# Retire at 30 ? How ?



## gladaki

http://www.mrmoneymustache.com/2011/09/15/a-brief-history-of-the-stash-how-we-saved-from-zero-to-retirement-in-ten-years/

I dont get it.How he ended up retire at 30.

I earn close to 80$ ..net worth is close few thousand..Emergency fund for 3 month thats it.
Rent is 22% of my salary ..fixed expenses including car loan takes 50% of my salary...

How he did it ??


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## Moneytoo

"If want to retire within 10 years, the formula is right there in front of you – simply live on 35% of your take-home pay**, which is approximately what I did without even realizing it during my own younger years. The only reason Mustachians will remain a rare breed, is because this article will never appear in USA Today. (Or if it does, people will be too busy complaining about how it can’t be done, rather than figuring out how to do it)"

(c) http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

(*Note*: I'm not trying to do what he and others did - besides, too late for that - just answering your question )


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## CrashTestSnoopy

gladaki said:


> http://www.mrmoneymustache.com/2011/09/15/a-brief-history-of-the-stash-how-we-saved-from-zero-to-retirement-in-ten-years/
> 
> I dont get it.How he ended up retire at 30.
> 
> I earn close to 80$ ..net worth is close few thousand..Emergency fund for 3 month thats it.
> Rent is 22% of my salary ..fixed expenses including car loan takes 50% of my salary...
> 
> How he did it ??


You need to think outside the box and commit 100%. Once you're married, it's even more difficult when sharing decisions and that perky house with a picket fence will be just around the corner. Once the kids arrive, it's pretty much over but your priorities would have shifted significantly anyway. By now, you'll know that working at a day job and getting eaten alive by taxes plus expenses won't get you there, at least not at that age. 40 still isn't too bad. My dad got there in his 50's which considering the time was pretty good. Eventually he got bored and became a pastor in Panama.. LOL


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## donald

I don't know to much about the world of 'forums' or 'blogging' but one would have to think he must do alright on that front
he is reaches a lot of people and that has to be one of the most popular finance forums in north America for sure (a by-product albeit)


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## brad

donald said:


> I don't know to much about the world of 'forums' or 'blogging' but one would have to think he must do alright on that front
> he is reaches a lot of people and that has to be one of the most popular finance forums in north America for sure (a by-product albeit)


He had a great post on this a couple of years back: a lot of people were calling him out as "not really being retired," because he makes a lot of money from his blog plus he does construction work on houses. The sentiment was "gosh, if he's doing anything that earns money, he can't be retired." You can read his reply here: http://www.mrmoneymustache.com/2013/02/13/mr-money-mustache-vs-the-internet-retirement-police/


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## nathan79

It also helped that he was pulling in well over 100K during his with his wife pulling in an additional 70K. They were basically spending 30-40K/yr, which means they were able to save nearly 100K per year even after tax.


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## daledegagne

donald said:


> I don't know to much about the world of 'forums' or 'blogging' but one would have to think he must do alright on that front
> he is reaches a lot of people and that has to be one of the most popular finance forums in north America for sure (a by-product albeit)


First off - MMM lives on about $25K per year: 

Source: http://www.mrmoneymustache.com/2015/01/16/exposed-the-mmm-familys-2014-spending/

2nd - When you talk about your income you've only got 1/2 the equation. Income > Expenses x buffer = Early Retirement (I know that isn't a true mathematical equation)

By far he's got the best Lifestyle to "Savings" Ratio that I have ever seen (35/65 is awesome most people struggle to get much past 70/30) so that's totally pro of him. And he literally leads off with all the things he did to be able to save that type of money in his first blog post.

http://www.mrmoneymustache.com/2013/02/22/getting-rich-from-zero-to-hero-in-one-blog-post/

If you can realize that it doesn't matter what you make, or what you spend, but only the interplay between the two, then you can make it just like he did (or any other Retired Early person). It's not rocket science - It's purposeful, boring and affective.


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## james4beach

If you read the mustache man's chronology, you can see that he got very lucky with the timing of his income and investment years. His tech career accelerated right during the tech bubble years of the late 90s. He got lucky with employee stock plans and cashed out at opportune times with corporate stock that was actually WORTH something -- that's just lucky too. And his investment activities were heavy starting after the tech crash of 2000, aligning (again luckily) near that 2003 low. Great timing; sheer dumb luck. It all had to do with _when he graduated_.

As an example of his incredible luck, notice that he cashed out stock and accumulated cash in 1999/2000 right before the stock market crash. He shifted asset exposure to real estate at an ideal time... rotating into real estate exposure at _just the right time_, exactly on track to benefit from Alan Greenspan's carefully engineered real estate bubble "reflation".

I know guys that entered in to the same path as him at T+4 years and I can tell you, that didn't work out so hot. They got drestroyed. Their company stocks crashed or became worthless and their job opportunities were horrible and their income never accelerated like that.

It's kind of silly to assume that the "average case" would replicate what this guy had, with rapidly increasing income by being in the right bubble sector at the right bubble time. For every story like MMM's, there's another story with someone that had the worst timing possible. Same people, very different results -- due to volatility in the stock market, economy, and boom-bust cycles (and bubbles... tech bubble, in this guy's case).

This guy makes excellent points about cutting living expenses and increasing your savings rate. HOWEVER, he makes a logical error in reasoning: he dramatically under-plays his sheer dumb *luck* of alignment with the job market & stock market. I'm glad it worked out so well for him but it is NOT a universal story. Just wiggling his graduation by 3 or 4 years would make a huge difference in outcomes.


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## brad

james4beach said:


> This guy makes excellent points about cutting living expenses and increasing your savings rate. HOWEVER, he makes a logical error in reasoning: he dramatically under-plays his sheer dumb *luck* of alignment with the job market & stock market. I'm glad it worked out so well for him but it is NOT a universal story. Just wiggling his graduation by 3 or 4 years would make a huge difference in outcomes.


I agree about it not being universal. He basically commits the common middle class white man error of assuming "if it worked for me, it'll work for you." Our lifestyle to savings ratio is close to 20/80 (we live on a little more than 20% of our household gross income), and while we're in our mid 50s and thus way too old to retire young, I also don't think we'll be able to fully retire before age 70. I think the secret if you want to retire early is to earn high and live low starting in your 20s. I've pretty much always lived low, but didn't start earning high until my late 40s. On the other hand, I was never motivated to retire early, so I didn't and won't. It's just never been a compelling goal for me.

Your Money or Your Life is another example where a strategy that worked for people back in the 1980s doesn't even come close to working today.


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## crazyjackcsa

Perspective matters as well. At 34 years old, I'm either semi-retired, or underemployed depending on how you want to look at it.

I work a couple of part time jobs, which combine for about 25hrs a week. As a school photographer my wife works "teachers hours" with summer and christmas and march break off. She doesn't make teachers pay though! 

We've never made more than 65K gross household and yet, we're fine. We save 25% of our income for our childrens' RESP and our retirement. We save for big expenses, we have a manageable mortgage and no other debt.

We take modest trips and have been saving for a few years to go to Florida so the kids can see the mouse.

We could continue on this way until our "retirement" at 65. Would I like to fill up the other 15 hrs? Some days yes, some days no.

So, am I semi-retired? Or underemployed?


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## gladaki

@^ do you count your mortgage as debt If yes then out of your 30 percent how much is mortgage


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## sags

I had a female friend who I worked with.

Her husband retired the day after they started living together at the age of 25.

She worked every day and all the overtime...........and he looked after their backyard pool.

On my last of day of work...........she was working and sending him money in the Bahamas.........where he was vacationing.

She is retired now, and they live comfortably on her DB pension. They can look forward to her pension, CPP and OAS..........and his OAS.

He should write a blog on how to retire at 25.


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## Woz

I don’t really think he got that lucky. The $10k stock options he cashed out in 1999/2000 was small and didn’t have a large effect on his net worth. His net worth really took off from 2001 to 2006. 2003 to 2006 the stock market did 28.7%, 10.9%, 4.9%, 15.8%. Those are definitely nice returns, but it’s also not that unusual and he did have a fair bit invested in 2001 and 2002 where he would’ve had negative returns. His salary also didn’t seem that crazy during the tech boom. It wasn’t really until 2002 when he got his $100k+ salary.

By far, the biggest factor in his net worth is a high salary and low expenses that allowed him to save ~$100k per year.

Being able to retire at 30 was mostly due to his net worth, and being comfortable retiring with a fairly low number. I think most people wouldn’t be comfortable retiring with ~$800k.


He details how he progressed here: http://www.mrmoneymustache.com/2011...e-saved-from-zero-to-retirement-in-ten-years/

I’ve summarized below:

Year 0 – Age 22 – Year 1997 – Salary $41k – Net Worth $0
Year 1 – Age 23 – Year 1998 – Salary $58k – Net Worth $5k
Year 2 – Age 24 – Year 1999 – Salary $58k – Net Worth $23k
Year 3 – Age 25 – Year 2000 – Salary $77k – Net Worth $67k (cashed out $10k stock options, bought $235k home)
Year 4 – Age 26 – Year 2001 – Salary $127k (family) – Net Worth $150k
Year 5 – Age 27 - Year 2002 – Salary $160k – Net Worth $250k
Year 6 – Age 28 – Year 2003 – Salary ~$170k – Net Worth $365k
Year 7 – Age 29 – Year 2004 – Salary ~$170k – Net Worth $490k ($30k stock gains)
Year 8 – Age 30 – Year 2005 – Salary ~$195k – Net Worth $600k (cut back to 4 day week, cashed out stock options, $40k stock gains)
Year 9 – Age 31 – Year 2006 – Salary $110k – Net Worth $720k (“retired”, wife works half year, starts small house building company)
Year 10 – Age 32 – Year 2007 – Net Worth $800k


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## cainvest

So those Salary figures (41k, 58k, etc) are after tax dollars right?


