4 min read
There seems to be an unspoken rule in the F.I.R.E. (Financial Independence / Retire Early) community that once you quit your day job you’re not allowed to work anymore because that would mean you’re not truly financially independent or “retired”.
I’m not sure how this idea came to be, but I think it misses the entire point of F.I.R.E.
The whole reason people try to retire early or achieve financial independence is so they can live their best life possible without being weighed down by their finances. Whether or not this includes work of some kind shouldn’t make a difference.
Our Hatred for “Work”
In most cases, people either hate their day job or they feel ambivalent towards it, which is why the idea of “quitting your job and never working again” is so popular. The word “work” itself has a negative connotation. It makes us think of pointless meetings, long commutes, dumb corporate rules, boring projects, etc.
This is why the idea of financial independence is so popular and why so many people feel they need enough money saved up to never work again.
But I think these negative feelings towards work have made us forget that not all work is miserable. In fact, doing work we find meaningful can be one of the greatest joys in life. Doing the right work can make us smarter, tougher, and better. Getting really good at certain work can allow us to contribute something valuable to the world, which is also one of the best feelings we can experience as humans.
I believe there is a way to live your best life possible while incorporating work into your life. I’d like to throw some numbers out there to make you ponder the concept of working even part-time…
Working One Day a Week Can Be Worth $100,000
In college I used to work at a math tutoring center where tutors got paid $12 per hour. One of my coworkers was a guy in his 40’s who only worked on Saturday mornings. He told me he did it just because he loved math and helping students.
Each Saturday we would work a six-hour shift, which meant we earned about $60 after-tax. This guy worked every Saturday which meant he earned an extra $3,120 ($60 * 52 weeks) in income each year.
To put that in perspective, that’s the same as earning dividends from a $104,000 dividend stock portfolio with a 3% dividend yield. By working one day a week at a job he loved, he had the same spending power as a $100k portfolio.
Hypothetically, if he worked twice a week he could earn an extra $120 each week, which would be an extra $6,240 each year. That would be the same as receiving a 3% dividend yield from a $207,000 stock portfolio. It would take most people a decade to build up that type of portfolio.
There’s obviously some benefits to having the stock portfolio. The dividends would likely grow over time and it requires no active work. If this guy ever wanted to quit his weekend job, he’d earn $0. The portfolio, on the other hand, would just keep paying him his dividends each year.
It’s a game of trade-offs. The portfolio offers passive income but it could take years to build. The tutoring gig is easy and fun, but it only pays cash if you show up to do the work.
Get Paid for Work You Love
This example is just the tip of the iceberg. There are plenty of part-time, weekend, and freelance jobs that pay far more than $12 per hour.
When I tutor students in statistics I charge $50 per hour.
My dad dresses up as Santa each year and does local Christmas events each December to earn an extra $3k and he loves it.
My sister recently started dog-sitting through Rover and earns an extra $100-$200 each weekend and she also loves it.
There’s all types of side-hustle gigs out there that pay quite well.
In a recent interview I did with Financial Panther, I asked him how he finds time in the day for all his side hustles. His answer was genuis: he simply looks for ways to get paid doing things he’s already doing. He already spends time cleaning his house, so it made sense for him to rent out his spare bedroom on Airbnb. He loves animals so he gets paid to watch dogs at his own house.
What if we translate this idea to post-retirement: Do stuff you love, but get paid for it? That way it doesn’t even feel like work.
Do you love animals? Dog sit once a week. Twice a week. However much you want.
Do you know a foreign language? Tutor students at a local high school once a week after school. Tutor people via Skype on the weekends.
Do you know a lot about computers? Do some freelance consulting for companies three months out of the year.
Do you love gardening? Grow and sell your own vegetables at a local farmer’s market in the summer.
Options
Incorporating some type of work into your life can dramatically alter your financial plans for the future. Instead of enduring another decade of cubicle hell to reach financial independence, maybe stick it out for another two years, save a stack of cash, and do part-time work you love to cover your expenses.
By giving yourself the option of working even a little bit after “retirement” you can potentially quit your day job far sooner than you thought. Instead of spending three years saving an extra $100k you could just work once a week at a job you love.
The end goal of F.I.R.E. is to live a good life, not to avoid working entirely. If you are aiming for complete financial independence and never want to think about money again, by all means go for it. But just know there are other options.
Part-time, freelance, weekend, and seasonal work doing something you love could be the ticket to a happier retirement and a much closer F.I. date.
