Lifestyle Design While Coasting: How to Live Your Retirement Dreams Now

Lifestyle Design While Coasting: Flexibility and Financial Freedom

In this episode of The Retire Early Retire Now podcast, host Hunter Kelly, a certified financial planner, discusses lifestyle design as the next step after achieving 'coast fire'—a state where your savings and investments are sufficient to carry you to retirement with minimal new contributions. Hunter explores the concept of flexibility, both in terms of time and money, and shares practical steps to start designing a life that balances financial independence with meaningful, fulfilling activities. The episode also includes advice on tracking savings, automating investments, and the importance of aligning financial decisions with personal values. Finally, Hunter emphasizes the significance of implementing aspects of your desired retirement lifestyle even before hitting your full coast fire number.

00:00 Introduction to the Podcast
00:17 Understanding Coast Fire
02:26 The Importance of Flexibility in Lifestyle Design
04:23 Practical Steps to Achieve Flexibility
07:37 Balancing Trade-offs and Values
11:03 Implementing Lifestyle Design Now
18:33 Recap and Final Thoughts
19:04 Conclusion and Call to Action

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Transcript

0:00

And welcome back to The Retire Early Retire Now podcast. I'm your host, hunter Kelly, certified financial planner and founder of Palm Valley Wealth Management. On this show, we talk about how high income earning families can create financial freedom. Retire early if they choose, and most importantly, live life on their terms. Today's episode is all about lifestyle design while coasting. Last episode, we talked about coast fire, so hitting a point where your savings and investments can carry you to retirement even if you stop contributing to those accounts aggressively. But once you've reached that point, what comes next? The answer. Is lifestyle design. Today, I'm going to walk through what that looks like, give you some examples, and share some practical steps that you can use to start designing the life that you want while coasting toward financial independence. this will be the last week of coast fire from a high level. So we're gonna talk about, kind of your goals, priorities, trade-offs that maybe you'll have to consider. and then next week we'll get into more of the technical things like taxes, how to. Calculate, your coast fire number, and things of that nature. And so that's where, we'll get into more, quote unquote technical financial planning, topics and things of that nature around this idea of coast fire. And again. I like this idea of coast fire, not my original idea. but I think it is one that is most common when I look at my practice and who I'm working with, and just, doing research and things of that nature. People still wanna work, they still wanna do things, but they do want that peace of mind of. Being somewhat financial independent, whether, whether that be, through their retirement accounts later on down the road or just having that flexibility, so they're not. Stressed about money,'cause obviously money can be very stressful. So if you're liking this content, if you're liking this topic, let me know. There's a text me button on the show note descriptions. let me know if this is something you like. I've been getting some pretty good feedback. want to continue this topic if that's something you guys want to hear. So let me know that. And if you feel like there's a friend that you. Know that would benefit from this episode or other episodes that I've done in the past. Please share this with a friend and leave a five star review on your favorite podcasting app. So let's jump right into it. What lifestyle design really means when we talk about lifestyle design. It. Really comes down to flexibility. That's what, this whole coast fire, topic or idea is, is built around, is that flexibility to do the things that you want to do, that you value the most. And flexibility can mean a lot of different things depending on where you are in life. For some of you listening, it might mean time flexibility. So being able to leave work early to go coach your kid's baseball team, take a Friday off, on a long weekend. not worry about the workload that you have or, stressing about a paycheck. For others, it could be money, flexibility, so having the financial breathing room. to take a family vacation and not worry. about having that larger credit card bill or saying yes to something like private school, because that's something that's important to you, but also knowing that you have your long-term plan still on track, right? And so having that peace of mind, having that flexibility to do the things that matter the most to you. That's really what this about, right? And so the beauty of Coast Fire is that it gives you both types of flexibility. Time flexibility comes from knowing you don't have to keep grinding 60, 70, 80 hours a week just to feel like you're staying ahead. Money flexibility comes from the fact that your nest egg is already compounding in the background. So. Not every decision is a trade off between today and retirement. And so that's where we want