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## gladaki

Woz said:


> I don’t really think he got that lucky. The $10k stock options he cashed out in 1999/2000 was small and didn’t have a large effect on his net worth. His net worth really took off from 2001 to 2006. 2003 to 2006 the stock market did 28.7%, 10.9%, 4.9%, 15.8%. Those are definitely nice returns, but it’s also not that unusual and he did have a fair bit invested in 2001 and 2002 where he would’ve had negative returns. His salary also didn’t seem that crazy during the tech boom. It wasn’t really until 2002 when he got his $100k+ salary.
> 
> By far, the biggest factor in his net worth is a high salary and low expenses that allowed him to save ~$100k per year.
> 
> Being able to retire at 30 was mostly due to his net worth, and being comfortable retiring with a fairly low number. I think most people wouldn’t be comfortable retiring with ~$800k.
> 
> 
> He details how he progressed here: http://www.mrmoneymustache.com/2011...e-saved-from-zero-to-retirement-in-ten-years/
> 
> I’ve summarized below:
> 
> Year 0 – Age 22 – Year 1997 – Salary $41k – Net Worth $0
> Year 1 – Age 23 – Year 1998 – Salary $58k – Net Worth $5k
> Year 2 – Age 24 – Year 1999 – Salary $58k – Net Worth $23k
> Year 3 – Age 25 – Year 2000 – Salary $77k – Net Worth $67k (cashed out $10k stock options, bought $235k home)
> Year 4 – Age 26 – Year 2001 – Salary $127k (family) – Net Worth $150k
> Year 5 – Age 27 - Year 2002 – Salary $160k – Net Worth $250k
> Year 6 – Age 28 – Year 2003 – Salary ~$170k – Net Worth $365k
> Year 7 – Age 29 – Year 2004 – Salary ~$170k – Net Worth $490k ($30k stock gains)
> Year 8 – Age 30 – Year 2005 – Salary ~$195k – Net Worth $600k (cut back to 4 day week, cashed out stock options, $40k stock gains)
> Year 9 – Age 31 – Year 2006 – Salary $110k – Net Worth $720k (“retired”, wife works half year, starts small house building company)
> Year 10 – Age 32 – Year 2007 – Net Worth $800k


I dont get it ? House (What about mortgage above, wont it is suppose to be subtracted from networth)


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## Woz

He makes it sound like the salary is before tax.

It looks like his home equity is included in his net worth. In year 3 he lists his net worth as $67k with $47k coming from equity in his home, so $188k mortgage.


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## donald

lol sags


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## Just a Guy

I think it's entirely doable, but you'd need to start early and develop many forms of passive income in a society which preaches getting a paycheque.

One of the best ways to do this used to be real estate. It was highly leveraged, so you had more earning power for your out of pocket cash. Of course, you still needed to find cash flowing properties. I had a friend back in high school who started buying rentals before he graduated...lost touch after school ended (and this was long before I got into real estate myself), I imagine he's probably very wealthy today if he kept it up...he probably could have retired by 30.

Of course today the market is a lot different, highly overpriced in my opinion, so it would be much harder to find cash flowing properties...but there are many other forms of passive income. If you can buck the trend of get a good job, I still think it would be possible.


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## humble_pie

sags maybe she liked it that way? especially the part about the bahamas. when the cat's away the mice can play


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## Barwelle

crazyjackcsa said:


> We could continue on this way until our "retirement" at 65. Would I like to fill up the other 15 hrs? Some days yes, some days no.
> 
> So, am I semi-retired? Or underemployed?


IMO you're only underemployed if your earnings don't support your lifestyle, and/or if you _want_ to work more but cannot get the hours. 



Just a Guy said:


> Of course today the market is a lot different, highly overpriced in my opinion, so it would be much harder to find cash flowing properties...*but there are many other forms of passive income*. If you can buck the trend of get a good job, I still think it would be possible.


Go on...


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## donald

What i don't care for with mr M is he assumes to much imo(like he is the only guy in the world with a magic key)
I get leery of people that have a high need to proclaim day in and day out about their 'life'(whatever aspect)is the holy grail
I have a female friend on facebook that likes to posts photos of her and her boyfriend every freaking day saying she is so happy and in love and she has the 'perfect' boyfriend
she is just dying for the like button to be hit and the comment stream of 'your so lucky'
she needs validation every freaking day(i think i wouldn't be the only on-looker thinking she has certain self esteem issues)
The empty train over the trolly track makes the most noise type of thing.


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## cainvest

Woz said:


> He makes it sound like the salary is before tax.


It's hard to say without an itemized list of income and/or expenses ... some of those net worth jumps seem high but without details, who knows.

If you are a "heavily weighted to live for the future and not the present type of person" the bottom line is, get well paying job and cut expenses as much as possible then save the rest, no magic there.


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## treva84

Barwelle said:


> Go on...


Agreed - other than RE (renters), blogging / forums (advertising) and investments (dividends), what are the other common forms of passive income?


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## Just a Guy

Well, authors and musicians get money from royalties. Stock owners can get dividends. I know many an angel investor who generate large amounts of money investing in others, but they generally start with money. Business owners get money from their companies. The business ownership can be literally nearly endless ways of making money. 

I find the fact many of you can't even fathom ways of making money without working as a sad comment on today's education system...

What ever happened to thinking in a creative manner? I never had to be told "how can I make money?", it was a question to which I've always looked for the simplest answer. Of course, I hated some of the jobs I had as a kid (minimum wage jobs are some of the hardest and least enjoyable ones out there in my opinion), so I was inspired to find different solutions.

My thinking has slowly evolved into being driven by the question "how can I make money from this?" It drives most of my major purchases now...from my residence, my vehicles, even some hobbies... It's not the only driving force, but if I can find a way to make money from whatever I do, I try to implement it.


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## CrashTestSnoopy

sags said:


> I had a female friend who I worked with.
> 
> Her husband retired the day after they started living together at the age of 25.
> 
> She worked every day and all the overtime...........and he looked after their backyard pool.
> 
> On my last of day of work...........she was working and sending him money in the Bahamas.........where he was vacationing.
> 
> She is retired now, and they live comfortably on her DB pension. They can look forward to her pension, CPP and OAS..........and his OAS.
> 
> He should write a blog on how to retire at 25.


Just realized I had my dating criteria all backyards. It should have been "so.. what are your aspirations later? how about you work while I measure the chlorine?" You know, pool maintenance is real hardship. I mean, you gotta apply sunscreen, keep the algae at bay, pick up the toys, and all the while be a lifeguard for chipmunks and squirrels.. can't let your furry buddies get caught in the deep end, right? Forget the fact Ontario is 2 months summer and 10 months winter, you need to still drain and cover it, so that's still a lot of follow-up to worry about. I'd say Bahamas + LPSE (Lifelong Pool Subsistence Entitlement) benefits would be more like it. Good lord, why didn't I think of this. All I'd have to do is ask and if she says "GET REAL" then I just call up the next one on my list till one of them say "sure honey". I'd blog everyday and post videos on youtube of me rescuing them furry little ninjas, just like this one: https://www.youtube.com/watch?v=7cmxbSNtLP8

God, hear me now, I need a time machine.


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## CPA Candidate

I personally think retiring at 30 would be extremely boring. I actually like going to work most of the time, it gives me a challenge and sense of accomplishment and is a social outlet as well. That doesn't mean I want to work until 65, but retiring today would be fairly dull existence I think.


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## brad

CPA Candidate said:


> I personally think retiring at 30 would be extremely boring. I actually like going to work most of the time, it gives me a challenge and sense of accomplishment and is a social outlet as well. That doesn't mean I want to work until 65, but retiring today would be fairly dull existence I think.


It really depends on what you define as "retirement." Mr Money Mustache considers himself "retired" but he's a busy guy: building houses, writing a blog, giving workshops and lectures, being a dad, etc. Some of those things happen to earn money: there's no law saying that you can't earn money during retirement. But his point is that he doesn't need to earn money. He could stop the blog and his construction business today and still be fine: he works because he loves doing what he does, and he gets to choose what he'll do and when/where he'll work. 

Most people I know are busier in retirement than they were when they were working -- a friend of mine who's been retired for five years told me: if you have any projects you want to get done, do them before you're retired because there won't be any time once you're retired! The idea that retirement involves endless hours of playing golf or sitting on the beach is pretty well outmoded by now.


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## Moneytoo

^ Saw this card last night after the Big Ban Theory episode and chuckled:

*CHUCK LORRE PRODUCTIONS, #354*

Hardly a day goes by when I don't think about quitting this business. Hanging it up. Taking my proverbial bat and ball and going home. In my imagination, the day after I quit is a wonderful, relaxing, joyful experience. I reconnect with old friends, walk on the beach, read, listen to music, play guitar, play golf, eat leisurely meals off of real plates, exercise, meditate, maybe go see a matinee, or take a stab at writing a few pages of a self-indulgent, joke-free play filled with people screaming at each other, and then, after taking the dog for a walk, climb into bed and fall into a peaceful, stress-free sleep. The day after that, bored out of my mind, I start drinking around the clock and quickly descend into a dark, frothing madness that leads to either being institutionalized or liver failure and an agonizing, premature death. The really scary part? There's hardly a day goes by when I don't think about quitting this business.

http://www.chucklorre.com/index-2hm.php?p=354


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## steve41

OK.... here's an 18 yearold earning (gross) $60K. He plans to retire at 30, and (just) die broke at 95. It is do-able if you can imagine living on $18K per year. (based on BC taxation, 4% rate of return and 2% inflation)

http://www.fimetrics.com/retireat30.pdf


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## cainvest

brad said:


> It really depends on what you define as "retirement." Mr Money Mustache considers himself "retired" but he's a busy guy: building houses, writing a blog, giving workshops and lectures, being a dad, etc. Some of those things happen to earn money: there's no law saying that you can't earn money during retirement. But his point is that he doesn't need to earn money. He could stop the blog and his construction business today and still be fine: he works because he loves doing what he does, and he gets to choose what he'll do and when/where he'll work.


