How much money is “enough” is a critical concept when it comes to reaching financial independence. The concept of enough is that once you have reached a certain level of wealth (or truly passive income, as they’re essentially interchangeable), having more wealth doesn’t actually lead to any increased happiness. In fact, in many situations, more leads to decreased happiness.
Mo’ money, mo’ problems.
- More to worry about losing.
- More to protect from lawsuits.
- More to worry about paying taxes on.
- More estate planning tasks to do.
There is no specific dollar amount that represents enough for everyone. For some, it could be a low six-figure amount, while for many it will be a seven-figure amount. It might even be an eight-figure amount for a few. [If this is the first time you’ve heard of this concept and you have no idea how much money might be “enough” for you, multiply what you spent last year by 25 and that’ll get you into the right neighborhood.]
The Crisis of Early Financial Independence
Katie and I have been fortunate to have reached “enough” relatively early in life. This has all been very exciting, of course, to watch our income and wealth grow, but it is also at times terrifying. In some ways, it has provoked an existential crisis as we try to figure out what to do with the rest of our lives now that we are freed from the need to exchange our time and life energy for money. If, as Jonathan Clements has stated, acquiring a nest egg sufficient to support you the rest of your life is your most important financial goal, what comes next?
We fully recognize that this is a dilemma that many of our readers, as fortunate as their financial situations may be, do not currently face. Some do, of course, but only a small percentage. No matter your station, there will always be somebody with more wealth and income than you and somebody with less. However, it is a dilemma that we hope and fully expect each of our readers will face eventually, so we thought it was worth addressing.
Even if you are nowhere near financial independence, or even are still struggling with paying off the credit cards, hopefully, there is something in this post you can use. Like with everything on this blog (and every other source of financial information out there), take what you find useful and leave the rest.
Today, I’m going to discuss a few things to consider when you get beyond enough. This is relatively new territory for me, so I wouldn’t be surprised if my views on the subject change over time, but I think I’ve learned a few items worth sharing.
6 Tips For Those Who Have Enough
I've written about life Beyond Enough before on The Physician on FIRE website, but it is something I spend more and more time thinking about as the years go by.
# 1 Dealing with Guilt
Katie and I worked hard to become educated, make good financial decisions, grow a business, and help as many people as we could. But we didn’t work as hard as what we’ve been blessed with. By no objective measure can we claim to deserve this level of financial success.
I recently had the opportunity to discuss my grandfather’s life with my mother. She was one of twelve children raised on a 200-acre farm in Eastern Utah that was purchased about the time of her birth. (Prior to that point, this grandfather, like my other grandfather, was a miner.) There was a one-bedroom house on the farm. The girls got the bedroom (3-4 in the bed), my grandparents slept in the front room (there were only two rooms total in the house), and the boys slept in the barn. They primarily ate bread along with potatoes, carrots, and onions raised in the large garden. The farm grew wheat, barley, and hay and there were 15-20 cows to milk each day and about 200 sheep. Nearly the entire production of the farm was consumed by the family. The only “cash crops” were the cream from the milk and the wool from the sheep.
In addition, starting when my mother was young, my grandfather took a job pumping gas at the service station all night. He would return from work, sleep for a few hours, farm for a few hours during the heat of the day, sleep a few more hours, and go back to work. Needless to say, the children had to take care of most of the farm chores. My grandfather busted his butt for his entire life just to keep food on the table.
By contrast, I was 43 when I wrote this post (45 now), never have to work again, and can afford to buy just about anything my heart desires. Given technological change, my privilege, wealth, opportunity, and health are beyond that of the vast majority of kings that have ever lived on this planet. Do I feel a little guilty about that? You betcha. This is not uncommon for the wealthy and something you have likely had to deal with in the past or will have to in the future. Here’s my take: There is nothing wrong with having wealth and privilege, so long as you use it to better the lives of those around you. As Uncle Ben said, “With great power comes great responsibility.” In fact, I have no doubt that my grandfather INTENDED for me (and my 80+ cousins) to enjoy a more privileged life than he led. That was why he went to war in the 1940s and why he worked so hard after he came home.
