Freedom 45

The Toronto Star newspaper is running an excellent series called "Freedom 45." Each article highlights thoughts by Tim Stobbs, a young father who plans on retiring at the age of 45. He is also tracking his dream on his blog. I'm not sure why I clicked onto this piece in the first place; generally I only have time to scan the headlines before something (or someone) at home is calling me. But I did click on this article, and am I ever glad I did.

First of all, his profile. No, he is not a big-wage earning, investing-savvy, trust fund-baby man. In fact, they aren't even a double-income family. He earns less than $80,000 a year, and his wife is at home raising their children. He invests his money in a few different areas, but even this part isn't lost in the dark unknown of investing; James and I actually have our money invested in the exact same way.

Which puts the thought in my mind: could we be retired by 45?

I think Tim Stobbs philosophy about money is spot on. Every money decision is put under the spotlight of this question: will I still be glad I spent this money if I think about it next week? If the answer is yes, he spends it. If the answer is no, he doesn't. He doesn't deprive himself of living now so that he can retire sooner. But he spends the money he does have wisely. He saves where he can, and splurges when he'd like to treat himself or his family.

Vacation? Yes - lots of camping. To this I would also add last minute vacations, which can be a steal if you know your prices. Dining out? No - but they do "dining in" - a four-course meal with friends where everyone brings a fancy course to share with the other guests, which cuts the dining cost by 75%. RESP? You bet. But the plan is to help pay for a portion of higher education. He expects his children to also contribute, so they have a greater appreciation of the experience. RRSP? That's the ticket. His ideas on how much you will require are a huge part of the success of his plan.

And what are his plans once he does hit 45? Well, they aren't just about lounging about doing nothing. He has many goals and dreams he wants to accomplish without being tied to the daily grind of a job. This is the focus of his entire plan. He has a vision of his future and is actively working now to achieve it.

At any rate, I highly recommend the article. I am certainly going to be looking over my money plans a little more closely, thinking about what my long-term goals are, and coming up with ways to make those dreams a reality.