Do you wonder how to retire early? Twenty years ago i asked the COO of the large company that I worked at what book I should read. He said “7 Habits of Highly Effective People“. He even gave me a copy. Several days later I went to read it. I opened it to the table of contents and noticed that none of the habits were to read the book. I didn’t read it. Should I have read it? Of course, but hindsight is in the rear view mirror.
So step one of the 10 easy steps to retire early is I am not going to give you any steps. You wouldn’t follow them anyway. If you would, then this is not the blog for you. I don’t believe in certain steps. I believe you follow your own path. This blog will tell you what I did, but more than anything don’t do what I did. Do what you need to do. You aren’t me. We have different risk tolerances and time horizons. We have different incomes and different expenses. Our collection of goals in life are different. Our experiences are different. We have different networks. Be you. I have no intention to teach you to be me. Be you.
If you need steps, check out Dave Ramsey. He’s not perfect, but he isn’t bad. I find myself watching quite a few of his YouTube videos. He has clear steps on the path the controlling your finances. He’s easy to understand, and so many of his stories are relatable to anyone.
But you don’t need steps. Financial Independence Retire Early just comes down to spend less than your income. You need to know what you spend to do that. If you spend enough less than your income than you invest. If you invest smartly and over time then you have a lump sum that can cover your expenses. How much lump sum you need depends on you. It depends on what lifestyle you want. It depends on if you want to sacrifice more now or more later. For me it came down to understanding the concept of satisfice.
Being Financial Independent is not about steps. There is no secret recipe for how to retire early. There are recipes that others have done, but you aren’t others. Focus on the mindset. Focus on what it takes to think about trade offs. Understand where your money is going and where you money will go. Make decisions about whether you want to buy stuff or buy your time, or some healthy combination of both.
Think about your timeline. Shortening the time line means you need to do some combination of taking on more risk, living on less, and earning more. The timeline doesn’t need to end at some magical retirement number in your 60s. You can shorten it. It’s all just math and mindset. Don’t over complicate it.
I am not going to tell you to decrease your standard of living, to increase your income, or anything of the sort. This is your life, you need a plan that fits you. Just read through this blog. Read other blogs. Develop your own plan and make it happen. Make it happen.