what you do to fill your days. There is no disgrace in retiring, at any age.

I ask you these questions: What are you retiring from? And what are you retiring to? 

If your job is a drag it might be time to move on. Maybe a different job, one that fulfills you, or retirement. 

Before you take the long walk, consider this. Have you thought about an extended vacation or gap year? Do not confuse tired or exhausted with being ready for retirement. 

Maybe you are ready to retire, maybe not. 

For me, retirement is a hollow promise. The faces in my office are changing. Clients so familiar all these years are disappearing; first one-by-one, now in droves. With each passing minute I become the old guy with lots of crazy stories from history. 

I am desperately afraid of the night. This is what I do and what I am. I will not complain about complex tax law changes or clients sending me unreadable photos of their tax documents. I will gently nudge them in the right direction. They meant no offense and do not understand what it is like on my side of the desk. Age has granted me more patience; an example of a blessing from growing old.

Whatever path you choose, know you can always make additional changes in the future. You are not wedded to what you are doing now. Plans should be changed when things don’t work as planned. 

Most of all, do what you love. Life is too short for anything else.

 

We close with a few more words from Pink Floyd.

Encumbered forever by desire and ambition
There’s a hunger still unsatisfied
Our weary eyes still stray to the horizon
Though down this road we’ve been so many times

 

I have High Hopes for all of you.

 

More Wealth Building Resources

Worthy Financial offers a flat 5% on their investment. You can read my review here. 

Personal Capital is an incredible tool to manage all your investments in one place. You can watch your net worth grow as you reach toward financial independence and beyond. Did I mention Personal Capital is free?

Medi-Share is a low cost way to manage health care costs. As health insurance premiums continue to sky rocket, there is an alternative preserving the wealth of families all over America. Here is my review of Medi-Share and additional resources to bring health care under control in your household.

QuickBooks is a daily part of life in my office. Managing a business requires accurate books without wasting time. QuickBooks is an excellent tool for managing your business, rental properties, side hustle and personal finances.

cost segregation study can reduce taxes $100,000 for income property owners. Here is my review of how cost segregation studies work and how to get one yourself.

 

The One Place World Travelers Forget to Visit

Travel to exotic destinations. Even seasoned travelers miss some of the best places to visit. Here is a travel tip to a destination that will change your life forever. #wealthyaccountant #travel #traveltips #destination #exoticI have a confession; I’m a hypocrite. My greatest platform has been a complete lie. Please don’t blame me. It got out of control and before I knew it the lie was so big I had no way out with the exception of telling the truth.

From the beginning I railed against traveling while I’ve visited most of the U.S. states, Canada several times, Jamaica and Costa Rica. And here I am pounding out a post while traveling and sitting at the kitchen table of my first Airbnb stay. For a guy who whines so much about traveling I certainly do a lot of it.

Traveling has certainly been a love/hate relationship for me. The anxiety is almost overwhelming (sometimes it is and I collapse). This post will publish Thursday and I’m writing Tuesday night and the clock claims the night is closing in on 10:30. For several weeks leading up to FinCon the anxiety increased. Sleep turned fitful, my thought disorganized. I dreaded the flight. Most of all I dreaded all the people. Farm boys from the backwoods of Nowhere, Wisconsin never truly adjust when pushed into civilization. The savage is always there.

It is in this fog of insanity I realized I travel too damn much, but also realized I travel to places even the most seasoned travelers rarely go.

Give Me Space

Wanderlust is something I understand. I fear the crowds, the bright lights. The newness will heighten my senses activating the fight or flight reflex. Yet this is still a lie!

There is a form of traveling I lust for ceaselessly. When I see people driving toward early retirement so they can travel the world I roll my eyes. Who in their right mind would want to do that? There is nothing more painful I can think of. And still, I can’t stop the deceit.

See places few visit. Your travels are incomplete until you travel through time to this exotic and wondrous destination. #wealthyaccountant #travel #ventures #travelplanning #travelideas I better clarify. Many Most people have a strong desire to travel, to see new places, meet new people, enjoy new experiences. There is something in the DNA of humans to want to crawl to the horizon and beyond. From the very beginning when our ancestors wandered out of Africa to our post-modern times where eyes are turned glistening to the moon, Mars and the stars beyond, there has been a powerful urge in humans to explore. The chance to grow and learn is an irresistible pull.

But people have traveling all wrong so they miss the one place more important to visit than any other.

The mistake is all about space. The desire to travel is never satiated because you travel spatially. The mode of transportation is plane, train, boat, car and even bike and hoof. Whatever it takes to get from here to the other side of the hill.

I bet you make the same mistake. You travel from here to there and no more. A trip to Europe or some other continent holds the promise of exciting new cultures to sip from. And it works. Most people are awesome and love communicating with people from far away. They share as you share; learn as you learn.

