Not What I Planned

Kristine Hayes

I WROTE MY FIRST column for HumbleDollar four years ago. In that article, I described how a midlife divorce had forced me to learn as much as I could about investing and personal finance. As part of that education process, I spent hours creating spreadsheets designed to predict my financial health over the next decade.

Planning didn’t seem difficult back then because my life was quite simple. I shared a one-bedroom apartment with my elderly dog. I was saving nearly half my paycheck. I invested that money in a few low-cost mutual funds. I had a substantial amount of cash sitting in a credit union, which acted as my emergency fund.

I set up spreadsheets to forecast my retirement account balances and net worth. I had documents designed to predict the exact day I could leave fulltime work behind. I spent hours modeling a variety of scenarios for my future self, accounting for as many variables as possible.

I anticipated annual rent and salary increases. I guessed at future rates of inflation and taxation. I estimated how much I might spend on car maintenance, veterinary bills and utilities. Every time I thought of another variable, I added another line to my spreadsheets.

There was, however, one variable I didn’t accurately anticipate: life.

In the four years since I debuted on HumbleDollar, I’ve remarried. I’ve purchased two homes. I now live with four very active dogs. And while I still have the same job, a global pandemic—something I didn’t predict in any of my scenarios—has altered nearly every aspect of my workday. The only constant in my life? I still drive a 2007 Honda CRV.

Do I regret all the time I spent trying to predict a future that didn’t come close to matching my current reality? Not at all. As it turns out, I’m still meeting all the goals I identified four years ago, just in a much different way than I imagined.

Back then, I set a target of accumulating a $500,000 personal net worth before I turned age 55. Thanks to record high stock market levels, as well as increases in home equity values, I’ve easily exceeded that goal.

In 2017, my retirement account balance stood at $250,000. Even though I no longer contribute a high percentage of my paycheck to the account, the balance has continued to grow and currently sits at $410,000. Add in my share of the homes that my husband and I now own, as well as my savings account balance, and my net worth—at age 53—is just shy of $600,000.

I’m still on track to retire early. Four years ago, I had no idea where I’d live when I left my job. I didn’t know if I’d continue to rent or attempt to qualify for a mortgage. Now, housing isn’t much of a concern. My husband and I own a home in an Arizona retirement community, as well as a house in Portland, Oregon, where I currently work.

The biggest change I’ve experienced over the past four years? These days, I’m not so inclined to try to predict my future. Instead of obsessing about the unknown, I’m more focused on enjoying the pleasures that go along with living on a day-by-day basis.

Here are three key lessons I’ve learned over the past four years:

1. Focus on the big picture rather than the small details. When I tracked every facet of my financial life, I often found myself emotionally exhausted. Any unexpected expense I incurred made me worry I wouldn’t be able to retire when I wanted. Stock market dips caused me to panic, believing my financial future was about to be derailed.

These days, I realize the only thing I need to focus on is my primary goal: Am I continuing to make progress toward a stable, comfortable retirement? The vision of what that retirement will look like, along with the path I take to get there, will no doubt continue to change. But for now, I’ve learned not to obsess about every fluctuation in my account balances, since I know I’m headed in the right direction.

2. Major life changes are easier when your financial foundation is solid. No debt, an excellent FICO credit score of 800 and a solid work history—including 23 years at my current job—all helped me to qualify easily for a mortgage. A sizable emergency fund meant not having to worry about the added expenses that go along with homeownership. Without that foundation in place, it’s likely my life today would look very similar to the way it did four years ago.

3. Some things never change. Four years ago, I didn’t have any credit card debt. Today, that’s still true. I also continue to live within my means. Despite qualifying for a $403,000 mortgage two years ago, I chose to purchase a home for significantly less than that sum. I drive a 14-year-old car rather than spending several hundred dollars a month on a car payment.

The fundamentals of frugal living, which I’ve followed most of my life, have served me well. I have no intention of abandoning them, either now or in the future.

Kristine Hayes is a departmental manager at a small, liberal arts college. She enjoys competitive pistol shooting and hanging out with her husband and their dogs. Check out Kristine’s earlier articles.

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