Zach is the author behind Four Pillar Freedom, a blog that teaches you how to build wealth and gain freedom in life.
He quit his day job as a data scientist in 2019 because he was able to earn enough income from profitable websites to replace his salary. He now teaches people how to start and grow their own profitable websites from scratch in the Income Community.
Zach's favorite free financial tool he's been using since 2015 to manage his net worth is Personal Capital. Each month he uses their free Investment Checkup tool and Retirement Planner to track his investments and ensure that he's on the fast track to financial freedom.
His favorite investment platform is M1 Finance, a site that allows him to build a custom portfolio of stocks for free, has no trading or maintenance fees, and even allows him to set up automated target-allocated investments.
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The thing I love about this is that it helps augment your withdrawals. If you hypothetically need $40k/yr and have a $1M nest egg, going by the 4% rule you’re good. But there’s a lot of controversy lately about people not feeling the 4% rule is sufficient for an early retiree – something like 3.75% or 3.5% would feel better
It can be as easy as earning an extra $5k/yr (which should be extremely doable for anyone doing part time/seasonal work) to drop that down to 3.5% and make most people’s worries subside. Plus, it gets you active and engaged with others, and if it’s something you love, it won’t feel like that much work!
You make an awesome point – the whole controversy over the 3% – 4% withdrawal rate can basically be eliminated if you’re just willing to earn an extra few thousand bucks a year. It’s actually pretty incredible how much a difference part-time work can make in the grand financial scheme of things.
Great post!
I was introduced to this idea from a retiree at my first job. Older man in his 70’s worked part time at a bakery only for the love of fresh bread and pastries. Being young in was hard to comprehend why work if you retired(with his hot-rod collection, he wasn’t in it for the money). Years later it all makes sense. Thank you of reminding me of this idea!
Thanks so much! That’s funny because I also used to think that way – why would anyone ever work more than they have to? It wasn’t until I realized that some work actually gives people energy rather than draining them, and that’s the best type of work to pursue.
Thanks for commenting 🙂
Yeah, I decided to eliminate the withdrawal rate question by doing some light consulting a couple of days a week after I quit my corporate job. So now my withdrawal rate is zero and I’m really enjoying the right amount of work for me. I’m paid kind of outrageously for my part time gigs because I know stuff that is in demand and most people can’t earn their entire cost of living doing what I’m doing but as you point out even a little bit extra is pretty huge in terms of quality of life, or it could be. In my case I’m just doing it for fun.
That’s awesome to hear, Steveark. Consulting can be a great way to earn good money without excessively long hours. It definitely helps to have knowledge in a niche topic that people are willing to pay you for – I’ve had a similar experience with being able to charge ridiculous money for statistics tutoring because very few people understand the field.
Interesting point Zach. We in the FI community tend to not care what other people think, so why would we care about what others in the community think of work after FI? Let’s support others to do what they love rather than nitpick over expectations.
Couldn’t agree more, Lady Dividend. I think there’s all kinds of hybrid active/passive income situations that can maximize happiness and the end goal shouldn’t be to stop working, but rather to ONLY do work you enjoy 🙂
Zach!
I just blindly clicked through the top links on Rockstar Finance and started reading without looking which blog I was on. And once I hit the line, ” In fact, doing work we find meaningful can be one of the greatest joys in life.” I immediately knew I was on 4PF! Kudos for developing a unique voice and style!
Also, I think you should link on the bottom the calculator you made for retiring but working part time. I think that would be a good addition to this post. (Or you can just link in reply to this comment lol)
Haha thanks so much, Ernie! It’s great to hear that you can recognize my writing style without knowing it’s me! And nice idea with the calc – here it is: https://fourpillarfreedom.com/four-visuals-volume-3-quit-your-day-job-calculator/
Cheers 🙂
Love the post. I already have a few sidehustles, but I’ve been meaning to start teaching guitar lessons. Most folks charge around $40 an hour or more and I would gladly teach for less, since I love playing and teaching. Another case of getting paid to what you love.
Teaching guitar lessons sounds like the perfect way to earn some extra cash while doing something you love. It probably wouldn’t even feel like work to you – and that’s the best type of work to pursue
For me, the FI is more important than the FIRE. As you said, reaching FI gives you the option to work or not. After you reach FI, life is a blank canvas for you to paint a picture of the life that you want. If you want to keep working, go for it. If not, follow another passion. You are free to decide.
