If you are early on your journey like we are, I want to make the case that maybe the numbers don’t really matter right now.
Projecting is Harder Long-term
Just like the 10-day weather forecast is never right, the 10-year projections won’t be right either. I can tell you firsthand that projecting can be frustrating when you have so little in savings. Conservative estimates make early retirement look impossible.
Do you know why we chose $500,000 in 7 years? Because I could make the numbers work. Barely. And because anything more than that seemed impossible.
No one can predict the market. Maybe you want to be conservative and say 4% return after inflation, 6% return after inflation, or plan 10% returns! There’s not a “correct” answer. No one has any clue what will happen the next 10-20 years. Everyone is guessing. We could (and probably will) have another recession in that time period. No one knows when or how long it will last.
You Can’t Predict Your Future
Just like we can’t figure out returns to count on in making projections, we also can’t count on our numbers. When I slated out our numbers, I used exactly what Mr. T and I were making that year and how much we spent that year. Guess what? Mr. T makes a bit more now. I make about the same. We also have a few side hustles we didn’t have before. We also now spend more money than we did then. We travel more. My kids take more lessons.
Your life won’t look exactly like it does now in 10 years. Guaranteed. Nothing goes as planned. Hopefully, your life will actually look much better than it does now. Maybe you’ll be making more. Maybe you’ll be promoted. But maybe it looks better in that you left that job you hated and you now have a better work-life balance. Maybe that means your life is better but your numbers are worse. There’s no predicting.
What Can You Do?
Instead of focusing on projections, focus on what you can do today:
1. Focus on Savings
You know that in any projection, higher savings means less time until you hit your goals. You don’t need to know all the details of how much money equals how much time. Just focus on your progress. Can you save more this month than you did last month? Can you increase the amount pulled out of your paycheck for retirement? Every change will help your future.
2. Focus on Priorities
Have you assessed if your spending reflects your priorities lately? What spending happened this month that didn’t actually improve your life in any way? Is there a way to cut that spending next month?
3. Focus on living your “why”
What is the big reason you’re racing to early retirement? What exactly does that awesome life look like when you get there? Is there a way you can get closer to that now without completely thwarting your future?
4. Focus on the Plus Side
It’s so easy to think: “I wish I had discovered the path to early retirement sooner” or “I wish I had more saved so I could just snowball to early retirement in just a few years.” This thinking is harmful. You (and I) are at the beginning of our journeys. The plus side of this is that we already know it’s a long road ahead. Maybe it will come faster than we think, but we’re already putting our future selves in a great position. Instead of killing ourselves over the next couple of years, we can make sure things are set and forgotten and enjoy that “rest on a moving sidewalk” I talk about so often.