Update: Below is a video describing what I will be doing in this early retirement journey.
Okay, so I told myself a few months ago that I planned to retire no later than age 35.
Yeah, I’m serious.
I’m dead serious.
However, one thing I’ve noticed in my research of achieving this dream is that everyone tells me how to do it, but nobody tells me of any sort of struggle or reveals what it was like to start in the beginning. Don’t get me wrong, I love a good success story, but if I decide to follow along, I’m the kind of person who gets pretty discouraged when I hear how easy everything was and how it only took these 3 steps to achieve this major goal and yadda, yadda, yadda.
Tell me about the nitty gritty. Tell me about your struggle. Tell me about the things you learned and what you think you could have done differently. I don’t care to see pictures of you on your houseboat surrounded by scantily dressed women holding cocktails. I want to know about how it took you a total of 7 years because you spent the first 2 years screwing things up and what you learned from those screw ups. That, to me, is a success story.
Now, I think I’d be a pretty big hypocrite if I did the same thing: finally reached financial freedom and then told everyone about how I already got there. Not only do I want to do something differently by documenting my entire journey, but I’m kind of hoping to inspire someone else the way I was inspired. I remember reading a quote that went something like “We don’t buy things with money. We buy them with hours of our lives.”
Pretty crazy thought, huh?
This was just one of those things I thought about during the time I teetered between spending money on whatever I wanted because life is short or holding on and saving my money for a later date. After reading a post from one of my favorite blogs, Making Sense of Cents, I learned about a woman by the name of JP Livingston who was able to retire at age 28 with $2.25 million being her net worth. She talks about how she was able to achieve this by saving and investing her money.
Sounds easy enough to me…
Well, when the talk about investing by having a diverse portfolio and saving by buying only secondhand comes into play, that’s where I think things can get tricky in my mind. Not gonna lie, it can sound like a bit of a turn off, but when I get to hear about how she doesn’t have to worry about finances, works on her own time, and travels whenever she wants, it sounds like a sacrifice I can live with.
With that, here are the list of things that it takes to retire early (as told by the people I follow who are now retired at my age or a bit older) and what I will try to do to take the journey to financial freedom myself.
Number 1: Make More Money
…Well… I kind of figured…
No, what these early retirees mean is basically doing all you can to make the most you can. This didn’t necessarily mean that you need to make millions in order to retire early. Not at all. Some of these people were retiring from pretty small jobs or even blogging. It wasn’t about making a lot, it was more about making as much as you could. This includes creating a business, getting a side hustle, and more.
Number 2: Invest That Money
I don’t have many investments, but my mother would talk to me about how important it was when I was younger. I still remember her telling me to get a 401K plan as soon as it was offered to me back when I was in high school. When I turned 20, I finally got that opportunity after becoming a bill collector for an automobile finance company.
The one thing I saw that a lot of these early retirees had in common was their talk of a Roth Ira. (I’ll go into more about a Roth and it’s difference from a Trad and so on in another post.) I knew that it would be a good investment, and plan to do it very soon. At the moment, I just moved to Waco, TX to go to school at Baylor, and am now unemployed. However, I plan to roll my 401K over to my new job (when I get one) and open a Roth Ira to start further investments.
Number 3: Save
My parents taught me to save at a pretty young age. I opened my first savings account with Washington Mutual when I was about 7 or 8 with $212 and change. I wasn’t the best saver growing up, and I could still be a better one. That quote that I mentioned really opened my eyes, and I started looking into more ways that I can save my money and be wiser with what I earn.
Number 4: Live Well Below Your Means
This is more like a sub section for Number 3. By living well below your means, you save tons of money that you’d otherwise be spending on things that you really don’t need. The difference between living below your means and living well below your means is this: if you don’t need it, you don’t buy it. Some people take this to the ultimate extreme by just sleeping on a mattress on the floor.
Most follow the basics: buying clothes second hand and only if they need new clothes, never eating out, not buying a car and taking public transit, and so on. It may sound like it’s something hard, but different and difficult aren’t synonyms for impossible. I know it can be done because these early retirees did it.
That being said, I will be posting more about early retirement and my journey towards this new long term goal of mine. I hope that anyone else reading this becomes inspired by the journey, learns from any mistakes I make along the way, or teaches me about more opportunities that may come along. I’m pretty excited and can’t wait to see what’s in store for me!