I love that – “After you reach FI, life is a blank canvas for you to paint a picture of the life that you want”. I couldn’t agree more. Once we stop viewing work as inherently evil we open our eyes and see that some work can actually be a huge joy and happiness booster.
Nailed it!
If we are truly optimizing for most time that we control then having an FI date much closer is a huge win.
The calculator you put together really shows how powerful the concept of working part time can be. One can shave many years off their FI date by committing to at least some part time work.
In the Mofi’s view, establishing a way to have flexibility with your time as soon as possible offers massive upside optionality because the time can be spent with family and building businesses. Both activities are highly valuable uses of time to us and we are looking forward to living the dream!
Huge thanks to the entire community for helping to open our eyes to these wonderful possibilities!
I love that view – using free time to spend with family and build businesses. That’s essentially what life is all about. Relationships and meaningful work. Cheers to that lifestyle 🙂
I don’t think you are FI or RE if you are working for money you need to live on. However, not being FIRE does not mean you are not winning! If you can; quit a job you don’t like, work less, spend your time doing something you love and have enough financially, you WON!
Agreed! In fact, the true metric of success is happiness. You can have that with or without FI. In fact, you can be FI and also unhappy. The real goal to pursue is to work on YOUR terms, no matter what that work looks like. If you find satisfaction in a 9-5 job that’s perfectly fine. If you find that satisfaction in working for yourself, that’s great too. Once you conquer your finances you give yourself the option to choose a work situation you love.
Great stuff.
Every time I write something about the joy of work I get attacked by people in the FIRE community.
I’m FI but I love working. Please don’t hate me for that. I’m transitioning to part-time soon though. Each person who reaches FI should be able to decide how, whether, how much, and why to work. We could use more articles like this exploring this important decision and the financial implications.
If you do want to work part-time it allows you to reach a version of “FIRE” much quicker.
Thanks WealthyDoc! What’s interesting to me is that the type of people who can actually achieve FI quickly are often hard-working people by nature. So it only makes sense to work whether or not you’re FI. I agree with you – part-time work can help most people achieve a version of FIRE much quicker than they may think.
Thanks for the feedback 🙂
Great post.
Not to even mention the added health benefits of working. Keeping your mind sharp is super important once you decide to “retire.” Why do you think women live longer than men? Once we retire, women keep their minds sharp by being active in communities, and are socially minded indiviuals as opposed to men who would be perfectly fine sitting on a couch watching football every day.
Thank you for this!
Thanks, Cory! Completely agree with you – look at people like Charlie Munger, still working everyday past the age of 90 because he does work he LOVES and it keeps him sharp. Work can indeed make us better people. Thanks for your thoughts 🙂
Nice redirect with the math, Zach! My kind of guy. This post speaks to me as I’m a big proponent of cash flow, and this is a case study for keeping that steady stream of income in a down-shifted life.
I look forward to reading more on your blog going forward. Good stuff!
Thanks so much, Cubert! Cash flow is indeed the name of the game. A high net worth is great, but what you actually need is cash flow to cover your expenses. That’s when you’re financially free. Thanks for commenting and stay in touch!
Hey Zach
Great read, thanks for sharing. Couldn’t agree more, in order to do what you want in life and find purpose, having options is key. I’ve always loved to work (and will quite certainly continue to do so even after having reached FI) but I never wanted to RELY ON A JOB. A relatively high savings rate and a solid investment process put me into a position, where I am no more “at the mercy of somebody”. Just BEING ABLE TO QUIT a job if you’re not satisfied anymore to do something else you like more and not having to care too much how much you’re getting paid is tremendously liberating.
Cheers
I think that’s the end goal – not to stop working, but to be in a position where you don’t have to work to put food on the table. Just having the financial flexibility to quit a job can make that job much more enjoyable knowing you don’t need it to survive.
all these speak to a point i have been meaning to do as an article. BE NICE. i mean be decent towards the others at the dog park or the cafe that you frequent and the store where you buy your wine or beer or organic whatever. you ought to do it just because it’s the right and decent thing to do. also, if you’re living mostly local then take an interest in the lives of the people in the places you frequent. they know when you are genuine and it is much easier to find these little side work things if you’ve treated people well. and don’t forget to smile, grumps.
Couldn’t agree more! It always pays to be nice to those around you – you never know when you’ll need a favor or a helping hand from them. Aside from that, being nice is just the right thing to do.