I was reading the book “Sapiens” last year when I came across this paragraph that I noted down:

“Contradictions are an inseparable part of every human culture. In fact, they are culture’s engines, responsible for the creativity and dynamism of our species. Just as when two clashing musical notes played together force a piece of music forward, so discord in our thoughts, ideas and values compel us to think, re-evaluate and criticise. Consistency is the playground of dull minds.

This is such an essential feature of any culture that it even has a name: cognitive dissonance. Cognitive dissonance is often considered a failure of the human psyche. In fact it is a vital asset.”

I took some solace from that, because I’m suffering from Cognitive Dissonance right now! As you may be aware, I like the retirement life but I miss the fulfilment I found in paid work too. This is just a fact, regardless of how often I tell myself – or others tell me – to just content myself. Well, I can’t. And I fear that if I do fully embrace the retired life and become “content” with consistency to my days, then I’ll become the “dull mind” referred to in the preceding paragraph.

I do get riled sometimes when people tell me I should be “happy” not having work to go to. Happy? Cows are happy. Being constantly happy would be so depressing. Like being immortal, which is, when you think about it, a fate worse than death. I’ve no ambition to be constantly happy and content because I fear that, if I ever do, then I’ll have lost my ambition for growth. Sometimes, of course, I’m very happy to have no work to go to. And sometimes I’m not. What’s wrong with that?  

People telling me to content myself and “be happy” is like when people used to go on about having “fun” at work. In my book, fun was fun and work was work. The contradiction between the two somehow helped produce enjoyment and fulfillment from each separate activity. I think I enjoyed and appreciated weekends and my own leisure time much more when I was working than I do now. On the other hand, when I was at work and earning money I had some kind of peace of mind that I was contributing to an activity that was bigger than myself and my own preoccupations. Okay, I “had” to go to work, but having obligations that lay outside of myself was a good thing – it helped me appreciate my own time when I had it.

I never really saw work as “fun” though. It was a serious business and why shouldn’t it be? Work can be fulfilling, satisfying, rewarding and a lot of other things too, but fun? Not if you’re doing it properly. Show me someone who’s having “fun” at work and I’ll show you someone who’s not taking it seriously enough. Yes, Bruce Springsteen seems to be having a fun time at his work, but only because he’s deadly serious about it. I don’t know what he does to relax, but I bet it’s not writing or playing music. After all, that’s his job.

In the same way, retired life is not, and shouldn’t be, the soma induced happiness of a Brave New World. What’s wrong in not being 100% satisfied with the retired life versus the working one? For me, the fact is I could go back to work and, while it’s absolutely not a siren song, it can be a distracting tune. If I blot it out, I’ll need something to replace it. I’ve tried voluntary work, but it wasn’t really for me. There seemed to be something missing in it (apart from the money!) Perhaps it was the fact that I knew I wouldn’t even be there if I had “proper” work to go to? Maybe I need to try a few other types, but I’ve got to be honest here: unless it’s a vocation (which I’ve yet to find)  if I’m going to work, as in devote my labour to produce a result, I want to be paid for it.

Sometimes I think I would love to be a Mr Money Moustache, ripping off roofs, excavating Victorian furnaces, working with my hands. Getting paid, maybe with a six pack of beer and a returned favour, but getting material acknowledgment nonetheless. This might be an option going forward, because I know quite a few tradesmen and I could maybe ask them if I could help out. But, let’s be honest, I’m in my fifties and I’m unsure if I’d be an asset to them or a burden!

This is where I can feel people’s hackles beginning to rise. Why, FFS, don’t you go out and try working on a building site if you think you might like it? What do you have to lose? Because, FFS, this isn’t a “Please choose Option A or Option B” situation. This – I now understand – is cognitive dissonance! Out of which I’m hoping a creative and dynamic solution will eventually appear.

I was listening to a phone-in on Radio Five last week that was discussing the merits of a common retirement fantasy: emigrating to live abroad. Although many of the people calling in seemed to be retirees, the show wasn’t aimed exclusively at them, but I soon tired of smug pensioners calling in from Europe to tell us how wonderful life was in France, Spain, Portugal, wherever. “Good. Effing well stay there”, I barked at the radio. “And don’t come running back here when you need our Health Service”, I added, only to be told by caller after caller that European health care is so much better than our own.

As far as I am concerned, Jeremy Clarkson summed up everything about emigrating that I could possibly want to say:

“In the whole of human history, nobody has ever woken up and thought, ‘I know, I have a wonderful family, lots of money, a great job, and an active social life. I shall therefore move to Australia.’

Australia is where you go when you’ve made a mess of everything. That’s why the 1.3million Brits who live there are known as whingeing Poms. Because they’re all failures.

Another popular destination is Spain, which these days is home to 761,000 Brits.