I can see the confusion for many, working and yet calling yourself retired is a grey area with the difference being if you are (in some form) financially independent. Going by MMM view, I've been retired for a while now.


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## Barwelle

Just a Guy said:


> Well, authors and musicians get money from royalties. Stock owners can get dividends. I know many an angel investor who generate large amounts of money investing in others, but they generally start with money. Business owners get money from their companies. The business ownership can be literally nearly endless ways of making money.
> 
> I find the fact many of you can't even fathom ways of making money without working as a sad comment on today's education system...
> 
> What ever happened to thinking in a creative manner? I never had to be told "how can I make money?", it was a question to which I've always looked for the simplest answer. Of course, I hated some of the jobs I had as a kid (minimum wage jobs are some of the hardest and least enjoyable ones out there in my opinion), so I was inspired to find different solutions.
> 
> My thinking has slowly evolved into being driven by the question "how can I make money from this?" It drives most of my major purchases now...from my residence, my vehicles, even some hobbies... It's not the only driving force, but if I can find a way to make money from whatever I do, I try to implement it.


I've got a couple things in mind / in progress, but it never hurts to keep thinking. The issues with these ideas - not everybody is a creator type that can make a work of art or writing that is good enough to sell, and stocks, angel investing, and businesses all need cash to start with. So, unless someone starts off with money from an inheritance or generous parents, you still need to work.

Your last comment is funny, I have a similar attitude to some extent... one friend of mine likes to tease me for it (part of the running joke is if/when I buy a girl an engagement ring, the cost of the ring will be proportionate to the amount of money and assets she brings to the relationship).



steve41 said:


> OK.... here's an 18 yearold earning (gross) $60K. He plans to retire at 30, and (just) die broke at 95. It is do-able if you can imagine living on $18K per year. (based on BC taxation, 4% rate of return and 2% inflation)
> 
> http://www.fimetrics.com/retireat30.pdf


Sheesh. All I can think is, that looks tight. 

But, there is a couple that blogs in Vancouver about their frugal lifestyle, and their total combined spending was just under 18,000 in 2014. So it's definitely possible. http://incomingassets.com/2015/01/01/2014-financial-report/


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## sags

steve41 said:


> OK.... here's an 18 yearold earning (gross) $60K. He plans to retire at 30, and (just) die broke at 95. It is do-able if you can imagine living on $18K per year. (based on BC taxation, 4% rate of return and 2% inflation)
> 
> http://www.fimetrics.com/retireat30.pdf


CPP would pay $6,000 per year reduced pension at age 61, after only contributing for 12 years ?


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## steve41

Yeah.... I eyeballed that. That's $6K in nominal $. Look at the CPP as CPP and some form of pension plan.


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## Davis

Moneytoo said:


> ^ Saw this card last night after the Big Ban Theory episode and chuckled:
> 
> *CHUCK LORRE PRODUCTIONS, #354*


Thank you for that, Moneytoo. the best thing I've read all day. It won't stop me from retiring at 50, though.


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## Cal

daledegagne said:


> If you can realize that it doesn't matter what you make, or what you spend, but only the interplay between the two, then you can make it just like he did (or any other Retired Early person). It's not rocket science - It's purposeful, boring and affective.


So True.

Having said that...I wouldn't want to retire at 30....I like my job, and will enjoy doing it for many years, but because I choose to, not because I have to.


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## christinad

I made $35000 at age 30 so it was difficult to save. Most peoples' income goes up gradually. Mr Moustache has a skewed view of reality to think most people could do what he did.


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## fplan

definitely possible. if home prices drop 50% or more.. crappy houses also costing 1M, how can anybody save.. double income around 150k can achieve that.. only if they don't buy a house..


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## OurBigFatWallet

One thing about MMM many don't consider is that the site itself earns 6 figures plus I'm pretty sure he does carpentry work as well. Managing a web site and part time work on the side......some may consider that early retirement, others would consider it a career change. I guess it all depends on what you'd consider "retirement" to be


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## OnlyMyOpinion

In our experience, the opportunity for material savings came after the house was paid off, after the resp's were saved, the kids through school and gainfully on their own. During that time we always maximized our rrsp's, but we wasted money (that could have been saved) on many adventurous family vacations & memories, we wasted money visiting our extended families each year at the other end of the country or flying them out to vacation with us, we wasted money helping church and family, etc. This required one full time job throughout with no ability to consider retiring earlier than our late 50's. Oh well, that's life.


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## brad

OurBigFatWallet said:


> One thing about MMM many don't consider is that the site itself earns 6 figures plus I'm pretty sure he does carpentry work as well. Managing a web site and part time work on the side......some may consider that early retirement, others would consider it a career change. I guess it all depends on what you'd consider "retirement" to be


Read http://www.mrmoneymustache.com/2013/02/13/mr-money-mustache-vs-the-internet-retirement-police/ for his response to this.


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## My Own Advisor

OurBigFatWallet said:


> One thing about MMM many don't consider is that the site itself earns 6 figures plus I'm pretty sure he does carpentry work as well. Managing a web site and part time work on the side......some may consider that early retirement, others would consider it a career change. I guess it all depends on what you'd consider "retirement" to be


+1


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## Echo

Some might call it early retirement. Others might say, "I quit my job for a few years and now I'm a self-employed author, blogger, contractor, whatever."


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## brad

Echo said:


> Some might call it early retirement. Others might say, "I quit my job for a few years and now I'm a self-employed author, blogger, contractor, whatever."


Yeah, but his point is that he's not living on the income he gets from those activities.

In 2013 he and his wife spent a grand total of $25,142: http://www.mrmoneymustache.com/2014/01/12/exposed-the-mmm-familys-2013-spending/

In 2014, they spent $25,330: http://www.mrmoneymustache.com/2014/01/12/exposed-the-mmm-familys-2013-spending/

This is why he considers himself retired: sure he's doing things that bring in money, but he could stop doing all those things today and still have enough to live on.


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## lightcycle

brad said:


> Yeah, but his point is that he's not living on the income he gets from those activities.


You could also argue that those that are "retired", but actively balancing their portfolios to maximize returns/dividends and minimize risk are also in the same camp, and are not really retired at all, but are instead part-time investors.

And in that case, to be truly able to fit in the "retired" category, you can't do anything that will earn you an additional income. Instead you have to have a huge stack of bills in a safe that you take out a little bit every day to live on. You could call that your "safe withdrawal rate"...


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## cainvest

I guess one simple determining factor is the T4, if you get one, you're definitely not retired. Also, if you're working but don't need to be, then you're just financially independent but not retired.


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## Jon_Snow

I consider myself "retired" even though my wife still works - others might say I'm a "kept man". But she could quit tomorrow and we could easily live off our investment income. Her salary is just gravy...and wonderful, six figure gravy it is. MMM's blog income is similar to how I view my wife's income - nice to have, but not necessary.


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## brad

lightcycle said:


> You could also argue that those that are "retired", but actively balancing their portfolios to maximize returns/dividends and minimize risk are also in the same camp, and are not really retired at all, but are instead part-time investors.


Right, he goes into that in his "Internet Retirement Police" post, which I've linked to three times already but will link to again because it's hilarious and really worth reading: http://www.mrmoneymustache.com/2013/02/13/mr-money-mustache-vs-the-internet-retirement-police/


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## Karlhungus

Wow, a lot of whiners/complainypants in this thread. A lot of people are totally missing the point. It doesn't matter how much money he makes now, its all bonus. He didn't retire because he makes tons of money from his blog/carpentry, he retired because he saved 65% of his income and got to the point where are his passive income covers his expenses. 

For those complaining about his salary, you need to look up his post about how an average couple with an average salary can do it.


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## christinad

Maybe i wouldn't feel so defensive if he didn't act like anyone who doesn't take his path is somehow less enlightened. Unless you are living frugally there is something wrong with you. Personally i wouldn't give up all the travel i did when i was younger to retire earlier and i shouldn't have to feel bad because i go out to dinner occasionally.


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## peterk

My main complaint is that people assume that they will be able to or _want_ to keep the same amount of spending their whole lives as they did in their 20s. Just because you live off of $2000/month between the age of 20 and 30 doesn't mean you'll want to when you're 40+. And how could you possibly know? I mean maybe you will, but what if you don't? Then you're screwed, because you already retired 5-10 years ago and are now old and unemployable.

My second complaint is people's tolerance of market risk and the 4% rule. It's touted as "safe" with no regard to the size of the portfolio. A baseline for a lot of these early retirement cases is approximately "have your house paid off and about 600k in income generating investments and you're good to retire on 2000/month spending with the 4% rule." That's all great, but what happens if you're house turns out to be a dud and costs $1000/month in repairs? What happens if you're investments go down and stay down for 20 years? You have no buffer with $2000/month in spending, and are squeezed hard until you're forced to liquidate underwater investments or sell you're house just to pay for the bare minimum, or go back to work!

The 4% rule on $2M on the other hand makes a lot more sense. Now you're dealing with ~80k/year, and have a lot more buffer for real world crises that may arise over your 50+ year long retirement. Having to drop your spending from 80k/year to 40k/year because you badly screwed up your finances is a lot less devastating to your life than having to drop from 20k/year to 10k/year.