to get to. That's, that is the pinnacle of, coast fire, right? We, we don't have to grind as much. Maybe we enjoy doing the things that we do in our career, whether that's practicing law or medicine or owning a business, whatever that is, but then getting to a point where we can balance other things in our life that are important to us as well. And so some simple steps you can take right now to start building toward flexibility. Well, what are those? Here's a couple. and some of these I've talked about, uh, in a lot of different podcasts and different contexts. and so it may not come to a shock to you, uh, but some I have not necessarily talked about in detail. the first two are, things that I've talked about a bunch, and that is tracking your savings. So know what you're saving. if this is a new concept to you, a new idea, to you, and you notice that your savings rate is, let's say. Under 10%. Well then you need to work on getting that savings rate up. If your nest egg is not already built to a point where you can start meeting this coast fire idea, right? but maybe you've done a really good job of saving and you can back down to under, under 10 or under eight or whatever that may be, right? track your savings so that you know where you are. It's just a point a. And then from that point a. You understand where point need point B needs to be, whether that's a higher savings rate or maybe even a lower savings rate to up your lifestyle because you've already done the heavy lifting and saving and things of that nature. Number two would be automate your investing. Right? I talk about this a lot when I talk about budgeting and pay yourself first. Automate your savings so that you can, set it and forget it and you look, you pick your head up in, in a year or five years, or even 10 years depending on your timeline on things, and you have, a significant amount of wealth saved up in your retirement accounts and things of that nature. So those are the two things that I would just start out with. Where am I at point A, where, where do I need to be for point B? and what are the changes that I need to make in between there? And then number three is something that I find that is the hardest for people to do, and that is. Practice saying yes or more importantly, no intentionally. So maybe saying no to a dinner or a vacation that your friends are, planning out or family are, are planning out and redirecting it to something else that is, is more important to you or saying yes to a long weekend away because you know you're still on track financially, whatever that may be. So there's two sides to that coin, right? There is the side where you're still building and working toward this idea of coast fire, right? Maybe you have a number in mind. and saying no to some things may make sense in the short term so that you can get to this number. But then on the other side is when you get to that number. you need to be able to say yes to things as well. And so if you've, you've had the saving aggressively mindset for 5, 10, 15, 20 years. Sometimes for some people, if they're retiring at a more traditional age and maybe 40 years of being frugal and saving and. Things of that nature. And so it was really hard to flip that switch and go, you know what? I can go on that vacation or, I can, send my kids to this, this higher cost school, whether it be college or, or grade school or whatever. being able to know when to say yes and when to say no is going to be, uh, key along the way to either building up to that coast fire moment or living in it and enjoying it as well. and so one of the things that you can do is buy back your time. So let's say you have hit your coast fire number. and you want to spend more time doing other things. Some of the things that you can do is buy back your time by hiring out lawn care, getting grocery delivery, some of the things that you probably already do to be honest, and, outsource other things. Maybe that's, cleaning your house or, Projects around the house to keep, if you own a house, to keep it up to date and functioning properly, things of that nature. And giving, getting more flexibility with your time, is key here. And so one of the things that you could do to do that. Is to buy back your time by taking some of these mundane tasks outta your day-to-day living. Right? And so these little shifts are what open the door to lifestyle design. once you've experienced even a small amount of flexibility, it changes the way you think about money and work moving forward. And so I think about when I, when I say this sentence, what I'm thinking about is that switch. That my mind made from when I was a teacher, in teaching high school, about 10, 12 years ago. and I decided to leave the world of teaching and move to the world of financial planning. teaching, especially in high school, your day is not very flexible. You have your five or six periods that you teach and you're on a bell. so every call it hour, you're hearing a bell. The next period comes in, you're teaching the next bell, so on and so forth. actually coach football as well, and so that was very rigid and structured. Monday we have a certain practice. Tuesday we have a certain practice Wednesday. Walk through