What Percent of My Income Should I Invest If I Want to Retire Early?
I get asked this all the time: “What percent of my income should I invest if I want to retire early?” But that question misses the point. There’s no golden percentage. No magic number that’ll guarantee freedom.
The answer depends on how badly you want it, and what you’re actually willing to do about it.
If you’re looking for a shortcut, this isn’t it. Real early retirement is built on mindset first, math second, and discipline all the way through. You need to know what you want, how far you’ll go, and how long you’ll keep going.
Let me say this as clearly as I can: there is no one-size-fits-all answer. But there is a strategy. And I’ve lived it. Let’s get into it.
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Why Listen To DadisFIRE? (Hint: I’m Already Retired)
I’m not here to be your guru. I’m not selling a course. I don’t need your money, I already made my own. I became a liquid millionaire at 38 and retired at 42.
No one handed me anything. I maxed out my 401(k) when I was only making under $50,000 a year. I bought rental houses in my early 20s with no money down.
I’m also a Chartered Financial Analyst with more than 20 years of experience in financial services. I didn’t stumble into this. I studied it, worked in it, and built my freedom step by step.
Everything I write comes from actually doing it. Real decisions, real risk, real results. I don’t care what influencers and “experts” say about magic numbers to retire early. I lived the real thing.
How Much Do You Actually Need To Retire Early? The Simple Math Behind Early Retirement
Ignore the 10%, 15%, 20% Advice, It Won’t Get You There
“Save 10% of your income.”
“Bump it to 15% if you want to retire comfortably.”
“Hit 20% and you’re a rockstar.”
That’s the nonsense you hear from mainstream advice. These numbers aren’t built for early retirement. They’re built to sell you books, courses, and ads.
Let’s do the math. Say you make $70,000 a year and save 15%. That’s $10,500 saved annually. Invested at 8% over 30 years, you’ll have around $1.25 million. That’s fine for a traditional retirement. But if you want to stop working in 15 years or less, that’s not going to cut it.
Now say you push to a 50% savings rate. That’s $35,000 a year. Same 8% return. In just 15 years, you’d hit over $1 million, and that’s before any tax advantages or real estate. See the difference? You don’t need guru math. You need intensity.
Most of the people telling you to stick to 15% are either selling a plan or parroting advice they never actually followed.
The Real Number That Matters Is Your Savings Rate
Forget income brackets. Forget tax brackets. Focus on this: how much of your paycheck are you keeping? That’s your real savings rate.
Use this simple formula: (Income – Spending) ÷ Income = Savings Rate.
If you make $80,000 and live on $40,000, you’re saving 50%. Every year you work, you’re buying yourself a full year off. Now flip it, if you make $80,000 and live on $75,000, your savings rate is just 6.25%. At that rate, you’ll be chained to your desk for decades.
The key isn’t how much you make. It’s how little you need. Once you control your spending, every dollar saved becomes fuel. The higher the savings rate, the faster the math tilts in your favor.
FIRE isn’t about guessing. It’s about knowing what you can live on, and investing the rest without apology.
Related Video: 9 Mental Shifts Required for a Successful FIRE Journey
A Big Paycheck Doesn’t Mean You’re Winning
You’ve probably heard it before: “I don’t need to save as much, I make more.” That’s the lie that keeps high earners broke. A $300,000 salary doesn’t mean freedom if you’re spending $280,000 of it. That’s not wealth. That’s stress in a nicer zip code.
Let’s break it down. A person earning $60,000 and saving 50% is investing $30,000 a year. If they stay consistent, that can grow to around $1 million in 15–17 years at an 8% return.
Now look at someone earning $250,000 but only saving 10%. That’s $25,000 a year. Sure, it looks close. But they’re living on $225,000 and they’ll need several million to replace that lifestyle.
High income with high spending is just a shinier version of broke. What matters is your gap. The difference between what you earn and what you need. That’s your runway. Stretch it. Guard it. Grow it. That’s how you win.
Why Income Isn’t the Biggest Hurdle to Retiring Young
Low Income Doesn’t Mean No Chance
People love to say FIRE is only for high earners. That’s just a lazy excuse. I didn’t earn six figures in my twenties. I didn’t even hit $50k until my thirties. But I still invested like my future depended on it, because it did.
The less you make, the more intentional you need to be. That’s not a punishment. That’s just reality. If your income is tight, you don’t have room for fluff. Every purchase has to earn its place. That’s a powerful mindset if you embrace it.
You may not be able to save 50% today, but you can still save more than most. And when your income increases, you keep the same expenses and scale the savings. That’s how you build speed.
Don’t wait until you make more to start. Start now, even if it’s $100 a month. The muscle matters more than the amount.
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Your Pain Tolerance Sets Your Timeline
Early retirement comes down to pain tolerance. How uncomfortable are you willing to be now in order to get free later?
Most people don’t ask that question. Or worse, they ask it and lie to themselves. They say they want freedom but live like comfort is non-negotiable.
When I was making under $50,000, I still maxed out my 401(k). That wasn’t easy. It meant cutting everything that didn’t push me closer to the life I wanted.
I also had roommates to help subsidize my costs.
I didn’t think of it as sacrifice. I saw it as buying back time.
The more pain you’re willing to accept today, within reason, the faster you shrink your timeline. You don’t need to suffer, but you do need to stretch. Every dollar you keep is one step closer to calling your own shots.
Light Your FIRE: Financial Independence Retire Early Strategies Explained
But I Want To Have Fun
I’ve heard it plenty of times. People giving their sour grapes answer that they don’t want to live frugally in their 20s, and you can’t take it with you.
Here’s the thing. I had fun in my 20s and 30s. Surely just as much as everyone else. No one knew how much I was saving. Most people didn’t even know I had the rental houses.
I made it work. I had the same lifestyle as my friends, except I wasn’t renting a house. I was paying down a mortgage on a true starter home. I also wasn’t buying new cars or eating out all the time.
I didn’t sacrifice fun. I sacrificed buying new and shiny objects. Shiny objects have never made me happy. Why spend on things that don’t make you happy?
The Reality of Early Retirement: More Than Just Luck
Stop Following Rules That Were Never Built for You
If you’re still asking what percent of your income you should invest, you’re asking the wrong question. The goal isn’t to meet some expert-approved benchmark, it’s to get free.
As soon as you stop chasing rules made for average people, you start thinking like someone who actually wants out.
There’s no perfect number. The answer is simple: invest as much as you can without breaking your life, and then stretch that a little more. If that’s 25%, good. If it’s 65%, even better. If it changes month to month, that’s normal.
This isn’t about being perfect. It’s about being committed.
Retire Early on Your Own Terms
Nobody retires early by playing it safe or following a plan built for someone else. I didn’t get here because I followed a rule in a finance book, I got here because I ignored the noise and made my own playbook.
I kept the spending low, pushed the savings high, and stayed consistent when most people gave up. Early retirement isn’t about discipline once in a while, it’s about doing the hard thing over and over until it pays off.
Now I’m free, because I wanted it more. So can you.
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