How time flies! Reflections on a two-year milestone

Two years ago today I drove to work and walked into my office for the last time. Shortly thereafter, I briefly met with someone in HR, turned in my company ID and laptop, and exited the building, no longer an employee. I’d performed this routine a number of times before at other companies, but this was the first time I’d done so with no new job lined up. I was unemployed – forever, perhaps, leaving my 23-year biotech career behind. This was indeed intentional, as I’d achieved my financial independence (FI) target a year prior, and was now “retiring” early (RE) – starting the next phase of my life. I had no idea what was going to come next but I was really excited about it!

One more year?

As I recently wrote all about, I’ve done a lot in the two years since that day. Taking inventory of what I’ve tried, learned, accomplished, and enjoyed, was a really valuable exercise. I’ve certainly felt busy very often, and looking at that list after writing it reinforced to me why that was the case! This time I’ve had, while often strange, has been incredibly valuable to me. As we recently discussed on an as-yet unaired episode of Two Side of FI, I wouldn’t trade anything for all that I’ve gained by deciding to take this path.

In that conversation, my show partner and great friend Eric asked me a question posed by one of our viewers:

“Knowing what you know now, would you have worked an extra 1-2 years that would allow you to build up additional buffer, such that some of the tougher decisions you’re making now (and stress that goes along with it) would be less of an issue or not at all.”

The spirit of the question was financial in nature, but I spoke to it more broadly. I’ve not yet watched the video recording, so I don’t know precisely how I answered. But I certainly recall the spirit of it as it’s easy: absolutely not. Sure, by continuing to work and banking another year of savings, mathematically one can only feel more secure. In doing so, you’d have more funds in your portfolio, additional cash reserves, etc. Perhaps you could use some of that money to buy something fun for yourself – maybe an RV, like so many retirees enjoy. That’s certainly a possibility too. However, that would have meant trading away my experiences over the last two years. And I’m unwilling to do that.

731 days of learning

Sure, I know what some may be thinking: trips could have been put off to a future date, coursework could have been undertaken at another time, and so on. But many if not most things would surely be different as a result. We can’t merely “cut and paste” the chapters of our lives as if we were writing a document in Microsoft Word. How can I look at the experiences I’ve enjoyed, time with family and friends, the memories I’ve made, and say “sure, if I could rewind the clock I’d do it all differently”, and elect to work another year or two? It’s unfathomable to me.

I’m so incredibly thankful for the experiences I’ve had and the memories I’ve made over these past two years. I’ve learned much along the way, most of it about myself. This time to reflect, and I believe, grow – greatly concentrated due to COVID-19 lockdowns and a lot of time spent at home, has been priceless. All retirees surely must go through this period of introspection and searching given the magnitude and suddenness of this life change. I don’t mean to say that I’m special in this way. Rather, I’m merely noting how much I have valued this time that I’ve had to think hard about my nearly 49 years on this planet, my successes, failures, and everything in between. Not to say that I have it all worked out – far from it! I’m merely getting started, I think, but every journey begins somewhere.

I’ve done and learned a lot in these past two years. In some ways it was very much as expected, but there have been so many more ways in which I was surprised (more on that here). I’m truly enjoying this opportunity to explore new interests, to learn, and grow. If I knew a genie, I wouldn’t choose to change my path to this day. I am truly grateful for the experiences I have had, and for this time with my family. I feel very fortunate and am thankful for all that I have. Here’s to whatever the next two years brings!

I wish you all the best in all things. Thanks for being with me on this journey. 🙏

Optionality: An Amazing Superpower

Most people are familiar with the old adage “Fortune favors the bold”. Apparently this phrase goes back more than 2000 years, and is one common translation of a Latin proverb. A great related quip is “Fortune favors the prepared mind”. But I think we can do even better than that one, so here is yet a third gem of similar vintage:

“Luck is what happens when preparation meets opportunity”

-Lucius Annaeus Seneca the Younger (Seneca)

I absolutely love this quote because it says a lot in very few words. In my writing, I’ve acknowledged the role that good fortune plays in the success of many – including myself. We all understand the idea of “good timing”, right? But to succeed, you must be sufficiently prepared to take advantage of the situation when it arises. This element is often under-appreciated in my experience.

