Leaving Money on The Table

This is a guest post by Martin, who is preparing for retirement within the next 5 years; no later than his 40th birthday.  He is married, has 2 young children and lives and works in rural Alberta as a regional finance manager for a large energy company. (As a reminder here was his last post)

Like most similar-minded readers of this blog, unconventional early retirement is possible for me because I respect money.  I work as hard and smart as I can to earn it and am diligent in making sure that I add real value to my life when I spend it.  Being an accountant only compounds the analysis and dissection that I place on my finances.  This obsessive, objective approach has revealed a point of concern in executing my retirement plan.

My financial mind is having a hard time dealing with the thought of leaving money on the table.

When I philosophize about it, it is clear to me that I do not want to work a day longer than I have to.  However, when I get into the details of determining how much do I need to retire, I keep reasoning that if I work an extra couple of years beyond what I need, I’ll add enough money to (a) provide a larger inheritance to my children, (b) not have to be so diligent about spending in the future and be able to afford the odd frivolous expenditure *gasp*, (c) buy a little cottage on a lake up north, or (d) <insert any of the reasons/excuses I’ve come up with add just a little more to my nest egg before retiring>.

I think my hang-up is derived from the notion that I haven’t yet been paid back in my career for the sacrifice it took to get where I am today.  For those with experience in the corporate world,  I’m just starting to bump up against the threshold where employees go from from being underpaid to overpaid commensurate to their qualifications and experience.  The objective financial quadrant of my mind is urging me to hang on for a few more years to correctly compensate me for the years spent being underpaid.

Has anyone else gone through this idea that you owe it to yourself to hang on a few more years to validate the effort it took to get there?  Any ideas on how to shake this idea and just walk away when the numbers are right?

11 thoughts on “Leaving Money on The Table”

  1. I would have no problem walking away if the numbers are right, but I find it tricky to decide when the numbers are right. It’s hard to decide how conservative to be in assumptions about future investing returns, future inflation, and my future cash needs (e.g., health case costs). Depending on my mood, my analyses have me working anywhere from 0 to 10 more years.

  2. It’s a bit of a well-known fact that most people believe they are about 20% short. You could have a much easier life if you made 20% more money, or had 20% more saved in the bank, or had a house that was 20% bigger, etc. These are rationalized in whatever way is convenient.

    I’m a bit like you. I could probably retire today but I’m not because I’m fearful. We’re having a new baby, my wife doesn’t work and I made good money from my job. It’s fairly ridiculous because we have enough saved to last indefinitely, plus we have plenty of money-making side projects. My deadline is also 40, so I’m rationalizing holding on until then (3 years), but I have to admit to myself that I don’t really need to.

  3. Leaving a larger inheiritance is, arguably, a poor use of money. If you have excess funds earmarked for the children, it should go to the children now instead of 40 or 50 years in the future.

    If you have desires that need to be fulfilled, then go ahead and earn the money. Certainly no one will listen when you tell people later that you didn’t take the opportunity to strive for a goal.

  4. I am going through the same thing right now… that carrot of X extra dollars padding my account are tempting me to work longer than I planned in my current career. I have not yet resolved this fear that I will regret leaving too early…

  5. I know what you mean. I’m not working, and I know that if I did return to work, I could afford whatever I wanted: bigger house, second car, leisure activities, etc. (not all at once). But then I’d have to recommit to the 9-to-5 grind, fight rush hour, take orders from a superior, and probably wear a suit. That’s what keeps me from working longer. You could probably take a couple months off, or switch to half-time, and then see if the extra dollars are still worth the extra pressures. I think that tradeoff depends on your job and your own preferences.

  6. As long as we are comfortable and happy, objectives and targets can be slightly adjusted! 🙂

  7. It’s so interesting that you are an accountant too. I was also and I the majority of readers I get emails from that have retired early are accountants. A combination of good training and exhausting work I think.

    Anyway, I was always planning on retiring at 45, but at 44 the numbers combined with my attitude about work screamed to me that the time was NOW.

    My advice is just to keep doing what you’re doing, planning and saving for your early retirement, and then just keep working until it screams at you that the time is NOW. Don’t lock yourself into the date, just be ready for the call. You’ll know when the time is right.

  8. P.S. Just another tidbit, being an accountant, the opportunities will probably present themselves to you in your retirement to consult or work a little part-time (I picked up one of these gigs after 3 years of retirement.) When I’m tired of it I’ll just let it go. The extra money is a nice cushion, but not necessary (pays for a little nicer travel.) So it’s not really an all-or-nothing decision.

  9. I had / have the same problem Martin. I just set myself a threshold of “enough” money to be made in a year. The low end is $25k (investments have covered that thus far) and the high end is $50k. I just have to accept that I don’t really NEED more than that to have a pretty great life that I’m happy with since that’s about what I lived on when I was saving. Yeah, I could pull another couple of years at $150-$200k or more but why? The jobs that pay that are high stress and, more importantly, when taken up by someone with high conscientiousness, require 60+ hours a week. Personally, I was “fortunate” enough to have a health scare that I feel was caused by overwork. It really has been a gift that it happened because it puts your priorities straight pretty quickly.

    My suggestion is to watch the movie Click with Adam Sandler. Like the Angel of Death (played by Christopher Walken) says in that – the leprechaun was chasing the pot of gold – and all it was was a bowl of cornflakes.

  10. It is interesting how your attitude changes about things. I’m almost 60… dreamed of a cottage (a retreat)…retired (until something I want to do comes along)…and not planning on living forever (don’t want to go through erosion process–lack of mobility, pain, suffering, dependency, etc. You come to a place were you say to yourself, you have accomplished what you were meant to accomplish. What now? Sure, you have the financial resources to travel (but you have traveled, and leaving home just doesn’t have the excitement it use too). You could buy a cottage (but who needs another property to look after). Finally, you begin to see your friends developing health issues, and some are dying off, and you begin to see that fate is going to award you the same future. Money won’t buy you more time. The priorities of 20, 30, or 40 years ago are no longer relevant, because you begin to realize that the time you have taken to pursue these is long gone, and you are left with a collection of memories. The moments you begin to cherish are those when you can share those memories with others, especially friends and family. Somehow that is what is important now….not “doing” stuff…just “being”…and hopefully finding a little peace and serenity each day. Money doesn’t buy you that…that is the great myth. People with little money often value people over things. When you realize this, then you are awakened to the truth about the value of “love” of neighbor. In them you find the truth of Aristole — “Man is a social animal”. He needs little to exist, except human contact.

  11. Ian: excellent insight…thanks for reminding me that happens. I best keep working on gathering more memories and remembering to just ‘be’ at times.


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