“He’s the Investing Type”

So, some coworkers of mine said something interesting to me the other day.

They were discussing the fact that someone from their division was retiring. He was, they pointedly informed me, only in his mid-fifties. My reaction was something along the lines of “Okay, sure. My dad’s is fifty-some and he’s planning to retire in the next year or so. Your point?”

Their reply was that retiring now left him with maybe 30 years of life left, and that it was weird that he was retiring now. What was he going to do with those 30 years? But then, as if to excuse the odd behavior, another coworker mentioned that “he’s the investing type”.

Wait, what?

The conversation ended at that point, but I spent the rest of the day thinking about it. My coworkers had some very distinct ideas about the man’s retirement, and it kind of shook me that I not only didn’t agree with them, I’m not even sure if I really understood them.

For example, the 30 years comment? In retrospect it could be taken two ways.

The first, which is what I think they meant, is that 30 years is a long time to spend without a purpose of some kind of keep you busy. The most obvious purpose is, of course, a job, but it could just as well be volunteering, a hobby, or looking after grandkids. If this is how they meant the comment, then I really hope that they hadn’t actually thought too hard about what they were saying. For starters, the ‘standard’ retirement age is 65, only 10 years off. As far as I can tell, keeping yourself busy for 20 years vs 30 years shouldn’t be that much of difference. If you’ve found something that you enjoy (writing, for example) wouldn’t it be great to have an extra ten years free of work to devote to it?

Yes, I realize that retiring in your fifties throws off the idea that most of your life is spent working, as opposed to being in school or being retired (assuming you live until 85, and that you graduated at 22, retiring ten years early would mean you only worked for 39% of your life, as opposed to 51%). Still, I maintain that this shouldn’t be that big of a deal. Why would my coworkers even bother to comment about it?

The second way the comment could be taken, is that 30 years of retirement is a much harder thing to budget for than 20 years of retirement. The extra savings and compound interest during those ten years would be significant. If they meant it this way (and I really don’t think that they did) then the investing comment, at least, would make more sense.

But if they weren’t thinking about money when they made that comment, which I’m pretty sure of, then what on earth did they mean by “he’s the investing type”?

As far as I’m concerned (and almost all of the PF community would agree with me), there shouldn’t be a group of people that are the investing type, because that would imply that a lot of people just aren’t. I’m not talking about people how most people live paycheck to paycheck and don’t learn to save, I’m talking about the idea (that the statement seems to imply) that when it comes to investing, you either have something that makes you an investor, or you don’t.

This strikes me as a debilitating mindset. I know, for a fact, that the coworkers involved in the discussion contribute to the company’s (rather generous, actually) 401k plan. But they have to go out of their way to designate this one man as the investing type, as if he’s an anomaly or specially gifted or something. What does that mean for them, then? Are they doomed to being forever pushed around by financial advisers and the current DOW numbers?

Obviously, I’m being a bit over-dramatic, here, but the conversation frustrated me because I don’t think this is a healthy mindset. So what if someone decides to step out of the path of “retire at 65 and you’ll be fine because you contributed the minimum to your 401k needed to get the full employer match”? If they’ve crunched the numbers and decide they can retire at 55 (or, heaven forbid, 35), more power to them. It doesn’t mean that they have something magical, just that they prioritized differently, and wanted the extra years of retirement so that they could go windsurf in Puerto Rico.

I’ve put a lot of time and effort over the last three years (or so) into learning about personal finance. Over that time, I’ve been gathering the courage and resources necessary to decide my own future: how many luxuries I choose to own, how much money I set aside each year, and how long I need to work before I can retire. It’s tremendously empowering, to know that I can make an informed choice on those topics, now.

But my coworkers are seeing the results without seeing the effort and the process. So, all they can say is “he’s the investing type”, which is rather missing the point. We can all be “the investing type”, it’s just that you have to take the time and effort to make the important steps between high-yield savings account, and well-balanced portfolio.

Trust me, it’s worth it.

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