# 2 Spend a Little
From time to time, Katie and I have very deliberately increased our lifestyle. We have intentionally spent more money on clothing, food, shelter, vacations, and even “stuff.” The fun thing about having “enough” is that anything above and beyond that amount can be safely squandered in any way you choose without it affecting the fact that you have enough. Yes, boosting your spending on an ongoing basis has the nasty side effect of increasing how much “enough” is, but within reason, that’s okay. And one time expenditures are exactly that. Good luck trying to tell “ongoing expenses” apart from “one time expenditures,” by the way. That’s a dilemma I never considered before but frequently think about now.
Bear in mind what the literature on happiness says — the best way to “buy” happiness is to have shared experiences with people you care about. Limit how much “stuff” you buy, make sure that which you do is of high quality, and remember that everything you own owns a little piece of you. Also, as you recklessly consume loosen the purse strings, be sure you remember what you are consuming. While you have enough money to buy/do what you want, remember that every product or service you consume has effects on the rest of the planet and every species on it. In many ways, the resources of the planet are more limited than yours! “Fix it up, wear it out, make it do, or do without” is more than a method to build wealth, it’s a prescription for improving sustainability.
Enough was sitting right beside me, but the Norwegian Fjord in front was pretty spectacular too.
# 3 Continue to Invest
Despite having “enough” we’re still saving and investing. There are really four categories of what we’re doing with our money. Currently, the smallest category of what we do with our money is to spend it. The next smallest category is to give money away. We’re proud to give away more than we spend each year. This includes money given to charities, money given to family (primarily 529s for nieces/nephews), and The White Coat Investor Scholarship.
The third category? Taxes. While the 2018 tax code changes helped a little, over 30% of our income still goes to support our national, state, and local governments and is spent as directed by our elected officials.
But the largest category? It’s still our savings. Why are we still saving so much? I guess part of it is habit. But there’s more to it. I think some of it is just boosting things up a bit. Having a little more than enough provides us a little extra financial security. Some of it is “rounding out” our investments. For example, we’ve met the original goals we had for money to give to our children for college and their 20s. But we bumped those goals up a bit because we could, so we’re still putting some money there. Some of that savings also provide us a tax break and a little extra asset protection, and that’s nice too.
If our spending continues to rise, as it has throughout our adult lives, we may also need a little more than what we now think is enough. So saving more allows us to increase spending. I’ve been impressed by our ability to spend more and more over the years without feeling like we’re wasting it, so additional savings adds a bit of a fudge factor in there. For sure a big chunk of this additional savings is going to end up being given away eventually, whether to heirs or charity. But would those heirs and charities be better off being given this money now or being given more money after we’ve invested it for a few more decades? I don’t claim to be Warren Buffett, but I’ve discovered that I’m a whole lot better at investing money than the vast majority of those on the planet, and that certainly includes my kids! But we still expect to give away more and more each year if our income stays anywhere near where it is now. Maybe at some point, it will eclipse our savings and our tax bill.
# 4 Give Money Away
Beyond enough, your focus should turn more and more to the needs of others. This includes your financial focus. Another cruise probably isn’t going to make you any happier. But the $10K you could spend on it can buy an awful lot of Meals on Wheels. It could pay the nurse practitioner’s salary in the homeless clinic for a month. At 20 patients a day, that could be 400 medical encounters you paid for. You could vaccinate or feed hundreds in the developing world. Prefer to teach a man to fish rather than give him a fish? You could pay for a year’s worth of college tuition with that $10K, and that’s in the crazy-expensive US education system.
I’ve written about charity many times before, but beyond enough, more and more of your income should be going toward it. Given the thousands of charities in this world, there must be at least one whose mission you agree with. You can't take it with you. Hearses don't have trailer hitches. You're giving it away eventually, you might as well give it while you can enjoy seeing the benefits of the gift.
# 5 Use Your Time Wisely
You now have minimal limitations on your financial resources. But you only have a limited amount of time, and perhaps a lot less than you think. This has all kinds of implications on your day to day decisions. When possible, exchange time for money. Maybe that means hiring a lawn care service or a housekeeper. Maybe it means Ubering instead of taking the subway. Maybe you hire an investment manager, even after a lifetime of do-it-yourself investing. Some expenditures may even extend your life – preventive, diagnostic, and therapeutic health care, medications, good food, a gym membership, a safer car, a less polluted city.
