While inflation on its own isn’t bothering me too much, what I’ve always had on my radar is Sequence of Return Risk. This is when the stock market crashes in the first 5 years of a person’s retirement, decimating their portfolio and making it much harder for the investments to fully support them for the rest of their retirement.
Being a single person, I only have one superannuation account and one set of other investments to see me through the rest of mt life. I can’t lean back on the security of having a partner’s superannuation to help pay the bills. When I retired at the end of 2020, I knew that I’d be keeping watch on the gyrations of the stock market, particularly in the first 5 years.
The short dip last year wasn’t an issue for me, but the dip this year seemed to feel a little different. This, coupled with a phone call letting me know that my old school was desperately short of CRTs (Casual Relief Teachers), got me to thinking that maybe it wouldn’t be a bad idea to pivot and earn some extra money to avoid pulling cash from my investments when the market was down.
I also have the added expense of a wedding I’m helping to pay for. A day’s CRT work is paying for two places at the reception. I’m also pretty pleased that I’m not taking $5k out of my portfolio to help my son and his fiancee – hey, I probably would’ve done enough CRT to pay for this, even if the stock market was booming!
I’ll likely keep picking up CRT days until I get tired of it. I know, intellectually, that I have more than enough to ride out the wave. But after struggling financially for so many years when the boys were children, I feel better about having that income stream coming in at the moment. It helps with the “Can you sleep at night” test.
Part of the FIRE mentality is being flexible enough to pivot when/if the situation demands it. If we’re smart enough to see the possibilities in the FIRE lifestyle and determined enough to go for it, surely we’re also far-sighted enough to adapt when we feel we need to?
Picking up some work in retirement wasn’t part of my initial plan, but for now – it seems to make sense.