Earning and working are different things in a post FI world

Before they are financially independent, most people work to earn the money to buy the stuff they need and want, it’s how 21st century capitalism is meant to work at the moment. It gives rise to the term ‘work’ – something that you have to do otherwise bad shit happens, like you end up with all your stuff thrown out on the pavement.


Because it’s something you have to do for many years, many of us get Stockholm syndrome with work. Inveterate story-tellers that humans are, we tell ourselves that work is innately a Good thing and lends meaning to our lives. Let’s take a fine example of this from someone who I’m generally in agreement with, other than in this aspect of life:

But I believe almost everyone will benefit from having an ongoing economic relationship with society while they can – even if only for a day or two a week.


I’m the poster child for disputing this paradigm. I consider it a limiting belief, and have taken pot-shots at the Calvinist work ethic every so often on here. The beauty of financial independence, however, is that you get to have the choice of whether to work or not. Over at SHMD, Jim has decided that he missed work, so he went and got himself a job, even though he doesn’t need the money.

Now I have never missed work, ever since I handed in the tools of an office-worker’s trade way back in June 2012. There is, however, a general psychological principle

Everything that irritates us about others can lead us to an understanding of ourselves

Carl Jung, MDR

I would generalise that to everything that irritates us… I don’t think it’s particularly personal in this case. If Monevator and Jim and 99% of the rest of the FI world want to work till they drop, good luck to them. It’s just the concept that work is an inherent good that gets my goat. As a society, we are going to have very serious trouble and mental distress with this meme if the robots and globalisation really do take half our professional jobs in the coming years, unless we have a social revolution that probably involves bending some of the axioms currently underpinning society. Hopefully one of them will be work = meaning 😉

I realize today that nothing in the world is more distasteful to a man than to take the path that leads to himself.

Hermann Hesse , Demian

In order to live intentionally, therefore, I need to separate the beliefs coloured by past experience from my current experience, and my temperament had the past experiences not happened. Otherwise I will live in an imaginary prison, boundaries that once had value but have no more.

What does the word Work mean to me

It means a lack of freedom, it means grind, it means being trapped. It means earning money, it means selling my time for money, it means restrictions on my time. It means doing stupid shit like justifying my existence, it means filling in time sheets that have no bearing on reality, paperwork just because. Because humans are devils with their recency bias, this litany of woe is because the most recent experience was largely negative. But for 27 years out of my 30 it also meant the opportunity to travel, to do good interesting stuff and to build capital across my working life as I slowly exchanged human capital for financial and social capital. If I were to allocate the experience of my years evenly, then only 10% were bad, maybe 12% if I add in the six months I was unemployed between graduating into Thatcher’s first recession in the 1980s and starting work.

So it’s easy to see the limiting belief. Work = pain, and I need get as far away from that as possible. Even in 2009 I intellectually knew that was an extreme view, but one that because of where I was in my working life I could get away with. The power of the intensity of feeling galvanised me to clobber wasteful spend and save and take the necessary risks with extreme prejudice, and reach FI 8 years early.

What I did not realise was that simplification also distorts

and it is the distortion that clouds much of my thinking when it comes to the topic of making money

I think the word ‘work’ has picked up some unnecessary bad connotations […], especially as we’ve transitioned out of the years when ‘the recipe’ (grammar school -> degree -> job for 40 years -> pay your dues -> final salary pension scheme) still worked.

liberate.life in this comment on here

I was that grammar school guy, son of a maintenance fitter, who went to university, got a degree, then worked only four real jobs[ref]excluding casual crap before leaving university – kitchen portering, repairing radios and TVs and odd-jobbing[/ref], have a final salary pension scheme. It worked for me. I was able to retire early because I saved roughly half the notional capital behind my FSP, but having the FSP effectively gives me a massive bond-like holding, which means my risk tolerance with stock market investments is insane, because the FSP will keep the wolf from my door.

Liberate.life is the counterfactual to my experience – younger and more dynamic, but electronics engineering is the field the younger Ermine worked in. And yet he is yin to my yang – he can sell, and freelances, and as I read this it looks like the antithesis of everything I know about work. It’s like looking in the mirror and seeing half the image right way up and half of the reflection upside down. I’m damned if I know which half is off but I suspect it’s mine 😉

So it was time to investigate the subject of work and money deeper. For a long time the obvious issue, that I associate work with pain, simplified things too much

I associate specialisation with success with work

For 25 years I was working in a big company, and in a big company hierarchy. Big companies tend to narrow people down into specialisms in engineering, because they have enough people that they can do that. I pursued some technical interests after leaving work, and have some of this on a blog, when I read it back it is a whole load of random bits and pieces on all sorts of subjects as I flit from one are of interest to another. Mine is worse on that front than your typical engineer’s blog, they at least tend to have a reasonable common thread for a few posts. As someone who is financially independent I can afford to pursue my whims, but if I were looking for staff and I saw that sort of character, I would think Jack of all trades and master of none, and file the CV in the round filing cabinet on the floor.

I haven’t even stayed with electronics and software, a few weeks ago I offered to fix a generator on a no fix no fee basis. I was pretty sure that Google was going to be my friend, the world is full of Honda GX small single cylinder 4-stroke petrol engines and Google is full of people who are describing faults and getting hints on how to fix them. The fault was the engine would run for about 20 seconds and the die. Google told me this was likely a blocked breather vent in the fuel cap, which I confirmed by unscrewing the fuel cap as the engine was about to conk out. Whereupon it ran fine[ref]Obviously you shouldn’t run an engine with the fuel cap open because petrol vapour is inflammable and invisible so don’t try this at home.[/ref] 😉

TFS identified this sort of mentality as a ‘scanner’ but twenty-five years of working in big companies has taught me to identify it as ‘dilettante’. Apparently it is more tolerated in today’s world of work, a kinder term for that sort is multipotentialite. It is more tuned to today’s world in some ways, because better communications means provided you can search well, you can gain the benefits of other people’s experiences by covering masses of ground. You just couldn’t do that before the Web, you couldn’t find enough different people to talk to, and it would have taken ages anyway. Multiple tabs were made for that sort of approach to finding stuff out – cover masses of ground, fast.

lots of tabs is the way to search - untill you run low on memory
lots of tabs is the way to search – until you run low on memory

So I have uncovered some unhelpful associations, and indeed at some level I despise that generalist tendency because for 25 years that wasn’t how to have success at work. It is possible I played against type for a quarter of a century because I prized security and stability and did not know how to manage money over more than a monthly basis. I always needed an answer to the Micawber question, and a regular income made that possible. I struggled with that while running several years from savings, in hindsight I didn’t spend enough. The generalist tendency occasionally caused me grief at work and probably slowed my rise up the greasy pole, on the other hand even in a big company you need people who can cross domains. It tended to work well in good times but be awkward in bad times.

