Wandering Reading #3

Welcome to my weekly summary of links. I hope you enjoy a few of the following items.

  1. Investoid looks at the implications of the Bank of Canada raising interest rates soon and he also has a contest for anyone who wants to win a subscription to the National Post online (deadline to enter is Friday).
  2. JD over at Get Rich Slowly found a great tool about determining your class (lower, middle, upper) which I found very amusing, since according to it I’m in the upper class. So where’s my maid then?
  3. The Money Gardener takes a look at his saving rate and is off to a great start.
  4. The Canadian Capitalist is again rolling out another list of new blogs and has a great post on the research on the financial circumstances of retirees which is just full of interesting information.
  5. The Dividend Guy has a great post of the implications of Walmart offering brokerage services.

Emotional Retirement

Retirement itself can be a funny thing emotionally. Suddenly your entire world is turn upside down and shook a few times. For some people it’s a great feeling like riding a roller coaster, for others it makes them feel a bit sick or detached from it all. Overall retirees actually share quiet a bit in common emotionally with high school students leaving their final year (as a reference point for anyone who isn’t retired).

I’ve spend a few weeks digging around message boards to see how everyone reacts to it all, as well as talk to several people my parents age about people who have recently retired and how they feel about it. In general there appears to be a few different patterns around it.

First it is very common to actually miss your co-workers a bit. After all these are the people whom you spent most of your days with for years and depending what you do in retirement you will have very little contact with them and suddenly a lot less in common if you retire early and they remain working.

Then there is the decompression stage where waking up each morning is like a vacation. Your end up drunk on the absolute freedom to do what you want. Many early retirees’ caution about making any series decisions at this stage since you are still evolving into your retirement lifestyle for the first six months to a year.

After that two main profiles of people tend to emerge. Type 1 tends to have issues adapting to retirement. They often can feel bored by it all and often have feelings of regret around their retirement. This type is much more common in those who were forced into a retirement by a company downsizing or medical reason.

Type 2 tends to take to retirement like a fish to water. They are happy and engaged in the community and/or their families and almost never feel bored or regret their decision to retire.

Strangely enough between these two types income doesn’t seem to be a huge factor. I’ve never really noticed a pattern of type 2 having more money than type 1. So what’s the difference? Type 2 people tend to have a wide range of interests and set themselves specific goals or focuses in retirement. In the end they just prepared to fill in that suddenly huge block of 40 hours (or more) of your week with other things to do than work.

If you end up being a type 1 don’t panic you can still turn into a type 2. I’ve personally seen someone pull this off. To change over you just have to sit back and develop some more interests and expand your hobbies a bit. Also setting a few goals or a focus to your retirement can help. Some examples include focuses in on the grandkids, learning a new language, visit family/friends around the world or even just in your own city/town. Most important of all is to do what you like. After all retirement is all about the freedom.

The Water War – Part I

As I mentioned a while back I’m currently updating some items in my house to see how much money I can save on my water bill. My average bill use to be about $50/month. Last month my bill came in at $43.48, so what changed? Nothing but my attitude and a few minor habits.

I basically just became aware of when I was using water in the day and trying to reduce that amount. So when brushing my teeth I fill up my rinse cup with 1/3 full of water and that’s all I use to brush my teeth. I also stopped running the water while washing my hands. I just fill the sink with a bit of water and then proceed to wash my hands and then let the water out. I’m down to perhaps two cups of water to wash my hands now. Then when washing the dishes I start with a small amount in the sink and during rinsing of objects I end up with a larger volume at the end to wash the big dirty pots and pans. I’m also letting my grass grow longer so it needs less frequent watering over the summer. That’s all I changed during that time.

I’ve also picked up a few new things just this last weekend so I will get to see the results on the next bill. I bought a few sink aerators to reduce the flow at my taps from 2.2 gal per minute to 1.7 gal per minute. These things are a good deal. I spend about $4 on the item and install it in two minutes with no tools. For the one tap I’ve put in I estimated it will save me $0.47/month just on my water bill. That doesn’t include the natural gas savings for using less hot water. So I will have a pay back period of around 8 months.

Another project I’m starting in the next week or two is making some rain barrels. I’ve picked up two 98L-garbage cans, which I’m going to convert over to rain barrels. I still need to pick up a few items to finish the project, but I’m hoping to be able to do it for about $50 for two barrels. I’ll let you know the final cost and how to build your own once I’m done.