Recipe for a happy retirement (2014 edition)

Impromptu intimate concert at our RV site

One of our many serendipitous social encounters; an impromptu concert at our RV site this week!

Hard to believe it has been 2 years since I last updated my recipe for a happy retirement. And 2 years before that I had the original post. Every 2 years seems like a nice interval to revisit my thoughts in this area. We are now getting close to completing 5 years on the road living in our RV and 9 years since we left the daily 9-5 grind and started on this great new life adventure. It’s been an amazing adventure that continues to improve. I can’t recommend it enough.

I’ll also add that in the past 2 years we have met many couples and individuals that are making the same lifestyle choices Nina and I have made without being ‘retired’. That word has less and less meaning these days for many including us. These people work on the road and have found ways to have mobile or seasonal sources of income and to keep their costs of living low. I truly admire these folk and having listened to many of their stories I often think we should have done this sooner. OK, but this post is about my thoughts on retirement so let’s get to it.

Below I reproduced the original recipe for a happy retirement post, along with my comments from 2012 and have then added my most recent observations for 2014.

I’ve come up with four areas that I think every retiree needs to think about and have a plan for;

1. Financial – this one is the most obvious. You can’t retire unless you have the financial means to do so. It may just be social security, or a pension. It could be 100% savings. What I think is important is to have a plan that you can mark your progress against. And more importantly a plan that is flexible, that takes account some big what-ifs. This is one major reason I think retirees get ‘scared’ back into the workforce and in the worst case have no choice but going back to work. This is one of the major reasons I started this blog – to help people with this part of their retirement.

[2012]I now recommend that that ‘plan’ I mentioned should be the IVY timing portfolio or timing the Permanent Portfolio for the majority of retirees (see my latest post on the subject here). The standard retirement models, e.g. 60/40 stocks bonds, are not the best solution in particular during retirement when you’re in withdrawal mode, not wealth building mode, and capital preservation is key. For those so inclined I think its possible to do even better with a dividend/income approach I outline here, although right now I outright trade equities versus options.

[2014] This has been the biggest change since 2012.  I have personally gone almost exclusively to quantitative investing methods (I still do some active bond management). That includes the different versions of the IVY portfolios. My latest update on all the portfolios I track is here. I personally now use the GTAA aggressive portfolios. I also use several of the quantitative stock portfolios I’ve discussed in the last year on the blog. I do no manual stock picking or trading anymore. What I have found is that even if you are one of the less than 5% of individuals who has the behavioral capacity to be a very active investor it is simply not worth the investment in time and emotional ups and downs. The bang for the buck is simply not there. I’d rather be doing something else. The majority of investors can’t even stick with simple buy and hold strategies.

As far as progress to a successful retirement, things have gone pretty well over the last 9 years since I first started withdrawing from my retirement portfolio. I will do a detailed analysis at the end of next year for the 10 year mark but so far my CWR is below my SWR when I started and the total portfolio value is higher as well. The RV life has been a big contributor to this outcome as it allows us to be very flexible in retirement spending and keep our costs down as well.

2. Social – work provides a lot of the social interactions we have in our lives. Many people’s friends are made through the workplace. When you retire you lose this unless you retire at the same time as your friends and in the same area. If you retire early most of your friends are still working. Without these social connections you can easily get bored, lonely, etc… Faced with a loss of these social connections you need to actively work at this in retirement. Do you join a social club? a golf club? volunteer for certain organizations? How are you going to fulfill this part of your life? This was a huge loss for my grandfather who was the social center of his small immigrant community. He has not been the same since. In our full-time RV lifestyle this has been our biggest challenge. We’re still working on it.

[2012] Well, all I can say is challenge conquered! Full-time RV’ing has turned out to be maybe the most social thing we have ever done. Our social life is a lot more full than it ever was while we were both working. And because of this new found socialness we are enjoying our lives even more. Many of our new connections have come from Nina’s RV blog, our volunteer experiences, serendipitous meetings at campgrounds, and even social media. So, I would even put more emphasis on the importance of having social connections in retirement. Not too long ago Nina posted about this unexpected surprise for us.