But since I have the drains up I may as well keep on digging at these unvoiced assumptions…

 I associate a steady stream with income – I am virtually blind to feeling uneven income is income

I can’t really relate to income that comes in unevenly in dribs and drabs, because for 30 years income arrived in roughly the same amount each month, apart from overtime (in the early days) and bonuses (in the last couple of decades). It’s still a little bit of a mystery to me how a string of lousy £50 here, £100 there dividends in my ISA adds up to a good few thousands of pounds of income when rolled up over the year. I was able to jump over the uneven lumps ≠ income in the ISA because there are so many of these minor transactions I can think of this statistically. Many people work really hard to make their dividend income spread evenly across the year, this sort of happened naturally for me, although slightly peaking in Q1 and Q3. You can have 20 companies working for you in a HYP, but I would defy anybody to work 20 part-time jobs or even have 20 streams of income, that sort of diversification is hard to have with many income streams.

At a gut level I don’t really consider the sort of hit and run one-off jobs like the generator as income. For sure, Quicken adds them up for me so I can declare this, as long as I keep my pension + earnings below the personal allowance I am chilled. Last year I was able to toss a lot more than the usual £3600 in my SIPP because these things added up to a fair bit more than that. But it doesn’t feel like income, because it is unreliable and lumpy.

I associate earning money with work

and worse than that, I associate earning money with selling my time for money. So these one-off jobs don’t feel like work which is good, but they don’t feel like earning money either, which is bad. I don’t trust them, so I just bung the result into SIPP and live off the steady income from the SIPP, because I can’t budget with variable lumpy amounts. By a curious twist of fate a retiree older than 55 can put all their earnings into a SIPP in one year and get it bumped up by 20% to extract the next year, provided they don’t draw more than the personal allowance. I’ve only got another few years worth of that before my main pension shoves me well into the normal tax bracket, but I may as well enjoy the windfall while it’s there.

And yet together with the income from the ISA these odd jobs will start to add up to about the national minimum wage. It was not so long ago that I was chuffed that the dividend income from the ISA matched what I would have got from jumping through the hoops to get JSA (£71p.w so ~ 3700 p.a.) and yet the rate of increase of the ISA income per year is creeping up[ref]in fairness that was written nearly six years ago when the best you could put into an ISA was about 10k p.a. Some of the win in getting to three times that was the fact Osborne turbocharged this to time and a half, the time honoured magic of Saving Hard at work rather than any particulalry sharp investing chops[/ref]. I don’t draw an income from the ISA because I don’t need to – I want to pump that up as much as I can before I enter the regular BR tax bracket in a few years, since it is tax-free income.

I have lived in a big-company bubble for 25 years and it has limited my vision

I owe liberate.life some beers for widening my search. Because the similarities of the engineering skillset (naturally separated by 25 years or so due to the age difference) and yet pretty much everything else looking like a counterfactual, he’s shown me a set of limiting beliefs I was unaware of. More surprisingly to me, they aren’t particularly due to the trauma of the nutty performance management usage and abusage I took in 2009. That does exist, and has it’s own consequences. The idea of following Jim SHMD’s path and selling my time to an employer to draw a salary brings me out in hives. I’m not gonna go there, and I don’t need to.

But unassociated with that, my concept of making money was massively narrowed by my experience of working life, the unchallenged assumptions of that grammar school kid who followed the default track. Now that I am grizzled of fur and sufficiently past the finish line that I have options all the way up to and including doing nothing, I can zoom out and ask myself the question – is there a better way?

Perhaps I should turn the telescope round and ask myself what do I want out of earning money. I have identified a project where I could use a bit more money. It doesn’t directly change my own lifestyle, so my greatest fear of earning more through selling my skills doesn’t apply – that fear is that I would earn money, inflate my lifestyle with Consumer Crap™, get locked into it and lose the delightful freedom of FI. I am happy with what I will have, my lifestyle will inflate somewhat anyway as my income increases once my main pension starts. I don’t need to earn more money to raise my lifestyle. Although once I believed that I screwed up discharging my mortgage early which meant I took an income suckout for the last four years, now I am on the other side I’m not so sure that I regret taking the suckout over the convalescence period. but that’s easy to say from the other side of the mountain. I got a significant ‘pay rise’ this when my DC pension started in June and will get a massive ‘pay rise’ when my non-deferred pension starts in a few years. Breaking the link between making money and my own lifestyle gives me detachment which can distance me from the suffering normally associated with ‘work’.  It is one aspect of the freedom to that financial independence is about, once you have spent the time integrating the freedom from.

So what do I want from off-piste opportunities to make money?

It is a subset of asking

I think I would feel truly fulfilled if I spent most of my days…

a subset for the simple reason that I have command of my time, being FI. I will do other things that fulfil me, this does not need to replace my use of time, but it needs to add, or at the very least not take away.

  1. I want to earn through doing something that is congenial
  2. and interesting
  3. has some originality or novelty
  4. creative in some way[ref]it doesn’t have to be engineering – for the past few years I have been makingsome money from photography and from sound recording. But trends in the wider economy are running away from those sorts of things[/ref]
  5. with decent people who aren’t dickheads in general[ref]Everybody s a dickhead sometimes, it’s part of the human condition, and that’s OK. Persistent dickheadery is what I want to avoid[/ref].
  6. that helps people or causes that I know or care about personally
  7. that is specifically something I bring to the party from skills, temperament or talent if any
  8. I want to spend less than a day a week on this, but I favour that being in all-or-nothing chunks with long gaps in between. Part of this is that I am limited by the tax system, I don’t want to work for the government 20-40% of my time. I have done my share of that over the last 30 years.
  9. I don’t what to sell my time for money. Obviously doing something creative takes time, but I don’t want it in the form of billable hours, more billable results
  10. I don’t want to ever see performance management. An engineer’s work speaks for itself, should that be the field I use
  11. I don’t want regular or ongoing time commitments. Hit and run jobs are what I  want, get in, do, then get out
  12. I don’t want to carry a smartphone all the time
  13. I am happy with no fix no fee and no guarantee of regular work – but if you aren’t there regularly for me there’s no guarantee I will be there for you 😉 and yes, that is sort of at odds with 9
  14. I prefer to sell Mind, not Stuff. Stuff gives warehousing and cashflow problems, and regulation is a bitch. It’s not hard and fast though.
  15. I do not want to be derivative or routine. I don’t want to be a replaceable work unit. No chuntering out ebooks or matched betting which seem common fave side hustles in the PF scene. I am rich enough not to have to do this, and old enough to know my time is limited.
  16. no franchising, if I am not original enough to make a decent return then I will just walk away

and if I do do this, I want to earn a lot more than the minimum wage for the time I do spend on it. Unless it really is so much fun that I don’t mind, but I’m not building that assumption in from the off. I am not volunteering. I don’t do that, particularly the sort of staffing job. I have done one-off data analysis and design stuff for the RSPB, but not under the usual volunteer x hours a week, it was task-oriented.

