Working ridiculous, long hours and failing to take holiday are almost badges of honour for many business owners. Whenever I ask anyone sporting those badges why they do it I tend to get a mixture of three common answers:
- I do it because I love my job
- That’s what it takes to run a business
- I work hard now so that I can retire early
It’s the last of those points I really want to address, as it is both the most common answer and the one that is built on some very shaky logic. Let’s just get the other two, easily dismissed points out the way first.
“I do it because I love my job”
I love my job too, but it isn’t the only thing I love. It’s not even the thing I love the most (that would be my Cat… luckily my wife and kids don’t read my blogs). Doing just one thing, even a thing you love, is boring. It also makes that thing boring and makes you love it less over time. That aside, I’m not buying this answer anyway. People who say they’re working 70 hour weeks, 51 weeks a year because they “love their job” still talk about their dream holidays and their bucket list they never dip into. They just do it whilst repeating this line over and over to themselves trying to convince themselves it is true.
“That’s what it takes to run a business”
I hate to contradict the LinkedIn hustle, but this is not true and there are thousands upon thousands of people running their business in ways that prove it isn’t. Sure, there are times when all stops need to be pulled, but those should be exceptions not the norm. If “work every hour I can” if your long term plan, then I’d strongly urge you to re-evaluate that plan. There are definitely better options. Running a business isn’t like front line work. It isn’t an hourly rate job and what you get back from the business should not have a direct correlation with the hours you put in. If it does, you are labouring not leading and you probably already know that.
“I work hard now so that I can retire early”
The reason I wanted to focus most on this answer is because, unlike the two previous answers, I think people actually believe this one. If I am going to be completely honest, it’s also partly because I used to buy into this line myself. I was wrong though. In most cases it is simply a bad strategy to get the most out of life and I’ll demonstrate that through three arguments and an optional spreadsheet (There’s always a spreadsheet):
Counter 1 : The maths doesn’t stack up
Let’s consider two 30 year old business owners. Both are young enough to make whatever plan they choose work for them. Entrepreneur A has studied the lessons from every LinkedInfluencer and knows that the answer is to work minimum 12 hour days 6 days per week. If they holiday then the laptop will go with them and they’ll only have 7 real work-free holiday days per year beyond their one day weekend. They do this so that they can retire in 20 years time, on their 50th birthday.
Entrepreneur B is what our first entrepreneur calls “lazy”. He only works 40 hours a week, often doing those hours in 4 days so that he can travel, see friends and waste time on his hobbies. He takes and enviable 6 weeks a year out of work and barely checks in with the team when he does. This comes at a cost though. It’s going to take him 50% longer to afford retirement. He’ll work working up until his 60th birthday, a full 10 years after his more “driven” peer.
At first glace it feels like Entrepreneur A had it right, but if we look at how many hour each worked between turning 30 and retiring we get a clearer picture.
- Entrepreneur A : 66,300 hours
- Entrepreneur B : 55,200 hours . Over 20% fewer hours!
OK, the numbers themselves are slightly arbitrary, but it proves the point. In fact, even if Entrepreneur B had to work on at that same pace right up to receiving state pension at 65, he would still have done 2000 hours less work that A. He’d probably also be a lot happier, healthier and a much more interesting person to be around!
The older you get before making a change, the less impact it has of course, but then the same applies to increasing the work (the later you leave it, the less impact it will have on retirement age).
Want to play around with the numbers yourself? Try this simple Google Sheet
Counter 2 : The impact of Risk
In the above example, Entrepreneur A is effectively investing their time hoping to get a pay-out of more time back later. Like other investments, we need to factor in the risks as well as the potential reward. When I invest money I am happy for modest returns when risk is low, but expect higher returns when there is more chance of losing some of that money. It’s the same when I invest time.
One of our fictional entrepreneurs above is working 80% more hours for each of the next 20 years. That is time invested. The hoped for return is more time to themselves (or maybe nice things sooner), which our look at the maths already shows is questionable. However there is also risk that the plan could be disrupted. The worse-case version of that is that something happens to Entrepreneur A between the age of 50 and 65 that prevents them using that time in a quality way (Not an unlikely scenario of those taking no time out of the business). More likely is that those 80% extra hours each year don’t turn into the early retirement hoped for because longer hours don’t guarantee success. In fact there is a growing body of evidence supporting the fact that we become less effective at work when we work beyond 35 hours per week and that effectiveness continues to decline as the hours increase. This would mean that Entrepreneur A would be more effective for the hours he worked than his tired out peer.
When it comes to time or money, a bird in the hand is definitely > a bird in the bush (2 birds would be dependent on timescales and target returns!) and that needs to be shown in potential returns.
Youth is wasted on the young
I did retire at 50. Personally I think it sucked and I started a new business a few weeks later and am happier for it. My kids were at school, my wife enjoys her work (mostly) and possibly didn’t seem that enthusiastic about the idea of being with me 24/7 anyway. My friends are mostly distributed around the world and doing their own things, and a lot of the activities I used to enjoy doing in my spare time just bloody hurt now.
I’m not saying retirement is bad, even if I am not ready for it myself. I’m just saying that 24 hours in your 50s isn’t the same as 24 hours in your 20s, 30s or 40s. I don’t know many early retirees who wouldn’t gladly swap a bit of time off now for a little more time when their children were young, when their parents were around or when their then-stronger social group were doing far more interesting things together. We need to be careful of swapping out most valuable hours for less valuable ones later: They are not worth the same.
Figuring out what you really want
I think “retire at 50” is one of those goals that other people set for us. Business owners tend to be more driven people and driven people respond well to clear objectives. Knowing this we set objectives based on common ideas of success rather than taking time to understand what is really important for us and setting goals aligned with that. Retiring at 50 is a common goal because most people aren’t entrepreneurs. They have limited control over the job they do, the hours they work or the business they do that within. They’re passengers and the only option they have is to switch which ship they’re on. As entrepreneurs we’re not passengers. We’re not only captain our won ships, but own them too. If we feel we’re stuck on a particular route we can turn the rudder and sail off in any direction we choose. We have the option to build the business to give us our dream job and optimise for whatever it is we want from life.
Maybe early retirement is essential to your life plans. Who knows, you might have the dream of living off-grid in Borneo for a decade and refuse to be a Starlink customer. If so, great: Optimise for that. My point though is that “work harder, retire early” shouldn’t be the default answer. Don’t do it if it isn’t what you really want deep down, and definitely don’t do it if you are going to end up worse off by doing so!