Personally, to retire, I think I'll want about 1.5M in assets, plus some sort of skill in my back pocket that I could easily turn into a respectable hobby income or part time consulting income if I really screw up and lose half my assets shortly after retiring.


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## Karlhungus

The thing is, all of his calculations have a huge buffer. Its almost a worst case scenario. He doesn't account for raises, CPP, or OAS. All the "what if the house is a money pit" blah blah is countered by the safety margin.


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## steve41

OK. Time for my semi-annual 'moonlanding' rant. 

"Each of you is sitting on on more computer power than NASA used to send a man to the moon. Don't you think someone could build a program which took into account all this stuff (taxes, clawbacks, variable rates, CPP, OAS, investment types, loans, variable salaries...) and actually calculate a plan? Not a one-time projection, but various 'what-if' projections?

Or maybe your idea of spending useful time is a rousing game of Angry Birds. Sigh.


----------



## brad

christinad said:


> Maybe i wouldn't feel so defensive if he didn't act like anyone who doesn't take his path is somehow less enlightened. Unless you are living frugally there is something wrong with you.


Oh, I agree, but it's important to note that Mr Money Mustache is essentially a cartoon character: he's a persona. The real man behind the cartoon character is not as extreme in his views; he's just having fun with the persona and rocking the boat. When you hear him in interviews he comes across as much less "frugaler than thou," and seems like a reasonable guy (which is also confirmed by people I'm acquainted with who've met him in person).


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## Westerncanada

I think the message is great. And can see how saving half of your take home pay can lead to a very earlier retirement etc. 

That said, 2015 is the first year of my life where I am able to actually save half of my income.. and looking at past history I could not have even made my rent payments let alone eaten/car payments/child support on half of my income let alone saved it.


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## Just a Guy

christinad said:


> Maybe i wouldn't feel so defensive if he didn't act like anyone who doesn't take his path is somehow less enlightened. Unless you are living frugally there is something wrong with you.


I find this comment rather ironic as most people with a paycheque seem to be the same. 

"Go to school, invest in yourself, get a good job..."

"Investing is risky"

"Being a landlord is a nightmare"

"Self employed people usually fail"

Heck, just look at this board for postings of a similar vein, and this is a place with many investors, self employed people, landlord, self made millionaires...


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## lightcycle

brad said:


> Mr Money Mustache is essentially a cartoon character


Yep. He's figured out that the easiest way to gain an audience is to be audacious and controversial. Doesn't mean that the underlying message isn't sound, but the way it's packaged is how he's able to generate traffic and revenue. This thread is proof of that.

Good for him, IMO!


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## el oro

steve41 said:


> OK. Time for my semi-annual 'moonlanding' rant.
> 
> "Each of you is sitting on on more computer power than NASA used to send a man to the moon. Don't you think someone could build a program which took into account all this stuff (taxes, clawbacks, variable rates, CPP, OAS, investment types, loans, variable salaries...) and actually calculate a plan? Not a one-time projection, but various 'what-if' projections?
> 
> Or maybe your idea of spending useful time is a rousing game of Angry Birds. Sigh.


Calculations of my anticipated 6-7 decades of retirement are modelled after rrifmetric. Best method I've found. Muchos gracias Stevie wonderful


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## CPA Candidate

I was pondering this issue last night while being unable to sleep and came to a rather interesting conclusion, Mr.Money is really not much of an economic maximizer, just a spending miser.

As opposed to accounting earnings, economic earnings consider the cost of foregone opportunities to make money. For instance, if you quit your 50k per year job, take $10,000 out of savings earning 5% and start your own business than earns 40k, your economic earnings are _negative_ $10,500 for the year. This is the amount you gave up by making your decision ($10000 in wage and $500 in interest).

If he had such a good paying job that he could have saved enough to retire at 30, his opportunity costs of foregone wages (and benefits) far outweigh his current investment income. His current economic earnings are likely negative. Consider the foregone wages compounded over three decades, it's literally millions of dollars left on the table.

Your skills and abilities to earn wages are the best cash generating unit that anybody has. Pulling the plug on a good paying job is not a smart economic decision if you truly wish to maximize wealth.


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## brad

CPA Candidate said:


> Your skills and abilities to earn wages are the best cash generating unit that anybody has. Pulling the plug on a good paying job is not a smart economic decision if you truly wish to maximize wealth.


True, but maximizing wealth was never on his radar as a priority. His goal was to retire as early as possible. In his view, being able to retire at 30 was literally worth millions of dollars.


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## Just a Guy

CPA Candidate said:


> I was pondering this issue last night while being unable to sleep and came to a rather interesting conclusion, Mr.Money is really not much of an economic maximizer, just a spending miser.


There are many ways to accomplish wealth or financial independence. David Chilton preaches cut back on spending and pay yourself first.

Personally, I don't agree with either. I went with the increase your passive income strategy.

No one strategy is the "right" way to do things as they all seem to work. I know several people who have found success in all these ways, and others as well.

I don't, however, know more than one person who got wealthy or financially independent from a paycheque.


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## cainvest

Just a Guy said:


> I don't, however, know more than one person who got wealthy or financially independent from a paycheque.


I believe there are some of them here on CMF that are financially independent from paycheques.


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## Eclectic12

Just a Guy said:


> There are many ways to accomplish wealth or financial independence. David Chilton preaches cut back on spending and pay yourself first.
> 
> Personally, I don't agree with either. I went with the increase your passive income strategy.


I'm not following how cutting expenses, paying yourself first ... *to buy investments* would not be increasing one's income. I haven't read the second book but with the writeup talking about investments, I'm thinking the basic premise hasn't changed.


As for "pay yourself first" - is not that embedded Mr. Moustache's philosophy? 
This is basically setting priorities ... those who don't set priorities typically have blow their money (ex. boatloads of toys/electronics) and can't make ends meet regardless of what their income is or grows to.




Just a Guy said:


> No one strategy is the "right" way to do things as they all seem to work. I know several people who have found success in all these ways, and others as well.


There are many ways ... the trick is to identify what is available as well as one that matches one's goals/interests.




Just a Guy said:


> I don't, however, know more than one person who got wealthy or financially independent from a paycheque.


The paycheque is one variable ... what one does with it is what will destroy, keep even or build wealth.


Cheers


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## SuperGrover

I think there a few key things Gladski is missing from Mr Money. 

First one was very apparent, while typing up expenses, I heard Car Loan...., which likely means you are driving a car worth too much. The car I drive I bought four years ago for 2.5g and is taken me over 50,000 km without a hitch. If you cant go that low, my wife bought her car for 10g. 

There are three principle things Mr Money has:
1) High Income with a second good income- most mmm's are engineers or liketypes. 
2) Never paying someone to do something you cant do yourself. This also leads to the ability to earn money 
3) Avoiding buying things on payment at all cost. Which also means buying a modest house.

I don't agree with a lot of mmm stuff, but the underlying prinicples (which are very simple) remain very true for retiring early. It just depends on how extreme you want to go. But being efficient with your money and spending less than you make is really all he preaches.


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## Eclectic12

^^^^

I read it as similar to Chilton's "Wealthy Barber" ... the point of the principals is to make the stash grow by investing. Without the investment step, even with the big numbers of savings, stock options etc. - I doubt he'd have retired at year nine.


Cheers


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## sags

Chilton, Orman, Ramsey, MMM.............all espouse the same philosophy, which is neither new or revolutionary.

Pay yourself first, save 10%.........all assume the other often quoted...........living within your means.

Canadians have been doing just that for decades. The savings rate used to be 20%. Today it is 3% and negative in some Provinces.

What changed...........Canadians or their circumstances ?


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## Just a Guy

Chilton annoys me because he preaches one thing, and does another. He doesn't cut back spending, he increases income. He has passive income from his books, his investments, his businesses...he never cut back and saved, he looked for other streams of income.

MMM is at least living the lifestyle Chilton preaches.

I also never said you couldn't retire young from a paycheque, I said I only know one compared to a number who did it through other means so, from my point of view, increasing your revenues outside of a paycheque is more likely to get you to your goal of financial independence.


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## sags

Out of school at 25 and retired by 30 ?

Best hope you hit the jackpot on a stock.


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## Beaver101

^ Or born with a silver-spoon (more like platinum these days) in your mouth or hit it big and early in Hollywood. :biggrin:


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## Jon_Snow

I had no chance of pulling the ripcord at 30. Met my wife around that age, married her soon after...two pretty good incomes, bought MUCH LESS HOUSE than we could afford (and bought just before Vancouver market TOOK OFF), paid the mortgage off in 7 years...made the tough decision not to have kids. Probably saved about 75% of our income over a dozen years or so, and we invested much our savings in late 2009 - didn't nail the bottom of the market, but close enough. 

A bit of fortunate real estate and investment timing, some very conscious decisions (no-kids), and a steadfast determination to live below our means was OUR RECIPE.

Really, I was my own version of Mr. Money Mustache years before I found that blog - too bad I lacked the self promotion gene and the writing ability he possesses, or I could have had a nice little side gig like him.

I really can't complain about much though. Early retirement is better than I expected, and I had lofty expectations going in. 

It's not a realistic a goal as MMM would have you believe - lots of things have to be in place to shoot for it (high family income REALLY helps).


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## SuperGrover

I am not sure about all the naysayers. Not going to get into details but here is the problem with todays generation. I'm 29 and some of my friends are quite ridiculous.

Expectations, in general are killing peoples savings rate

Fancy new BMW or Audi, eating out at lunch and dinner. Big vacations each year or multiple times a year. That stuff adds up quick. 

Yes it is hard to live off of 12 bucks an hour, but at 25 bucks or more. You should be saving at least 10% a paycheck.


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## SuperGrover

and to retire at 30, you need to be extreme. Walk or bike everywhere. Rent or buy house and rent out rooms, etc. 