[2014] And the party continues! We’re even more social now than 2 years ago. We have formed some amazing friendships on the road and continue to do so. These relationships and interactions vary from brief visits and happy hours over campfires to week long rendezvous or caravans to spend quality time together. Now we even have to be careful not to have too much socializing. I still need to give my introverted side some alone time every once in a while.

3. Mental – work usually provides much of the mental/intellectual stimulation we get in our daily lives. What do you do when this goes away? Do you have a hobby to keep your mind active? Just relaxing, watching TV or surfing the internet is probably not going to be enough. Even if your work was very physical, and not mental, what do you do as you age and your ability to engage in physical activities goes away? Often this can be combined with #2. There are many ways to fulfill this need like volunteering and in today’s tech world many remote possibilities enabled by the internet. For me, my interest in investing fulfills this role. And I try to parlay this intellectual interest into helping me with my social and financial areas. On-line forums, blogs, social networks all help in this regard. I have seen many retirees struggle in this area. They find it hard to engage in new areas. It takes courage to leap into new things and a lot of experimentation.

[2012] Only a couple of things I would add here. As an astute blog reader pointed out in my first post, sometimes you need to de-program before you can start enjoying retirement. Societal programming is a very powerful force and sometimes you need time to adapt to a slower more leisurely pace of life. Then you can start taking up new hobbies, or old ones, to keep that old nogging rocking. Investing still fulfills this role for me, even more so than 2 years ago. One thing that helped me was to go completely cold turkey from TV news, talking heads, etc…and that goes for most financial news media especially CNBC. Unlug, you’ll be happier. Surprisingly, technology has helped me stay informed, yet unplugged. My iPad, blogs, and twitter have been a huge boon in this regard.

[2014] Well, 9 years after leaving the 9-5 grind and 5 years on the road I can confidently say that I am fully de-programmed. I guess the only change for me here has been that the move to more quantitative investing has given me more time to do other things like cook more, do more long term investment research and macro-economics study (yes, I like these things), read more literature, etc…All good.

4. Physical/Health – I think being physically active helps in all areas of life but it certainly does impact your health. Also, in this age of expensive health care and insurance it is a key aspect of retirement especially as one ages. The healthier you are the less financial impact it will have on your retirement. The healthier you are the more you can do in retirement. So, I think its critical to have at least one physical activity/hobby that you love and engage in all the time. For my wife and I, its is hiking. We hike/walk 3-6 miles a day with our dog, without fail. We also are active in yoga, we run a bit, and do some strength training. Nutrition is a also big part of this for us.

[2012] No changed here except maybe I think its even more important than I first thought. I would also add to beware of conventional wisdom in particular standard medical, pharmaceutical treatments and nutritional advice. My wife and I are happy and healthier than ever following primal/paleo lifestyle for the last 4 years.

[2014] It’s just as important now as it was 2 years ago and it’s a big part of our life.

Retirement is not unlike any major transition in life. It takes time, patience, flexibility, and a little bit of effort. Pour all ingredients into a bowl, add an optimistic bright frame of mind and you have yourself a recipe for a happy and fulfilling retirement.

Full Disclaimer - Nothing on this site should ever be considered advice, research or the invitation to buy or sell securities. These are my personal opinions only.

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22 Responses to Recipe for a happy retirement (2014 edition)

  1. Pingback: Fired Up For Fresnel -> The Lens That Changed The World Of Light | Wheeling It

  2. Ingrid says:

    Hubby and I are focused on physical health more than ever before so we can enjoy this lifestyle to its fullest for a long time. A healthy Paleo diet has also become the norm for us. Great post 🙂

  3. Janna Clark says:

    Awesome post Paul!! Thank you!

  4. It may not be a “guy” thing, but I would like your thoughts on the “emotional” impact of retirement. How does it feel to be retired? Do you experience more or less of any feelings than when you worked 8-5 other than happy? Can you separate those feelings from the changes from just getting older?

    • libertatemamo says:

      Alice, during the transition from the full-time 9-5 to retirement I definitely went through a few emotions. Don’t know if they were just a guy thing, I think some of them were, but it was definitely an adjustment. At times I felt loss of a sense of purpose, feelings of ‘uselessness’ or ‘what the heck am I going to do now…’, and also fear – fear that this would be a failed experiment. I even told Nina after a few months that I wanted to go back…. I have found that this transition seems to be more difficult for men than it is for women.

