The Most Important Thing You Have To Do Before You Turn 50

This goal replaces retirement and renders the entire concept meaningless

Source: Author

I’ve seen people in their 40s and 50s commence 30-year mortgages on $1 million+ homes.

I watched my Grandfather drop around half of his Social Security check on rent for decades, well into his 90s.

I’m watching my Aunt pay nearly $1,000 for rent in her 60s on the back of whatever her late husband left her and an hourly blue collar job.

Not good.

I watched my Father work long hours to pay off his 30-year mortgage in about 20 years. Rock, once I pay off the house, I can slow down.

He had the right idea.

Priority #1 for an increasing number of us —

Don’t carry a housing payment — of any kind — with you into relative old age. Having just turned 47 the other day, I like to call relative old age somewhere in the neighborhood of 50 years old.

For this increasing number of us — and, soon, probably most of us — this means retirement, in the traditional sense, is no longer the priority. It ceases to be a meaningful goal.

We’re redefining the word retire. And we better make sure we don’t fuck it up.

However you slice it, it’s no longer about entering your 50s with or close to a million bucks (though that’d be nice), it’s about squashing your cost of living. It’s about finding the floor.

Once you’re free of a rent or mortgage payment, you’ve probably reduced your expenses by anywhere from 25 to 50%. Blows my mind why this isn’t a prevailing peice of personal financial advice. Something that’s actually achieveable.

This accomplishes several things beyond the obvious lower cost of living:

• It provides increasing levels of cash security. Bank what was once your housing payment. Spread it across your pots of money.
• It provides financial flexibility. Maybe some other cost snuck up on you. At least you don’t have to worry about making the house payment.
• It gives you the luxury of choice. With an extra several hundred or thousand bucks in cash flow coming in each month, you can be a bit more loose with your spending. Or not. You can save more.
• It allows you to do work you love. Or at least work that doesn’t occupy so much time. Hopefully both. You might not be able to pick and choose the type of work you do in relative old age if you’re on the hook for a housing payment each month.

My plan is to enter my 50s without a housing payment. Ambitious goal. I fully realize it might not happen as quickly as I’d like.

However, there are two things I know for sure.

One — I’m not saving for retirement. I’m saving to not have a rent/house payment.

Two — If one doesn’t work out, I’m absolutely not taking on a bigger housing payment than I have now.

Based on the bigger picture for my partner and I, either of these options likely require a move abroad.

Under no condition will I enter act two of my life paying more for housing than I did during act one.

I watched these 40- and 50-something homeowners do it. Watching my Aunt do it.

Worst case — it’s a potentially massive financial mistake.

Not quite as bad, but still shitty case — you’re tied to work you might not necessarily want to do forever to meet your housing payment. Or you’re blowing through too much of your limited cash flow each month.

If you choose or have to move, aim to pay less each month than you’re paying now. Now might not be the time you’re able to do this. Unless you move abroad or downsize domestically in what‘ll likely be a big way.

But you gotta do it. Have that shit set — or at least strategically planned — before you notch half a century on Earth.

So you can live out the second half of your life in semi-retired style.