When I was young, I pictured my retirement account as a pot of gold. It would be there at the end of the rainbow, when my career is done, to fund my retirement.
Talking with folks, it seems like the pot of gold is the type of thing lots of people think about when the subject is retirement. Whether it’s finding their “number,” amassing a big enough balance to feel “safe” enough to retire, or hitting a nice round goal like $500,000 or $1 million, the lump sum is the thing.
The challenge with thinking in lump sums is, we live our lives moment to moment, month to month. We have food to buy every week, bills to pay every month, and holidays or travel or projects to fund every year.
In other words, life happens with recurring income—not a lump sum.
A pot of gold sounds nice, but when you take gold out to do something or buy something, it’s gone: you can only spend it once. This may be why some people with substantial resources still don’t feel comfortable with the idea of hanging up their earning power. They’re stuck on discrete balances instead of ongoing flows.
Long ago I realized that what we need in retirement is an orchard, not a pot of gold. The orchard produces a fruit crop, and the crop is what meets our income needs for a year. And when it’s over, we still own the orchard! Next year, another crop. When the orchard is sustainable and can produce a fruit crop big enough to live on, we’ve become financially independent—and don’t need to sell our labor to pay our bills, anymore.
One of the best things about the orchard is that it does not matter how long you live. If the fruit crop each year is big enough, you won’t run out of resources. We tend the orchard and keep it healthy enough to supply the crop.
And when you are done with it, “you can’t take it with you” as they say, so the orchard gets passed down to people or causes you love. You don’t just leave an empty pot, where the gold used to be. Instead, the ground can be made ready—for whatever’s next.
Email us or call if you’d like to talk about turning your pot of gold into an orchard.
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