Today while hiking I got thinking about the related concept of optionality. This term comes up often on Two Sides of FI, most recently in an episode about market volatility. My show partner Eric and I love optionality. That is, whenever you can take decisions that enable you to have more options down the road, this is invariably a good thing. On my hike, I thought about all the times where I’d done things that enabled optionality and how that worked out for me. Here I’ll share just two of the disparate ideas which came to mind.

Building breadth is a powerful enabler of career optionality

While not explicitly described as enabling optionality, this idea came up several times in my previous Keys to Success series. This wasn’t initially a deliberate strategy on my part – I’m not so clever. But after a few jobs I realized the power that came from broadening my skills + experiences. On reflection, I understood how in each successive company and role, I was learning new technologies, developing new management skills, and understanding new industries. Each of those added new tools to my arsenal which in combination, could be leveraged to advance me in my future roles. They gave me more options!

One example of this was in a pivotal role in my career which I’ve written about before. In this case, I was offered a job which on paper I wasn’t even qualified for: running a customer support organization. I had never worked in nor led such a group before! Sure, I knew the technology area, had a solid scientific background, and had managed teams before. Why would they take such a chance? Were they just desperate?

My new boss confided to me a year later that it was my broad base of experience that got me the job. He’d hired me because with my diverse background, he’d determined I had the skills both for the job at hand and also provided the company options for how to use me for future, not yet identified needs. He was impressed that I’d had such broad experience and success in a variety of different roles. In his mind, that meant he was bringing optionality in the company. Over time this idea played out, as I moved through several different roles in the company. This was a turning point in my career, and I carried this important lesson learned into the roles that followed.

Optionality is essential for financial + mental health

In the Two Sides of FI show linked above, Eric and I talked about the merit of a fixed income allocation in your portfolio. That is, having sufficient assets that aren’t stock-based, such as bonds and cash. The latter are viewed by many (particularly younger) investors as unattractive, boring, or even “bad” ideas – even for those nearing retirement or who have already retired. While incorrect, their thoughts are understandable, since the only market many of them know is the past >10 years of a bull run. Cash (ugh, inflation!) and bonds look pretty boring compared to a booming stock portfolio.

Needless to say, as soon as the market started dropping, those comments fell off quickly. Why? Well, at least partly because those people are too busy freaking out about their net worth plummeting to comment on our videos. I like to think still others are acknowledging what we already know: along with a risk-appropriate asset allocation, having financial optionality is essential. This is particularly important for those who are already drawing down their assets, because they are no longer earning income from a job, and don’t want to run out of money. What do I mean by that?

Having an appropriate cash position means that you can fund your lifestyle without having to sell assets you don’t want to sell. Why wouldn’t you want to sell them? If the market is down, you’d have to sell more shares of stock or a mutual fund to generate the same cash vs. when it’s up. This is inefficient and effectively “locks in a loss” in a down market. Similarly, you’d rather refill those cash reserves by selling bonds, which would be expected to hold value better in a downturn vs. stock.

Having financial optionality is essential, because you don’t need to take actions you don’t want to take. You have choices because you’re prepared for contingencies. But wait – in a good year, won’t my portfolio return be lower than one 100% in stocks? Absolutely! But I don’t care, because I need to have appropriate options in place during a downturn, like now. I’m sleeping fine despite all this churn because I have optionality on my side.

There are a whole host of areas in which I feel optionality is incredibly valuable. I suspect with a little thought, anyone reading this could identify at least several ways in which they’ve benefitted from it. If optionality is not something you’ve deliberately thought about much to date, I’d recommend it. Leverage this superpower for yourself!

image credit: Alexander Schimmeck on Unsplash

WAIT, what? Did I get a…job?

In the sage words of Douglas Adams, one of my favorite authors: “Don’t Panic!” I have not reversed my decision to leave full time employment and my biotech career as part of my FIRE journey. In fact, what I’m writing about here is nothing of the sort. But it is true that this week I accepted a part-time role at a small business in my town. But I thought I retired early! What the heck am I doing and why? Read on to learn more!