There are serious limits to spatial travel. You can only see places where the transportation can take you. Mars is off the docket. . . for now. Anther serious limit to spatial travel is time. You need more than an afternoon to tour Africa. We can discuss cost, but you already understand that part.

New Dimensions

This is where we entered our story. My lie isn’t exactly about spatial travel. While I’ve imbibed often enough, I believe my personal constitution absolves me from serious travel crime. Yes, I have gallivanted around a section of the globe relatively close to the home farm, but gallivant I have.

I still abhor travel in the traditional sense. The anxiety is so powerful and overwhelming I’m surprised I can function at all in those situations. You can’t imagine what I see in my mind as I struggle through yet another bout of time away from familiar surroundings. (The lights are not as pretty as I pretend.)

But this is where truth ends. In a bad year I leave the yard three times. In a good year I cross the road a mere once. And then there are the times where I’m in heaven as Pinky (my cat) notices I stay snuggled close for over a year uninterrupted. But just because my tail is planted firmly in the couch doesn’t mean I’m not traveling. In fact, it’s a journey too few ever take. Seasoned world travelers wander the planet for decades and never see the places or people I’ve seen.

You see, I travel in time.

I know, I know. Your favorite accountant has gone and flipped his lid. (I am writing this while traveling. Remember the Airbnb kitchen table.)

Extraordinary claims require extraordinary proof and I’m prepared to provide it. (If I didn’t it would be a really stupid post. (You in the back: sit down. If I wanted your opinion I would have asked.))

The best way for me to prove I time travel is to explain the people and places I visit.

There are so many stories; where to begin. I time travel so much, see so many wondrous place, enjoy intelligent conversation with so many great minds I sometimes forget how incredibly lucky I am to experience such travel.  I may as well spill it all.

Time Travels

It may be hard to believe, but I was there when they spiked Christ to the cross. I knelt with His mother before the cross and comforted her. I was there when Socrates drank the hemlock and when Plato left the city and the school he founded “lest Athens sin against philosophy twice.”

When Voltaire exposed the government, religion, science and philosophy with the biting satire of Candide and when Rousseau fomented revolution I was there. Just another trip down Memory Lane. I warned Voltaire his humor would not be appreciated for centuries when comedians were allowed to live (usually) after exposing the  hypocrisy of said institutions.

When the Dark Ages descended over Europe and the Black Death spread fear I was there. I felt their pain, felt their fear. When the light of Renaissance flickered after the long night I experienced the enlightenment first hand. I was there when the Renaissance flourished into an Age of Reason and a Reformation in Christianity.

I saw all these things and more. And you can travel to these places, too! All you need is a book.

Space and Time

Plenty can be said for spatial travel. There is a thrill of newness in the act even if a crazy accountant in the room suffers emotional distress while engaged in the process. There are serious and great benefits from travel. Spatial travel brings people together as the world shrinks into a single community.

Need travel ideas? How about a low-cost vacation to an exotic location few know how to book. Be different! Travel further than anyone else. #wealthyaccountant #travel #vacation #travelideas #vacationideas #destinations #cheaptravel #lowcosttravelBooks are awesome, of course. Some of the flavor is lost in the mists of time unfortunately. Plato and I had plenty to talk about, but the people around him are relatively unknown or completely forgotten. It was also a one-sided conversation. How I would love to have asked questions. All but the major players are relegated into oblivion. There story is untold, lost in the sands of history.

The filter of time determines which stories we are exposed to. Aristotle was almost lost to us in the Dark Ages. When the Library of Alexandria burned much knowledge and understanding was irrevocably destroyed. Many stories died that day forever. If ever there was a genocide, it was that day. Many great minds gasped their last breath that day. If I could have been there. But, alas, time travel doesn’t allow changes to the time stream.

Time travel is important! It is the great men and women of the past who gave us our chance at greatness today. We build on the shoulders of giants.

To truly experience a culture and place while spatially traveling you need to understand the foundation that brought that place and culture to the current condition. The only way to do that is with time travel, with a book.

Coda

When I express my issues with travel I’m asked if I hate the travel (airport, car, et cetera) or actually being there. Yes.

Not funny, I know. The traveling part of travel is the worst, of course. The exhausting nature of travel is also a part and so is being away from home.

The people are always incredible. I still prefer a book because I can absorb at my pace and see so much more of the world faster when I can avoid the wasted time of airports. I was born out of my time in some ways. Regardless, I still feel the pull of the horizon. I’m human! What did you expect?

It is getting late as I finish this post. The Airbnb hosts were traveling (surprise!) so they had Rand and Joy step in to run control on the accountant clan visiting. We had some deep and interesting conversations. (Airbnb beats a hotel by a gazzillion miles. I’m sold. Future travel will be Airbnb whenever possible.)

