By Dr. James M. Dahle, WCI Founder
6 months after I started blogging, back in December 2011, I penned a post titled 14 Reasons Why You Shouldn't Retire Early. The point of the post was to demonstrate that early retirement had its costs, and many people, even people who are very smart with their money, will reasonably decide that the cost of early retirement is not worth the sacrifice.
Fast forward 2-5 years and the FIRE (Financial Independence, Retire Early) movement became somewhat mainstream, with many people taking it to its logical extreme: that all of the tools of personal finance and investing should be directed at the goal of quitting an onerous job and perhaps even paid work completely just as soon as possible. I started blogging before the existence of thousands of FIRE bloggers out there telling their story, calculating their net worth each month, and encouraging you to reuse your paper towels and wash your ziploc baggies so you could quit work 45 minutes earlier.
But retiring early was always an option. Just like changing jobs to one you liked better, going part-time, buying that dream house, vacationing in the nicest resorts, enjoying a less stressful life, or driving a Tesla was always an option. The point was that YOU could decide your own financial goals and aim as many of the guns of personal finance and investing as you desired at those goals.
I've never been a FIRE-maniac. I'm a firm believer in Seth Godin's philosophy:
Instead of wondering when your next vacation is, maybe you should set up a life you don't need to escape from.
That could be reworded to:
Instead of trying to retire ASAP, maybe you should find a job you don't want to quit.
Or the Mark Twain classic:
Find a job you enjoy doing, and you will never have to work a day in your life.
I still believe that. I wasn't sure if I believed it in 2011. You can't really be sure if you will retire early until you are financially independent, but now that I am and I'm working harder than ever, I've convinced myself that work will likely always be a meaningful part of my life. That doesn't mean I don't play and travel and do all kinds of fun things. But I've taken enough vacations and trips in recent years to realize that there is an upper limit for me on how often I actually want to play.
Fast forward to 2020. That 14 Reasons Why You Shouldn't Retire Early was republished at The Physician on FIRE. Jill, our content manager, sent it over to Leif as part of our Saturday WCI Network Series, not knowing the history of this article as I did. You see, this article was the one that pissed Leif off so much that it caused him to start The Physician on FIRE when he read it. So he dutifully republished it, but not without extensive rebuttal and a new title:
14 Reasons Why the White Coat Investor Doesn’t Want You to Retire Early
Now I'm a big fan of clickbait. If nobody ever clicks on your title, they never read your stuff, you never help anyone, and you never make any money. But that title isn't even close to accurate. I'm completely agnostic as to whether YOU retire early or not. I want you to set your financial goals and achieve them. If one of those goals is early retirement, then go for it.
Actually, I'm not COMPLETELY agnostic to early retirement. I want there to be some doctors left to take care of me when I get old and sick. But as far as the few of you who will ever actually acquire the financial skills, discipline, and desire to punch out of medicine in your 40s or 50s, knock yourself out. Lest I be accused again of being anti-FIRE, I guess it's time to point out the rather obvious benefits of retiring early. So after that lengthy introduction, here we go:
14 Reasons to Retire Early
Before we get too far, we must define the terms, both retire and early. Now I don't want to be the Internet Retirement Police, but without working definitions for our words it's impossible to have a conversation. So for our purposes today, let's define retirement:
- Leaving the practice of medicine or dentistry or your chosen profession whatever it might be.
- If you continue to bring in earned income, it should be less than 1/4 of what you were making before. Otherwise, I think it's probably more appropriate to call that “job change” than “retirement.” Don't worry Leif, I'm not going to make you retitle your blog as Physician on FIJC. We all know your plan wasn't to become a financially successful blogger. You were just too good at it, unfortunately.
- Now, let's define “early” as before age 60. (All the FIRE bloggers just snorted milk out their nose, but honestly, that's what most of the world considers early retirement and very few docs will ever retire before entering their 50s.)
#1 You Don't Have to Go To Work
I told you this list was obvious. But I still think we should start here. Even for those of us who love our jobs, it can still be a drag to get up early and go into the office, clinic, or hospital. There are still some parts of that job that you don't like. Maybe at the end of the day you're still glad you went, but if you retire early you don't have to even tolerate the few bad things you don't like. They're just….gone. If you ask the Physician on FIRE why he FIREd, it basically came down to the fact that he liked his Saturdays more than his Mondays. When you're retired, every day is a Saturday.
#2 You Can Spend Your Time Doing What You Want
Work takes up a large part of your useful time. Think about it. There are 24 x 7 = 168 hours in the week. Even surgical residents average 6 hours of sleep a night, and most people want one or two more. So let's subtract 8*7 =56 from that 168. That leaves us 112 hours. You're likely going to spend something like 2 hours a day preparing food and eating, so now we're down to 96 hours. Maybe add on another half hour for grooming a day, leaving us with 92 1/2 hours. We all have chores of some kind, whether they involve cleaning a house, repairing stuff, buying stuff, or taking care of the finances. Maybe that's another 4 1/2 hours a week. Add in 5 hours of commuting and that leaves us 83 hours. There is some debate over how much doctors work (some studies say as much as 59.6 hours on average) but that number is clearly above 40. Let's call it 50, just to be conservative. 50/83 = 60% of your useful time going to your job. How would you like to have 150% more time to do whatever you want? Obvious benefit.
