Believe early retirement is a privilege? I sure don’t!

46 thoughts on “Believe early retirement is a privilege? I sure don’t!”

  1. I think you’re spot on Steve. I believe anyone has the ability to reach FI with focus and good decision making. Some factors like starting early and having a larger income might help in the pursuit, but certainly don’t prevent someone from obtaining. So much of what we do with our money is the mental/behavior piece over the math.

    1. Thanks Brian, I appreciate your comment. You’re absolutely right that a lot of early retirement (and life in general) is mental. Once we control our brains, we control our lives. 🙂

  2. Nice post, Steve. And very true.

    I’d be lying if I didn’t say that luck has something to do with financial success. I could have health issues. I could have been involved in an accident that wasn’t my fault. Life happens sometimes, and it’s not always good. I’ve been blessed… doubt about it.

    But I’ve also worked hard, and hopefully smart. The all-nighters. The business trips. Taking the risk of starting my own company. Building (hopefully!) a good business reputation. These also entered into the “early retirement” equation and certainly had nothing to do with “luck.”

    Some have been lucky and inherited their wealth or won the lottery, but the vast majority of early retirees earned the opportunity, with perhaps a little luck thrown in. Or maybe we created some of the luck by our work ethic and measured risks we took!


    1. Hey John – thanks for the comment. It’s true that there are many things in life that we cannot control, like hereditary health issues, getting into an accident that wasn’t due to driving negligence, etc. But like you said, people who work smart and hard tend to have more opportunities open to them. I do believe in the overall concept of “creating luck”. There’s a saying that I believe goes something like this: “The harder I work, the luckier I become”. 🙂

  3. Great post Steve! From Good Fortune – I too had #1, #2 (though I did have debt from graduate school it was somewhat minimized thru scholarships and part-time work, and we still started saving for retirement even though we didn’t max out our contributions during the debt repayment years), and #3. From Choices – I too made #1, #2, #3 (no credit card debt, nice but not extravagent house, new but not luxury cars), #4 (not quite to the same degree you have – no RVs in our future!), #5 (also choice not to have kids factors in here), and #6 (not as good as you guys but we’re working on that). Early retirement = hard work, discipline, and trade-offs, and those don’t materiallze thru luck or privilege.

    1. Thanks Kristin! I love this quote, “Early retirement = hard work, discipline, and trade-offs, and those don’t materiallze thru luck or privilege”. In my view, that’s 100% spot on.

  4. Great post Steve. Some people do have great hurdles to jump over that others don’t, but I’d say for a majority of the population it is definitely in reach. But then look at Dom from GYFG – he had tons of hurdles and look where he is now.

    1. Yup, and Jason from the former Dividend Mantra blog is another example too. People can make truly amazing changes in their lives by taking charge of their decisions.

      Thanks for the read!

  5. I agree — some people grow up in better circumstances than others but that doesn’t guarantee success, financially or otherwise. Up until a couple years ago, I didn’t know that early retirement was even an option. By chance I stumbled onto the Mr. Money Mustache site and it completely changed my perspective. If I hadn’t, I’d still be living the same consumer lifestyle, destined to retire in my late 60s.

    Reading the blogs about people who have made ER happen (or are very close) is inspiring and helps keep me motivated. With so many great (free) resources online and the complete automation of my investments, it’s never been easier to save for retirement. You just have to want it bad enough.

    1. You just have to want it bad enough – you’ve hit the nail squarely on the head, Kate. People truly are capable of more than they might otherwise think. We are powerful creatures, and our powers can definitely be used to achieve our goals…if we want them bad enough!

  6. I do think that if you start with certain advantages as you acknowledge, from there it is all about choice, but the research shows that socioeconomics at birth have a lot more to do with your lifetime earnings or opportunities than your grit or willpower or work ethic. But I think within our socioeconomic class, people are still dumb. There’s also a different between breaking out of poverty and breaking the poverty mindset. I personally know several people that make a decent salary but are stuck in the poverty mindset so they cant ever get ahead. It’s sad.

    1. I definitely agree with you, Maggie, that so much of this is about mindset. If people believe that they’ll never retire early (or achieve any other goal they might have), then sure-as-shootin’, they probably won’t. Confidence is big when the game is unconventional, and retiring early is still fairly unconventional.

      The sheer number of “rags to riches” stories in this country are just amazing.

  7. Good piece. I agree that luck has only a little to do with reaching FI. There has to be intent, you have to make the right choices and you have to put in the effort to make it work.