Unfortunately the logical conclusion is freelancing or contracting. I have no experience of that at all, zero track record, no domain knowledge, I am an introvert and can’t sell. So I have never done this in a big way although I did have a multimedia/web design company on the side in the early days of the WWW mid 90s to early 2000s. But selling was my weak point and when the major customer changed technology I folded the company. I read this and think ‘bloody hell, I can’t do any of that’.

Not only that, but it appears that small companies are where the most likely chances of success are. I have worked for a small company, a 10-15 man band, but it was at the very beginning of my career 34 years ago. Small companies are like the past – they are a foreign country; they do things differently there.

The Ermin place of work at my first company. The duff sensor heads are lined up on the back wall. I don't have a good explanation for the can of wifebeater on the bench, perhaps were were celebrating a big Egypt order. 'elf 'n'safety would shut this joint down i na jiffy. We used to wash PCBs in boiling Arklone, a CFC with the instruction 'don't fall down, else you'll stay down'. The vapour was heavier than air.
The Ermine place of work at my first company. The duff sensor heads are lined up on the back wall. I don’t have a good explanation for the can of wifebeater on the bench, perhaps we were celebrating a big Egypt order that came in around this time. ‘Elf ‘n’safety would shut this joint down in a jiffy nowadays. We used to wash PCBs in an open tank of boiling Arklone, a CFC with the instruction ‘don’t fall down, else you’ll stay down’. The vapour was heavier than air.

I had some bizarre engineering experiences in small firms, two stick in my mind. In my first company, the design engineer swore blind that a virtual earth amplifier had a high input impedance. Now at 22 I didn’t know a lot, particularly when to keep schtum and STFU, and I had been testing these blasted things which used to want to take off and oscillate more often than not. That’s bad in an optical sensor. But I did know that a virtual earth was a low impedance input. So when there was much head scratching in a meeting as to why we have more duds than good ‘uns I go and pipe up “but a virtual earth is a low impedance – the clue is in the name”. I was dead right, and the clue is indeed in the name, but there was a deathly silence and the assembled multitude digested the unwelcome fact that the lead designer had goofed, as pointed out by the rawest recruit. Seemed a good idea to move on from there after a year…

The second was when I was the lead engineer on a project at The Firm, and we had contracted some clever fellows in the Cambridge Fens. These guys had minds like planets, and I had told them the average TV sound in expected typical audio levels of 0.7Vrms. For some reason they decided they only needed a peak to peak level of 1V, sadly convention has it that the peak to peak amplitude in this case is 0.7×(2×√2) or nearly 2V. The passage of time had gentled the Ermine’s needle-sharp teeth and I had learned that it pays to nudge people to coming to the conclusion that perhaps a mistake had crept in somewhere. But I confess I had to look it up in a textbook after a meeting where one of these guys a lot brighter than me was declaiming that the signal was entirely correctly 1V, he really believed that. They were awesome at digital stuff, could pull their set-top box code apart and have it have it changed in a few hours. In a bigger company somebody else would have been in charge of all that fuzzy analogue stuff and this challenge to basic engineering fundamentals wouldn’t have happened, particularly in front of the customer 😉 Small companies have much more of a heady mix of absolute brilliance and the occasional absence of fundamentals, in my limited experience of them.

For many reasons I would be a fish out of water trying to apply what’s left of my skills in this different world. I have no knowledge of the terrain, and I don’t know if my passport is good for the country. To my advantage I don’t have to succeed, though of course that may work against me too, perhaps I will not have sufficient fire. It’s not looking good, but I have one key advantage. I am not desperate – I am financially independent. Even at the moment the amount in my current account slowly creeps up month on month and I need to toss it into the Nationwide every so often to win 5%. As a result my risk profile is very different from normal, I can screw up a few times and let it go.

There are other odd wrinkles, take this perfectly reasonable recommendation

To free yourself from the grind, be defined by your strengths

I can see that might work when each piece of work is won anew, ie there is no history, it’s obvious to play to your strengths. But in my career I achieved many wins by fighting down weaknesses – it is this which turned an introverted young Ermine into someone who could speak in public and lead international teams. Even in the specific realm of personal finance I had to fight down the common get rich quick belief that trading is the way to make money with stocks, and come to understand that the noisiness of the information, the abnormally high likelihood of infrequent outliers and the high frictional costs mean that often the less you do[ref]inaction on its own is not enough although Robert Kirby’s The Coffee Can Portfolio made a good case it was, inaction is necessary but not sufficient IMO[/ref] the better your long-term performance.

So there are many hurdles and mindset-shifts before I could turn freelancing for small companies into something workable. And surprisingly, none of them are particularly associated with the issues that finished my big company career. Why consider this route? Because the one thing I know I don’t want to do again is a regular job. I don’t have the time, there are all sorts of bad associations, and it’s not what I want to do with my life. Because that was the only way I knew of making money, I accepted I was never going to make money from my human capital again.

People have occasionally challenged that assumption. But it took time for the noise and hum from the crash-landing of my career to die down, and for me to see an opportunity that wouldn’t lock me into a consumption lifestyle, so that I could see the remaining limiting beliefs. Whether it will amount to aught is unknown at the moment.

Andy’s liberate.life is a different take on financial independence, with less emphasis on the financial and more on the independence

In the personal finance sphere our weapon of choice is  of course personal finance, it is the Law of the Instrument. If all you have is a hammer, everything looks like a nail. It’s written in the term financial independence, hell, what other sort is there? Well, given the assumption we are talking about living in a First world consumer economy in the 21st century, that is.

We are aiming to save enough money to not have to work. RIT is the poster child for doing this relatively young, but his journey to FI was a pretty harsh ride. I’ve never earned anywhere near the amount of money I guess RIT earns, but I’ve never taken that sort of punishing schedule for years on end either. In my case, because I was naturally closer to the end of my working life, I could get away with focusing on the financial route to independence. You can become more independent, in terms of choice on how you spend your time, without becoming financially independent. The model I and most people follow, working for a company to get nearly all your income, is one of the least independent ways to get the financial capital you need to live life in a Western consumer economy.

Andy at liberate.life is a new kid on the PF block. Although it doesn’t apply to me, he challenges the principle that financial independence is an indivisible unit. His site is well worth a look if you are in this position

You made it! You’re financially comfortable. Your car is new enough to not break down all the time. You live in a nice house. If you have kids, they’re well dressed. People hold you in high regard and by society’s standards, you are a success.

