Four years ago, the world was coming to an end. Bear Sterns blew up in the Spring of 2008 and on September 15, 2008, Lehman Brothers filed for bankruptcy. I vividly remember the Dow Jones closing down 500 points or -4.4% on September 15 after the news to around 8,100. But things got much worse as the Dow plummeted to around 6,600 in February, 2009.
Four years later, the Dow Jones has doubled to ~13,000, the unemployment rate has risen to 8.2% from 7.0% (but off the 1/2010 highs of 10%), mortgage rates are at at all time lows, and the world is still spinning. We also have a massive national debt in the US, a European debt crisis, a slowdown in China, and soaring unemployment for those under 30 in South America.
I would think that most people over the age of 27 would objectively say that 2012 is a much better economic time than 2008. If you were still in school in 2008-2009, you missed how dire things were. I had friends getting laid off left and right. Instead of telling people they lost their jobs, proud colleagues would say they were going to graduate school as applications soared by 30% YoY. I was wondering every week when my last day would come. I certainly did not have any control over my employment destiny as I dictated this year.
WE WERE YOUNGER THEN
Despite all the good and bad, the one unequivocal fact is that we were all four years younger then. We’ve now got four years less to live, to make our fortune, to find our true love, to make a difference. My how quickly time passes us by.
We’ve only got so many steps within us until our knees go out and our hearts stop beating regularly. Yes, I believe we are better off now than we were four years ago, because how could we not be? 2008-2009 marked the worst economic crisis of our lifetimes! Yet, if you were to ask me whether I’d be willing to return to the fall of 2008, I would say absolutely!
The main reason why I engineered my layoff is because I am acutely aware of the passage of time. Because I grew up in six different countries and proceeded to work in New York City and then San Francisco, my memories since I was two years old are incredibly vivid. Each place served as a mental anchor point. Time feels like its accelerating, nagging me to start completely living life on my own terms.
For example, I clearly remember loving the taste of a Pepsi in a milky white old bottle in Zambia when I was two. I was sitting in a high chair at an outdoor restaurant with my family during the day. At the age of four, I remember playing with my godmother’s make shift room made of an oval curtain on a snowed in winter’s day in Virginia. At the age of six, I almost set our apartment on fire in Osaka after discovering how to light a lighter for the very first time.
If I had lived in one place all my life, I wonder if I would be able to remember as much, or whether everything would just blur together. I also wonder if time would slow down. Instead, with each move and with each language learned, I see my life as a series of chapters that closes as soon as they are opened.
PROGRESS AND OPTIMISM
Financially, the average 401K balance has breached the $69,000 2007 highs of five years ago (somewhat sad if it has not). Surely most of us who have been working all this time have also seen our savings and net worths increase from four years ago. But of course there are plenty of cases where people have lost their jobs, depleted their savings, forced to live with their parents, and find getting back on track to be extraordinarily difficult.
I’m not sure what I would do if I were them, but four years ago I was afraid of the state of the world. There was little doubt in my mind that I could be tossed to the side after nine years of service to my company. I needed an outlet, so I began to read other people’s stories. Then I began to write my own in 2009.
After the scare, I raised my after tax savings rate from about 55% to over 70% because I no longer wanted to be afraid of exogenous variables ruining my life. I wanted to feel in control again, as we all do. Savings is a small price to pay for financial freedom.
At the same time, I wonder if those who do not save, or who do not save as much have the ultimate gift of already feeling financially free? As someone who now feels more financially free, I hardly save as much for the future anymore. Instead, I’m focused on getting out of the savings mentality and spending as much as I comfortably can. It’s very hard to go from saver to spender after so many years. Perhaps the same is true in reverse.
CHOOSE YOUR PATH
Four years ago, I was not in a position to control my own destiny. My success was at the whims of the economy, the market, and upper management.
Today, I feel completely different. Perhaps not so much because of the establishment of various income streams, but more so because I’m just older. There’s an age in everyone’s lives where we feel fully confident in our own decisions. There’s also an age where we fully understand what we want and what we don’t need. We have deeper perspectives, or perhaps they are just different.
The ability to choose your own path is better than money and recognition. Because when you get to choose your own path, you get to work together with time.
Readers, are you better off than you were four years ago? Do you feel time speed is accelerating? Do you agree that being able to choose your own path is better than money or accolade?
Photo: Outside of Ann Frank’s House in Amsterdam. We are much better off than 70 years ago. SD.
Note: The Yakezie Epsilon Member Posts will begin by September 10. For those going to Fincon this week, we’ve got a Yakezie meetup on Thursday evening. Please ping me for details.