    I don’t know about privilege. What we recognize as “privileged” tends to be “the Joneses” who we all know are worst off when it comes to money (or any future prospect of it).

    All that said, for many of us in Early retirement, we got there riding the climbing stock markets.
    I don’t think luck comes into play but to some extent, we certainly are at the mercy of it.

    Yes, we can prepare for downturns with proper diversification/strategies but you can only protect yourself so much and still make the returns required for continued FI.

    The market giveth and the market taketh. Even though luck has little to do with it, I keep my fingers crossed this downturn will end soon.

    Whether this gesture is directed at greater forces of evil or good I don’t know. I do know it’s out or my hands. So Lady Luck, if you’re listening: feel free to jump in right now, I’d be okay with that.

    1. Hey Maarten – agreed, the stock market gives as much as it takes, that’s for sure. But at least with the market, we are all MOSTLY on the same playing field. When the market does well, we all do well. With the market goes south, we all lose some money.

      What really separates us, I think, is how we approach those things that we can control, like our level of spending, the house that we live in – even our location. There is a LOT that we have control over in our lives, and the more of it that we choose to take control of, the better off we tend to be.

  8. It’s not a privilege. Early retirement just don’t get handed to you. You need to “work” hard for it and things have to line up in order to achieve early retirement. Having a high income and starting early both help but it doesn’t mean you can’t retire early with modest income or starting in your 30s or 40s. The key is to widen the difference between income and expenses. The more you can save and less you spend on things, the faster you can achieve early retirement and have your money sustain your lifestyle for longer. It’s very simple math really.

    1. Thanks Tawcan – It really is important to understand that early retirement isn’t handed to us. We must want it bad enough to challenge ourselves to budget harder, spend less, downsize our lifestyles and make some of the decisions that we might not otherwise make. Some of these choices are sacrifices, no doubt.

  9. Thanks for permission to disagree — I always respect that about you, Steve! And, actually, I’m not going to disagree at all about the content of this, but just about the connotations behind “privilege.” When we talk about “the ‘p’ word,” we’re not saying anything like “Oh, well obviously we are the blessed ones,” or any of that other arrogance (which may well be what others intend — we can only speak for ourselves). When we talk about privilege, it’s to be grateful, and to acknowledge all of the ways we were set up to succeed by circumstance. We certainly didn’t *earn* being born into the middle class instead of poverty. We didn’t earn being born with white skin, in America. We didn’t earn going to schools where learning actually happens, and where going to college is actually possible. Mr. ONL didn’t earn being born a male, and the higher pay that comes with that. And we certainly didn’t earn the loving families who have always supported us and been a safety net for us, which would allow us to fail if we ever happened to. That’s not a luxury that many people have, the knowledge that if they fail, they won’t become homeless or go to prison. That was truly a privilege, and we’re grateful for it, just like all of the other things that had to go right in order for us to be in the fortunate position to now be able to make the right choices and do the hard work of earning a lot and saving quickly. Put another way, privilege is the circumstance, and the rest is your set of decisions in that circumstance. Many people are put in the circumstance to retire early IF they make the right choices, even if they don’t earn much (like the Charltons, in our interview last week!), but many others aren’t, because of the huge obstacles (financial, social, structural, psychological, health/physical, etc.) posed by poverty, or being born a person of color, or being born in a less economically developed country. And we are grateful that we have the privilege of falling into the former group. Like the quote says, “It’s not happiness that brings us gratitude, it’s gratitude that brings us happiness.” 🙂

    1. Hey ONL – I definitely appreciate your thoughts. I understand your position about how you define privilege, and I respect your definition. Part of the problem for me is how a lot of this comes across, especially to those who may be outside of the community and looking in. In my humble opinion, it makes this sound like we are the “chosen ones” because we were put in this position, and unless you’re white and college-educated, it’s probably not going to happen for you.

      I definitely realize that probably isn’t the true intent, but putting myself in the position of an outside (which I very much was at one point in my adult life), it doesn’t sound inviting or all that motivational.

      I think this issue is an opportunity not to talk about how lucky we are, but about the challenges that we’ve overcome. Overcoming challenges is what’s motivational, not chalking up early retirement to privilege. Most of us have overcome a lot in our lives and proactively made choices to fundamentally better ourselves, and that is what should be celebrated.

