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June 11, 2020
Jim McCarthy is a successful Silicon Valley executive who worked for Yahoo! as employee number 258 and grew up with the industry. In 2013 he was diagnosed with prostate cancer. He decided right then to live each day with purpose. In the process, he wrote a best-selling book with lessons for people in all stages of life.
Those questions set him on a path of personal discovery that culminated in his book and new career filled with purpose, satisfaction and mindfulness.
Do you want to know how you can live your best life and prepare for life after sixty-five? Read on!
The subtitle of Jim’s book — a simple guide to happiness — isn’t as simple as it sounds. “I could walk from here [in Marin County] to where I live in San Francisco,” Jim told Steve on the NewRetirement Podcast. “The way I would do it is to take one step after the other. That’s pretty simple.” But the distance from Steve’s house to Jim’s house is 20 miles, which shows that simple things are not always easy.
Many of us have made New Year’s resolutions, but how many of us have made those promises into life-changing habits? You want to stop smoking, get more exercise, save more for retirement and learn a second language, but how often have you found yourself staring down another new year without having accomplished any of your goals?
Changing your behavior is a matter of habit, and it can be as important to unlearn bad habits as it is to learn good ones. Jim talked to experts in the field of behavioral psychology and found that they recommend “habit stacking,” which is when you add a good habit onto an existing habit to cultivate it and make it grow.
Jim gives the example of meditating: “if you want to start meditating and you’ve never meditated before, then maybe the best thing you do is you just say, ‘Okay, in the morning, after I drink my cup of coffee,’ I will sit down for five minutes and meditate.’ You build a new habit on top of an existing one that you just do all the time. If you can just do that, then you can layer one new habit on top of another. Once you have that reminder or that trigger of what it is you want to do, then doing it isn’t that hard.”
The best part about building better habits is the real reward of being able to say, “Wow, I had the discipline to do something!” Seeing your hard work materialize into concrete gains is a great feeling. It gives you purpose and satisfaction.
TIP: NewRetirement recommends the habit of updating your retirement plans monthly — quarterly at worst. Log in now to update accounts and try a scenario that could increase your wealth and security.
Getting a cancer diagnosis helps clarify your priorities (to say the least). Oftentimes, our plans are muddled because we don’t know the balance between pleasure and purpose that’s right for us.
Happiness research shows that most people experience a “U curve” of happiness from the time they become adults until they are in their 60s and 70s. The curve starts high when you are young, energetic and have not many responsibilities, but as you approach middle age the curve dips to the bottom of the U.
Taking care of children and possibly older parents, worrying about the state of your chosen career and your preparedness for retirement (as well as the state of the world these days) take their toll until we reach the bottom of the U around age 47.
Your mid-40s are the time when you’re working hardest to be financially secure. You work to make money to enjoy the rewards of financial security, including a nice house, a car, vacations and the things you see people around you enjoying. Most of the time, it’s also when you’re paying the least attention to your purpose in life and the joy you get from that.
Research indicates that people who do some kind of volunteer work that gives back to their community are much happier, and that the vast majority of people say that they feel better about themselves after they volunteer. By helping other people you feel better about yourself, you build community ties.
The good news is, as you progress through your 50s and 60s things get steadily better. And that’s what you’re planning for in retirement. To boost the happiness dividend that starts paying later in life, start giving back to and building your community. It’s as necessary an investment as regularly contributing to your 401k.
TIP: Learn more about the surprising age when happiness peaks. And, use the NewRetirement Planner to create a detailed retirement budget that reflects your retirement priorities. Budgeting can be a great way to focus on what is really important.
Before Jim landed in Silicon Valley, he was a young teacher and a Fullbright scholar in Germany. At the end of his scholarship, he bought a plane ticket to India for a month-long journey to see what he could see. He was young and relatively poor, so he put himself on a strict budget. In all, the trip, including airfare, was just $1,200.
Jim said for years his friends and coworkers would say, “God, all this traveling you’ve done, Jim. You must have had a ton of money.” He told them, “No. No. I just learned that you can travel very, very cheaply.” The same minimalist mindset that a backpacker brings to traveling — focusing on the journey rather than the stuff you bring with you — is useful in retirement as well.
