Raise your hand if you’ve ever had this thought: “When I get to financial independence/early retirement, I’ll finally have the time to __________, and then I’ll be so much happier!”
(Don’t worry. We’re all raising our hands.)
Magical thinking is something humans are especially gifted at, and the “If only _____ [insert thing you wish would change], then ______ [insert state of perfection]” phrase is practically written into our DNA.
Also written into my DNA? An actual genetic basis for my crappy sleep! (And that I can smell asparagus pee. Because apparently 23andme thinks I needed an elaborate test to tell me that.)
Magical thinking is the result of good intentions, and our natural tendency to be problem-solvers. We identify a problem, look for the likely solution, and then strive toward that solution, expecting the problem thenceforth to be solved. And sometimes that works. Like if the problem is that we have a stack of dirty dishes by the sink. We look for the likely solution (washing the dishes), strive toward the solution (wash them) and then rightly reap the rewards of no more problem, at least for that moment (until more dishes appear).
But sometimes the solution we’re striving for is bigger and takes much longer to reach, and in that time gap, our minds begin to exaggerate things, namely how we’ll feel about it all when we get there. That exaggeration is the magical thinking, and sometimes it’s harmless — but often it’s not.
Today we’ll get into all of that — why magical thinking about early retirement and financial independence in particular isn’t harmless, and what we can do to counter that tendency when we feel our minds drifting toward the magic.
I have described part of this journey as magical before, specifically how surreal the latter portion has felt as we’ve watched our numbers grow without it feeling like we’re doing anything to make that happen. (And yes, I know that is exactly how compound interest and passive income work. But knowing it rationally and seeing it happen are two different things.) Talking about magic that way is what I might call “the magic of wonder.” Like when Harry Potter first finds out he’s a wizard, and everything is just awe-inspiring and surprising to him. (Obviously there are going to be more Harry Potter references in this post. Fair warning.) It’s the magic of the present moment, the magic of observation, the magic of surprise.
Let’s call that the good magic.
The other kind of magic — let’s just go with it and call it the dark magic — is magical thinking, that tendency to create a causal link in our minds between one action and an outcome, and then to build up that outcome into an exaggeration. (And totally transparent fact check here: both anthropology and psychology have clear definitions of magical thinking that I’m not strictly sticking to here. I’m going with the more contemporary vernacular meaning of the phrase.)
Let’s use an example that most of us can likely relate to, using that if-then construction:
If I didn’t have to go to work every day, then I’d be so much happier.
Action: Stop going to work. Outcome: Happiness!
There’s so much loaded into a simple statement like that, it’s easy to miss it. But here are a few things going on there that are worth noting:
- The false notion that work and happiness cannot coexist.
- Ignoring the fact that happiness is the result of many factors.
- The overemphasis on work’s negative attributes (the ones that feel like a barrier to happiness) while ignoring the positive ones.
- The huge burden we place on the end of work to deliver us nothing less than happiness.
We all think this way sometimes, and the point of this post isn’t to get us all to dissect every thought we have. Rather, it’s to help us identify when that natural tendency to oversimplify our thinking steps into the realm of dark magic.
Why It’s Worth Countering Magical Thinking
A magic-like sense of wonder in the present moment is a glorious thing, and something I hope everyone gets to experience from time to time in life. Hold on tight to that good magic.
It’s when we shift that magic into the future — expecting a not-entirely-realistic future outcome from a set of actions we’re taking or planning to take — that we risk peril. And there is a scientific basis for this, focusing on our expectations. In that example in the last section (no more work = happiness), our expectation quickly got lofty, to nothing less than the ultimate aspiration of humankind. And there is research to suggest that happiness results when the outcome exceeds our expectations, but not when it only meets our expectations or falls short. We could definitely have a robust discussion around how and when that’s true, whether it applies to all situations, whether happiness is often a choice and not an outcome (as we believe it often is), etc. Those are all important questions. But it’s easy to see how, if we expect one (big) thing to result, and we don’t quite achieve that, or we achieve it but not the way we expected, we’d feel disappointment. And that’s the first problem of magical thinking:
Magical thinking builds up the end state so much that it can’t help but disappoint us once we arrive there.
Because, like, magic isn’t real, much as we might all like to zip on over to Hogwarts. If we let ourselves get attached to these lofty or overly simplified outcomes, we’re bound to feel let down because life is rarely so simple. And, if the research is correct, we’d need to exceed those expectations to be happy with the outcome, which is essentially impossible if we’ve defined the magical outcome as all-but-unachievable anyway.
But that’s focused on what happens way down the line, after we reach our goal. What about what magical thinking does in the present?
Magical thinking makes our present lives seem worse by comparison and focuses our attention on the negative.
