But he’s not advocating for a free-spending lifestyle or encouraging you to cash out your 401(k). Just the opposite — Kinder is a planner and a preparer, and he wants everyone to make the right moves for their financial futures.
When it comes down to it, Kinder believes focusing on “retirement” is the wrong way to frame it. Instead, he wants people to plan for freedom, starting with defining what that means .
Everyone knows they should be saving for retirement — and Kinder said that’s the core of the problem. “Retirement” as a financial concept is a vague goal that doesn’t give people much to strive for.
That disconnection may be why in a GOBankingRates survey conducted earlier this year, 61% of respondents said they don’t have enough savings to retire, and 28% have nothing saved at all.
When a goal lacks personal meaning and specificity, people are less likely to commit to it. They budget less for the retirement fund and more for the vacation they’ve been dreaming about.
Freedom Is a Meaningful Goal
Not saving for retirement doesn’t make you impulsive or short-sighted. According to Kinder, it just means the vague vision of “being retired” isn’t vivid or meaningful enough for you.
The solution, he said, is to plan for freedom instead of retirement.
Freedom is a core human desire. It’s intrinsically motivating and encourages people to put their hearts into the game — provided they know what that means.
“Every person has a dream of freedom,” Kinder told CNBC in a recent interview. “And they ought to be living it.”
Kinder wants people to define that dream for themselves. In his writing and public speaking engagements, he leads people through three questions that help them find that meaning:
Imagine you suddenly woke up with total financial security. You’d always have enough money. How would you live, and what would you change?
If you learned you only had five to 10 years to live, but you’d be healthy until then, what would you do with your remaining time?
What regrets would you have if the news changed, and you only had one day left?
These questions can help people build an image of freedom. They start thinking about what they want to accomplish and what doors would open if they were financially free.
“The focus shifts from money — where we have a lot of anxiety, and there are a lot of tasks to do — to freedom,” Kinder explained. “What does it actually look like, feel like? And what are the steps to get there?”
Freedom Keeps You Focused
During his half of a century as a financial planning professional, Kinder has seen countless people lose their goals in the minutiae of personal finance .
They try desperately to stay on track with tasks like increasing their 401(k) contributions or saving more per month. They focus so much on deposits, transfers and balances that they forget their motivation.
When you focus on achieving freedom, motivation returns front and center. You know exactly why you’re saving and investing.
For example, imagine your definition of freedom as having enough money to quit your full-time job and move to the country. You learn that to have $50,000 a year to live on, you need $1.25 million if you quit your job at 40. Therefore, you want more of a nest egg and aim for $3 million.
You now have a target number and a meaningful goal that matters all that much more because it’s a step toward the life you want to live. You’ll make choices and sacrifices to live that life.
Freedom Is Flexible
Lastly, Kinder explained that the concept of retirement is time limited. Even if you aim for “early” retirement, odds are you still see it as something far in the future.
Freedom, on the other hand, can happen anytime, and that time can be sooner if you don’t limit yourself. You may not achieve your end goal immediately, but you can take freeing steps.
For instance, imagine your dream is to spend the cold months in a warm climate and the warm months in a cooler climate. You may not be able to buy two houses in the next few years, but you could reach an income level where you’re able to rent a place to work remotely.
Making these small steps can be incredibly motivating. Instead of waiting for a “retirement” that feels far off and vague, try taking steps toward a concrete, meaningful target lifestyle.
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