I think I’ve been lucky that when I was doing my hippy backpacking in India, I realized that there’s so much fun in life that comes from an unconventional path and from not needing to have a lot of money to have a great life.
Geographic arbitrage is a fancy way of saying you can change where you live to get more out of your money. It’s a popular idea among Millennials and FIRE followers who have traded in their expensive, cramped living spaces in the big cities for the freedom of working remotely from the open road. It’s also a good strategy for retirees who want to trade a high-tax, high-stress home base for more travel, possibly better weather and at a much lower cost.
TIP: Find 20 great retirement travel ideas. And, learn more about downsizing as a way to increase retirement flexibility or try downsizing and other ways to tap into home equity in the NewRetirement Planner to see what impact it will have on your retirement finances.
We have a negativity bias which, according to neuroscientists, accounts for roughly 70 to 80 percent of our thoughts. That bias is probably rooted in the deep human past when it was useful to be distrustful of things that go bump in the dark. It’s hard on the modern mind, however, that is soaked daily with a firehose of good, bad and just plain confusing information.
To stay sane, many people have begun cultivating mindfulness and gratitude as a practice. JIm’s book is based on the idea that It’s possible to train yourself to be happy. It’s the most important lesson we can learn in the chaos and noise of today’s world, and the one most likely to make our lives rich and full into advanced years.
Most of the time we think of our lives as a series of events we plan for. You get into a good school, you get the right job, you marry the right person and have beautiful, smart kids. You put away several million dollars for retirement and spend some time perfecting your golf swing.
Of course, real life is also punctuated by accidents, bad decisions or good decisions that turned out bad despite our best efforts. One way to look at life’s setbacks and achievements is to think of them as beads on a string that leads us from the cradle to the grave. Most of us don’t win the lottery, and most of us bounce back from trials.
Another way of looking at our lives as we’re living them is to see that we can’t know or control the future, but we can control our present. As Jim notes in his book, about 40 percent of our happiness is under our own, conscious control. (The other 60 percent is genetic and environmental.) We are able to control that much of our happiness by being conscious of it. That’s what mindfulness is all about.
Retirement is a goal, and we humans get upset when we think we will miss our goal. Mindfulness can help us achieve our goals by gut checking them to make sure they’re the right goals for us. Do we have the right balance of pleasure and purpose in our lives? Are we able to focus on what’s working and move away from what’s not?
Practicing gratitude is as easy as taking stock of the good things in your life right now. Wherever you’re sitting, whatever you’re doing, you can be thankful for the years you have lived to this point and the years you have yet to live.
Another key to happiness is learning how to appreciate every season of life. Challenges are also opportunities; moments of beauty can and should be savored; ripeness in life is everything.
Jim takes an entire chapter in his book to talk about affirmations, which can train your brain for success by thinking positively. It goes beyond the power of positive thinking: neuroscientists have shown that you can build the neural pathways that lead to happiness, or as Jim puts it, “neurons that fire together, wire together.”
Making a practice of giving thanks for the good things in life can help you develop optimism just like working on your muscles at the gym.
Having a positive attitude, being grateful in your life, doing work that you find very meaningful, investing in family, friends, and community. These are all things that anyone can control independent of money, really. It’s how you think and how you go through life.
For those of us who are finance-minded, Jim did the math.
“I was like, ‘How much of a day is 10 minutes? If I spend 10 minutes meditating or doing affirmations or a gratitude practice, how much time is that?’ It’s about 1%. of your waking hours per day.” What is the ROI on 1% of your daily time budget? “I think the ROI is going to be very high on that 1% of my time that I spend doing meditation,” says Jim, “just to be at peace with the way things are.”
Time is a finite resource, and it’s the most precious resource any of us have. The key to living a life — both towards retirement and in retirement — is be thoughtful about it. Sometimes it takes a tragic event, like a cancer diagnosis, to make us realize how precious our time is. But it doesn’t have to.
Now more than ever it’s important to take stock of where you are in the world. As Jim says, “You’ll end up enjoying your life a lot more by having this awareness and appreciation that every day is precious. Every moment you have is really a gift and to really savor that as much as possible. That’s part of a very direct way to create your happiness.”
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