Connecting The Dots Through Art

Retiring Early To Do Art Full Time

Holding Sky, 2011 Toned Cyanotype Print

So recently, I got obsessed with FIRE. Do you know what that is? It stands for Financial Independence Retiring Early.

I’m not sure how I got into this topic, but it had something to do with looking at my new artwork for the past six months and writing that mid-​year review blog post.

I’ve spent every weekend for the first half of the year on A Million Suns, trying to finish it, but when I first looked at the whole work-​in-​progress a few weeks ago, I got scared.

It just didn’t look good.

I should be prepared for moments like this. Artistic setback is common. I should not abandon the work and throw in the towel just because the work is not promising.

I took a step back and thought about how to improve.

I had to be honest with myself: I wasn’t devoting enough time to my artwork.

That’s when I started thinking I needed to do art full-​time.

Since graduating from my MFA three years ago, I’ve championed the idea of combining a day job with art-​making. My day job definitely benefits from my artist mindset. I still think it’s the best way to go. I have a day job so that the money-​making part doesn’t have to enter the picture and stress me out. Currently, I’m one of those weekend artists. I work full time during the week and then do art during the weekend.

But perhaps this isn’t enough. I need to do this full time, or as Stephen Pressfield (author of The War of Art: Winning the Inner Creative Battle) calls it: “turning professional.”

So I started thinking, “Is there a way do art sooner rather than later?”

And that’s when I discovered FIRE:

It got me thinking, if they can do it, why can’t I?

I could retire early and devote more time to art.

High Level Plan for Retiring Early

One of the first things that FIRE people recommend is to establish what you will need for retirement. How much money do you actually need to live? That became my first task.

If I were to retire early, I estimate that I will need 40 K to cover my annual living expenses. I don’t have any debt, I don’t have a mortgage, I don’t have a car, I don’t have cable. I’m frugal by nature so I think 40 K will be fine. I recognize that even in the 40 K estimate, there is a lot of fluff. A lot. It could be cut even more. I’ve started to keep track of my actual expenses to validate this 40 K estimate.

So how am I going to fund this 40 K?

I get to benefit from the choices I’ve made in the past. It so happens that if I retire at 50 (which is two years from now), I could receive a company pension of 20 K. So the fact that I was an accountant at the beginning (as opposed to being an artist from the very beginning) has a silver lining after all.

I’ve always thought I was on the wrong road: choosing a practical and safe career rather than pursuing something that was more creative. Right or wrong, it doesn’t matter now. It’s done. All I can do is start where I am.

I now get to benefit from my past choices. I can quit my job and have a safe base of cash to draw on while I build my art career.

An art career will take time obviously, so in the meantime, how do I bridge the gap for the remaining 20 K?

Well, the goal is to make that gap with income that I will make through art. I will not actually be twiddling my thumbs once I retire (so “retiring” may be the wrong word to use. Maybe it should be career switch).

What if I fail to make any money from my art? What then?

Since I’ve worked for over 25 years, I saved about 330 K scattered among bank accounts and retirement plans (like the Canadian Registered Retirement Savings Plan (RRSP) and the American equivalent of the 401(K)). I can use that as my source as I build my art career.

If you were to read FIRE blogs, an annual withdrawal rate of 4% from your investment portfolio is considered to be safe (i.e. at this withdrawal rate, it is unlikely that you will run out of money before you die). Some blogs, like the​money​habit​.org, mention 3%, which would be more conservative. So this means for example, that if you need 40,000 every year for your retirement, you should have an investment portfolio of 40,000 / .04 = 1 million dollars. If you want to be more conservative, then you can set your withdrawal rate to 3%. In this case, you will need 40,000 / .03 = 1.3 million at retirement. The more conservative you set your withdrawal rate, the larger your investment portfolio has to be at retirement.

So If I’m going to need the remaining 20 K from my investment portfolio, then I will need 20,000 / 0.4 = 500 K of portfolio. Since I have 330 K right now, I will need to save 170 K more.

And here’s what I realized:

At the rate that I’m saving, I will reach this goal in 2 years.

There are obviously a lot of assumptions built into this scenario in terms of my health, my job performance, unexpected life events, taxes, inflation, and the performance of the stock markets(I invest in index funds so they generally track market returns).

The bottom line is I could devote more time to art without worrying too much about money. I’m using what I have to transition to something else. Call it retirement or career switch. It doesn’t matter. I’m FIRED up again.

Useful Resources To Read Up On

If you want to read more about Financial Independence and Retiring Early, I’ve done a lot of binge reading in the past several weeks. Here are some resources that I’ve found were really useful.

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