My name is Mark Goodfield. Welcome to The Blunt Bean Counter ™, a blog that shares my thoughts on income taxes, finance and the psychology of money. I am a Chartered Professional Accountant and a partner with a National Accounting Firm in Toronto. This blog is meant for everyone, but in particular for high net worth individuals and owners of private corporations. The views and opinions expressed in this blog are written solely in my personal capacity and cannot be attributed to the accounting firm with which I am affiliated. My posts are blunt, opinionated and even have a twist of humor/sarcasm. You've been warned.

Monday, January 30, 2017

Victory Lap Retirement – Book Review and Giveaway

For many Canadians, the new retirement reality is that there will be no such thing as a full stop retirement from working. The reasons for this are varied and many: from our increased longevity (see Part 5 of my 6 part series on How Much Money do I Need to Retire? Heck if I Know or Anyone Else Does!), to the realization that a sedentary lifestyle in retirement leads to boredom and a much higher probability of an early death to the disappearance of gold plated defined benefit contribution plans.

In their recent bestselling book, Victory Lap Retirement, Mike Drak and well known writer/columnist Jonathan Chevreau, discuss a new retirement paradigm, in which retirement includes a personally determined balance of work that is enjoyable, fun and stimulating and leisure.

I really enjoyed this book and the creative cartoons. The authors suggest the book should be read by everyone including millennial's and while I agree it would be a great read for a millennial (if you could get them to read a book with retirement in the title), this book resonates with baby boomers who will be retiring in the foreseeable future or have recently retired. I found it almost scary how many insights and comments the authors made throughout the book that struck a chord with me.

Mike and Jonathan suggest that financial planning fails without life planning and this book while integrating the former is really about the later and that is what makes it unique. The book is truly holistic, dealing with the importance of physical health, mental health, spiritual health and how vital it is to never stop learning (as my father-in-law always says, “If you’re not learning, you are forgetting”). The authors note, a Victory Lap “gives you the opportunity to start over and design a new life for yourself, but without being limited by your job or responsibilities to others".

Chapter 4 of the book lists four benefits you may reap when you delay a full-stop retirement:

1. Reduced financial anxiety

2. Longer Life - various studies have shown that by delaying retirement, you live longer

3. Better Health -as you continue to exercise your mind and body

4. Prevents boredom, a huge issue for many retirees.

In the forward to the book, Ernie Zelinski author of How to Retire Happy, Wild and Free and The Joy of Not Working, contributes an un-attributable quote that says “retirement is wonderful if you have two essentials - much to live on and much to live for.”

I love the above quote. It is also the essence of the book. Victory Lap Retirement is predicated upon achieving “Findependence” (a term coined by Jonathan that means you have achieved financial independence and you work because you want to work and not because you have to work) and thus, you have the confidence to focus on creating a lifestyle of work and play without financial stress.

This premise is the one main issue I have with the book. Findependence [defined as when you have achieved sufficient passive income (interest, dividends, rental income) to cover your non-discretionary expenses (essentially living expenses)] is the cornerstone or prerequisite for a Victory Lap Retirement. While this is a financial goal we should all aspire to achieve, it is a goal many people will not achieve for two reasons:

1. Significant savings are required to cover annual discretionary expenses.

2. People such as me, who do not ascribe to the frugal lifestyle, are not even close to achieving Findependence. In my case, as I have discussed many times on the blog, my goal, in part because I had a father die young, is to live my life to the fullest while healthy (see my various bucket list posts including ones on Pebble Beach and my Safari) but at the same time, be cognizant of building up a retirement nest-egg. I will not achieve Findependence based on my "live while you can" lifestyle, that converts what many would consider discretionary expenses into non-discretionary expenses.

Thus, as I told Mike (whom I knew when he was a banker and not a famous author), while I understand why he and Jonathan consider Findependence the cornerstone of retirement, I think they should ensure that they convey the message that the Victory Lap philosophy is not reliant upon reaching Findependence, although it clearly makes the Victory Lap a wind-assisted one.

The one other issue that I don’t think the authors contemplated, is that many business people and professionals who enjoy what they do and would like to continuing doing so in retirement, albeit at a slower pace, are prevented doing such, by non-compete clauses when they sell their business or retire from their firms. I am getting picky here; the book is a great read and I thoroughly recommend it.

Giveaway


Mike has graciously provided me two books to giveaway to my readers. If you are interested in a copy of the book, email me at bluntbeancounter@gmail.com by February 6th and I will notify the winners by email on February 7th.

This site provides general information on various tax issues and other matters. The information is not intended to constitute professional advice and may not be appropriate for a specific individual or fact situation. It is written by the author solely in their personal capacity and cannot be attributed to the accounting firm with which they are affiliated. It is not intended to constitute professional advice, and neither the author nor the firm with which the author is associated shall accept any liability in respect of any reliance on the information contained herein. Readers should always consult with their professional advisors in respect of their particular situation.