How much does it cost you to work?
Perhaps a somewhat strange question, but please allow me a few lines to explain. If the aim is to become financially "free", i.e. being able to live out of a passive income and retire* before the official retirement age, we have to factor in the cost of actually working. Sure, net effect is positive, but in my case there are a few cost items I have due to working which I would otherwise not have of would be significantly different; a few examples:
- Car - we
wouldwill not need two cars ifwhen I retire*
- Work day lunch
- Work clothes
In addition to the above we have some softer and harder to quantify financially factors to consider as a consequence of having a "normal" job:
- Time away from family
- Stress level affecting health
- Less time/energy to exercise, causing a medium/long term health risk
When retiring* there would of course be other activities also generating costs, but I would be in much better position to control these and ensure that e.g. food is healthy, that I get enough exercise etc.
*) I keep adding a start after each time I mention the word "retire". This should probably be described in a separate post in some length, but what I mean is that
- I have enough financial assets so that I with a 4% withdrawal can finance our cost of living
- I quit my full time job
- I might do some part time work on a contract basis every now and then (because I want to, not because I have to)
So, with this said: One action coming out of this is for me to calculate the cost of work (at least the parts which I can determine financially) and see what that does to my financial freedom calculation.