Just as you should use your money to better humanity and the planet, so you should use your time. We’re not just talking about volunteer work here. When you are no longer working for money, I would recommend you make sure your work meets these three criteria, no matter what it pays:
- Give you something to do. Boredom and lack of structure have killed more retirees than cancer. Want to be happy? Retire TO something, not FROM something.
- Allow you to make a difference in the world. Define this however you like, but purposeful work is critical when its main purpose is no longer to trade your time for money.
- Provide a challenge. Routine, easy, mindless work might seem attractive as a teenager, but most of those reading these words have since learned that a job without challenge rapidly loses its joy. That challenge might be making more money or creating jobs for other people, which is fine. But make sure there is something there that will keep you learning and growing.
It is said that if you want to motivate white-collar employees, you need to make sure they can have mastery, autonomy, and purpose. That goes for you too.
# 6 Take Care of Your Health
Since you are no longer working for money, there is no reason to be a slave to your job. Turn down the stuff you don’t want to do. If the bad stuff outweighs the good and it can’t be adjusted, quit. No reason to be working 80 hours a week. You now have time to find the perfect balance of productivity, recreation, and rest. Consider the recommendation of Brigham Young for the balanced day: 8 hours work, 8 hours play, 8 hours sleep.
“Life is best enjoyed when time periods are evenly divided between labour, sleep and recreation. All men, women, and children should labour; all must sleep; and if mental and physical balance is to be maintained, all people should spend one-third of their time in recreation which is rebuilding, voluntary activity—never idleness. Eight hours work, eight hours sleep, and eight hours recreation.”
That would seem to indicate no more than a 56 hour work week, but most will find that they have enough non-paid productive work to do that they don’t need to spend more than 20-30 hours a week to get what they’re looking for out of a job they don’t need the money from. Exercise more. Who says you can’t be in the best shape of your life in your 40s or 50s? Eat better. Lose weight. Sleep more. Destress. See a therapist. Travel. Increase your spirituality. Rekindle relationships with family and friends. Build new ones. Find that balance that eluded you when you had to work for money. One wonderful thing that financial independence did for me was to give me dramatically fewer URIs (colds). Not sure how much is due to working less (and less exposure to sick people) vs a stronger immune system from not staying up all night and constantly rotating shifts (what I attribute most of it to.)
Wrapping it Up
I hope these tips are helpful. I wrote them as much for me as for you. As I noted above, this is new territory for us, and we’re figuring it out as we go along. My hope is for each of you to have the opportunity to wrestle with these issues and find your own path.
What do you think? What will you do when you have enough? How much is enough for you? If you’ve been beyond enough for a long time, what tips do you have for those of us who have found ourselves in this position more recently? Comment below!
Great post!! I am almost there but already employing the above strategies of (attempting) to limit my workweek to 56 hours and work on my health. Love your perspective, and I know that continuing to invest will get me to 25X in a few more years.
“Hearses don’t have trailer hitches” has got to be my favorite line from this outstanding post (I really hope that you get back to publishing your content on this site more regularly, your writing style is phenomenal and what was a big inspiration for me to start my blog).
Loosening the purse strings after so long of investing/savings can be tough, but for me I do see myself doing that at this stage. It is indeed the experiences you share with others that make life worth living.
Investing in your health now will pay dividends later. What is the point of having a 7 figure nest egg if your body won’t allow you to enjoy it? Everyone ages, but some age more gracefully than others and it is those that have taken care of themselves when younger (no smoking, healthy eating, exercise) that have the best chance to really enjoy their golden years.
Great post Jim, and agree re: “hearses don’t have trailer hitches.”
I know you know, but we’re all grateful that you earned this and helped us in the process!
Cindy and I are shaking our heads at this comment because I publish two posts a week written all by me and have for literally years. Every Monday and Friday is me writing. So we have no idea what you mean by “I really hope you get back to publishing your content on this site more regularly.” Can you explain?
I Thought the same thing when I read this post. I have been a reader since the very beginning when my husband was in medical school. We are just about to finish residency now. I used to attribute bad grades in medical school to your blog… But, this felt more like good solid advice of the “original” White Coat. Some of the other posts feel like something is being sold to me. That being said. The post was perfect and has already been bookmarked with our other favorites.
I just went through the recent blog posts and they all have high quality, useful content. Not sure why anyone would feel differently.
https://www.whitecoatinvestor.com/classic-blog/?tab=latest#latest
Thanks for the valuable feedback. Can you list out a few posts that felt too salesy to you?
