By Brenda W Hargroves
Joe Hodowanes, Tampa-based career strategy adviser, defines ‘the right life’ as “a life where you feel more like yourself, where you’re doing what you want to do – not what people tell you to do – when you recognize that you were given a gift when you came to this planet and that your job is to discover that gift, develop it, and raise it to the point where you can give it back.”
Wow! That sounds like the life for me. Waking each morning feeling as if I can accomplish the day’s activities in a comfortable, relaxed manner and support myself doing something I enjoy. The point about recognizing and developing my gift, and then using that gift to give back makes it even more worthwhile.
The process of reaching ‘the right life’ clearly requires a maturation period. Most people do not begin with a lifetime career that meets those standards, nor do they necessarily find themselves in the position to give back. Let’s assume middle-age is the point where a person is likely to have reached living ‘the right life’ status. Therefore, ages ranging between 40 and 55 might ensure having attained this plateau.
So, how do you achieve this state of bliss before you are too old to enjoy it? Like mastering any other task, you must have a plan. In this case, a long-range plan. Let’s first take a look at financial considerations.
Begin an automated system of saving
My mantra with regard to saving is “Do what you can, with what you have, where you are.” Start saving as soon as possible! Take an amount, no matter how small, from all of your earnings and start a savings account. Be consistent about paying yourself something every time you get paid and depositing those funds into your savings. Ideally, you should arrange automatic deposits into your account. You don’t see the money and, therefore, don’t think about it. Well, hopefully, don’t think about it often. The point is that a consistent method of saving will generally allow you to accumulate more than sporadic deposits.
I started saving at an early age. I was fortunate to attend a public elementary school in New York City that allowed students to open savings accounts. We could bring in our quarters, dimes and occasional dollar bills, along with a completed deposit slip and the money would be credited to our account. I know I’m dating myself! But I think it would be a good idea to reinstate this benefit so children can learn the value of saving at an early age.
Make your money work for you
Once you’ve saved a certain amount, place a portion into an account with a higher interest rate, preferably one that offers compound interest. Continue making deposits into your original savings and transferring funds into the higher interest account. The increased deposits into your second account will earn higher amounts of compound interest. As these funds accumulate you can then investigate more sophisticated investments and other financial resources to put your money to work.
If offered, take advantage of employee 401(k) or pension plans. If not, make it a practice to deposit expected or unexpected windfalls into your savings. For example, save a portion of your annual tax return. At some point you may sell your home or business, receive an inheritance or even hit the lottery. Whenever you acquire a lump sum of money, make sure you save some portion. And if you don’t have an immediate need for the funds, save all of it.
I have had many jobs over the years and never participated in a 401(k) or pension plan; however, I made a profit the sale of two houses I owned. In addition, I started, and later sold, a business. These three transactions allowed me to accumulate a principal amount to invest for retirement. So, in essence, I created my own pension plan.
Conclusion
Following the steps above will hopefully lead to developing savings habits that work for you. It did for me. I worked full-time in the corporate world and as an entrepreneur until age 43. Since my semi-retirement I have held several part-time jobs and consulting positions. I became interested in the nonprofit field and served as the Executive Director of a small volunteer organization. I moved to Florida knowing few people other than family and had zero job prospects. Careful financial planning allowed me to investigate employment opportunities without having to worry about covering my living expenses.
See my next post if you want more discussion about ‘the right life.’
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