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Would it be easy to Quit your $9000/mth job if you are financially independent?

My good friend was young enough to understand the concept of financial independence and how much each of us requires to be financially secure, or financially independent.

He, however, notices a paradox. Things are not so simple.

Your opportunity costs becomes greater and greater the faster you can work towards either financially secure or independent.

How does that work out?

Suppose you earned $4000/mth and you can accumulate wealth at a rate of return of 6%/yr.

Based on my formula, the relationship between your savings rate, your wealth machine’s rate of return and how many years to reach the goal can be describe in the following table:

At $4000/mth you could probably at most put away 30% of your income to wealth building. It will take you 25.81 years to become financially independent.

Now suppose, you get a promotion and earned $9000/mth. You could now keep to your current lifestyle, expand a little but still put away 70% instead of 30% of your disposable income into building wealth at 6%.

The number of years to reach financial independence shortens from 25.81 years to 8.52 years.

The goal becomes very possible.

You can remain frugal and spend only the current 30% of your income.

However, your opportunity cost if you quit today, is that you will lose a $9000/mth salary. The $9000/mth salary let’s you reach your goals much earlier, but it also places some questions in your head.

1. You will stand to lose a huge amount of Your Future Human Capital

Our biggest resources is not our home but our human capital.

For the person who earns $9000/mth without additional bonus, assuming that he starts working at 25 years old and be financially independent at 34 years old, his opportunity cost is that he could work until 70 and could have earned a huge sum of money.

This sum, over 36 years, come up to $6.8 mil!

Making that all important decision just became more difficult.

2. Fearing bad planning and bad estimation

While the numbers tell us we are ready, psychology, the switch may be difficult.

I think about this more and I realize it is my confidence in the plan.

Did I came up with the right amount for financial independence, or retirement?

Was my plan to execute how to withdraw the cash flow fundamentally sound? Or there are holes in my plan?

It is this main question that usually makes us procrastinate and delay the big decision.

3. Fearing we could not command that salary again

Your  value in some industry is driven more by your network, and in other cases how rapidly changing the industry is. Once you ‘retire’ for 2 years, you are afraid you would lose that relevancy.

You might not command that same high pay again.

This makes your decision to leave more critical.

4. We are too single skilled

While you envision stepping down, one thought on your head is that for the next 36 years where you are very actively, what would you do?

What could you do?

Our school system and work system have been more of a factory model, which prepares us to be competent in a specific work area, but that we are not well verse in more than one area.

So the advice of stepping down to a less time taxing, mental taxing work scope might not happen at all.

5. Which is more important? Time or Money?

When we are working our whole life there is a deep inertia to continue to do that because it is traditionally right, what everyone is doing and safe.

It takes a lot of reflection and higher state of thinking to arrive to a conclusion that my time spend with my family is more valuable than the amount of money I can earn in the next 20 years.

You cannot turn back the clock to when your son or daughter is 4 years old to watch him or her grow up, build a good relationship with him or her, mentor him and her in a sound way.

Sure you forgot that huge amount of money, but you may end up spending a lot of those money bailing your children out if they turned into misfits.

6. Could you lower your status after being a high level executive for so long

It is easier to say then actually practice working in an area of work where you are a grunt than a commander.

You transit from one where people look at you as an authority, to someone who is suppose to be told to do what you are asked and nothing more.

When I spoke to acquaintance who got retrenched, and found work in a lower capacity, they told me the initial damage to the pride takes some time to heal.

7. What you want is a less Mental Taxing Work then a Time Consuming One

As PMETs, we like the idea of financial independence maybe not because we spend too much time at work.

It is usually the time we spend THINKING about Work, when you are OUT of work.

Basically we are working 18 hour days without realizing it.

This becomes more prevalent as you climbed to middle management.

I realize the people who are honestly ok with their job are:

  1. They are very competent in handling processing work stuff out of work. They are OK with it! Have a good grasp with it!
  2. The vocations where we do not have to think about work so much when we leave the office. These are usually workers doing less value and repetitive work without the decision making component.

The solution to this is: Get better. Learn to tackle this well. The better you get the more you feel this is not a consideration for quitting any more.

If you yearn for it more, it is probably that this job is too taxing for your capacity. You might want to change a work environment instead of seeking financial independence.

8. The liquefaction of the employment could aid financial security

As a summary, to preserve your pride, sanity, and address your fear of losing your skill set to hedge your risk of unsound planning, a change in the work environment might be the best thing that could happen to those pursuing financial security.

Instead of working the normal 40 hours, you might be able to transit to be a freelance consultant. As a freelance consultant, you are still able to leverage on the expertise you have built up over these short time, to earn and keep yourself fulfilled.

You will still be honing your skills, and keep up with what are the challenges and solutions faced in the industry. Should you feel you want to go back to work or reemploy, you have not fallen that far off.

For some folks, they are even lucky that their existing companies allow a consultant working arrangement.

This is more possible when we transit to a more software as a service community.

In truth, it requires a lot of repackaging what you know into a service product.


It is definitely not so straight forward to say that I could just make the switch just like that. We have so much baggage particularly the pressure from society to do what most people would do.

I am sure being financially independent, or being early retired appeals to a lot of high earners, but would they have the same concerns as the points mentioned here?

If you have transition despite the high opportunity cost, how is your decision model like? Do let me know.

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Dividend Knight

Monday 11th of July 2016

Point 6 can also be applied to a husband, especially if his wife is earning around $9k per month. A significant drop in price will dent his male pride.


Tuesday 12th of July 2016

Hi Dividend Knight, good point. We always joke that it would be great if we can be a house husband, but psychologically, we are not creatures that accept a role we are not protecting the family.


Sunday 10th of July 2016

I'm glad that my work allows me a certain sort of flexibility to adjust the work hours accordingly. I'm trying to work out something so that I can reduce my work hours without the corresponding drop in pay. That would be perfect.

That being said, I've no wish to stop my work, so maybe it's a different story altogether.


Sunday 10th of July 2016

Oh i hope next time you can share how that awesome hack is done!


Sunday 10th of July 2016

Very insightful article that I can relate to, for better or worse, especially in relation to the first three points.

When I started out in my career, 1m was the figure, and now that had risen to 3m. It ain't easy to quit a well paying job that you do not particularly feel passion for but are good at.

Gnaws at my soul daily though. Haha


Sunday 10th of July 2016

Hi RB35, thanks for sharing your thoughts. I think nowadays we seldom work in a profession we are passionate about. if we work in such an area, perhaps the kinks of the business will take out the passion. Being very competent in a certain area makes things seem really OK.

I am looking forward to your next writing!


Sunday 10th of July 2016

Liked & agreed


Sunday 10th of July 2016

Thanks Jasmin!

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