5 min read
“You can’t connect the dots looking forward you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something: your gut, destiny, life, karma, whatever.”
Three months ago, I moved with a roommate into my first apartment. Nine months from now, our lease will be up, my roommate will be moving to a new city, and I’ll be faced with some very real and very tough decisions:
Do I stay in Cincinnati and keep my current job? Do I move elsewhere in the U.S. and get a new job? Do I abandon a traditional job altogether and focus on freelance work? Do I move somewhere overseas and attempt to be a digital nomad?
These are all possibilities for me. For the first time in my life, I have to admit that I don’t have a definite plan for the future. Yet, whether I like it or not, I have to make a decision once August 2018 rolls around.
Based on my current monthly savings, my net worth should cross the $100k threshold before August 2018, which will put me in a financially flexible situation.
I recognize that $100k isn’t enough for me to be financially independent. Yet, because I always plan on doing work that I find interesting, I don’t need to save up enough money to never work again. I’m not shooting for early retirement. I just need enough money from a combo of passive and active income to ensure that I don’t have to rely on a traditional 9-5 job for income.
Between my dividend income of $100 a month and blog income of $500 a month, I can cover about half of my typical monthly expenses of $1,200. Over the course of the next nine months, I expect to be able to cover nearly all of my monthly expenses through these two income streams.
Hypothetically, this means that I could quit my day job and survive just fine without a 9-5 paycheck. If I chose to move overseas, I could live even more cheaply in a place like Thailand. However, there are more factors to consider.
The Family Factor
If I planned on being single forever and living on $15k a year for the rest of my life, I wouldn’t even be facing this dilemma. I could just quit my 9-5 job and work for myself indefinitely without worrying about running out of money.
Unfortunately, there’s no guarantee that my expenses will remain so low. More than likely, I’ll have a wife and kids some day in the future, which could increase my annual expenses closer to $40k or higher.
My biggest fear is that I don’t save up enough money to live off a combination of passive income and freelance income to support a family and will one day need to go back to 9-5 work. That’s the main reason I am considering saving closer to $200k – $300k before leaving the 9-5 world.
Facing the Unknown
I realize I’m privileged as hell to even be faced with this decision and that it’s not actually a real “problem” at all.
The problem isn’t whether or not I want to work for myself or for a corporation; that decision is obvious. I would much rather work for myself and make a living from blogging and from freelance writing for other sites.
The problem is that I don’t know how much money I need to save to avoid working at a 9-5 ever again. This means that I don’t know long I should stick it out in Corporate America.
Another concern of mine is that I may dive head first into the “digital nomad” lifestyle and end up liking it less than I anticipated. Would I miss all my loved ones? Would I dislike being my own boss? Would I become unproductive with all of my free time? Would I come to realize that I prefer stability over wanderlust?
The only way I could possibly answer these questions is by actually quitting my job and attempting to work for myself.
There is No User’s Manual for This Situation
There doesn’t exist a user’s manual titled “What To Do Once You Save Up $100k by Age 24, You’re Single, You Want To Be Your Own Boss, You Don’t Know How Expensive a Family Will Be, and You’re Not Sure How Long to Stick It Out in a 9-5 Job”.
I might have to write that exact book ten years from now once I see how this situation plays out.
In the meantime, the only way for me to move forward is to follow my “gut, destiny, life, karma, or whatever,” as Steve Jobs said.
My gut is telling me to leave Corporate America in nine months and become my own boss. But that might be too soon. A better idea may be to keep my full time position and continue saving for a few more years.
“Follow Your Passion”
Growing up, I heard time and time again that the way to lead a good life is to simply “follow your passion.” However, the more I read, the more podcasts I listened to, and the more life experiences I had, the more I realized that this advice is dangerous.
I have realized that those who quit their day job too soon, without enough savings and without enough aptitude, often fall flat on their face in an attempt to “follow their passion.”
I recognize that it takes time to build up skills, experience, and savings in the bank to truly start working for yourself and to earn an income from your passion. I understand that earning money by working for yourself is considerably harder than most people think.
At the same time, I also realize that the flip side of the coin is equally dangerous. Sticking it out in a comfortable job because you’re scared of working for yourself and of potentially failing can lead to regret. I don’t want to spend too much of my one life on this earth in a 9-5 job that I feel no emotion towards just because I’m too timid to quit and see what else life has to offer.
There’s a fine line between being courageous enough to quit a job and being naive enough to think that you can survive just fine without a paycheck.
The fantasy dream of leaving my job and of becoming a digital nomad sounds great in theory. But I don’t want to be the person who strikes out on his own too soon and loses all of his money in 3 years, only to come crawling back to Corporate America to find work.
The Paradox of Choice
The fact that I will have choices on how to live my life in the near future is both a blessing and a curse. Up to this point in life, I haven’t actually had to decide what direction to go. I have always had a guide to follow.
From ages 0 to 5, my parents helped me figure out how to live.
From ages 5 to 18, primary and secondary school told me what classes to take and how to spend my time.
From ages 18 to 23, I had a college curriculum to follow.
For most people, there’s also a guide for adult life: get a starter home, buy a dog, get married, upgrade your car, buy a better home, get more stuff, climb the corporate ladder, and continue on with 9-5 life until you’re old enough to retire.
I, however, have already decided that’s not a path I want to go down. I want to live a life with less stuff and more freedom. It just so happens that this lifestyle choice is rare and that the only way to navigate through it is to figure things out as I go.
Nine months from now, I will have to make some tough decisions. That’s both scary and exciting to think about.
Once I do figure out my next steps forward, I’ll be sure to blog all about it. Until then, stay tuned…
Zach is the author behind Four Pillar Freedom, a blog that teaches you how to build wealth and gain freedom in life.
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.
Although the bulk of his net worth is invested in index funds, his favorite place to invest in individual stocks is M1 Finance, a site that allows you to build a custom portfolio of stocks for free.
His favorite way to save money each month on his recurring bills is by using Trim, a free financial app that negotiates lower cable, internet, and phone bills with any provider on your behalf.
His favorite micro-investing app is Acorns, a free financial app that takes just 5 minutes to set up and allows you to invest your spare change in a diversified portfolio.
His favorite place to find new personal finance articles to read is Collecting Wisdom, a site that collects the best personal finance articles floating around the web on a daily basis.
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