There’s a lot of good in that approach, because of course during the accumulation phase, you need a wide margin between your income and expenses in order to build up a nest egg.
But there’s also another factor to consider: your happiness and values. And as your income grows and your investments compound, you may find yourself asking, what is all of this for?
A lot of us judge our self-worth using external factors. What do others think of me? Do I look successful? What is my net worth today? The problem with that – and I say this from experience – is that how you feel about yourself is pushed and pulled by things that are external, beyond your control.
Time is the limited resource; we are all going to run out of it. Sure, for years we have to trade our time for money. That’s what work is: being compensated for adding value to society.
I know a lot of high earners who balk at the idea of working for a wage far lower than what they are used to earning. Even if they hate the higher paying work and love the lower paying work, the income differential alone can dissuade them from pursuing their passion.