So why the hell does your life feel like such a grind? At one point, you were young and full of optimism but now you just follow the routine, day in, day out. You don’t have any passion for what you do any more. You do it because you have to. You’ve got bills to pay.  You can’t see a way out of this before the sweet release of retirement at 60-something… and then you’ll be too old and worn out to live out the dreams you’ve always had anyway.

Now since I am not a million years off 60 I would dispute

and then you’ll be too old and worn out to live out the dreams you’ve always had anyway.

Bollocks to that, mate, remember that statistically happiness is U-shaped across the life cycle in many Western societies, so some of this is part of the human condition. But that proviso aside, he’s offering a freebie course in how to get FI[ref]for the sake of full disclosure I have done neither[/ref], and if you want to pick his brains specifically 1:1 interactivity is there if you pay him for his time.

In many ways getting to FI is a matter of asking the right questions as much as finding the right answers. The right questions can lift limiting beliefs into the light of conciousness. You don’t have to fight limiting beliefs if you don’t want to or need to. I’m not going to bother fighting the belief that working for an employer has become a soul-destroying issue of gamesmanship and playing the game with meaningless metrics that strip out the joy of solving problems sometimes otherwise known as work, because I don’t need to. It’s probably not universally true, even for me now.

But now I have found a potential application for deploying the residual vestiges of human capital I may still have which won’t lock me into lifestyle inflation and consumer crap, it is worth challenging some of the limiting beliefs about making money other than just using my financial capital. And without a doubt, Andy helped me ask some of those questions, and I have found that the default answers were often wrong, inconsistent and incomplete.

So if you feel you have made it but want a way out go read some of his work, if only to ask yourself some awkward questions. You may not like the answers but they can serve you well.


40 thoughts on “Earning and working are different things in a post FI world”

  1. Hey Ermine.

    Thanks for the endorsement.

    It looks like you’ve turned a corner and perhaps the many opportunities for well-compensated, enjoyable work (which have been there all along really) will start to stand out a little bit more now. You never know, maybe some new ones are about to appear…

    > Bollocks to that, mate, remember that statistically happiness is U-shaped across the life cycle in many Western societies…

    Typical engineer. Refuting my sales copy with hard facts and evidence. We really are a tough crowd to market to aren’t we?

    Just, whatever you do, don’t start upsetting the audiophiles with ‘science’. We need to sell £700 USB cables to them or the kids will starve!


      1. Thanks for the heads up on the Gravatar profile – fixed now.

        The Atlantic article was interesting. If I followed it properly, despite it being difficult to control for other variables in humans to nail down the effect, the data from other apes (who don’t have commutes, divorces etc) strongly supports the U-shaped idea.

        I could take one of two positions:

        1) Andy the marketer: what I said has the desired effect because the answer to the question ‘So, you’re OK with being imprisoned in a job you hate until you’re old?’ is usually ‘No’ (note, I’m talking about ‘old’ from the perspective of a 30 year old)

        2) Andy the rational problem solver: I should change my copy to say something like ‘The U-shaped profile of happiness vs age should lead you to want to be free before your 40s because you *really* don’t want to suffer the double-whammy of being stuck in the grind *and* suffering the expected age-related lowering of happiness simultaneously’.

        Unfortunately, people don’t read sales copy like you and I read datasheets so I’m afraid (1) wins! 🙂


      2. Don’t get me wrong, I’m not usually one to let precision get in the way of a good story. .

        Being stuck in the grind and suffering the age-related low-water mark is a bear, though. Particularly when a wunch of bankers arrange a massive finacial crisis at about the same time. But the younger me wouldn’t have believed it would happen.


  2. “… the unwelcome fact that the lead designer had goofed …”

    Um, yes, I guess we’ve all been there at one time or another. I know I occasionally found it impossible to play this stupid game of “keep shtum and hope it’s all quietly sorted out in a politically-acceptable-face-saving fashion before the next meeting” – I ended up pointedly saying what (I bloody hoped!) everyone else knew/was thinking. As a certain Blaster Bates said “It doesn’t do yer case any good, but it gets it off yer chest !”

    Mind you, as a freelance IT contractor on most of those occasions, I kind of felt I had to demonstrate I knew what was what (especially given how much they were paying for me to occupy furniture whilst all this was going on !)

    I don’t know who said “it is dangerous to be right when those in authority are wrong” but they were probably right if done too bluntly …

    Still, sitting here with a mug of tea and a nice view out of my upstairs window this fine morning, it doesn’e seem to have done me any lasting harm. 😉 Kind of wish I was on top of somewhere like Blencathra or Bowfell on a morning like this, anyway …

    I used to really enjoy contract work and, excepting the odd bit of lunacy such as that above, I like to think both parties were well chuffed with the end result. But, I suspect that, like you, those days (that “style” of working in essence) has well and truly gone. I know my father felt just the same when he packed in doing structural steelwork design (with the odd mechanical job on occasions).

    He was just retiring when CAD, email, etc was really starting to become common place – he freely admits he wouldn’t have taken to it. He was an old-style draughtsman’s drawing board, coffee percolator on top of filing cabinet full of drawings, and bung ’em in large cardboard tubes in the post kind of guy, and everyone was happy with that, back then.

    Everything moves on. He now spends an awful lot of time in the garden on various projects and does an occasional day a week in other people’s, and I know he’s happier doing that these days 🙂


    1. Being right as a hired in expert is a lot safer than as the new boy. I was living at my parents at that time and remember telling my mother the story. I think she did try and suggest to the arrogant young pup that was her son the subtleties of it being possible to be right in the wrong way, and that you should always try and give people a place to be wrong, preferably in private. But I was 22 FFS, and I knew that I knew a lot more about the world than I know that I know about it now.


      1. Fair comment. I guess we all feel we know it all when we’re fresh and “up to the minute” with the latest programming/design techniques (or fads as I often see them). There’s “good enough to get the job done” and there’s “inventing stuff for the sake of it” in my view. Pick something suitable, roll shirt sleeves up and get to it.

        I think there were a couple of reasons why I said what I did in such meetings:

        1. I’d been there before, working in my fresh-faced “eager to help (i|e)nsure our team’s success” way of mine back then, for eighteen solid months, only for the project’s deliverables to be handed to the customer … and promply shelved, never to see the light of day. Don’t ask !

        2. I’m very much a Northern “tell it how it is” type that would prefer things get sorted out early on before we end up with the sort of “massive project over-run scandal” that’s all over the front pages. I’ve seen and heard about too much of that in IT circles over the years. It gets seriously embarrassing when it’s YOUR industry this is happening in. This sort of thing costs ALL of us a LOT of money, our sodding money. Forget about “government money” – it doesn’t have any other than what it gets from us taxpayers and what it’s borrowed from elsewhere.

        But, of course, I’m wrong these days – nobody’s below average these days, nobody’s supposed to be called out for being crap at their job and, as a result, likely to endanger an entire project. Give me strength! What are people sticking in CVs these days then (and isn’t picked up on) that this happens ?

