Most financial people talk about return on investment. Today, we’re going to talk about “return on life” with author and retirement expert Mitch Anthony.
Mitch describes return on life in a couple ways. First, it’s about getting the best life you can with the money you have and second, it’s about managing your money in a way that improves your life.
This is Part I of a two-part show on how to significantly increase your “return on life.”
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Imagine a picture of a sailboat whose sail is made out of a dollar. Mitch says money is simply a utility that we skillfully manipulate in order to navigate.
As you picture that sailboat, it’s important to realize that money is not the shore we’re headed toward. It’s not the sea we sail upon. And it’s not the vessel upon which we sail. It’s simply a utility we use to help us live our most meaningful life.
Our guest Mitch Anthony is the founder of the Financial Life Planning Institute, the author of multiple books, widely published in financial periodicals, an international speaker, and the host of a syndicated daily radio feature, The Daily Dose.
Seven Insights From Bill Keen and Mitch Anthony
1. Stop comparing yourself to others or to a benchmark.
Rather than comparing yourself to others or to some benchmark, Mitch says, “The conversation people need to begin having with themselves and with their advisor about their money is, ‘How am I doing against my potential?’ That’s what return on life does. It says, ‘Let’s utilize our money, let’s facilitate our money, let’s manage our money in a way that helps us live the absolute best life we can right now. We’re not waiting for a number to live our life.’”
2. Your intellectual capital appreciates into retirement age so keep it healthy by continuing to use it.
Most career people working today are trading their intellectual capital for a paycheck. And as you get older, your intellectual capital appreciates and accumulates—unless you fail to use it, says Mitch. “There’s a reason Warren Buffett is still doing deals at age 85 and didn’t quit at age 65.
3. Are you flexing your “relational capital” muscles?
Mitch says the second thing we’re trading for a paycheck is what he calls “relational capital.” It’s the relationships and networks people build over time to distribute ideas, products, and services. And relational capital appreciates with time and maturity, too.
4. Pretending everyday is Saturday in retirement gets old fast.
As we age, our intellectual capital and relational capital appreciate. Yet, in today’s society, many people view retirement as a time to pretend everyday is Saturday and you’ll be happy for the rest of your life. Not so says Mitch. “I’ve got news for you. You’re going to wake up on day 43 and realize you don’t have any purpose anymore. You’re not getting a high return on life.”
5. Do you know the ingredients for a happy retirement?
So what are the ingredients for a happy retirement? Mitch says, “Enough purpose to wake up in the morning, and enough money to sleep at night.” He goes on to say, “Money cannot produce a purpose. It can only fund a preexisting purpose. We’ve been sold on the idea that having enough money is enough. It’s not.”
6. Are you engaging in passions that inspire and ignite you?
Retirement is not a time to just kick back and veg out 24/7. Bill says, “In retirement, I see people working for pay, and I see people just doing things that feed their soul, that they’re not getting paid for. A little paycheck coming in is nice, but it’s not necessary in most cases. Folks often want to retire from their old environment but then be inspired and ignited by their other passions.”
7. What are you retiring to?
Having a non-financial retirement plan is crucial to your sanity. As Mitch says, “The first way to fail in retirement is to retire from something and not to something.” What are you retiring to to help you get a better return on life?
Bill Keen on second careers…
I’m seeing folks retire from one career and move into another one that is fueled by passion and a desire to give back and remain useful.
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Bill Keen is the founder and CEO of Keen Wealth Advisors, an independent Registered Investment Adviser serving affluent clients preparing for retirement and the host of the Keen On Retirement podcast. Bill brings more than 20 years of financial services experience and holds the CHARTERED RETIREMENT PLANNING COUNSELOR designation. Bill created Keen Wealth Advisors to build one of the country’s most personal and trusted wealth and retirement advisory firms.