I went to a consultant to discuss wealth management and life planning. He asked me a few questions. This is what I said:
I think about my pension daily. Probably too much. I am not sure from where the concern stems, but I am determined to not to have to work hard when I am 50. I am determined to not be poor when I am 60. I sacrifice fun today for security tomorrow at every turn, which is something I want to start changing, but I want to stash as much away as I can before I lose too much the power of compounding returns. I’ve marked 40 as a milestone.
It struck me, in a conversation this weekend that I may do well to re-evaluate my expectations of my future. My strategy of hoarding money for when I can no longer work may be more relevant to my father’s generation than to mine.
I was talking with my friend, my former girlfriend, Marina. She has just finished studying abroad and is back living with her parents in her home town and she is very frustrated and very bored. She does not have any concrete guidance on what she should be doing with her life. She’s currently looking for a part time job to support her through her final year of University. I love Marina very much, more than anyone. She holds a place in my heart with my niece and my mother, my most treasured and beloved others.
I told her that maybe she should think about doing what I did, combining the final year of her University career with groundwork for her working life. Two weeks after my final exam I was in Silicon Valley seeking funding for my technology start up. I didn’t even go to my graduation. My final year’s worth of coursework was all based around essays and projects on the new economy, the tech bubble, the new business landscape. These were the days pre Twitter and Facebook. Google was in it’s infancy, mobile phones were still black and white. I don’t think eBay existed. Blogging, tweeting, apps, cloud computing, broadband, big data and affiliate marketing were still a long way off. AOL bought Time Warner and it was seen as being incredible that a tech company could actually buy a ‘real’ company. I started one of the very first, if not the first, online data backup companies. Most people backed up to tapes the idea of backing up online was seen as ludicrous.
Thus it was like a relay race, a smooth baton change from University to work for me. I proposed a similar solution to Marina. I suggested she look to build today the seeds of a CV for tomorrow. Rather than looking for work next year with no CV, be the graduate with a head start. I pointed her to Elance, a freelance portal where companies and individuals post work packages (book-keeping, copywriting, admin, creative writing, etc) and individuals or companies bid to fulfil them. My suggestion; set up a profile and offer to do some work, maybe offer to work for free for a few contracts, just to get some references on your CV. If she could work towards earning £100 for writing a few blog posts, well that’s a week’s salary for her.
Technology has opened up lots of opportunities. We now have sites like Elance, Fiverr and even Ebay. You can make money remotely if you take a bit of time to build an established and respected platform.
Has this possibly changed the face of retirement? For my father’s generation, work was a place you went to physically and spent all your time. At some point you didn’t have the strength or will to do that anymore and employers wanted young bloods in – so you had to save up enough money during your working life to be able to not need a pay cheque anymore. Today it’s very different. What is to stop a 70 year old from buying a job lot of belts or ties and selling them for a slight profit on Ebay? Three grand of profit over a year may not be a lot to us but it is in Spain and it’s a hell of a good supplement to an existing pension.
To take it one step further, what is to stop a 70 year old with book keeping skills bidding for work on Elance? Maybe he gets one or two work packages in per month, it’s £200, not a lot, but I’ll tell you this, in the South of Spain I can live off £200 a month and eat out every day.
What does my retirement actually look like? At 70 do I get up in the morning, eat some tomatoes with basil on my balcony, drink some coffee and spend the first hour or two writing a blog post for someone or laying down a guitar track for someone on Fiverr? Maybe I won’t need to rely solely on my stock holdings. Maybe if I put some thought into this today, I can ease some of this burden.
It’s got me thinking. It’s eased a lot of pressure I carry. I could do worse than complete a few online book keeping courses; or learn some other handy, functional admin skill than I can use to remotely support businesses in the future. Just like my stock investments, seeding my platform now may pay enormous dividends in the future.
What will the world look like in 20 years and how can I prepare myself to be useful in it?