It wont be comfortable to get to that low of spending but you need to save at least 75% of your take home. And you likely need some luck in your timing of the stock market. And the assumption your spending doesn't increase with age.

Not my cup of tea, but I would like to be able to retire somewhat early. Just not thirty.


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## My Own Advisor

I'm with you SuperGrover.

I couldn't imagine not having a car in my 20s, the travel I've done in my 30s, and now the home we have now. Could I have worked and lived like a poor student for the last 20 years and be retired by now? Yes.

Would I have been happy? No.

I want to retire early, in my early 50s but I don't want to live like a pauper to do so. 

It's all about choices.


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## Daniel A.

Calling anyone retired at thirty is a stretch the fact is one at thirty has not experienced anywhere near what life has to offer.

Don't care who you are but it is total BS to speak of retirement at thirty.
It is nice to have options at thirty but give me a break !!!!!

It seems that with this forum someone comes along stating something most only dream of ie retirement and some guy or gal say's Oh look I'm retired faster than any of you. Time to put things in perspective what is retirement for most of us.
We raise family and work jobs till the day comes true for most, once in a while someone comes along and say's hey I'm retired early but is it true No they have to much of life left to experience.

For anyone claiming to be retired early show me you paid your dues.
At thirty its just a joke that makes someone feel good. 

What a BS thread.


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## nathan79

I definitely couldn't see not having a car, especially since owning a car can be pretty cheap if you're smart about it. I spend more than I need to, but still only spend about $3500/yr on my car. It's entirely possible to own and operate a car for about 3K or even less if you're very frugal. And that's in BC, where insurance is very expensive compared to a lot of places.


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## Valueinvestor

I think everyone missed the point of Money Moustache. It's pure marketing, plain and simple. The guy isn't retired - he runs a successful website that has gained international attention and makes serious cash. 

Frugal? YES
Retired at 30? NO

I'm sure he's enjoying the uproar caused by his claims though. Anyone can say anything online and there's a reason the guy won't give his full name - think about that next time you read about his outlandish claims. 

I think we could all save a ton of money without a vehicle but try getting groceries on your bike in -30 wind and snow. Not much fun there. I'm all for being frugal like everyone else but at what point does it not make sense? 

If I made a website that claimed I retired at 25 (even though I didn't) but wouldn't give my full name or income details yet enouraged everyone else to follow in my path......would you buy into it? Or would you start to put the pieces together by thinking for yourself?


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## brad

Valueinvestor said:


> I think everyone missed the point of Money Moustache. It's pure marketing, plain and simple. The guy isn't retired - he runs a successful website that has gained international attention and makes serious cash. ?


I've posted this maybe five times now, but might as well post it a sixth because obviously nobody's reading it. This explains why he calls himself retired and how he responds to all the claims that he isn't retired. It's a good read:

http://www.mrmoneymustache.com/2013/02/13/mr-money-mustache-vs-the-internet-retirement-police/


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## humble_pie

^^^

brad i did read it, one of those times you posted the link. It's so memorable that i've forgotten what he said


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## Synergy

But he's really NOT retired:biggrin:


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## donald

Age doesn't have to correlate with 'retirement' Mr A
I'm sure 21 yr old Jordan spieth(recent master's champion) could call it quits and buy and sell all of us combined today if he wants
He prob just started shaving
F>I is fi(financial independence)


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## Davis

Synergy said:


> But he's really NOT retired:biggrin:


Don't make brad come down there!


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## Valueinvestor

Synergy said:


> But he's really NOT retired:biggrin:


+1. Once you get past the fact he went through a career shuffle and some lifestyle changes instead of actually retiring, the story kinda loses it's lustre


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## Just a Guy

Would people be happier if he called himself financially independent instead of retired?


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## el oro

IMO, the folks that "retire" at 30 or so develop so many various skills and interests that it would be tough NOT to be paid for something(s) over their 50+ post-career years.


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## brad

Just a Guy said:


> Would people be happier if he called himself financially independent instead of retired?




Okay, okay, I'll save you the trouble of clicking on a link and just paste the relevant text from his post here:

Question: “It’s a shame we don’t have a better name for all this stuff we’re doing as Mustachians. Retirement doesn’t sound right. Financial independence comes closer. Can we invent a new word for it? How about Removed?”

Answer: News Flash: the perfect word has already been invented. Are you ready to hear it? Here it is:

*Retired.*

It’s perfect just as it is. It’s just like “Financially Independent”, but it sounds more amazing and it uses 75% fewer syllables.

“Retired” means you no longer have to work for money, and you are aware of this fact. You can then proceed to do whatever you want, as long as you do it consciously and of your own accord. If you meet this condition, and you feel retired, congratulations, you are.

Retired probably does not mean you sit at home watching TV, venturing out only for medication or a motorized-cart-aided round of golf. This is a subset of retirement, but only a very special case of it, for those with very advanced age or limited mobility.

Retired means different things to different people. But one of the rules of Mustachianism is that if someone tells you they are retired, you do not question them. You congratulate them.

Retirement may or may not include any of the following lifestyle attributes:

* the complete abandonment of alarm clocks, and a soft chuckle specially developed for anyone who tries to make you be somewhere before 9AM.
* a general lack of awareness of what day of the week it is
* a work ethic that ebbs and flows with your natural human cycle. There may be times of extreme productivity and late nights, and other times of dormancy.
* work and areas of interest that change over the years, some of which might earn you money, and some of which might be neutral or even involve spending instead of earning money.

Or it can be completely different. The only rule is that you theoretically must have sufficient savings (or other assets) that you could live indefinitely off the passive income they provide, and these savings must give you the freedom to realize that any work you do is totally optional. You don’t actually have to live off the income, it just has to be there.

So there it is – the official definition of Retirement, of which Early Retirement is just a special case.


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## My Own Advisor

I do agree with this...

"“Retired” means you no longer have to work for money".

AND

"The only rule is that you theoretically must have sufficient savings (or other assets) that you could live indefinitely off the passive income they provide, and these savings must give you the freedom to realize that any work you do is totally optional."

This is what I'm striving for; work or not on my own terms when and how I please.


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## Synergy

That's financial independance / freedom, NOT retirement. To each their own. When someone tells me not to question I turn the other way. Managing a blog and working as a carpenter is NOT passive income, it's WORK, whether you luv the work or not!


----------



## brad

dotnet_nerd said:


> Uh-oh. I hear sirens. It's the_ Internet Retirement Police_


:biggrin: Exactly.

So basically what Synergy is saying is that you're not allowed to undertake any activities during retirement that generate income, otherwise you are no longer retired. Passive income is allowed, presumably from investments and other things you set up before you retired; managing your investments is apparently allowed, even though that involves some work. So that means my next-door neighbour, who lives in Florida all winter and plays golf, isn't retired because he loves playing the accordion and gets paid a few times each month to play old classics at parties and other events. Now that I think of it, pretty much all my retired friends are not really retired by this definition, because most of them at least occasionally do some work for pay.


----------



## Just a Guy

Brad, posting the section misses the point, people aren't happy with the term he used...in fact, they seem quite unhappy with it, enough that hey are getting very upset and posting long diatribes on the subject, as if it was a life or death matter worth worrying about.

I'm just trying to find a solution before they blow an artery despite taking their blood pressure medication.

This is, of course, the typical reaction people who can't or haven't accomplished something similar...they automatically go into the "it can't be done", "it's impossible", "he's lying" type attacks. When that fails, they look for technicalities such as "he still gets paid for his time". They just can't seem to realize that, with 7.5 Billion people on this planet, that maybe, just maybe, a few of them CAN actually accomplish things (maybe even easily) that they can't. 

*Side note: with 7.5 billion people, statistics would imply that that 1 in a million long shot could technically happen 7,500 times.

We live in very insecure times...maybe I've got to reconsider investing in some drug companies, there seems to be a bigger demand out there than I previously thought.

Personally, I try to spend my time coming up with ways to "do" things, rather than wasting my time figuring out ways to justify, in my own mind at least, why someone is not doing something that they certainly seem to be doing, despite the fact that I haven't done that.

Don't worry, they aren't alone, there are still people who deny we landed on the moon, that the eat he is only 6500 years old, that everyone who has money did it illegally or by exploiting the poor, or whatever...


----------



## cainvest

dotnet_nerd said:


> Uh-oh. I hear sirens. It's the_ Internet Retirement Police_


Not just the IRP but the ELP (english langauge police) as well.

re·tire·ment
/rəˈtī(ə)rmənt/

noun

1. the action or fact of leaving one's job *and ceasing to work*.


----------



## Woz

He says he retired at 30 because it sounds better, not because it’s true. From his posts it doesn’t seem like he had enough to retire at 30. He needed the side income.

He spends $20k-25k per year with a paid off house. Using his own rules you’d need 25-30X that to retire, which is $500k-$750k. At 30 he had $720k saved which included a $400k house. $180k-$430k short of what he’d need.

I don’t have an issue with the way he portrays himself. It’s very clear the blog is a caricature and that it’s the message that’s important. I think he accumulated wealth quickly when he was younger. When he hit 30 decided he could slow down a bit, then when he was actually retired at 35 decided to start the blog.


----------



## brad

cainvest said:


> Not just the IRP but the ELP (english langauge police) as well.
> 
> re·tire·ment
> /rəˈtī(ə)rmənt/
> 
> noun
> 
> 1. the action or fact of leaving one's job *and ceasing to work*.


Okay, but that's only half the story: now you have to define *work*.

My dictionary provides about 13 definitions for the noun alone, but the first two are as follows:

1. Physical or mental effort or activity directed toward the production or accomplishment of something. [if we use this definition, a retired person who sweeps his front walk every morning is not retired, because he's doing work]

2. A job; employment.

I think we're talking about the second definition. Mr Money Mustache claims that he doesn't have a job -- he just spends time on projects and activities that he enjoys, and some of them happen to generate income. He doesn't depend on those activities to meet his annual living expenses.