      Just my two cents – change available if desired! 🙂

  10. Another great post Steve!
    All of these are extremely good points, but I want to emphasize on these two:

    ***I want ER bad enough to adjust my lifestyle
    Yes, 100 times yes! This is probably the most important point. I have many friends who make lots of money and are easily in the top 5% from an income perspective. They can see ER as an interesting concept, but are not willing to make any sacrifices along the way to actually achieve it. People can make loads of money and never be able to achieve FI because to them lifestyle inflation is a reason they want/get so much money.

    ***I married well
    This too. If your financial goals are not in line with your significant other’s, it’s going to be a very rocky ride. I know it’s possible to convince your husband/wife, but if they don’t already have a frugal attitude from the start it’s going to be tough. This is partly luck, but I think it’s easy to recognize a frugal mate when you find one. My wife had no attraction for expensive bags or jewelry, and was always careful about groceries costs. Although I didn’t think much of it at the time, I’ve recently realized that all my girlfriends (including my now wife) were girls who were down to earth in terms of prices. I assume I choose (or attract?) the frugal type of girls?

    1. Thanks Stockbeard – I think you’re right that there might be a little luck in the “married well” category, but I think you hit the nail on the head when you talked about recognizing *tendencies* in your wife before you had even considered marriage.

      Like you, my wife was never materialistic when we were dating. No expensive designer hand bags or glitzy jewelry, expensive European import car, a preference for “nicer” restaurants. None of that, and it now shows in our mutual desire to live frugally and retire early. Very, very good point!

  11. Well said! I agree that anyone has the ability to retire early. Like your wife, I was also born into a family that declared bankruptcy at some point along my childhood continuum. It made me more aware of the importance of money and the importance of knowing how to handle it. My mother of 71 years, still cannot handle her money. The choices I have made have led me to the early retirement path and community, not privilege. Again, well said.

    Mrs. Mad Money Monster

    1. Thanks Mrs. MMM – I appreciate you taking the time to comment. I believe that the harder we work to achieve our goals, the more sweet the feeling will be once they are accomplished! 🙂

  12. I’ve been looking forward to arguing with you since your preview tweet yesterday 🙂

    I generally agree with the spirit of what you’ve laid out: FIRE isn’t handed to anyone. It’s earned through focus and hard work. Maybe luck plays into it — whether in the form of fortunate career moves or good market timing — but it’s not the major factor.

    That said, I would argue that most of us enjoy a variety of societal privileges that make it meaningfully easier to pursue FIRE in the first place, and that it’s worth reflecting on them.

    I don’t mean that in a negative or accusatory way at all, nor does it demean our FI achievements. But who in our society is more likely to be able to earn and save sufficiently for FIRE? Who is more likely to experience societal disadvantages and barriers to equal treatment in school, employment, and housing?
    – A white person, or a person of color?
    – A man, or a woman?
    – A straight person, or a gay or lesbian person?
    – A cisgender person, or a transgender person?
    – A person born into a middle or upper class household, or a person born into generational poverty?
    – A person with stable housing throughout childhood, or a person who grows up homeless or housing-unstable?
    – A person who grows up in a great school district, or a person who grows up in an awful one?
    – An able-bodied person, or a person with a disability?
    – A native English speaker, or a non-English speaker?

    These aren’t things we choose about our birth and our upbringing — they’re privileges. That’s not to say that someone can’t achieve FIRE without all these positions of societal advantage. But I think you’d be hard-pressed to argue that they don’t set you up for a better chance. As Louis C.K. jokes about race, “I’m not saying that white people are better. I’m saying that *being* white is clearly better. Who could even argue? If it was an option, I would re-up every year.”

    1. I think I would agree with you that if you’re a white man in society, for example, you probably are *more likely* to retire early if that’s your goal than, say, a black woman. That’s true and generally tough to argue against.

      However, my position is, reading some of the material from those who believe that privilege plays a BIG part in the ability to retire early, is it can sound like if you’re a black woman, for example, you might as well not even try because it’s probably not going to happen. Again, I understand that the authors may not believe this, or intend for their message to come across that way. But at least when I read some of the material out there, it comes across that way.

      With all of its faults, this country stills remains opportunity-rich, and there are so many ways that people can improve their lives dramatically. I definitely agree it is easier for some than others.

      Thanks for the comment! Your point is well taken.

      1. Fair enough. I’m not sure I’ve come across exactly the type of material you’re referencing, but there is definitely a mindset of defeat in the variety of ER-negative content I’ve read, whether or not it’s in the context of the societal privilege I mentioned. That mindset of “the only people who can retire early have it all handed to them” is definitely not accurate either. I completely agree that we live in an opportunity-rich time and place, and that ER is within reach for many people if they’re willing to make the sacrifices and lifestyle changes required.