#3 No Commute
We mentioned the time involved in commuting above under # 2. But I don't think that's quite enough focus there. You see, if you are like most people, there is NOTHING in your life that makes you as miserable as your commute does. If you are retired, you can live where ever you want and still not have a commute. The WCI Podcast will help, but even it cannot make up completely for a terrible commute.
#4 No EMR
Some of you have never practiced medicine without an Electronic Medical Record (EMR.) So perhaps you can't even relate. But if you talk to doctors in their 50s, 60s, and 70s, dealing with an EMR is a major reason they cite in leaving medicine. I was able to enjoy four years of practicing without an EMR while I was in the military. (Air Force emergency departments were exempt from AHLTA at the time because leadership correctly understood that we literally could not see all the patients they wanted us to see if we were charting in that most terrible of EMRs.) Imagine, if you will, writing a single handwritten paragraph about each patient before moving on to the next one. Crazy I know, but that's what happens when the need to bill and the need to CYA goes away. I know EMRs have some benefits, but if you retire, you'll never have to log in to one again.
#5 No Call
Here's another part of medicine that a lot of doctors would love to see go away. I hated being on call so much as a medical student that it had some impact on my choosing a specialty that was never on call. Show me a mid-career doctor who likes being on call and I'll show you the pathway to El Dorado.
#6 No Malpractice Liability
Who likes getting sued? Nobody as far as I can tell. Most doctors will be sued at least once during their career. They are extraordinarily unlikely to ever lose any personal assets from that lawsuit, but it still wastes a lot of time lying awake at night and defending yourself. The earlier you retire the more likely you are never to be sued at all.
#7 Watch Your Kids Grow Up
All of us think we're there for our kids. I'm not retired, but I'm only at the hospital half as much as I used to be. I'm amazed how much better I know my kids and how much more time I can spend with them both in their daily routines and on trips. I don't think it's hard to argue that you will be with them more if you retire early.
#8 No Regrets About Trips Not Taken
I don't have any regrets about trips not taken. In fact, I turned down a trip to Vietnam last year because I was “tripped out.” (See what I did there?) But ask a few doctors what they would do if they retired some time. Almost universally they will tell you that they would like to travel more. Guess what? If you retire early you can travel more. Captain Obvious to the rescue!
#9 More Time to Volunteer
I think volunteering gets glorified a little too much sometimes. It's a bit like the travel thing. We all think we'd like to do tons of volunteer work, whether medical in a homeless clinic or overseas, or non-medical. I suspect most people do a lot less than they think they'll do. But if you would like to prove me wrong, retire early and volunteer to your heart's content!
#10 An Encore Career
Instead of volunteering, perhaps you just want a different job. Maybe you want to write, blog, go to law school, be a financial advisor, or guide clients down a river. Who knows? But if you retire from medicine you can move on to that other career.
#11 Better Health
There are two aspects to this one. First, if you retire you have more time to take care of yourself. You can actually go to your own medical appointments. You have less stress. You have more time to eat well and exercise more.
The second aspect is that you have more time while your health is good. We all know someone who had these great plans for their retirement but when they arrived at their mid-60s they discovered their health (or that of their partner) didn't allow them to do all of those activities they had wanted to do. There are some activities that are just a lot easier to do in your 40s and 50s than your 70s and 80s. It isn't that there are no 75-year-olds out there skiing, but most of them aren't.
#12 Less Infectious Disease Exposure
The recent pandemic has brought this home for many of us. Health care workers are something like 32X as likely to catch coronavirus. But I noticed this long before then. When I cut back on shifts and especially when I quit staying up all night, that nasty cold I'd get 3 or 4 times a year became an annual event, and only lasted half as long. Don't like being sick? You'll be sick less if you don't spend so much time with all those sick people.
#13 No Toxic Coworkers or Bosses
Many of you work with or for some real jerks. As physicians and dentists lose more and more control over their practices, this has become a bigger and bigger problem. Lots of early retirees say they miss their co-workers. But they're not talking about all of them.
#14 No Worrying About Finances
A prerequisite for RE is FI. In the CoronaBear a lot of doctors not only lost a big chunk of their assets, but also a big chunk of their income. When you FIRE appropriately (i.e. with enough assets), you stop worrying about money. At all. It's not so much the act of retiring that does it, as working toward that goal. But it is a nice benefit.
What do you think? What other reasons to retire early are there? Comment below!