        When I first went freelance professional indemnity insurance was “something you might consider depending on what you’ll be doing for them”. Over the years, it slowly and subtely changed to the point where it would be “bloody dangerous not to have it” !

        All things considered I’m glad to be done with all that. I really enjoyed what I did during my time and feel I did add genuine lasting value to the projects I worked on, but now ? Forget it. I will concede that doing well-defined mini-projects for small businesses might be a different story. I personally used to prefer the small office atmosphere to that of the few FTSE 100 companies I encountered, personal preference to some extent.

        However, given my belief that things have NOT been fixed from 2008, and the way large players tend to make smaller ones wait a bloody long time for their invoices to be paid, I’d likewise be concerned about THEIR ability to pay ME ! I had a very near miss with a pretty big invoice when one firm I was doing some consultancy work for went bust during the 2000-01 recession. It was only due to a good friend employed there at the time who must’ve deployed his elbows to good effect in Accounts that I got it paid before they disappeared for good !

        Maybe I’ve seen too much “Can’t Pay? We’ll Take It Away!”, who knows ?


  3. I worked 13 years fulltime (8 employers ), probably 1 years worth of contracts and 7 years freelance. I didn’t have the nads to go contracting until my mortgage was paid off and I had a FU buffer.
    Freelancing is a different kettle of fish, for me it resulted in much more interesting projects with complete freedom as to how they were done, but some pretty big unseen risks and a lot of personal responsibility. The having to prove yourself every time (at any cost!) revealed a pretty self destructive streak in my personality. Although I didn’t actually ever go splat, the accumulation of the awareness of risk has eventually dulled my desire to do that sort of “interesting stuff” for the time being.
    As far as not being able to sell and not knowing the domain. The domain is a project without the organisation overhead and the sell is “Yes, that sounds interesting, here’s how I successfully did something similar before”. If I ever found myself in a situation where the expectation was to do some cringey pitch, then I knew I was in the wrong place at the wrong time. I did however pick up quite a lot of work sorting out the wreckage resulting from other people’s over confident pitching 🙂
    Freelancing suited my personality and desire for independence. Apart from initially finding my feet without risk, being an employee was a ballache for me and my employers. Looking back, the factors that limited me from pursuing this much earlier were that I needed to be qualified and that mortgage and children required the “stability” of being an employee. All of which eventually proved to be without foundation.


    1. Interesting, the difference between freelancing and contracting, I don’t really understand the reason for the different risk profile between the two?

      > that mortgage and children required the “stability” of being an employee.

      UK housing is a bear. After I saw both neighbours repossessed in the 1990s that made me a more compliant employee than the somewhat ornery nature of a free-range Ermine would normally be…


      1. >I don’t really understand the reason for the different risk profile between the two?

        In my experience (early stage design) , scope and consequences.

        When contracting you’re contracted for a period of time which represents someones idea of scope. Some things just can’t be scoped up front (complex unfamiliar domains) and unfold in the “doing”.
        If you do need to scope your bit up front you are being paid to do so and have the time/resources to do a reasonable job. If the scope proves to be wrong on a contract everyone seems to be pretty supportive, jobs are not on the line.

        Freelancing scope is on your own time and there’s no access to resources. If you got the scope wrong on a freelance job you just suck it up. If it looks like you can’t you might suddenly find out about things like £20k per day penalty clauses imposed from further up the chain.

        Contracting also has a mechanism for you to invoice monthly, freelancing not so much, you might find yourself chasing an invoice for several months.

        None of this is of huge consequence, people are good and it does work itself out in the end. It’s just more seat of the pants than most people are comfortable with and in my old domain risk/reward favors contracting.

        >UK housing is a bear…

        Yep, we nearly lost our house a few times when we woz kids around that time. It does make me tend toward risk aversion, which has been inappropriate so far.


      2. Thanks for the explanation, I appreciate the clarification from someone who’s done both. On that basis I’ve curiously had experience of freelancing with the multimedia company on the side, but none of contracting.

        Contracting sounds better for my risk profile, but unlikely to suit my manifesto re hours, and arguably creativity 😉


    2. I went contract in the ’80s and went clean through the nasty period Ermine’s talked about in the past (buying a house at a bad time, interest rates at 15%, etc).

      Mind you, I was fortunate enough to be on long term contract at one of the banks for a good chunk of the early ’90s which seemed the safest place to ride out THAT recession I guess 🙂

      Depends on what KIND of recession it is though. I imagine it was definitely NOT the place to be during the last one !

      As far as personal responsibility goes I am definitely sympathetic on that one. Whilst I was working I felt the need to focus and be on top of things all the time, not just because I was a “hired expert” and it was implicitly expected, but because if something “bad” had happened the fall-out would be different depending on how it occurred: if a permanent employee cocked up they might be moved within the organisation, somewhere “safer” perhaps. If I had cocked up, oh boy, as I said in an earlier reply, during my years professional indemnity insurance went from “consider it” to “don’t leave home without it or you may not have one to go back to when they’re finished if it all goes pear-shaped !”


  4. I quickly learned to say “although in normal circumstances, you are right, of course, but here we have a unique situation where it turns out not to be the case,,,”

    Not sure it would work in a right/wrong engineering situation though


    1. That works when it’s a matter of opinion. It’s tough when it’s a matter of fact. I still should have shut my gob in the first case, though.


  5. Of the 16 points, number 5, I think, is the most important.

    In general though, I’m not sure I agree. Granted, there may be areas of human endeavor where a lonely impulse of delight could be a feasible enough motivation to persist. Enter Exhibit A: Grauniad’s multimedia corner today features Elon Musk. So if I were a real life inspiration for the Iron Man, okay then, perhaps, my views would be different. But as it is, work to me means

    “lack of freedom, it means grind, it means being trapped. It means earning money, it means selling my time for money, it means restrictions on my time. It means doing stupid shit like justifying my existence”

    Yep, all that. And also managing difficult people, handling HR issues, managing difficult clients, smoothing over ruffled feathers. Being forced to deal with idiocy (constructively, as they call it) rather than ignore it and walk away. Having to be patient and reason with people whose arguments do not so much defy logic as spit on its shoes, flip it off and insult its mother.

    An old friend of mine summed it up pretty well with “I’d be a great forex dealer if I didn’t have to deal with fucking clients”. I’m no forex dealer but I know exactly what he meant by that. A few months ago I re-read some of our email exchanges from waaaayyyyyy back. On work email, no less. I have to say it was incredibly stupid of us to commit that sort of rhetoric to zeroes and ones. In retrospect, we were lucky we got away with it; some of his priceless nuggets might have been construed as grounds for a disciplinary action, if not dismissal. I have those threads filed under T for “This Is Why I Drink”.