Are they all brain surgeons? Inventors? Did Sir Christopher Cockerell invent the hovercraft and then move to Porto Banus? No. Spain is where you go when you’ve sold your taxi.”

There are countries in the world that I love visiting and, at the top of the list, is the USA. I’ve been there many times and studied for a year in South Carolina (I know, being a student isn’t actually real life.) But one of my strongest memories of America is of being on a California fly drive holiday and arriving at a hotel after another long day filled with sunshine and open roads. As I settled down for the evening, I put the TV on to the public service station to see they were showing an episode of Morse. It was actually the final episode, The Remorseful Day, and the scene I’d tuned in to had Morse sitting with Lewis, enjoying a pint in an Oxford beer garden as the sun set over the Thames Valley. I instantly was washed over by a feeling of sentimental homesickness, way, way stronger than anything I’d ever experienced before. I suddenly realised, in that single moment, that Britain was always going to be the place for me.

I’ve never been able to forget that time and place and emotion. It was stronger than I can say and has stuck with me over the years. Much as I love America, I’ll not be emigrating there or anywhere else. Okay, I might decide to spend winters, or January to March at least, on an extended holiday somewhere a bit more sunny and warm, but that’s about as far as it (or I) goes.

As the ‘phone-in went on, people who had emigrated and then returned to the UK started to call in with their side of the story. When asked why they’d come back and what they’d missed about Britain, many could only state that it was “the culture”. This was often a much bigger pull than the “family and friends” they’d left behind, but many couldn’t put their finger on what exactly they meant by stating what it was about the “culture” that they missed. I knew what they were getting at though. Culture isn’t a single thing, or a collection of many single things. It’s a blend. If a country could have an emotion then it would be expressed as its culture. And Britain’s culture is, I think, undeniably deep. Don’t get me wrong, I’m no Billy Britain saying we’re superior to everyone else, it’s just that our heritage and history is something worth acknowledging as part of who we are. It’s not about pride, but it is what it is, warts and all. As Rudyard Kipling said:

If England was what England seems
An’ not the England of our dreams,
But only putty, brass, an’ paint,
“Ow quick we’d drop ‘er! But she ain’t!

I used to think that where you lived could have a big effect on your happiness and well-being but, over the years, I’ve decided that happiness has little to do with a physical place. A metaphysical place though, that’s a different story.

On the whole, I think, if you’re miserable in Britain then you’re probably going to be miserable anywhere else. And, incidentally, being miserable in Britain is infinitely better than being miserable than anywhere else, as Jeremy Clarkson demonstrates. Being miserable is one of our strengths. Ask Morse.

 

Two things over the weekend caused me to think about retirement. The first was an opinion piece by the excellent Luke Johnson in The Sunday Times, who always writes well about business and finance. This week he was having a swing about how retirement is bad for your health and how anyone over fifty would be nuts to put their feet up. What they should be doing instead, he advocates, is thinking about a second career phase, or relaunching themselves in an entrepreneurial role that will see them through the next twenty or even thirty years. What’s the alternative, he asks? Stagnation and death? (I’ve reprinted it here). 

The second was the movie “The Martian” where one of the challenges that is poised over space travel to Mars is the actual amount of time it takes to get there. I think a one way journey was something like a year, and one of the biggest challenges (I thought) would be to keep the astronauts occupied over that time. Sure, there’d be a gym on the spacecraft, and books, videos, a canteen…..but I’m sure NASA would ensure that there would also be plenty of work to do. Otherwise the astronauts would completely stagnate, physically and mentally. The best way to guard against this would be to make them work. They can then fit (and would be motivated to fit) leisure activities around their work, such as reading, watching videos, having a coffee with their fellow travellers….

I often reflect on the non-financial benefits of work and how leisure time is so much more appreciated when thrown into relief against the backdrop of a working day or week. When you’ve all day and every day to pursue what you once would have classed as your own leisure activities, they become your norm. I wouldn’t say they become less enjoyable or fulfilling, but they do lose some of the shine they once had. That twenty mile bike ride that I used to take early on a Saturday morning that cleared my head and so unwound me from the working week, well, I can do that every day now. And it’s not the same.  (I’m worried that it if I did do it every day, it might begin to feel like work!)

I’ve written before about the challenges of doing nothing all day and having all day to do it, which must stick in the craw of people stuck in jobs they don’t like. Of course, the solution for me is to go back to being employed. In the time I’ve had off, I’ve considered quite a few options to enable this, including setting up my own business, franchising, voluntary work, going part time and returning to industry I came from. To name but a few. I could probably write a blog entry on each of these options and what I’ve discovered in trying to pursue them, and I probably will at some point. One thing is for sure though, it can be quite irritating reading opinions such as Luke Johnson’s who insinuate that you just wake up one day and say, “Well that’s me, I’m bored with this retirement lark, I think I’ll now become an entrepreneur.” If only it was that simple! One of the biggest challenges of the lot is the fact that you might not HAVE to do it – I feel that the biggest thing that prevented me from throwing myself into setting up my own business was trying to work out what my objective for doing so actually was. If not the money. And, actually, it still IS the money because if the business is going to be something significant then you’re probably going to have to risk some capital. Yes, it’s rather annoying to congratulate yourself on the one hand for saving enough so that you don’t have to work for money, only to find that the risk of losing some of that money might prevent you from doing some work! When Luke Johnson talks about being an entrepreneur and “building something worthwhile”, I don’t think he’s thinking about setting up a dog walking business. If you want to “build something worthwhile” you’re probably going to have to put some skin in the game.