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## cainvest

brad said:


> 2. A job; employment.
> 
> I think we're talking about the second definition. Mr Money Mustache claims that he doesn't have a job -- he just spends time on projects and activities that he enjoys, and some of them happen to generate income. He doesn't depend on those activities to meet his annual living expenses.


I believe the general understanding and use of the word retirement doesn't align with MMM's use of it. Just for fun (providing you're employed right now) start saying to people, "Hey I retired last year and pulling down some good money working at [insert your own job here]" and see what they say. 

If you need to complete tasks/projects/activities for others that generates income ... well, you are definitely not retired IMO.


----------



## brad

cainvest said:


> If you need to complete tasks/projects/activities for others that generates income ... well, you are definitely not retired IMO.


So, for example, a person who dreamed all her life of being a novelist but worked her entire career as an accountant, then retired, started writing novels, got book contracts, and made money selling her novels wouldn't be considered retired? I remember Norman MacLean, the author of "A River Runs Through It" worked most of his life as a professor, then when he retired he started writing. But since he sold those novels to a university press instead of giving them away, we're supposed to say "he never retired, he just changed careers." Okay, I get it.


----------



## cainvest

brad said:


> So, for example, a person who dreamed all her life of being a novelist but worked her entire career as an accountant, then retired, started writing novels, got book contracts, and made money selling her novels wouldn't be considered retired? I remember Norman MacLean, the author of "A River Runs Through It" worked most of his life as a professor, then when he retired he started writing. But since he sold those novels to a university press instead of giving them away, we're supposed to say "he never retired, he just changed careers." Okay, I get it.


Correct, not retired, just changed jobs ... was a professor then became a writer.


----------



## brad

cainvest said:


> Correct, not retired, just changed jobs ... was a professor then became a writer.


So by your definition, if you want to be called "retired" you are not allowed to do anything that earns money, except managing your investments, right?

I think that means the number of retired people is a lot smaller than we think.


----------



## cainvest

brad said:


> So by your definition, if you want to be called "retired" you are not allowed to do anything that earns money, except managing your investments, right?


Without getting into millions of potential grey areas ... basically, yes.

So in your example above, professor becomes writer, what if it was professor becomes McDonalds employee ... a job that the professor loves and always wanted to do but doesn't need the income from it. So, still retired?



brad said:


> I think that means the number of retired people is a lot smaller than we think.


Most likely yes ... many people are also semi-retired (I know a number of them), as in working part-time.


----------



## Moneytoo

brad said:


> So by your definition, if you want to be called "retired" you are not allowed to do anything that earns money, except managing your investments, right?
> 
> I think that means the number of retired people is a lot smaller than we think.


Before these threads (there's another one in Retirement forum) I thought *retired person is someone who's getting a pension*  I didn't work for a few years a few years ago (and made a bit of money translating a book - a change from my IT career), but I called it "a mid-life crisis", not early retirement... lol


----------



## Davis

I think the key question is not whether you work for money, but whether you _have_ to work for money. What if the accountant/novellist couldn't sell her work? Would she return to accountancy and/or McDonalds? If not, then I think it is fair to say she is retired. My friend who left teaching to try other things and failed at them isn't retired: she's unemployed. She will have to return to teaching or find something else, or she will run out of money. When I leave my job next year at 50, I won't be getting a pension, but I won't have to work because I will have enough investment income to last me until I do get a pension. If I work, it will be entirely of my choosing because i won't need the money. (And I'm not planning to work.)


----------



## brad

Davis said:


> I think the key question is not whether you work for money, but whether you _have_ to work for money. What if the accountant/novellist couldn't sell her work? Would she return to accountancy and/or McDonalds? If not, then I think it is fair to say she is retired. My friend who left teaching to try other things and failed at them isn't retired: she's unemployed. She will have to return to teaching or find something else, or she will run out of money. When I leave my job next year at 50, I won't be getting a pension, but I won't have to work because I will have enough investment income to last me until I do get a pension. If I work, it will be entirely of my choosing because i won't need the money. (And I'm not planning to work.)


This would meet the Mr Money Mustache definition of retirement, since that's what he's doing. He could stop working today and shut down his blog, but still have enough to live on for the rest of his life. But it seems a lot of people here don't agree that this could be called "retirement." Honestly, does it matter what we call it? It's a nice situation, regardless of what label you decide to put on it.


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## Moneytoo

brad said:


> Honestly, does it matter what we call it? It's a nice situation, regardless of what label you decide to put on it.


It's a nice situation if you'd rather live on the verge of poverty for the rest of your life than work (I like the term "Financial Independence", but don't know many - if any - families who live on 25-30K a year, so somewhat agree with MMM's message, but not with the numbers )

So if a couple has a 1,5-2M portfolio that allows them to live on 60-80K/year till death - I would call it a nice situation. But if someone with half a mil decides to retire because a) they hate their job and/or b) because MMM could - I wonder for how long they'll stay "retired"?


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## brad

Moneytoo said:


> It's a nice situation if you'd rather live on the verge of poverty for the rest of your life than work (I like the term "Financial Independence", but don't know many - if any - families who live on 25-30K a year, so somewhat agree with MMM's message, but not with the numbers )


The thing is, $25K/year in spending can be pretty comfortable; it really depends on your interests and priorities. I know a young family (husband, wife, 1-year-old daughter) in Boston who spend $15K/year, and they have no desire to spend more. Their household income is over $250K/year but they give about half away to charity; the remainder after taxes goes to retirement accounts and other savings goals. Most of their hobbies and interests don't cost much, so while they acknowledge that they could easily spend more, they don't think spending more would make them any happier. They certainly don't feel like they're living in poverty. They have no car, buy their clothes at the thrift store, etc., but in their mind those things aren't sacrifices because they have no need for a car and they love the clothes they can find at thrift stores. Similarly, it doesn't sound like MMM feels deprived by his low-budget life.


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## peterk

I don't think it's whether you NEED to work that is the definition. There are plenty of people who don't NEED to work, they have 2M in the bank and a paid off house but they continue in their careers. Clearly they aren't retired. Jon_snow on CMF didn't _need_ to work till 43. He could have retired at 41 quite happily I'm sure. But he distinctly was NOT retired at 41.

I'd say the question that defines working vs. retirement is "are you _obligated_ to continue to do this work?" Obligated through contract, financial need, or social expectation. 

To use the "retired" writer example above... If you are writing a book, can you decide tomorrow to stop writing your book halfway through without anyone being extremely upset or breaking a contract? if so, retired. If not, not retired.

I use "tomorrow" loosely. Maybe it actually means in a couple days or a week. Certainly not much more than a two weeks I would think though. If you've obligated yourself to doing something for someone else for more than two week, and by breaking that agreement you've violated a contractual, financial or social expectation, then no you aren't retired. IMO.

As for MMM, I think that as a blogger, he is retired. He could say tomorrow that this will be my last blog post and then I'm out. He's free to do so with no legal, financial or social obligation to continue. As a construction contractor, that's iffy. I'd say that if he only does small projects that only last for a few days or a week, then yes he's still retired. If he's agreeing to build a house or renovation that lasts for a couple of months, and he would be contractually or socially expected to continue until complete, then no he's not retired.

Essentially it doesn't matter how hard you work. If at the end of the day you can go to bed and say "I don't have to do that ever again if I don't want, or at least not after next Friday" then you're still retired.


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## My Own Advisor

I think the key question is not whether you work for money, _*but whether you have to work for money.*_ 

Correct.

....and I don't mind this definition of "retired" whatsoever. As long as you don't have to work for the money, I have no problem with it. 

If you _*have to work*_ for income, and that income is supporting your lifestyle (whatever cost this may be, MMM's $25k per year or $100k per year) you are not "retired".


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## mrPPincer

^Perterk by your definition I am retired 
I use the term semi-retired, but I only work for money 65 days out of the year.

Unlike MMM I've never had a high income but I became semi-retired at age 40 through saving & investing and a frugal lifestyle. 
Actually spartan would be a more accurate term, I know what everything costs and buy it in bulk when on sale, I make my own wine, butcher my own meat (including roadkill if it's fresh), do my own construction/repairs, service my own furnace (thanks internet), cut & chop my firewood etc etc etc.

Bought my home for cash at age 23 (no inheritance or family loan or anything, in fact I was already paying room and board to my parents by age 14 through summer jobs), saved diligently, went to zero a couple times (life lessons), but eventually the portfolio became substantial enough that it can fluctuate more in a day than I can make in months doing manual labour.

Using the internet retirement calculators I could be fully retired right now assuming I could continue to live like this, but I am actually still saving even though I'm only earning something less than 14K per year.

I do need some form of physical activity and my 65 days per year are great for that as well as social interaction.
Hiking with the seniors is great for that as well, but my work is also a good change of pace.

So question to all the _Internet Retirement Police_ on this thread, am I retired??


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## Valueinvestor

It's funny how people get so caught up in the technicalities of retirement. 

I can tell no matter what some people will still believe MMM is retired and that he magically saved all the money. Yes he saved but I think most of us could "retire" too if we had a job that paid north of $90,000 every year after "retiring".

I'd compare it to someone who vows to give up all normal forms of housing and instead decides to live in their vehicle. The "anti-society" in a way. This idea would generate tons of interest and media coverage with some clever marketing. It's the perfect media storm since housing is already overpriced and finally someone decides they've had enough and gives it all up. Mainstream media loves this kinda thing. Profess you'll give up all forms of housing, throw up a slick website, tip off key media members for national coverage and voila - you'll have an instant following. Would this movement lose steam if someone found out the person still lived in a house? Anyone can say anything online and it blows my mind how many people fall for this kinda thing everyday. 