Thursday, game Friday, you watch film on the weekend and you start that over during football season, right? And then off season you have workouts and all those sorts of things. so it was very rigid and I didn't have a lot of flexibility in my time. And then when I chose to go into financial planning, it, it was, I wa I didn't own my own firm, but it was a lot like owning my own business where I had. Al almost ultimate flexibility, right? I definitely didn't have as much flexibility as I want because I didn't have a book of business or I didn't have clients that I was working with. I certainly had to build that out and learn the trade of financial planning and all of those sorts of things. but I wasn't on a bill, right? So I got that taste of flexibility. So if I needed to take a day to. Go to the doctor or, do some things or maybe even take a long weekend, whatever that may be, I was able to do that and not necessarily have to, clock out on PTO or things of that nature. Now, I was still working a bunch of hours'cause I wanted to build my business and things of that nature. I didn't have the ultimate flexibility or as much flexibility as I do now. but I did get a taste of it. when I say things like these little shifts are what open the door to, lifestyle design. and once you've experienced that flexibility, then it changes the way you think. I can just remember that being like, whoa, I'm not on a bell system anymore. Right? And so it seems trivial. but it was a big moment for me, being in my mid twenties and, and, not really experiencing that.'cause I went from being in high school, being rigid in college teaching, kind of in that same setting, and then going into the private sector and being like, whoa, that's, that's a big difference. So as you're working toward this Coast Fire number, you want to start envisioning what that's gonna look like, once you get there, right? And so we talked a little bit about this last week. What do you want it to look like? Do you want extended vacations? Do you wanna reduce your hours? Is there a hobby you really wanna lean into? I've said this a couple times on the podcast. I like to hunt, right? And so what I think about is as you're working toward. this coast Fire number as you're working toward, being more flexible because your, your financial situation is getting better and improving. you wanna start working in these pieces of retirement. as you're building, right? So don't wait. Right? Life is short. And so the analogy I, I want to use here and what I think about is, I think about siding in my bow before, a hunting season, right? I don't wait until the day before I go hunting to make adjustments on my bow, right? I'm testing it throughout the year. I'm shooting my bow constantly. deer season is up here, is coming up here in about three weeks. I've been shooting my bow. Almost every day for about two months. Right? And so I'm just getting it dialed in. Dialed in. and that's, that's the deal, right? That's just, the same deal with Coast Fire is we want to start implementing some of these things when we can. Financially it makes sense. but we wanna start leaning into those hobbies. We wanna start reducing our hours when we can, or spending more time on vacations, whatever those things are, as early as possible. Within reason. because again, life is short. Right? Life is short. We don't wanna wait until, 65 at retirement to start doing these things. Just like, I don't wanna wait, until the day I need to go hunting to adjust my boat to go, go shoot. Try to shoot a deer, right? it just won't, won't work out well for me, right? And so, start building these processes in, start doing these things, living the life that you wanna live now, while balancing, a. That coast fire number, right? Like I said, next week we'll get into, specifically, we'll dive in, how do we calculate that coast fire number, maybe get into some investment, talk a little bit, and then, move into like taxes and things of that nature. but lifestyle design comes with trade offs, and so you can't say yes to everything. So how do you decide? What matters most, right? And so this is kind of what I was alluding to just a minute ago. yes, you wanna start implementing some of these things in your life as you. Work toward coast fire. but there are trade offs, right? So you have to balance kids things, family life choices. the biggest thing that I can give to you guys is start listing these values. What? Is important to you. And so the thing that is important to me is I want to spend time with my family, my friends, the people I love most. Mainly outside. I love being outside. I, obviously, I say I hunt, so that's outside. I like to run. I, I'm constantly running outside, working out outside, going to the beach, uh, doing everything that I can outside coaching my, my son's T-ball team. Outside. so I just love being outside, right? And so if I'm doing those things or more of those things, then, then that makes me fulfilled. That makes me happy, right? I'm spending time with the people that I love, hopefully, ideally outside doing those things right? when I come to a point where I need to make a decision on. Am I doing this thing, yes or no? From a financial standpoint, does it align