      But I gave myself the time to adapt. Like any major life change it took some adapting and getting used to this new way of living. That’s when I started thinking about the few key things that would make a big difference to a happy, successful retirement. Then after about a year, it all started to click, and its been great and getting better ever since. Now, I’m generally in a state of utter happiness.

      I like to tell people, it’s not all roses and unicorns. I still have the normal vicissitudes of human emotions. There are still bad days. I still wonder sometimes what I’m doing with my life. But, most of the time, yeah it is all roses and unicorns…. 🙂


  5. TakeTo TheHighway says:

    A very timely post, considering I am one week in to “retired life.” You and Nina have been and continue to be great role models!

    • libertatemamo says:

      That’s great Suzanne. I’m very happy and excited for you. Looking forward to seeing you again soon.


  6. michaelmullin says:

    Paul, by the end of your post I was struck with the thought that almost all of that is perfect advice for anyone – not just retirees. Thanks for sharing!

    • libertatemamo says:

      Very true Michael. And work tends to squeeze out the other items and we lose our life balance, often for many years, often until it is too late. I wish more people would realize this.


  7. Mark Borseth says:

    Paul, I’ve been following you and Nina for sometime now and really enjoy your posts on the lifestyle and your thoughts on the financial approach during retirement. Still need to take the time to really dig into the details of the IVY model.

    We started our full-time adventure in July and hope to have the chance to meet you guys somewhere down the road.


  8. rex51 says:

    Reblogged this on And that was how it went. and commented:
    Always good to have a receipe and this one makes sense to me…

  9. Great post , I was wondering if you had a list of the 5 or 10
    most interesting books you have read since retirement .

    • libertatemamo says:

      Wow! Tough question Chris. I read a lot, 3-4 books a week, so that is a tall order. Any book in general or specifically on retirement, or investing???


  10. I would say 4 books on investing that have influenced you the most ,and one on life in general . Thanks again !

    • libertatemamo says:

      Chris, a while back I posted three lists of recommended investment books. See here. There’s a beginners list, intermediate, and advanced. I would now add, What Works On Wall Street as near the top of my list but you need a good base to really understand that book. On the economics front the book that has most influenced my thinking has been Debunking Economics by Steve Keen.

      As for life in general, I would have to say Paul Terhorst’s book Cashing in on the American dream opened my eyes to the possibility of exiting the rat race early and pursuing the life I’m leading now. It’s quite outdated, especially on the investment side, but a good story.


  11. Hi Paul and Nina,
    Just reading your blog and past articles on Investing.

    I just mentioned to Paul that my wife and I rented a cozy apt in Eugene this past month. After 13 years traveling and working in different parts of the world, I am experiencing a difficult time settling down to the same place for months on end. My wife loves it since we lived here for 30 years before leaving for the Middle East to work. Lots of friends and community. But…I gotta say, the past seven years of full-timing have been great. I found my tribe on the road, she prefers a comfy, warm abode in one place now. Ok…she’s 75 and no longer a spring chicken, so “Happy Wife, Happy Life” applies here. As for me…I’m counting the days until we leave again for parts unknown. Part of the reverse transition process in retirement.

    One thing I’ll add to observations about retirement: our monthly costs just went up 30% by moving into an apartment. Would have been similar for a condo or house except for the down payments. RVing is definitely the way to go for a simple, active, less expensive lifestyle. Our monthly expenses went from $2000 a month to $3000. One of the considerations to ponder before settling back down in the other world.

  12. Robert says:

    Some really sound here Paul. I’ve been retired from my career for 5 years now, but still work part time when I like to supplement my bad Travel Bug! Fitness & Health is our number 1 priority now and something that every healthy retired person should focus on to live happy and healthy for years to come. Even a 1 hour walk a day, will keep the doctor away!

    • says:

      Thanks Robert. Totally agree on the fitness and health aspect of retirement. One of the things I love about having a dog is that it forces me outside to walk/run/hike for “her sake”.


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