Saturday, February 26, 2005

Ethical insights about early retirement

How far one can « play the system » to reach early retirement before he should be concerned about ethical and morality issues?

When I first posted about my blog in forums in order to publicize it, some people responded saying that early retirement is unethical, that I should stay part of the system which include working for the most part of you life and be a normal consumer in order to support our economy. I think they are right – to some extent at least.

So, during the last month, I did post a little bit less on my blog and I started a rather lengthy process during which I tried to answer the question: “is it unethical to pursue early retirement?”.

I think the question is relevant. What is actually the difference between early retirement and living on social welfare while able to work? Some would answer: in the first case, you are living on your own money. But is that really true? For instance: if everybody in the society would seek early retirement (I mean: very early, such as retiring before 45), what would be the economic impact? I’m convinced I couldn’t retire early if other people weren’t willing to work until their 60s before retiring.

Common argument in favor of “early retirement isn’t unethical”
- I will retire using money I have earned by my work, I deserve it. If I am able to live on that money by living frugally, I’m not playing the system.

Common argument in favor of “early retirement is unethical”
- You don’t contribute enough to the economic system by being a productive member of the society during most of your lifetime. You benefit from the efficiency of the capitalism world that bring you goods at a low cost but you don’t support this by consuming and producing to keep the overall country production high. If everybody would do as you do, the economic system would crash and we would be back to the middle ages.

My conclusion
One’s role in the society is not limited to being productive. Disabled people, for instance, can, among many other things, help a society remember how lucky healthy people are and to pinpoint the most important things in life: family, happiness, share and not only possessions, for instance. Early retiree can be useful in many other spheres in the society: they can provide help to communities giving their time to charities, they can spare their time trying to improve their neighborhood, and they may promote art and culture to the benefit of others.

An early retiree is unlikely to stay on the beach and do nothing of all of his time. Say I’m successful with my plan and do retire at 37: I will have >40 expected years to live. I will surely find useful things to do. These things could turn out to be more useful, at the end, than what I would have contributed to the society should I have not retired early.
Thus, yes, I think one should be concerned about ethical issues relating to his early retirement project. You shouldn’t be just playing the system (it is particularly true for Canadians who can play the generous welfare system and other benefits low-income persons – such as that of very early retirees - have). My early retirement plan has two parts: reaching financial independence so I can actually retire and planning how I intend to remain useful to the society after this happens.


Blogger Viajera said...

Hi Jack. Very interesting point. I've thought about it myself, not necessarily the unethical aspects, but how I will react to the feelings of guilt brought on by my own ER plan.

Because I have a strong work ethic, will the feeling of having to be busy interfere with the joys of early retirement? Who knows? I guess neither of us will know until we get there.

Regardless of whether ER is ethical or not, I think that if it became a more accepted way of life (such as working mothers or work-share partnerships) people wouldn't question it so much. Also, I think most of them are just jealous.

Love your blog!

4:32 PM  
Anonymous Anonymous said...

Whatever concerns you have that your not pulling your own weight should easily be offset by the fact that your eco-footprint is bound to be lower. The earth has limited resources and your leaving more on the table for others

10:00 PM  
Blogger Mike said...


You might be interrested in reading Galbraith's "The Affluent Society" (from the library!). Although it was written 50 years ago, society hasn't changed much. At that time, work meant production of goods, so Galbraith spends much time discussing the drive to increase production of goods while simultaneously increasing the demand for goods.

Its espescially interresting in light of the fact that the US and Canada have switched to a service economy vs a manfacturing economy. We still define a "good" year as one in which GDP increases, even though such increases now represent more services than production.

Until recently (in historical terms), increasing production provided increased survival. Now with all of our technological advances, mere survival is virtually assured. Yet we feel compelled to "make ourselves usefull". I believe that people have a deep-seated instinct to produce.

When you suggest that you want to stop producing (services or goods), you are going against a basic human instinct. Its no surprise that you find resistance to your plan. But unethical? I don't think so. Its just unnatural.

10:12 AM  
Blogger Viajera said...

Very astute Mike. Thank you.

12:40 PM  
Blogger Jack said...

Anonymous: I think you are right and it is a very interesting thought. I also think that by living frugally, you play a role by tempering the overconsumption of the society. Some people might feel they exaggerate a bit if they own three cars, a large tv in each room, etc., when yourself you own only what's needed to live comfortably.

Mike: Thank you for the comment. I note the title of the book you suggest, I will take a look at my public library to see if I can get it (maybe I will not find it since I'm living in a french speaking area).

Viajera: Some people are jealous, I agree. They are jealous sometimes even if they would be able to do the same, they just aren't able to take the leap, I think the way of life it implies it too different from what they are used to. Just like many people are jealous of people that are traveling around the world for a full year or more: it might be possible for them to do the same, but they lack the courage (or whatever) to jump.

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