Great post, I would switch it around and put health as the number one thing to do. What good is anything if your body falls apart because you’re not taking care of it? Our modern sedentary lifestyles are pushing us in the unhealthy direction everyday, and it takes a constant fight to push against it. Having enough gives you the time to do that. I’m financially independent, only work part-time, and I’m in the best shape of my life in my late 40s. My intention is to continue getting in better shape even in my early 50s. I have the time to work at it
Best blog from you so far! By a mile . Ageee with you 100%. Thank you!
Thanks for your kind words.
Honestly, this is good advice even once you have a plan in place that you realize is going to get you to financial independence really early. Sometimes, people stress so much over their financial situation and achieving their goals, they forget to live a little bit.
Obviously, for most physicians and high-income earners who have a major spending problem, living a little bit isn’t the problem… but for those that have been bitten by the bug that is financial independence, they can swing the frugality pendulum a little too far!
And the “hearses don’t have trailer hitches” is great. I always tell my kids (if they seem to be struggling with materialism), that they “don’t get to take that [toy, doll, etc] with [them] when they die.” There are more important things in life – like loving our friends, family, neighbors, and even our enemies.
Thanks for a reminder of some of the big picture items in life.
TPP
Really insightful post from a youngster. I think many docs get so busy with the day to day of running a practice they do not realize they have crossed the “enough” finish line. Enough means different things to different people. Realizing that I had enough at your age allowed me to take my foot off the accelerator and start going home earlier and sharing call with more people.
That’s very nice of you to refer to me as a youngster. It makes the new gray hairs every morning hurt a little less.
If grey hairs hurt, I have a chronic pain issue
I have just celebrated the 5 year anniversary of being white coat and stethoscope free. When I walked away, it was definitely FROM something and without a definitive TO anything- freedom, less stress and responsibilities – those are all defined by the absence of something.
I suspect that this notion/rule of needing “something to retire to” is very much like the famous 70% replacement of income to retire rule of thumb- not really widely applicable to all people. Most high income earners spend far less than 70% of their income. At lower incomes, 70% might be applicable. You can’t apply a simple rule for all retirees.
In the same vein, I believe most high earning medical professionals, unlike those engaged in mentally less rigorous professional activities, have the intellectual curiosity and habits that will drive them to find that “SOMETHING to retire to” needed in retirement, whether they know what it is when they retire or not. I certainly have had no problem finding things to engage me everyday, and I doubt I am extraordinary or unusually gifted in this regard. One of my favorite weekly activities now is something I never considered or even heard about until I was over a year into retirement. (It involves volunteer tutoring)
So I would definitely say, do not let uncertainty about what you are retiring to force you to tolerate a job you wish to escape from. You can figure it out.
I agree that it isn’t absolutely required to have that thing to do before retiring, but having it does eliminate the risk that you don’t find it which is a real problem for many people.
From my experience (and from other
Early Retirees from whom I have heard) one of the amazing things that happens in retirement is that what you think will interest you in retirement before you retire often changes after you retire.
When I retired I was advised to avoid committing to anything for at least six months. Let yourself get used to the new you. I found this sound advice.
I think it’s important to have a reason for getting out of bed in the morning and having a passion for something. In my case, I developed a passion for reading, specifically books on ancient and classical history and religion.
This was such a great post to read on a Friday morning. Thank you so much for everything; the work and time you put into this site, your insight/perspective, charitable contributions, your ethics and morals. I with that more people felt and lived like you. With the focus many have on working, money, consumerism and personal concerns, it’s so important to be able to see the bigger picture and what we can contribute to the world, even when it does not directly benefit us.
I enjoyed this post immensely! You have a bright mind, a mature perspective and a wonderful writing style. My husband and I reached financial independence at age 58 and 59. I agree with all of your comments about retiring to something. We have found great joy in serving in our community, our church and our family. I truly believe happiness comes from shared experiences. It is hard to flip the switch from saving your whole life and accumulating to spending a little. However, I would much prefer that problem to the other of spending too much and saving too little. Life is precious and every decision we make has consequences. Those who take care of their health, finances, relationships and spiritual well being have more to share and give. It is a recipe for a happy and full life. Thank you for all of your time and insights that you give to all of us!