Whether you agree with the definition of retirement or not can we all move on and talk about someone/something relevant?


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## My Own Advisor

Good idea Valueinvestor for another site :biggrin:


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## Synergy

> I think the key question is not whether you work for money, but whether you have to work for money.


So let me get this straight. If one doesn't have to work (financially free) and if one has no ties (contracts, social obligations, etc.), even though they continue to work a 9-5 job (for the fun of it), it's okay for an individual in their early 30's to walk around telling everyone that they are officially retired? Seems a little odd to me.


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## steve41

Synergy said:


> Seems a little odd to me.


 Odd?.... Seems a little 'creepy' to me.


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## sags

No CPP or OAS for MMM and his wife, if they didn't live or work in Canada.

They left a lot of retirement income on the table.............$36,000 a year's worth ?

We went the other way..........both worked for 40 years, paid into the CPP and now have a $60,000 income per year, not counting wife's p/t income.

We have health care and nursing home benefits if the need arises. We have small paid off life insurance policies.

Our income is indexed to the cost of living, and isn't subject to sudden swings in the stock market.

We have insulated ourselves as best we can from whatever comes our way.

There are benefits to doing it the traditional way, but we did have to put in another 25 years of work each.

Were all those extra years of working worth it ?..............Time will tell.

So far in retirement of 10 years, we have already spent $500,000 or so...........so MMM's stash wouldn't have lasted us very long.


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## celishave

The main take away for me from Mr Money is that people should reflect on their lives and see if they have fallen into the consumerist mindset - ie, i need to spend $ to be happy. For example my $50 phone i've had for the last six years on a $25 per month phone plan works just as good as your $700 i-phone on a $80+ plan. I literally save nearly $1000 after tax income on my phone choice alone. I would need to save $33,000 to pay for the expensive phone habit for the rest of my life. If you want to do that, that's fine but you need to realize you are literally working for your phone, car, clothes, etc....the logic applies to anything. This of course mirrors 'Your Money or Your Life' logic. I didn't need either of these - I clued in early in my career whereas most remain in the consumerist haze their entire lives.

Because of this consumerist lifestyle we live ridiculously luxurious lives compared to 99% of the world's population out there who are happy with basic shelter(think mud huts) and rice/beans everyday. The naysayers will say, yea but I don't want to live like that. Neither do I, but it is simply resetting one's mindset that there is likely some cost savings for virtually everyone once they truly analyze what they are spending.


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## Plugging Along

Just a Guy said:


> Would people be happier if he called himself financially independent instead of retired?


I do think there is a difference.

I would say that one is retired where they are not generating employement income or business income (for those entrepenuers here). There is even a definition of CRA for when something is a hobby vs a business. I would follow something similar. That's just my definition though.

The funny thing with definitions is everyone has a different one. We have a good friend that sold his first company for just under $40 MIL (yes, 6 zeros after the 40) shortly before his 30 birthday. As part of the deal, he had to work for the acquiring company for 2 years. Though he was financially independent, he was not retired, he had to work for two years there. After the two years, by MMM definition, he was retired. He definitely never needed to work again. However, he really liked being VP, so he doesn't have to work, but liked it, so continued. For the fun of it, he 'retired' for six months, or was it actually an extra long vacation? He then started out another company, and worked his butt off, and sold he next company for even more. Do we call this a hobby? Was he retired? He would say he was working hard but enjoyed it. Then he did it another time, but instead of starting up the company, he was hired as the CEO, and the company was bought out. That was why he was brought on board. The funniest part was because he was 'laid off', he was eligible for unemployment. On principle he actually collected unemployment, which was equally some small amount of work, like a hour of his time. He is now off to his next adventure, which happens to be related to start up companies and getting them acquired. 

Financially independent, for sure, retired, definitely not.


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## houska

What is retirement vs financial independence? There are wise words at http://www.getrichslowly.org/blog/2014/05/08/coming-to-terms-retirement-vs-financial-independence/
To me it's partially just semantics, and partially an indication of mindset. The same person is "retired" if the way they think about it is "I've ended my career and now decide on a whim what I want to do with my time"; they are "financially independent" if they fill their days with projects, ideas, vocations freed from the constraints of making ends meet. 

As J.D. Roth writes in the link above, (early) "retirement" is a loaded term, a label (as we've seen in this thread) that provokes visceral reactions. For that reason, J.D. Roth, Jonathan Chevreau, etc avoid it. And that's exactly why Mr Money Moustache and some others (e.g. author of Early Retirement Extreme) embrace it -- their schtick is in-your-face, provoke a reaction (and then hopefully self-reflection). Like celishave, I'm unfussed about the label used, as long as one explores the underlying ideas.

By the way there's a different take at http://fijourney.com/financial-independence-vs-early-retirement-whats-difference/. I'm not sure I buy it.


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## SuperGrover

Early Retirement...Financial Independence, you can argue till the sun sets. I think it comes down to being able to walk away, FU money. This means no financial restraints and ALSO no time commitments. 

I feel like this short clip explains the concept of FU money (what I think the definition of when you've made it is)

Warning Language

https://www.youtube.com/watch?v=xdfeXqHFmPI

Some people want the golf everyday life, others don't. Just because you don't agree with them doesn't automatically make them wrong. Wasting their lifes working. Maybe some doctors find great satisfaction in saving lives, teachers providing futures for young ones, engineers providing society with energy, infrastructure, artist providing society art, etc. Just because they choose to be compensated does not mean they are wasting their life when they have enough money for retirement.


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## Synergy

SuperGrover said:


> Some people want the golf everyday life, others don't. Just because you don't agree with them doesn't automatically make them wrong. Wasting their lifes working. Maybe some doctors find great satisfaction in saving lives, teachers providing futures for young ones, engineers providing society with energy, infrastructure, artist providing society art, etc. Just because they choose to be compensated does not mean they are wasting their life when they have enough money for retirement.


I couldn't agree more. Thanks for the link!


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## ashin1

love it haha this is getting me very excited for early retirement!


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## PrairieGal

http://abcnews.go.com/Business/man-mr-money-mustache-retired-30/story?id=30989572

An interview with MMM.


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## My Own Advisor

Nice interview. That should be worth about 10,000+ more followers


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## Synergy

I thought we determined that he wasn't really retired?:biggrin:


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## Jon_Snow

You know, it's really just common sense. But give the guy credit - he has created quite an empire.

I was doing pretty much the same thing to retire early - but I don't have an entrepreneurial bone in my body. )


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## PrairieGal

I don't give a crap whether or not he is truly "retired" in the purest sense of the word. I think what is important is that he inspires people to live a frugal life by not spending to excess on materialistic crap; and saving for the future. I am a helluva lot older than him, but I was inspired to get myself out of debt after my husband passed away, and save for my future. I won't be retiring early in the sense that people here on CMF and MMM think of it, but it will be earlier than some of my friends that are still spending everything they make, and don't know if they will ever retire. 

I think Pete (MMM) has the best of both worlds. He loves carpentry, so he takes on whatever jobs he chooses. He is able to spend a lot of time with his son, take extended trips to visit his family (in Ontario) every summer. He was able to "work" full time renovating his "new" house; the one you see in the video. What kind of job would give you that flexibility? And he doesn't have to work if he doesn't want to. He is financially independent. 

Anyway, I like his message, and the way he goes about getting it out there is humorous. You can't argue with success. The only thing that bugs me a tiny bit is on his website he has "join the cult" which they showed in the video. I know this is very tongue in cheek, but I don't know if newcomers realize it.


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## My Own Advisor

I don't his mind his messages....distilled, it's about finding out what you really value and in the process, you'll find out you don't need as much crap. 

In the end, financially independent is a nice goal, one that buys in my book, the precious commodity of time and that's something I value very much.


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## avrex

@My Own Advisor

+1


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## My Own Advisor

@avrex,

Any timeline for you my friend? How many years away to "pull the plug" if you wish?


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## avrex

@My Own Advisor
If my wife and I were willing to live on $25,000 per year, like MMM.......... we'd be financially independent right now. 

Look for an upcoming blog post about my current annual expenses and my projected retirement expenses.
I think projected expenses is 'the' most important factor in determining when to "pull the plug".

In answer to your question, my friend......... hopefully in three years or less. :rolleyes2:


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## gibor365

avrex said:


> @My Own Advisor
> If my wife and I were willing to live on $25,000 per year, like MMM.......... we'd be financially independent right now.


Same with us! But considering the fact that my wife and daughter only on figure skating spend more than half of this amount, it's not feasible


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## cannew

Why would anyone in their 30's, even 50's want to retire. What's wrong with work, especially if one enjoy's their job. Even if they don't love their work, there is still the company of other workers, chance to improve one self and what would a retired 30's person do?


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## Moneytoo

cannew said:


> Why would anyone in their 30's, even 50's want to retire. What's wrong with work, especially if one enjoy's their job. Even if they don't love their work, there is still the company of other workers, chance to improve one self and what would a retired 30's person do?


The funniest answer I heard so far was, "People who say they they love their job are lying! Who wouldn't want to spend their time with family and friends instead of going to work?!" And I was like, riiight. Given that all your family and friends are retired, too - otherwise they'll keep going to work or school while you want to spend time with them lol


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## lonewolf

Want to retire in next couple of years. Take a few thousand dollars short the market (SPX) with far out of the money put leaps. Forget the crowded long trade it is totally counterproductive to your goal.


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## gibor365

cannew said:


> Why would anyone in their 30's, even 50's want to retire. What's wrong with work, especially if one enjoy's their job. Even if they don't love their work, there is still the company of other workers, chance to improve one self and what would a retired 30's person do?