    1. number 5 is indeed why I am even considering this 😉

      However, I would say that while I associated this with work

      “lack of freedom, it means grind, it means being trapped. It means earning money, it means selling my time for money, it means restrictions on my time. It means doing stupid shit like justifying my existence”

      it was in fact more a function of my lack of financial independence at that time. because otherwise I would have gone to the Big Cheese and said “I’m prepared to do you job for money, but not do your shit. Take it or leave it, sunshine.”

      > This is why I drink

      I loved that 😉

      And either way, I would not have ended up doing the shit. The lack of freedom, the grind and the being trapped was because of the lack of FI. But it has taken me four years to work that out!

      What I don’t know is whether the package is indivisible. From what people say the employee package tends to have them joined most.


  6. Mine will be a gentle glide into non-work next March, having been working a flexible part-time pattern for the last 4 years. I’ve been approached by a few parties who are interested in offering me consultative/NED type gigs which would take up little time and would pay rather well. Smashing. Or is it…

    The truth of the matter is that as long as you are being paid for what you are doing, you are committed and a significant part of your head space will have to be devoted to the gig – even when you are not actively engaged in working the paid hours.

    My area of work doesn’t let me just work the hours and then switch off; it involves a lot of reading round the subject and keeping up with changing law, etc (I suspect most readers of your blog have the same problem).

    So the answer is always ‘thanks for asking – but no, I’m not going to be working any more after March’. I’ve just hit 60, and there is way too much interesting stuff going on in my life for me to waste any more time or mental energy working for pay. Freedom, for me, can’t include a paid gig.



    1. > Freedom, for me, can’t include a paid gig.

      Agree without reservation, freer is not freest.

      The time between freelance projects was my own but I’d spend a significant amount of it mentally churning over the last / preparing for the next. So physically present but not mentally present at all. Unfortunately, this wasn’t self evident.


  7. @ermine we agree on a surprising amount of things, but not on the need to get paid for one’s labor when one already has more than enough to live on.
    Maybe it’s because I collected my pension from the start or maybe it’s because my human capital is now vanishingly small – but I just don’t see the need to charge someone for my talents when I usually am far better off than they are.
    When I first retired, I worked a bit professionally as an unpaid volunteer for a small coffee roaster that couldn’t afford to pay me anyway. They were paying fair trade prices for coffee to help third world farmers so I felt I was doing my bit to make the world a better place. The coffee company did well and prospered and outgrew the volunteer stages. Now If I did this work I’d be keeping a young person from making a living.
    So I’ll save my senior friends from themselves and Windows 10, research my family history and blog a bit, learn about Linux and have a nap with my ginger tabby. Not bad being a fair bit up the right side of the U shaped curve.


    1. “I just don’t see the need to charge someone for my talents when I usually am far better off than they are”

      There’s a few people out there I’d like to see “lead by example” on that one !

      “So I’ll save my senior friends from themselves and Windows 10”

      The last decent Windows in my opinion was 2000 Professional. If it wasn’t for the fact I have a legacy application which is no longer supported on 2000 I’d still be using it now ! I got so pissed off by the whole activation thing I pretty much run Linux everywhere these days. I can’t remember the last time an XP activation got done online as opposed to having to phone up and try and avoid writing something down wrong. Just for the record here I have no fewer than SIX legit XP licenses – it’s the PROCESS that’s a total pain in the arse.

      The tabby sounds to have the right idea… 🙂


      1. Yes I prefer Linux myself but I’ve had limited success getting others to use it. They prefer to buy a new laptop with all the crapware. Recently I got a legacy laptop from one of my neighbors who bought a new Windows unit, so I put in a new SSD and installed Linux. Now I have a great (new to me) travel netbook.


      2. Hmm, quite – you’re not alone there. I’ve still got a couple of quite old laptops which run up to date versions of my chosen Linux distribution perfectly happily and still serve a useful purpose. I couldn’t do that with Windows for two reasons:

        1. Whereas Linux tends to have drivers for everything from Noah’s Ark on, Windows drivers eventually get dropped, no longer maintained for previous Windows. I can’t put Win2K on one of them as a result

        2. Windows seems to me at least to demand ever more resources with each version, which I’ve not found to be the case with Linux

        I still encounter a good deal of “I think I’ll trust the young fast talking sharp suited kid rather than the older slower talking bespectacled bloke in jeans and T-shirt who doesn’t seem to be pushing anything in particular”.

        Fine. No skin off my nose 🙂

        On the subject of cats, a lot of them must have silent negotiating skills that put most of us to shame. I mean, if my experience of the furry beggars is anything to go by, they turn up at your front door, look cute, manage to convince you to take them in (caution: slippery slope ahead), feed them and, when you’re not looking, occupy the top shelf in the airing cupboard (how ?!) Then, a true master stroke, convince the owner of a few hundred grand’s worth of property to cut a 4 or 5 inch square hole* in an outer door and nail on two bits of old carpet for ’em. Brilliant !

        * This was a long time ago on a different property to the one I’m living in now, before burglary had been invented/taken seriously, just in case you were wondering

        They’re wasting their talents eating, sleeping, killing and b**king – they should be out there sorting the doctors’ dispute with the government … 😉

        Ahh, it’s Friday ! (claps hands together) Right, what’s next ? 🙂


      3. I’m a Mac devotee myself, but was recently awed to find my 75 year old mother runs a Linux on her ancient PC (courtesy of my computer nerd cousin). I poked around a bit and it seemed quite alright. The only issue for me was that I found it difficult to troubleshoot after I messed something up in the process of the aforementioned poking. None of my OSX or Windows mental shortcuts worked with that thing. Still, I recon if my mum can handle a Linux then anyone can; the woman hadn’t touched a computer before she was well into her 60s.


      4. @Ray I think I’m just at odds with the general view. The only so called volunteer work I’ve done have been one off jobs that others couldn’t do. Many people are happy to staff shops etc because they are replacing the role of Work, and this is admirable in being prepared to offer commitment without compensation. I just can’t do that.

        I see the general point of taking work away from someone younger, but I want to originate, create new devices or systems at a different price point that currently available. Or leave it be. I have no idea whether this is realistic, but at least on that basis I wouldn’t be taking away from a younger person. I haven’t changed my mind and suddenly found a desire to work for the sake of it 😉 I may still end up along Jane’s line of thinking!


      5. In that case I understand and wish you all the best. If you creatively come up with a new product or service you deserve to get paid union scale at least.
        I have also read a bunch of stuff over at LL’s site and I think he’s got the answer for new food science grads in Canada who will not get the job with a multinational company and enjoy the career I was able to have.


