Suze Orman did a smackdown of the FIRE (Financial Independence/Retire Early) movement on Paula Pant’s podcast. She said she “hates it, hates it, hates it.” Interesting since her publicist asked Paula for the interview, as well as asking this of other FIRE podcasters, in order to push Suze’s new book, products and events. Talk about inviting yourself to dinner and then complaining about the food!
Mr. Money Mustache did an excellent job of correcting her misimpressions of what we all are up to with saving and investing money early in life so we can be free to pursue what matters more than money. I don’t have anything to add to his explanation.
Coach Carson posted a balanced, informative response, appreciating Suze’s admonition to be sure you have enough for a risk-free retirement. Suze enumerated a string “what can go wrong” scenarios as evidence that early retirement (on less than $10 million) leaves you vulnerable when life hands you lemons — a whole tree of lemons. He — and MMM — responded evenhandedly but ultimately, here’s what Carson said she got wrong:
1. Early retirees are not withdrawing from life. They’re embracing a purposeful life MORE fully than ever.
2. Early retirees are not wild risk-takers. They are calculated risk-takers. They see the old bargain of a 9-to-5 job until they’re 70 as riskier than an early retirement.
3. The retirement plans of most early retirees aren’t naive, fragile castles built on sand. At least the ones I know of are anti-fragile, multilayered, flexible plans built on a combination of investment savings, retirement accounts, side businesses and backup plans.
For myself, post-FI life has thrown plenty my way. Cancer. The death of a partner. Homeowner miseries like a flooded basement, failed siding and carpenter ants. But none of this has thrown me. I find that much of what happens in early retirement can be addressed fairly easily through a combination of building close relationships with family and friends, insurance, a prudent stash in a money-market fund, level-headed and lower-cost choices, a MacGyver DIY knack and some gigging.
Read MarketWatch’s interview with Vicki Robin
But this post isn’t to quibble about whether my frugal lifestyle as failed me — which it hasn’t yet in 73 years. This post is to challenge Suze’s experience with retirement — and retirement itself.
She said to Paula:
“I’m telling you, I just did it for three years on my private island. I retired at 65. I shut down the Suze Orman show. I sold five homes. I got rid of five cars. I stopped going on QVC. I stopped writing for Oprah’s magazine. I stopped giving talks. I stopped doing everything, and I had a great time for three years. I learned how to fish. I learned how to win tournaments. I learned how to be the captain on my boat. and all of a sudden it was like, “Oh, there’s still stuff for me to do.” Now. I was in a field that everybody welcomed me back, when I came back. They were excited to see me in the halls of NBC and MSNBC, and everywhere that I went this past week.”
I think there is retiring forward and retiring backward. Suze did what many early retirees do. She left her day job. She got rid of excess not needed in a post-job life. For most, it’s getting rid of the car to impress clients or five suits for a weekly rotation at the office. For Suze, it was five cars and five homes.
Indeed, the simple life is one of the lures of early retirement.
This can mean time in nature, reading, meditation and family life. For many who achieve financial independence (FI), compensatory spending — the shopping you do to reward yourself for a tough week at work — disappears. For Suze it was quitting the QVC habit.
FIers might travel to exotic places. For some it’s backpacking. For Suze it was living on her private island.
And people tend to learn new skills. For most it’s a language or an instrument or home cooking. For Suze it was fishing and tournaments and being a captain of a boat.
And then, a couple of years in more or less, the identity confrontation lands with a thud. Who am I now that I am not my job? How do I explain myself to others? How can I gain the respect and voice I had with my old job? I was somebody. Now I’m nobody.
Retiring forward is using this crisis of identity to grow spiritually or take on some of the bigger issues in the world through volunteering, study, serving on boards, entrepreneurship, training or social innovations. Or they attend to the relationships they neglected as they hurried to their million or two.
Not everyone does this. Many retire backward, returning to their old professions after they’ve filled up on travel or hobbies, perhaps on their own terms, because that’s where they felt competent, needed and, truth be told, important. Many do a bit of both and feel their way along to who they will be and how they might spend their time in this new world of freedom, choices and sovereignty.
From Suze’s account, it sounds like she retired backward into her old role. OK. But what did she learn in those hiatus years that she can share with her audience? It seems from other comments she learned that even $10 million in a retirement account is not enough. That stuff happens and money is the answer. I hope for all our sakes that she learned more than that and will share it.
The question for early retirees is: “To what am I dedicating my freedom?” It’s really not about how many millions you have — Suze’s assertion. Nor how much play you can do before you get bored and go back to your old job.
I suspect that Suze had a blast in her own way, but she didn’t find anything in herself that wasn’t Suze, so crawled back into that identity — and then asked to be on FIRE bloggers’ podcasts to relaunch Suze.
In “Your Money or Your Life,” we promised FI as a reward for systematically examining your relationship with money. I think this is what most people attracted to FIRE really want. Independence of thought. Of how they use their time. Of options. Of choices. Of dedicating their attention to something less soul-searing than cubicle life or the endless boring meetings of middle management. Retirement and freedom are two different animals. Doing “nothing” and doing your passion full-time are not even the same species.
Read: Millennials have more money than you think — so expect ESG funds in your 401(k)
People don’t have to follow my path of service, spirituality and social innovation. There are so many ways to use your time for happiness, meaning, purpose and contribution. At the end of the day, we all want to have a well-lived life. Five houses and five cars and a private island — without a higher purpose — mean nothing.
Vicki Robin, the co-author of “Your Money or Your Life,” is often called one of the founders of the FIRE movement. This is an abridged version of a blog post — “Suze Orman — A Wet Blanket on FIRE” — that appeared on her website.