This was good enough for me to print a copy to save permanently. Very mature and reasoned advice.
That’s a great compliment to give a blogger.
Thank you so much for writing this wonderful article. My husband and I reached financial independence at age 58/59. It is often hard to flip the switch from accumulating to spending a little. However, I would prefer the problem of saving too much to saving too little. We have found great joy in spending time with our family, serving in our church and community. I admire your ethics, insights, and mature perspective on what is truly important in life. You are inspiring, intelligent, and a wonderful writer. My son-in-law who is a doctor told me about your website! I believe when we take care of our health, finances, relationships and spiritual well-being we have more to give to others. Thank you for sharing your wisdom with all of us. I tell everyone I can about your website and book when I have the opportunity.
Timely post – that again – serendipitously I checked on somehow through promotions tab?
Eitherway, I am there already at 35! I never thought I’d be FI and more this early. I mean I just started full time attending level work 3 years ago. This decision is even harder for me; should I give up medical career that I enjoy (if I do that I can double my income – easy; I’m sure you can relate), or continue and grow slowly? Or should I call it enough? Then I’d be bored. Just this year, I gained more skills “out there” than anytime in the past. My increasing focus is now family, volunteering, and physical activity/challenge. Travel more ? (Young kids, hard to do).
Its the best of times. Its the worst of times.
Add me to your contact list and hopefully they’ll come to your inbox instead of promotions.
Pretty impressively short period from finishing training to FI. Way faster than me. This post is for you though for sure.
We need more writing about this topic. I love it.
I graduated from Dave Ramsey’s 7 baby steps and then what? You are on your own.
FI has allowed me to be flexible at work, volunteer more, give more and support my family by being present.
Outstanding.
I can identify with more or less everything you said and my weaknesses really stand out when reading this. I’m doing well on the investing and giving front. I could do a better job allowing myself more recreation and guilt-free spending. I could stand to work less, too. Much of the time I’ve gained by practicing medicine less has been consumed by my online presence.
Thank you for the reminders.
-PoF
Are you saying it is hard to be internet famous?
No, it’s hard to be an anesthesiologist.
It’s time-consuming to be “internet famous.”
Excellent post! I feel the hardest part of addressing “enough” is humankind’s tendency to assess their wealth relative to their desired social sphere, rather than in absolute terms. The Chris Rock quote, sited in the below linked post, perhaps says it best, “If Bill Gates woke up with Oprah’s money he’d jump out the window.”
https://www.collaborativefund.com/blog/the-spectrum-of-financial-dependence-and-independence/
Morgan Housel’s above linked post, The Spectrum of Financial Dependence and Independence, is an interesting categorization of the stages of financial security and may be worth discussion. Personally, I would eliminate Level 15, as basic decency requires a degree of concern for others and society may find ways to punish even the wealthiest sociopath.
Love the quote. Also love Housel’s writing. Embarrassed that mine still isn’t as good as his.
Not a doc here. Went through my taxes, for the last 11 years I worked, I averaged $3K/year. One year was an outlier, I made $17K. For those here, I’m sure this is unbelievable. BTAIM, I struggle with #1, dealing with the guilt.
Incredible that I will have those around me serving my needs till the day I die. You’re right, Kings could not dream of living one day as we do.
BIL is a doctor. Almost 60, saves, but doesn’t think he has enough to retire. He plans on working till 62 or even 65.
Dr. Dahle: As a fellow emergency physician who has had “enough” for quite a while, your post was one of the best I’ve come across and felt it was speaking directly to me. Although we are not your largest audience on this site, there are a lot of doctors and other professionals in the “pre-retirement” phase that after years of busting it, saving, investing, and sacrificing have reached financial independence. It brings on a number of new issues that don’t always have straightforward answers.
For me particularly, the transition between working in the “accumulation phase” for so long, and now transitioning to the “distribution phase” has been very difficult psychologically for me to adjust to. I realize it’s a great problem to have and I feel a number of us agonize endlessly over minute details that are really not that important in the grand scheme of things. I have been working part-time for the last 2 years and really enjoy working just for the ability to help others, educate future practitioners, stay in the game, and be able to utilize my accumulated knowledge and experience. Thanks for the reminder about what’s important for those of us who have “enough” or “more than enough.”