  8. Hi Ermine, well as you know we’ve been discussing/debating this for 4-5 years. I am glad Andy has reached a part that I couldn’t reach! 😉

    Even if you decide doing any paid work is still not for you — and as I’ve said before I simply don’t believe you couldn’t use the money to do interesting things / have more experiences you want to have, etc, from what you’ve told us here — the soul searching looks really useful from this distance, and even a bit inspiring. (Maybe I should take a leaf out of your book and question why I never try to fix electronic appliances but rather have them fixed or replace them… 😉 )


    1. I did think of you while writing this 😉 The healing process of Time, and discovering something where I could use the money without changing my personal lifestyle were key. I have enough money to have a very decent lifestyle, and haven’t got an interest in pumping that up for fear of getting locked into the system. But being able to contribute finacially to something on a best efforts basis had made me look at this again.

      Andy holds a mirror to the 25 years younger me, though he is more enterprising than I was. There again, pretty much anybody who is anybody is more enterprising than the 25 years younger me, because to make headway in the world now you have to be!


      1. To an extent, yes, especially at the start. But even in the modern world once you get going you definitely have a bit of momentum, soon some very regular clients, regular jobs/work, etc.

        Every day doesn’t have to start with you acting like a market trader selling fresh fish, is my point! 🙂

        Good luck. 🙂


  9. A couple of thoughts about the staff, contractor, freelance continuum building on @Nathan’s comments:

    I started as staff (academic and then industrial R&D), started my own consulting company (freelance), became a contractor to one of my clients, was brought onto the staff, and have just exited into semi-retirement freelancing again.

    So I have seen a number of variants, although I suspect there are industry sector differences in practice.

    Fo me the difference between freelance work and contracting, in addition to what @Nathan said, is that freelancing you are doing a defined piece of work that has a beginning and an end, whereas contracting you are fulfilling a role that the client needs – everything from maternity or sickness cover, to extra capacity or filling in whilst they recruit permanently.

    The consequence is that contractors are typically seen as being on the ‘inside’ and much more likely to be subject to all of the policies and management processes of the client. So a comforting feeling of belonging and no immediate risks, or having to put up with all the meetings, wheelspinning and bullshit, depending on your perspective.

    Interestingly, in the client I contracted for all contractors appeared on the HR org charts, but freelancers never did.

    When I went from contractor to staff very little changed. My effective day rate went down, balanced by pension contributions, performance related pay and some other bits and pieces, but the work I was doing did not change at all. Many people I was working with did not know I had been a contractor, if they did had not noticed I was now staff, and generally saw no changes at all.

    So if it is all the management processes that drive you nuts, freelance is better than contracting. The downside for the committed and interested is that they will probably pay you for the work, but may not ever use it. That can be really frustrating. A mentor of mine a couple of years older than me who had trodden a similar path to freelancing once said “Never forget it is the client’s inalienable right to be a complete dickhead! They don’t have to listen to you; just make sure they pay you!”

    I also wanted to pick up on your expert, dilletante, generalist comments.

    It may be sector specific again (I am not an engineer, but a chemist), but when I was recruiting for R&D in large corporates 25 years ago we were nervous and careful about recruiting out and out experts who wanted to be experts. We were looking for STEM trained people who could move across a wide range of roles and subject areas, and had the intellectual restlessness to want to do so.

    We had very few roles for experts who wanted to stay in their specific field. May be one or two in each speciality (in very large multinationals). But we had an insatiable need for people who had shown they could master an area in depth, but would throw themselves into anything interesting given a couple of weeks run up. What I call ‘T-shaped skills’. Proven capacity to develop real depth, but with a much wider range of interest and curiosity.

    The reason for this approach was the diversity of the businesses and the rate of change in markets, products and technologies. We knew the future would be different, but we did not know in which direction things would change, and we could not afford to get stuck with the ‘wrong’ experts and a resistance on their part to change.

    In one business, through a series of acquisitions, we ended up with a corporate R&D capability that was a mismatch with the business strategy. I worked with some of these teams to try and find a route forward for them, but many who defined themselves by their expertise saw no excitement in getting into new areas, only threat. Essentially saying “if that is the future, I want no part of it”. I respected their view, but boy did it cause an enormous amount of work and delay in restructuring the organisation to suit the strategy. A new strategy demanded by the changing market and new technologies.

    So that is the view from the business side, but people need to be comfortable in their role. Somewhere I read an analysis that classified people broadly into:

    Experts – who value themselves by their deep knowledge and experience
    Corporates – who like to make the business work really well
    Enterprisers – who are outward looking and focused on markets and customers; often creating new business areas
    Entrepreneurs – personally driven by their own vision and a desire to make it happen.

    I think the analysis was that larger organisations tend to have too many experts, because it solves today’s challenge, and not enough enterprisers who are looking at what happens next. Large organisations can’t afford too many entrepreneurs because they are too disruptive and impatient. The will either break the business, stage a palace coup, or leave.

    So by your comments I think your personality leans towards the ‘expert’ position. Vital people to have, but typically you can only afford a few. And so experts often gravitate to freelancing, because they can sell those skills to multiple clients; each of which needs the skills for a period. But the bet they are making is that there will not be so dramatic a shift in expertise required that they lose their market position.


    1. Thank you for such a detailed analysis – certainly food for thought. Certainly the role I played towards the end was expert, although the trends towards generalist are at odds with that. With the accuracy characteristic of hindsight, the fit wit the culture was drifiting out lot earlier than I’d appreciated.

      Love the deceription of the trouble entrepreneurs cause in big firms 😉


  10. I was one of those who felt work was imperative . I retired in July, a part time job that was meant to happen has not yet materialised , and I feared mental and physical atrophy. The reality is different however; I feel rested, I can focus on areas of personal growth and development and realizing that the work imperative was really just a conditioned state. I volunteer, I take an interest in the world but I do so on my terms. That’s liberating!


  11. The beauty of having FU money is the freedom it offers through having real choices. Fear of change – loss of identity/status/income etc., often leads to people staying far too long & then paying with their health. In many corporations today, roles are fluid, as is the heirarchical structure, breeding constant insecurity & subsequent anxiety.

    If they don’t own you through your own financial precarious situation, you have the ability to walk if your happiness is threatened, let alone your mental heath …..which we too easily forget is priceless. If there isn’t such urgency, you will then have the luxury of preparing well enough for this significant change coming. You can set your expectations on the new lifestyle & properly research what role would be best for your particular character, giving yourself a much smoother transition & change of success.

    People often forget through paralysis analysis when their major activity [work] in their lives is threatened with upheaval, the cost of staying – only seeing the cost of leaving. If you’re being treated with contempt, it not only hammers your confidence, but can have bad crossover effects on other areas of your life like relationships for example. Our current society values work too highly, having managed to conflate it in our minds with our identity & so the most likely meaning of life. In it’s proper context within a more healthily balanced lifestyle, it should be only one relatively important thread making up the rich fabric of our world.