OK what is going on here?

In short, I signed on to pour wine one day a week at a great boutique winery tasting room in my town. How did this happen? A friend from our neighborhood mentioned that she wanted us to meet this other couple in our neighborhood. She said we should stop by their tasting room downtown and say hi to the wife, who was working there – which we did. First, it was really nice to meet another neighbor! My wife Lorri, and I had a really great chat with her. Second, the wines were wonderful! We were off to a good start for sure.

Over the course of the conversation (which included talking about FIRE, yes!) we learned that our neighbor was pretty new to working at the tasting room, as it had only recently re-opened post-COVID restrictions easing in our area. I mentioned that I’d been considering picking up a shift at a tasting room, myself. Coincidentally, they were looking to hire someone one day a week. I decided to express my interest and she was pleased to hear of it! After exchanging text messages with her and another owner later that day, it was off to the races! I had my new hire training yesterday evening and this afternoon I will work my very first shift at the tasting room!

I thought the goal was to “retire” from work? What gives?

In agreeing to take on this role, I’ve thought about the “why” of this new and exciting development. I’m sure you’d like some answers as well! Yes, I can hear you already: Haven’t I been enjoying the freedom to spend my time as I see fit? Doesn’t picking up a scheduled task sound like it would be in opposition to that? Am I just trading time for (a small amount of) money – i.e. decidedly not passive income? I thought the goal was to be free from the shackles of working for someone else? All of these are excellent questions!

First, this “job” is absolutely spending my time as I see fit. Post-financial independence (FI), the requirement to work to generate income to meet expenses is gone. I don’t need to work – I want to do this. Most importantly to me, it sounds really fun and that’s why I’m doing it! I love wine, I like teaching and talking about things of interest to me, and I enjoy meeting new people. Yes, it does mean committing to a bit of a schedule, but it’s just one day a week and I’ve gathered there is a good deal of flexibility. If this doesn’t turn out to be to my liking, I don’t have to stick with it because again, there is no pressure to work. The tasting room is also just a short walk or bike ride from my house, so there is no commute. It’s also far from a high-pressure situation and nothing like a corporate job either!

It’s also not about the money. I can earn >20X per hour doing consulting vs. this gig. Sure, some extra spending money is nice, but clearly there are more efficient ways for me to earn income. In addition to the fun aspect, I’m also looking at this as a means to test out an idea. One of our long standing thoughts has been to open a small brewery and tasting room. I’ve always believed that I’d really enjoy talking with people about the beer I make, guiding them through their flight. That’s exactly what this job is only with a different beverage! So while it won’t generate a lot of cash, someone will be paying me to figure out if the beer tasting room idea has legs. Sounds pretty great to me! It’s coming across less and less like a job, isn’t it?

It is another / next phase for me – likely not the final one!

At the core, I look at this step as “the next thing I’m doing”. As readers of this blog will know, I’m always trying out new things, building skills, and exploring hobbies that may or may not turn into something more. Working at a winery tasting room is yet another part of the seemingly random walk on which I am presently endeavoring in this next phase of my life. Might I love this part-time role and desire to turn it into something bigger or longer term? Of course! But I have no way of knowing that right now nor do I care either way. I’m approaching it completely open minded. Like anything I do, I’m going to work hard, try to learn a lot, and enjoy the time I spend on it.

In the initial months after leaving my biotech career last year, I found I was fretting a bit over not knowing exactly “what I would do next”. It was a combination of pressure I felt from former colleagues as well as some I was putting on myself, to figure it all out. Talking to my wife and my Two Sides of FI partner, Eric, I thankfully realized this pretty quickly. That was an important step as I could then get back to really enjoying this freedom that I am so fortunate to have! So in keeping with that, I don’t know what if anything this will lead to and I’m totally ok with that! In the meantime, I’ll enjoy the experience and gain from it everything that I can. Did I mention the wine is really great? ?

It’s gonna be fun!

image credit: Photo by Kelsey Knight on Unsplash