Key takeaway: Freedom is what we all search for, but we can find it only by taking deliberate steps. We can have either independence like my son now feels with a driver’s license (as he is in the driver’s seat) or anxiety like I now feel watching his tail lights.
About two weeks ago, my 16-year-old son passed his driving exam. It was a Friday. Saturday morning, he was off to a nearby town to run with some buddies from track. Just like that, he was chasing what all of us are chasing every single day: freedom.
If you don’t know of Carl Richards, you should. Carl is a financial advisor who started sketching big life lessons on the backs of napkins with a Sharpie for his clients. Those sketches eventually led to his current column in The New York Times (take a look). Every week Carl’s sketches tell a story about how to face challenges in investing, behavior, spending, and self-worth. His topics may be diverse, but the prevailing theme through all of his sketches is our constant search for freedom. Freedom can come at any age, if you know what you are looking for.
In your 30s: Freedom, particularly later in life, can start at this age by simply making smart decisions around money. You should limit debt, and the best way to do this is to not buy the biggest house or fanciest car you can afford. Focus on those two things and you will enjoy opportunities in the next two decades that others don’t have.
In your 40s and 50s: Freedom in your 40s and 50s is often defined by choice. Do you have a choice to change jobs, take time off as needed for kids’ soccer games, fly on a whim to ski in Colorado, or celebrate your anniversary with your spouse at a nice restaurant? Freedom at this stage is about movement and experiences. If you buy too much stuff (particularly in your 30s), you can’t afford experiences.
In your 50s and 60s: Freedom in your mid-50s and early 60s shifts toward having the ability to stop doing things for money and start doing things for the joy they bring. Often, this is shifting away from work and into the next phase (often referred to as retirement), but it can also be about volunteering and pursuit of personal change (e.g., taking classes or finding new hobbies).
The next phase: As people move into the next phase (retirement), freedom is having the peace of mind that you have enough for you, and in fact, you would like to start sharing more with others. This is where many start thinking about their legacy. It can begin with just baby-sitting grandchildren, but it often continues with planning for your children’s and grandchildren’s future without you. Assuming you have enough money for your lifestyle, you can find great joy in thinking and giving to others—family or charity.
You may notice a theme here: Freedom comes from control. Controlling your life and outcomes occurs only when the pursuit is toward being in the driver’s seat, not watching the tail lights. As I thought about my son driving off in the distance, I thought about the freedom that he was experiencing in the driver’s seat. But as the dad watching the tail lights, I felt anxiety about what might happen. He felt control, and I felt a lack of it.
Think of the tail lights as buying something on a credit card and then watching it off in the distance. You are still paying for it years later, which leads to a lack of control (you already spent the money, so you can’t enjoy spending it on something else) and, therefore, a lack of freedom.
It is important to put yourself in the driver’s seat, where you have control and thus experience freedom. This happens only when you are deliberate about putting yourself there. Putting yourself there occurs by living below your means, saving along the way, being careful about large purchases, and building a game plan that looks one, three, 10, and 30 years out. All this happens by having more information that allows you to take deliberate steps in life. And a good financial advisor will help you sift through all that information.
The opinion of the author is subject to change without notice and must be considered in conjunction with relevant regulation, as well as subsequent changes in the marketplace. Any information from outside resources has been deemed to be reliable but has not necessarily been verified. Each individual has unique circumstances to which this information may or may not be relevant. Under no circumstances will this information constitute an offer to buy or sell and it does not indicate strategy suitability for any particular investor.