    1. > Our current society values work too highly

      Now there’s a fellow after my own heart – I couldn’t agree more. It’s the symbolism and the psychology as much as the money that traps people. It may be an interesting seam to mine for insight, the meaning of work.


  12. Dear Ermine, I always look forward to your posts when you cast them onto the web… particularly those on the theme of work & it’s changing nature. I thought this opinion piece today in the Guardian might interest you on some of the issues that you frequently touch on in your writing, albeit with a different angle as this is largely considering those at the bottom who are very much not financially free to make their own life choices:



  13. “For some odd reason we think low interest rates make houses more affordable. It just makes them dearer” – The curse of our time, it seems most people only look at whether the monthly payment is affordable right now, worked in the past, not so sure it will from now on, inflation is not coming to save us this time by the looks of things. I guess its going to take a decade or two for this to sink in (i.e. when lots of people still have enormous housing debts at 50/60 +), then maybe we will get some sanity. The current 20/30yr olds are stuffed, poor sods.


  14. My first post …after having recently fractured my shoulder i have more time as off the toad work for time being. I’m of similar age i guess (i’m 57) and a similar background , grammar school, plate glass glass degree 1980, Jim Callaghan my MP in Cardiff at the time ….no job for a while for me.

    And no savings or sense of it until years later …wasted decades, until 2000, after an accelerated growing up i got a job in an old school firm who paid a DB pension ….the funny thing is i didn’t (honestly) know what that was at the time … i had no idea of the difference between DC and DB as all i had cared about in past was what cash i had in pocket to fund a wanton lifestyle.

    Twelve yearst pass , and it gradually dawns on me that by contributing a little over 200 quid a month i am being promised an extra £1000 a year from my DB scheme …and that very few folk other than council teachers etc get anything like this. Linked to RPI and capped at 10% …all new words to me. Anachronistic acronyms.

    Then in 2012 the toad work is outsourced to,ll an even bigger firm…and unlike my local council workers, bang goes the DB scheme. Stop.

    Enter a new DC world, whereby my 200 odd quid ..some piddling percentage, needs to be replaced by 33% of my salary….which is duly done to avoid 40% and in some vain late in life attempt to save some money.

    My point here is that everything changed in 2012…a sense of security, guilty entitlement and a start of if i’m honest, a resentment to those who had avoided the saloon bar in the Outsourcers Arms and still had their snouts in the glittering FS trough.

    I realised that an uncomfortalbe sense of security was predicated on possesion of the DB scheme. And having to listen to people wingeing about having to contribute 7% instead of 5% or whatever, to keep getting it.

    Can’t help it …there i’ve got it off my chest , sort of.

    So now n position of ..as you appear to be …how to play the satellite pots of savings etc until your DB scheme commences. In my case its hugely simplified by having one SIPP and one DB scheme.

    I’m writing this note really because of something i read yesterday when you discuss viewing your DB as bonds which permits greater risk in SIPP savings …something i’d never considered before.

    I’ve managed to save a 100k tthe passing of the DB scheme…and its taken me that time to even start to get a picture how to handle it.

    I even took some advice on fund choice in a pre SIPP pension scheme , and then promptly, paid for it and ignored it ! …and decided i might do better, swapping funds as if i were shunting in some great railway yard. i have, en route encountered Monevator and Passive investing…i have half my bunce in an inexpensive active scheme and half in VLS60 , plust a bit of property.
    i’ve calmed down a bit now …

    I am awating a CETV valuation on my DB scheme ..my 12 years equated to getting c. 14K at age 63, RPI. .

    I hear of siren CETVs of x 45 and drool, and dream.

    Surely the sum of my two schemes (nothing else whatsover to add in), might just form a sufficient lump to draw a modest yield?

    And i’d be rid of a sort of a thorn in the side ….have you ever been tempted to sell ? i guess not so as if viewed as the bond like planet to more adventurous moons ….but if it were eg. 3/4 of a million quid wouldn’t that be tempting ?

    I’ve only read of fraction of your outut and would like to thank you for your generosity of spirit and effort in producing your blog …it’s provocative and entertaining.

    I’ll follow up with my cetv valuation when i get it ! Pretty sure i won’t do anything daft but the recent valuations illustrate if nothing else the craziness and inequity of the whole DB farrago.


    1. Sorry to hear about the shoulder – hope it gets better ASAP!

      Every beginner to investing will hear the siren song of trading. I keep a fine stack of contract notes from my dot-com days to remind myself. Do. Not. Churn. and keep out of the shunting yard. Monevator sorted us out 😉

      the recent valuations illustrate if nothing else the craziness and inequity of the whole DB farrago.

      I would disagree. The valuations highlight just how damned expensive it has become in the post-crash economy to provide that DB guarantee, which is why they are offering you so much money to shuck the obligation. So if you are thinking of taking the CETV, you have to ask yourself, what do you know that they don’t, and generally, do you feel lucky… Factors which would favour taking the CETV, would be: poor health implying a limited lifespan (not all poor health does that), no need for a spouse pension, or an expectation that you wouldn’t use all the pension before death and a wish to leave a lot to children.

      The combination of a DB pension with a stock market portfolio is a good one due to the uncorrelated nature of the assets. You could ask yourself whether VGLS60 is the right balance, since you should look at your pension savings as an integrated whole. The capital behind a 14k FS pension at a 4% withdrawal rate is about £350k, but you have people like RIT thinking of withdrawal rates of 2.5% which would imply an equivalent capital sum of £560k. A DB scheme takes away that sort of “what is a safe withdrawal rate?” angst, particularly with a RPI cap of 10%.

      As such your 100k is a low proportion of the notional FS capital, and thus of your total pension savings. I’d be tempted to have gone equities all in with the SIPP, if you had VGLS100% the combined pension pot would be roughly equivalent to ~ VGLS20, which is within the groove, perhaps a little bit conservative for someone in their late 50s.

      Congratulations on playing your cards well with the DB pension and pumping it up – I’m definitely of the school of thought that a late starter Feckless Freddy who has experienced decent career progression can get in front of a Steady Eddie. Against that it appears that the late peaking of career progression was a characteristic of your and my generation’s career arc. Millennials get ahead a lot faster in their lives than we did but their careers seem to crest and fizzle in early midlife, so maybe we were lucky to be able to go for the late burn!


  15. Thank you for your reply and kind words re my shoulder….if saving , prudence etc good in late middle age then taking up on a MTB (and falling off it) not so clever….

    My lesson lately is not to view my current SIPP DC savings as if they were an independent pot ….to get away from the temptation of applying an age appropriate asset allocation to it (say 50/50)…and to be able to view the DC Sipp as the sol to the sombra of the DB scheme…and depending on how it goes i reckon another three years if the Toad’s will put up with me ignoring their Performance Management Appraisal rot…so perhaps a change of gear up to VGLS80 rather than ~60.


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