with doing something with the people that I love? And is it outside? Right? Ideally is it outside? so if a friend of mine invites me to go on a big hunt, and it's not gonna be too much of a stress on my family, then I'm probably likely gonna say yes to that. Right? obviously if it makes financial sense, if my son wants me to coach his T-ball team, I'm probably gonna say yes. Right? if there's something. That has asked me that doesn't align with that value, then I'm likely gonna say no. And I have a hard time saying no. Like probably a lot of you, right? If it sounds fun, maybe it's not quite within, what I normally would do, but it sounds fun. I'd like to say yes to some of those things and. I often have to find myself saying, okay, really think about this and do I want to do it or do I not? Right? Um, like my son just started juujitsu a few months ago. Uh, one of the coaches was talking to me about doing juujitsu. it looks fun, like I really want to, but it just doesn't kind of fit into that, that, that mold right, or that value that I've set out for myself. money is a tool, it's not a scorecard. So lifestyle de lifestyle design is about using that tool and creating meaning now, not just later, right? And so we want to create, uh, we want to use money as a tool and start creating that. And so how do we balance that? I'm gonna save for later versus come do some of these things now. And so, uh, knowing your value, your sets of values are the things that you want to do to have a fulfilling life. we will help you make those yes or no choices. Be intentional about your choices, and then understand those trade offs of if I do this, this is what happens if I do that, this is what happens. Right? of course you can't design a lifestyle. So again, you've hit your number. If you have not hit your number, you need to calculate that number and we're gonna dive into that next week. There really, the, the crux of that is what number do I need to get to so that I can reduce my savings? And if I'm not reducing my income, well now I have extra income to use elsewhere. Right. On hobbies, vacations, sabbaticals, whatever that may be for you. Right. the next thing we want to identify parts of retirement that we can start doing now. Again, life is short and this is really. what I'm trying to get at, right? Life is short. You're not promised tomorrow. So why wait to do some of the things that, that, you want to do? Right? So if you're big into hiking, the last thing you wanna do is be hiking, when you're 70. And it would've been much more physic, less physically demanding when you're 45, right? not that you shouldn't go hiking when you're 70, I think you should do that. but why not start doing some of that stuff now, right? the next thing be intentional, like I just talked about. Be intentional about the tradeoffs. Does it align with what you set out to do with your life, right? So the things that you are currently doing money-wise, time-wise, does it align with the things that you want to do? So if you're a big gamer, right? If you love playing video games, uh, are you doing things to align with that, right? That's kind of, so just be intent about your, your decisions that you're making with your money and your time, right? Number five or number four, revisit yearly. Your wants, your desires, your values may change over time. And so make sure you're having these thoughts, these conversations with your spouse, whoever that may be. and make sure that, one, you're doing the things that you want to do from a value standpoint, but two, if it changes. Then change the way you're making your decisions to fit those, right? So this isn't about spending more recklessly or, not saving properly or whatever the case may be. This is about aligning your money with your values today. And so to recap, Coast Fire gives you flexibility and lifestyle design gives you direction. It's about asking yourself, what part of retirement can I enjoy now without sacrificing my long-term goals, whether that's more family time, travel, hobbies, just peace of mind of knowing that I, I don't need to save 20 or 30% of my income. You don't have to wait until you're 65 to start living. The life that you want to live. You can start implementing some of this stuff now. Right? If you're listening today and you want help figuring out what your own coast fire number is or how to design your lifestyle plan, or your financial plan, that's exactly what I do at Palm Valley Wealth Management. You can visit my website, palm valley wm.com, and click on the Palm Valley Pathway button to see how I help. Families like yours build a plan that balances financial independence and living a meaningful life today. If you've enjoyed this episode, share this with a friend who's working hard and could use some perspective on how to enjoy life along the way. And as always, leave a five star review on your favorite podcasting app. It helps the show reach more people just like you. Thanks for tuning in, and we will see you next time. This podcast is for educational purposes only. Is not meant to be financial or investment advice. Do not make decisions solely based on this podcast alone. Please seek professional help when considering your own situation. I.