Some travel destinations are like traveling through time. The less beaten path is one with more wonders and awe. No crowds. Plenty of fun and adventure. All low-cost. Plan today before everyone else discovers these gems. #wealthyaccountant #travelplans #travel #exotic #vacation #cheap #rare #undiscoveredI was interrupted as I completed the first paragraph of this post by Rand and Joy. I explained what I planned to write (it turned out slightly different than I expected; a common occurrence in writing)  when Joy lit up. Her eyes flashed wide as she realized why all the stuff I said sounded so familiar. A friend of hers has been sending her links to this blog when she found good stuff. (My guess is she didn’t need a lot of time with that kind of filter.)

Joy has been reading this blog for about two years. Rand checked it out earlier today. (Stalker!) He only mentioned one post: my obituary. I understand. No, really!

What I find amazing is that the population in the U.S. tips north of 300 million and a couple hundred thousand people visit this blog every year at least once and somehow I ended up in an Airbnb with a reader. How cool is that?

I am amazed and also humbled. You, kind readers, are lost in the glare when I write. I know you’re there, but I can’t see you or feed off your reactions as a stage actor would.

Then it all turns real when a reader appears in an unexpected place. I expect a few people to know of my work at FinCon. But out on the street I have no illusions of my celebrity. I’m a bit player on a historical stage. In short, I was Plato’s water boy, forgotten in time.

After 1,500 words I’ve realized how wrong my original supposition has been. As much as I enjoy traveling in time with armloads of books, it is meaningless unless I also travel spatially. Both are intricately connected. One does not exist without the other.

A mere 1,500 words and I discovered I MUST travel in time AND space.

Anxiety will always be a problem. Damn anxiety. They have pills for that now.

 

More Wealth Building Resources

Credit Cards can be a powerful money management tool when used correctly. Use this link to find a listing of the best credit card offers. You can expand your search to maximize cash and travel rewards.

Personal Capital is an incredible tool to manage all your investments in one place. You can watch your net worth grow as you reach toward financial independence and beyond. Did I mention Personal Capital is free?

Side Hustle Selling tradelines yields a high return compared to time invested, as much as $1,000 per hour. The tradeline company I use is Tradeline Supply Company. Let Darren know you are from The Wealthy Accountant. Call 888-844-8910, email Darren@TradelineSupply.com or read my review.

Medi-Share is a low cost way to manage health care costs. As health insurance premiums continue to sky rocket, there is an alternative preserving the wealth of families all over America. Here is my review of Medi-Share and additional resources to bring health care under control in your household.

QuickBooks is a daily part of life in my office. Managing a business requires accurate books without wasting time. QuickBooks is an excellent tool for managing your business, rental properties, side hustle and personal finances.

A cost segregation study can save $100,000 for income property owners. Here is my review of how cost segregations studies work and how to get one yourself.

Worthy Financial offers a flat 5% on their investment. You can read my review here. 

The Value of Time

IMG_20160813_185658You did everything right: maxed out your retirement accounts, invested in index funds, paid off all debt, saved half your gross income, and did every home project and car repair yourself to save money. If you are like me this describes you to a T. I save a massive amount of my income in tax advantaged retirement plans and stuff non-qualified accounts, too. Very few jobs are off-limits to me. The roof is bad; I go up there and spank on another set of shingles after tearing off the old ones. A bad light switch is an easy fix after a short visit to the hardware store. I clip my own lawn at home and the office; I grow most of the food I consume; I bike to work even though it is a 30 miles round-trip; change the oil in the car; and I have no problem with a paint brush.

Once per month Mrs. Accountant makes a major grocery run. Once per week she picks up milk and a few perishable staples. There are times we make our own bread, but milk needs constant resupply with kiddos in the house. Most items we consume at home or at the office are ordered online. Most of the time the price is cheaper, even with shipping costs added. When you consider the value of time and the cost of driving around town shopping, most online purchases delivered are a bargain.

Things Overheard

Several months ago I overheard Pete Adeney, aka Mr. Money Mustache, say he was toying with the idea of having his groceries delivered. His argument was his time was worth more than the few dollars in savings running around town doing it himself. My first thought was, How un-Mustachian of the ‘ol boy. Here is a guy who does all his own projects. He bikes around town and consumes only 25 gallons (95 liters) of gas a year. Now the bum wants to have his groceries delivered? Really!

But he has a good point. My time (and his) is worth a lot. My billing rate at the office ranges from $120 and up. There are projects I get paid $2,200 an hour to do. How much is grocery shopping worth now? My time is valuable and so is yours. Even in retirement your time is a valuable asset. You have the same amount of time in a day as the richest man on the planet and the poorest bum. The rich/wealthy have no time advantage. What you do with that time is up to you. Spent wisely you have a cherished life of happiness and wealth; squandered, and you have increasing regrets as time takes its toll.