– Dr. Scott
I agree there is a lot of agonizing over minute details that probably don’t matter much in people approaching retirement, even and perhaps especially those who have enough.
The Myth of Steady Retirement Spending, and Why Reality May Cost Less
“Financial advisers have a few ways of describing the decline in retirement spending over time. One of the most popular, coined by the certified financial planner Michael K. Stein, is to view retirement as three stages: your Go-Go years, your Slow-Go years and, finally, your No-Go years.”
https://www.nytimes.com/2018/11/29/business/retirement/retirement-spending-calculators.html
“CAN I RETIRE” by Mike Piper-fast easy read
To me, enough meant doing some things I was putting off. I used to say “working gets in the way of all the stuff I want to do.” I don’t have to say that anymore.
Dr. Cory S. Fawcett
Prescription for Financial Success
Your Money or Your Life is the seminal work for the financial Independence crowd. So much of what our community thinks about seems to have origins her her book. Enough, time/money trade-off, oit impact on the planet and of giving/sharing our wealth. She tells the story if these ideas so well and you reflected a lot of those ideas here.
I think this book changed my life just as this website did.
Excellent post WCI. We have been grappling with all of the issues you describe. The guilt hit us long before FI since we have been financially very fortunate. This despite it openly being a goal from my parents that we would be so.
The biggest eye-opener for me was from observing my patients. About 15-20% of mine don’t survive (I am an ICU doc – not just a really bad doc). One, I was seeing more my age – so the balance of spending now vs delayed gratification changed for me. Fortunately, upfront saving had made that ok. Second, the most functional families would reflect on the support and great memories shared. In contrast, those who focused on their professional achievements or importance were usually the most dysfunctional. The most important thing we can spend is time and not money. Third, a year later, I bet very few think much about the important people I have seen pass away. But their families do. The most important people to spend our time on are those we want to remember us.
Key to the above is building good financial health plus pausing to recalibrate. Thanks for your site which is helping docs do both.
-LD
Live rich, die poor.
Great post.
Unfortunately, the only way to be in the best shape of your life in your 40’s and 50’s is to have been in lousy shape in your 20’s and 30’s. Many out of shape 25 year olds could run a very fit, for age, 45 year into the ground. The goal should be to get and stay as fit as your age permits. Don’t worry that you cannot do a 50 what you could do at 20. If you can, then you were a mess at 20.
You mean like people who were working 80 hour weeks and eating hospital food all day in their 20s and 30s?
Statistically, hospitals are among the top killers of people. Avoidance of hospitalization is one of the best incentives for a healthy lifestyle.
Amen!
I think that statement is a bit unfair. Most of those “killed by hospitals” weren’t exactly in great shape on their way in. That said, avoiding unnecessary hospitalization is wise not only due to that risk, but also due to the very high cost, even with insurance.
Dr. Michael Greger has spoken about the high unnecessary mortality involved with hospitalization. He ranks hospitalization among the leading causes of death, citing 100,000+ deaths alone, annually, from adverse drug reactions.
My mother’s cardiologist is grossly overweight. When I drive past the local hospital, employees can be seen huddled and smoking.
What? People eat too much and smoke? Even those who work in health care?
I do remember being surprised finding out some of my medical school classmates were smokers. They must have been a bit ashamed about it as they went to great lengths to hide it.
Talking to yourself “out loud” in this raw heartfelt post is just the right kind of intimate honesty we need to share with our world to make it a better place. Your struggles are our struggles Jim. In sharing your journey as it is happening with the world you display the humble courage in vulnerability that personifies leadership at its highest level. I’ll say my friend, as I have been honored to have meet and share a meal with you, you underestimate the true maturity, beauty, and power of your writing. You weave marvelous tales of fact, opinion, wit, and metaphor. You are right! Hearses don’t have trailers, as they shouldn’t!:). Insight into your family’s past is so telling to your present, but it still can’t predict the future! Thank you for that. My favorite part of the post was the quiet picture of “Enough” with you and Katie breathing in the beauty of a moment of bliss in the glory of a spectacular landscape. You might consider framing that moment in time and physically putting it somewhere close to the hearth in your home. And I quote you: “Enough was sitting right beside me, but the Norwegian Fjord in front was pretty spectacular too.” I look forward to what comes next and when next our paths will cross, but for now this post rocks and belongs in some blog of fame.
Thanks for your kind words.