When I left work, I was given access to an employment consultant, or development coach, to help me work out what I wanted to do next. In our initial interview, when I outlined my personal situation to her, she frowned, bit her lip and said, “The most challenging candidates I have to deal with are those that have decided they don’t want or need to work for money any more.” I hadn’t realised that this was how I was coming across, but my Early Retirement Dreams had pretty much brought me to the point that I was in that position. I really hadn’t given much thought to “What’s next?” other than “To enjoy myself”. Fair enough, but I do agree with a lot of what Luke Johnson is saying – you can get a lot of enjoyment from work, providing you’re still up for the challenge. The initial challenge, however, is deciding what that enjoyable work is going to be!

Last week, the chancellor made a U-turn on pensions. Well, this was news to me. I mean, what road was he on? The way it was reported in the media it was as if Gideon had announced a concrete proposal to switch pensions to an ISA style arrangement where you’d pay the tax at the point of investing, not when you came to take it out. But this was never announced, was it? He was, at best, considering this option, but we never really knew how close to a decision he’d come. The way it was reported last week, it was as if an ISA pension system was a done deal. As ever though, when it comes to personal finance, we’re not given a foregone conclusion, we’re given a foregone confusion.

When it comes to saving and investing, I like to think I’m well on top of the fundamentals. I’m certainly no numbers geek, and many of the investment articles I read that seem to delight in digging into investment ratios and projections go straight over my head. I focus on the very basic basics, but I’m still often blindsided by information that I feel is “a basic” but that I’ve been unaware of. This time it happened on pensions, when I read that your pension, once you begin to draw it, is actually taxed at source.

Up until this point I was telling myself that I had at least three years to research and develop some decent strategies to minimise the tax on my pension income. Obviously I’d take the tax free lump sum and then maybe only draw down an income of less than £10k a year while I spent my way through the pot of tax free money. I assumed that if I kept within the personal allowance limit, then I’d not be taxed on that £10k income. But now it seems that I will be.

My next half-thought-through strategy was to take my projected annual pension income and stick it into a personal pension for my wife, meaning she will then benefit from twenty percent tax relief upon it. So the government takes twenty percent from me on the one hand and she gets it back on the other. It’s a bit of a paper exercise though, because she’ll subsequently be taxed on that eventually too (apart from the lump sum element) when she comes to withdraw it. I suppose it might also grow if we kept it invested for five years, so there’s a bit of an upside there. How much to put in though? What if she’s still working? For how long should I do it? What if things change for the worse over those years and the tax burden on withdrawing pensions becomes even greater?

I have to admit though, I’m already losing the will to live as I write this stuff down. Why is it all so complicated? Why do I feel that I’m going to have to go and get professional advice, for a probably ridiculous fee, on finding a tax efficient way to withdraw my own money that I’ve saved hard for over the years? I know all the information I need is probably “out there” on the web, but I don’t trust myself to find the right stuff that applies to my exact situation. Over the years I’ve put a lot of money into pensions and never really thought hard about the tax implications on the basis that I had plenty of time to worry about that when it came. Well, that time is coming, and I now find myself wishing that maybe I’d stuck more of my money into ISA’s instead, because that is so easy to understand. The money I’ve saved in ISA’s is what it is: all mine, tax free, no questions asked. Simple. I can plan fairly effortlessly on my ISA’s. Increasingly I feel I can’t plan on my pensions at all without expending a lot of mental energy on something that I might never fully understand. Despite the fact that getting good tax advice might save me thousands of pounds going forward, my heart sinks at the prospect of it. After all, I’ve never met a Financial Adviser who I thought would put my financial interests before his own, and I know I’ll be giving myself a hard time for not doing the work to understand the situation myself.  It’s a double whammy: “I’m thick, and it’s costing me money”.

Although any change to an ISA style pension probably wouldn’t have affected me all that much at my age, I can see the attraction in it. Surely it cannot possibly be as complex as the situation we currently have? As I near pensionable age, the one thing I want is stability. All the conjecture about change is unsettling, and at the same time the press reported the “U-turn” on the ISA proposal, many took the opportunity to ponder all the other alterations and tweaks that might be pushed through regardless. “Change is going to come and it probably won’t be for the better”, was the message. Mind you, isn’t it always?