Agree about 30's, but don't agree about 50's... Somewhere I've read stats that only 10% are really like their job.... so if somebody in 50's and hate their job , don't really like other workers and it's too late to "improve one self " , so generally person reached peak of their carrier ..... Why this person should continue working and suffering until death if he/she is FI?


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## avrex

cannew said:


> Why would anyone in their 30's, even 50's want to retire. What's wrong with work....


If someone is *financially independent and happy* with their lives..... why not?

Comments like this above, continue to show that there are two camps of people.... and they don't seem to understand each other.
1. People who love/like their job/work.
2. People who want to leave work as soon as they are financially independent to pursue other interests/activities that they find more fulfilling/satisfiying.

See the "Admit it. Work isn't fun. The solution. Plan to Retire Early" thread for further discussions on this.


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## lightcycle

To me, it's not a question of hating your job, it's owning your own time and not having to answer to anyone.

You can love what you do, but if you're FI (or "retired"), you're not obligated to keep doing it if in the future you discover you don't love it anymore.


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## My Own Advisor

avrex said:


> If someone is *financially independent and happy* with their lives..... why not?
> 
> Comments like this above, continue to show that there are two camps of people.... and they don't seem to understand each other.
> 1. People who love/like their job/work.
> 2. People who want to leave work as soon as they are financially independent to pursue other interests/activities that they find more fulfilling/satisfiying.
> 
> See the "Admit it. Work isn't fun. The solution. Plan to Retire Early" thread for further discussions on this.


+1

If folks want to retire early, to be happy or happier, go for it. In the end, you only have one shot at this life and might as well love as much of it while you can.


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## cainvest

avrex said:


> If my wife and I were willing to live on $25,000 per year, like MMM..........


Speaking as a single person, living on $25k a year is pretty easy, $20k would be a minor challenge, $17.5k would be about as low as I "could" but wouldn't be much fun.


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## My Own Advisor

I could see that cainvest. For two, I could see us living off $40k per year without any debt.

I think anything under $25k as long as we wanted to own two cars would be a challenge. Then again, we might get rid of one car eventually.


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## My Own Advisor

@Avrex,

Same, re: were willing to live on $25,000 per year, like MMM.......... we'd be financially independent right now. 

My only other condition is no debt. We're not there yet unfortunately.

I look forward to your post!!


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## cainvest

My Own Advisor said:


> I could see that cainvest. For two, I could see us living off $40k per year without any debt.
> 
> I think anything under $25k as long as we wanted to own two cars would be a challenge. Then again, we might get rid of one car eventually.


Yup, debt free and home ownership make $25k easy, depending on where you live of course. For two people the cost for food, clothes, etc is higher but many things are shared expenses. Sharing one vehicle would definitely help reduce costs but everyone has to weigh out their own comfort factors.


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## gibor365

cainvest said:


> Yup, debt free and home ownership make $25k easy, depending on where you live of course. For two people the cost for food, clothes, etc is higher but many things are shared expenses. Sharing one vehicle would definitely help reduce costs but everyone has to weigh out their own comfort factors.


With debt free and home ownership , I'd assume we'll (I mean couple) need around 60K to live comfortable... Alone, I'd easily live comfortable life with 20K


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## cainvest

gibor said:


> With debt free and home ownership , I'd assume we'll (I mean couple) need around 60K to live comfortable... Alone, I'd easily live comfortable life with 20K


Sorry but I just have to ask. 
So ..... why do costs triple for two people?


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## Moneytoo

cainvest said:


> Sorry but I just have to ask.
> So ..... why do costs triple for two people?


He doesn't figure skate lol



gibor said:


> Same with us! But considering the fact that my wife and daughter only on figure skating spend more than half of this amount, it's not feasible


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## gibor365

cainvest said:


> Sorry but I just have to ask.
> So ..... why do costs triple for two people?


Because my recreation is running outside or playing hockey and my wife's figure skating and I mentioned earlier how much $$$ does it cost ...
Also, I practically don't need any new clothes, boots, home renovations etc. , but my wife may want


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## gibor365

$$$2 already answered


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## Moneytoo

gibor said:


> $$$2 already answered


I think I'm having too much fun at work (while getting paid for it lol)


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## Moneytoo

Retire at 30 is so yesterday! New trend is to create a portfolio for your child to never having to work lol:

The Half-Million Dollar Income Project
http://www.seekingalpha.com/article/3102806


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## Synergy

^ That would be one of my goals - generational wealth.


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## My Own Advisor

gibor said:


> With debt free and home ownership , I'd assume we'll (I mean couple) need around 60K to live comfortable... Alone, I'd easily live comfortable life with 20K


I think we could do $40k (after-tax) on a budget.

I think $60k would be very comfortable for us (this is our goal) when we pull the plug.

Anything $70k + is living very well.

I would suspect couples with $100k + are really living it up.

All of this of course means debt-free at time of retirement.


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## Frank Drebin

cannew said:


> Why would anyone in their 30's, even 50's want to retire. What's wrong with work, especially if one enjoy's their job. Even if they don't love their work, there is still the company of other workers, chance to improve one self and what would a retired 30's person do?


Its not about retiring for me. Its about the freedom to retire if I want to, to not_* have *_to work


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## gibor365

> I would suspect couples with $100k + are really living it up.


 it depends on the couple


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## LBCfan

When I was 30, I loved my job so much, I'd have done it for free. If your goal is to work about 10 years and retire, pick either your employer or your ancestors well.


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## gibor365

LBCfan said:


> When I was 30, I loved my job so much, I'd have done it for free. If your goal is to work about 10 years and retire, pick either your employer or your ancestors well.


When I was 30 I had ambitions  now, when I'm close to 50, I realize that I reached my ceiling some time ago


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## RBull

My Own Advisor said:


> I think we could do $40k (after-tax) on a budget.
> 
> I think $60k would be very comfortable for us (this is our goal) when we pull the plug.
> 
> Anything $70k + is living very well.
> 
> I would suspect couples with $100k + are really living it up.
> 
> All of this of course means debt-free at time of retirement.


Exactly one year into retirement and I would agree 100% with your numbers.


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## avrex

My Own Advisor said:


> I think we could do $40k (after-tax) on a budget.
> 
> I think $60k would be very comfortable for us (this is our goal) when we pull the plug.


@RBull. These are the exact same numbers that I'm thinking about when I retire.

It's nice to hear someone else confirm that this amount is comfortable. thanks.


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## RBull

avrex said:


> @RBull. These are the exact same numbers that I'm thinking about when I retire.
> 
> It's nice to hear someone else confirm that this amount is comfortable. thanks.


You're welcome. Let me know if you have any questions.


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## My Own Advisor

Good to hear from you RBull. Hope you've been well!

3 years to pull the plug avrex? If so, that's good buddy!


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## gibor365

avrex said:


> @RBull. These are the exact same numbers that I'm thinking about when I retire.
> 
> It's nice to hear someone else confirm that this amount is comfortable. thanks.


Recently calculated out spendings for 2013 and 2014....The numbers are very close.... We spent annually around 105-107K for family of 3.5  (our son in iniversity , living in Waterloo and partially pays for his education with co-op term money)...
Those are regular spending without any renovations, new cars or yacht  and include 3 vacations abroad....
So imho 60K won't be really comfortable for us.... but will be able to survive


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## RBull

My Own Advisor said:


> Good to hear from you RBull. Hope you've been well!
> 
> 3 years to pull the plug avrex? If so, that's good buddy!


Absolutely excellent. And the same to you!


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## mars

Every few years I track every penny I spend to help give me an idea of how much I will need to have in order to stop working if I choose to. To have something to compare against I put together I high level budget, just 6 major spending categories. My total budget came to $47k. As I come to the end of May I am spending around 70% of my YTD budget through May. One of my highest budget items is for entertainment which includes travel, golf, going out for drinks with friends, whatever you would put into that category of having fun. Even without house payments, my second highest expense is for housing. It is amazing how much insurance, taxes, and utility bills add up. If I was able to get to $60k per year, I would be in a very good position financially, unfortunately I'm not quite there yet, but working on it.


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## gibor365

> If I was able to get to $60k per year


 I;m trying to reduce under 100K  even though my wife telling that I`m too greedy....and I`m telling that I`m just frugal 
So far this year we spent around 39K


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## My Own Advisor

Well, into our very early 40s now, including the blog income...if our house was paid off, a big IF, then we could try and live off $25k per year but a) I'd rather not and b) we need to save more.

We hope to have $1M invested before we consider retiring, excluding any pension plans, LIRAs or any home equity. That's our magic number.


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## gibor365

and why would you exclude LIRA


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## My Own Advisor

Well, I figure that's pension-like income because it's locked-in and can't touch any monies until age 55, like most other pension plans.


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## gibor365

So you just may increase % withdtawals from othe accounts and decrease when you are at 55


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## My Own Advisor

Correct. I figure if I just keep saving and working hard, everything will work out


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## dorian01

gibor said:


> When I was 30 I had ambitions  now, when I'm close to 50, I realize that I reached my ceiling some time ago


Agreed, I was driven and really liked my job in my 20's and early 30's - imagined doing it forever. Not so much now. Fortunately, that work ethic created more income (sales rep) and combined with living below my means, allowed me to save enough to become FI at the age of 41. I plan on retiring by 45. Might work a fun part time gig after that-but it will be on my own terms not somebody else's. Things change, how you feel about working on someone else's watch today, may be very different tomorrow. It's nice to have options because life is short.


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## AvidSaver

I'm curious as to how half your annual salary goes to car payments? That's outlandish.

Retiring at 30 is a risky proposition. You'll likely need to live very austerely, but I suppose that's just a lifestyle choice.


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