If you (think you) know this magical future is out there waiting for you, then your current circumstances will feel a lot worse by contrast, even if things are actually pretty good. The difference between feeling great about your current circumstances and feeling lousy about them is where you place your focus and expectations. Magical thinking puts the focus on more, better, perfect, ideal, not on contentment and satisfaction now.
Magical thinking also — and perhaps more importantly — places a barrier between us and our desired state, an obstacle that may be entirely artificial.
Saying “When [x future state] arrives, I’ll be happy,” implies that you can’t be happy now. Or be fully self-actualized, or have time for your passion project, or whatever else it might be. And chances are good that barrier isn’t as clear or as sturdy as that line of thinking might make it seem.
Fortunately, it’s possible to shut that magical thinking down before it skews our experiences and expectations.
Magical Thinking and Early Retirement
Here’s a partial list of some of the magical thoughts we’ve had about early retirement:
- When we retire, we’ll have time to get in the best shape of our lives and we’ll quickly start summiting major Himalayas.
- When we retire, we’ll be able to read every book we’ve ever wanted to read.
- When we retire, we’ll never feel any stress ever again.
- When we retire, we’ll get so much done that’s meaningful to us.
- When we retire, we’ll be super motivated to get outdoors and to be productive, and we’ll never waste days sitting on the couch or surfing the internet.
- When we retire, we’ll be two little Buddhas, radiating love and positivity, and never getting frustrated or irritated.
- When we retire, we’ll be able to travel the whole world, climb every mountain we want to climb, read tons of books, write some other books, ski every continent, make videos and podcasts and all kinds of other stuff, relearn piano and painting and ballet, and have lots of time to catch up on sleep. (Just reading that sentence is exhausting.)
If there is one thing I’ve learned from talking to people who early retired ahead of us, it’s this:
Even without work, our to do list will never get shorter, only longer. We will never have enough time to do everything.
Add to that: It’s still real life, and it’s still us. We’re procrastinators now and that won’t magically change just because we’re retired. We’re sometimes lazy and we’ll still sometimes be lazy. We’ll still have things that need fixing and bills that need paying, and we’ll still fall into those clickbait black holes sometimes. We’ll still have the fragile body and fragile tummy that occasionally force us to spend a weekend wrapped in ice packs instead of getting out there and crushing it. We’ll still react like human beings and get cranky sometimes, even if we’re happy and content overall.
The point of the last paragraph isn’t to dash all our dreams. It’s to do a little reality check on all that magical thinking we’ve done over the years, and to adjust our expectations accordingly.
Because if we go into early retirement thinking it’s a magical cure-all, or that we’ll magically become our happiest, most fully-actualized selves, we’re bound to be disappointed.
And after working so hard for so long to reach this big goal, the last thing anyone wants to be is disappointed. Given what a rare and special thing early retirement is, anything less than wonder and gratitude is borderline tragic.
Questions We Ask To Counter Magical Thinking
Magical thinking is pretty easy to shut down once you know you’re doing it, so the big step is just identifying it in the first place. And we’ve found that asking ourselves these three questions works especially well:
Could that outcome be an exaggeration? — Is the end state we’re expecting what’s likely to happen, or is it a hopeful projection of what we wish could happen? Are we truly going to become superheroes capable of scaling 8000 meter peaks, or should we maybe set our sights on more modest altitudes, at least at first? Or is quitting work truly going to make us happy, peaceful and stress-fee, just like that, or might true happiness take a little more thought and work?
What’s stopping me from doing that thing now? — Is the barrier we perceive, usually in the form of work, really as much of a barrier as we think it is, or might we actually be able to get around it? If travel is that important to us, why would we wait until we’re retired to stop doing it? If I dream of writing more in retirement, why wait until then to prioritize it? (Good news on both of these: we are doing them now.)
Does that really sound like me? — We probably all dream of this magical version of ourselves whom we plan to become in retirement, but it helps to put things back in terms of our present day selves. That totally blissed out little Buddha who never gets stressed about anything? Yeah, that doesn’t sound like me, and also, I don’t want to be like that. I always want to be fully engaged in the world and all its messiness, to get outraged when things warrant it, and to fight to make the world better. I can’t do that if I’m just sitting under a bodhi tree. And being super productive all the time? I’m not going to put that pressure on myself because I know that my creativity comes in waves, not in a river.
You may find that you have a different set of questions that help you sniff out your own magical thinking. These three have worked well for us, and helped us stop making those sweeping pronouncements we used to make, meaning we’re going into early retirement with surprisingly low expectations and minds ready for lots of present-day magic.
Let’s talk magical thinking!
Anyone care to join us in confessing your own magical thoughts about early retirement or financial independence? Any questions you’ve found to help keep your expectations more grounded? Want to quibble with anything in that expectations vs. happiness research? Or are you immune to magical thinking and have secrets you can share with the rest of us about how you do it? Let’s chat in the comments!
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