Thursday, 3 December 2009

Realistic Expectations

By Notes From The Frugal Trenches
I blogged today on my personal blog about friends making poor financial choices and basically purchasing big ticket items (cars, house) without adequate finances. This made me really think about what are realistic expectations for life? I've blogged before on this site that life for me is a journey, I began downshifting, getting rid of debt and living a frugal life with such idealism; I was going to be able to sew, knit, crochet, grow my own fruits & veggies, become a master chef & expert baker all with the stroke of a wand. Oh how I came crashing down! I did however learn through trial & error, hard work, determination and realistic expectations that baby steps do lead somewhere and while I may not be able to knit a sweater just yet, I'm pretty good at knitting dish & wash cloths!
Taking realistic expectations a step further, I've begun to wonder about what my expectations are about my life in general? What do I expect to own? How do I expect to live? What is a realistic expectation of where I want to be physically and financially five, ten, twenty, thirty years from now.
You often read that people want to be able to retire at 55, own their home and a cottage, be able to enjoy a couple of holidays/vacations a year, eat out a few times a week etc. Many financial books I've read suggest that people have $1 million + before they retire. I have to say my own expectations are nowhere near as grand! I don't mind (and hopefully I'm physically able!) working until I'm 65, I'd prefer to work part time for more years than full time for less, I would like to own a home with a little bit of land, adopt, volunteer, live simply & frugally and give to others. Am I realistic that I will need money in order to accomplish most of these things? Absolutely! But I also know that money does not necessarily buy quality of life, it does not make you enjoy the life you are living each and every day! A friend recently read a study on happiness and finances and she said that the research showed that once someone had an emergency fund (savings of approximately $25,000) and an income that they could pay mortgage, utilities, food and enjoy one "average type" holiday per year, then their happiness factor did not increase even if they had 4 or 5x that in savings or disposable income! Just hearing this confirmed what I expected - that realistic expectations, a purpose driven life, an understanding of who you are, challenging what success means to you, living a simple life and helping others really does give you all you need to enjoy life, to have fulfillment and to contribute in a positive way.
I'd love to hear from you, how do you keep your expectations about what you can accomplish in your daily life realistic? And for the big things in life, where is it you want to be in 20 or 30 years and is that realistic?