There is an advantage I have over most people. Pete is my tax client and I get to speak with him as much as I want. My worldview is beneficial, but guys like Pete see the world in a way that is not always obvious to me. There are times the guy says things that blow my mind away. Who the hell is the one working with clients every day for the last thirty years? You would think my experience working with people from all walks of life and business owners would put me front and center. For some reason Pete sees the world differently. It should be obvious, but it eludes us mere mortals.

The Next Step

There are things I insist on doing and justify the actions by saying it saves me money. For example: I clip the lawn at my office. If I hired the work done professionally it would cost under a thousand dollars per year. Knock another 30% off the cost for taxes. Now I saved maybe $600. Was it worth my time? Hmm.

Karen is my office manager. Her husband, Chris, is in the military. When he is home he loves working on buildings. He spends most of his time helping a landlord with a large number of properties. I had a project in the office to repair some water damage around the sump pump exit. I dragged my feet forever until I finally asked Chris to do the job. He did. I bought the parts needed and he billed me $150 for his day of labor, including the running around to pick up parts. I am certain my gas and tools required to do the job would have been more than $150. Doing it myself would have been more expensive and Chris did a better job than I would have and faster!

There are only so many days we get to live. We need to choose wisely what we do with them. People like me want to experience everything life has to offer, but it is impractical. Sometimes it is best to defer to the professionals. I discovered years ago installing flooring was not a good project for me to undertake. I decided to install carpet in one of my first rentals and quickly learned it was a skill I would probably never master. I don’t want to talk about how the job looked when I was finished. If you ever meet me and I tell you I have installed carpeting, just smile and humor an old man. I can still remember the address of that property, how we found the property, and what we paid for it. That was twenty-five years ago. Some scars run deep.

31hn1RJnQwL._BO1,204,203,200_Valuing Time

There are no hard and fast rules for valuing your time. A starting point might be to put a price tag of at least $40 per hour on the time it will take you to complete the job and compare it to what it will cost a professional to do it instead. Your level of experience and competence with the project involved will weigh heavy in the decision-making process of who does the work.

Readers of Mr. Money Mustache and The Wealth Accountant sometimes feel they have to do everything in life exactly like us. That is crazy! What Pete or I do is irrelevant to what you do. I installed carpet to save money, but hated the job; I’m not much of a remodeler. It was no surprise it turned out the way it did. Tax preparation may be the same with you. The odds are high I will prepare your taxes faster, better and cheaper than you can do it yourself. If you over pay your taxes because you don’t understand all the tax advantages available, your higher tax bill is what replaced your tax preparation bill. Bet I am starting to look cheap. Okay, I am not always faster; I am busy as hell.

Your time is worth something. Maybe not $120 per hour or even $40, but it is worth something. Certain jobs should be handled by an experienced professional. Your furnace or air conditioner is best left to a pro unless you happen to be a HVAC professional. That said you can educate yourself on any subject you want. I recommend educating yourself on a project before hiring a pro.  It is not necessary to possess the skills of a star quarterback to be an outstanding quarterback coach; the two jobs are not synonymous. I enjoy certain roofing jobs and will happily join in when a roof needs repair. I am not afraid of hard work or long hours, but, as Clint Eastwood said, “A man has to know his limitations.”

Picking the Right Projects to Do Yourself

The hard part is deciding what to do on your own and when to bring in the cavalry. Money is not the only deciding factor. Life is about happiness. Money can bring freedom to choose and, if handled properly, accentuate happiness. Money allows you the ability to choose which projects bring you the greatest pleasure doing yourself.

Clipping the lawn at the office is a bit of exercise at the end of the day I enjoy so I will not hire out the work at this time. If it becomes a chore I have the financial resources to hire the work done. At home I love working around the farm. My place is not immaculate by any means; I like the old, used look more. I don’t care what the neighbors think. In my neighborhood the neighbors pretty much live like I do. I hired the best contractor in town when I installed a mound system; the project was well out of my league. Other landscaping and gardening projects only exist because Mrs. Accountant and I like doing them. Once they stop being fun the projects end.

If a DIY project does not trip your trigger consider hiring it out. Life is too short wasting time on things that do not bring you pleasure. This is not selfish pleasure I am talking about either. What I am talking about is jobs that bring a level of satisfaction when doing them. It is not about money then, it is about doing something you like doing. Once you understand what a project entails from your research, you can decide if it will bring you happiness performing the tasks of the project. If it makes you happy then you can decide if it is a wise financial move to DIY. Now you are able to make the right decision.

Or, you can do what I did installing carpet over on Roosevelt Street. It was a work of art. As memory serves I sold the damn place shortly thereafter. Nightmares.