  13. I think this is a great post. I think this point should be made over and over again because people are so quick to dismiss FI because of whatever circumstances they are in. Anyone can do it. But not everyone wants it bad enough to do it.

    1. Thanks Miss GF – that’s the key, the want. The motivation. It is definitely easier for some than for others, but a lot more is possible in this world than we care to admit to ourselves, some time. 🙂

  14. No privilege has led to early retirement (2 months left!) in my case. I’ve always believed success comes from doing the little things right time after time and at the same time avoiding big mistakes. (with the exception of folks that are victims of health or other issues out of their control)

    1. Appreciate your comment, MrFireStation – you’re right, often times it is the little things that make the biggest differences. 🙂

      Congrats on being so darn close to your epic escape date!

  15. I mostly agree with you. Early retirement is definitely not something that only the rich can attain. By which I mean those born rich or otherwise making millions. Even those people aren’t guaranteed early retirement.

    Financial independence takes work in 99% of cases. Generally, it does mean good income, cutting costs and living with less (not to be confused with deprivation).

    That said, I think people underestimate the health aspect. It’s not just about not getting into a car accident or eating a bad piece of meat. I have chronic fatigue, and my husband has fibromyalgia. We’ve got to be spending at least $15,000 a year in health care.

    Not to mention that the $25k we so assiduously saved up last year is going into dental implants. That amount could pay off 1/3 of our mortgage, more than fund an IRA and a SEP or be a 20% down payment on a rental property down here in Phoenix. But instead, we’re putting it into my husband’s mouth and starting from scratch. (And that’s not including the $12k we spent 8 years ago to get oral surgery/dentures to take care of the original problem.)

    Chronic conditions can hit no matter how well you eat or how much you exercise — though good for you for at least actively pursuing a healthy lifestyle — and they’re more common than you might think. They severely hamper earning capacity. Frankly, we’ll be lucky if I’m actually able to fully retire. (My husband is on disability.)

    That said, thanks to my lucking into a job I can do from home, we’re in a much better place than we perhaps ought to be, given our health problems. But with at least one of us on disability the full 10 years we’ve been together, even ignoring the accompanying health expenses, our ability to save has been severely compromised.

    Anyway, that’s not to take away from the hard work you’ve put into your early retirement efforts. But it does mean that there’s definitely some significant luck involved beyond the obvious ones of socioeconomic class/parental habits.

    1. Hi Abigail – I appreciate your comment, and your point is very well taken. I used the car accident/bad piece of meat as an example of medical/health issues that we simply cannot control and did not intend to imply that’s where it ends. Chronic illnesses, as well as hereditary conditions, are definitely included in that category. Perhaps I should have chosen better examples.

      And a big congrats for finding a job that you can do from home. That makes a HUGE difference, as you know. 🙂

  16. Powerful article Steve! Early retirement is definitely something that you have to work for, it cant be handed to anyone on a silver spoon. Early retirement gives your life so many more options, spend time with family, take exciting adventures, do something you love. There are always downturns in life that set us back but keeping the goal in mind helps us get back on track to early retirement, good luck!

    1. Thanks FF – I agree that the benefits of retiring early are just flat enormous and gives people much, much more time to do what truly makes them happy. The harder that we work for it, the sweeter it is once we reach that goal!

  17. I agree that decisions are powerful because look at the celebrities that earned millions and are in debt. It’s a widely known fact that many lottery winners are broke within 5 years of winning the lottery.

  18. Steve,

    Really enjoyed this post, and I think you’re spot on. I’ve seen a statistic published multiple places that says something like 88% of millionaires are first generation, ie. they were self made and didn’t just inherit their wealth. There are a ton of factors at play, such as upbringing, social class, etc. that can have a big impact on a person’s ability to earn a certain level of income. That being said, I think with our consumer culture, the fact that many people can’t retire at a reasonable age is largely a byproduct of their choices. You and your wife have made considerable sacrifices along with years of diligence and commitment to your goal. That doesn’t just happen, that’s very hard to do, and it’s why many people fail. Many people want the result of not having to work, but how many people actually choose to struggle along with the process that it takes to achieve that result? Most people choose consume in the present and then are cynical about early retirees who have taken a long-term outlook on life. It’s not “privilege” or “luck” it’s commitment and focus on a long-term goal.

    1. Thanks Matt, very much appreciate your comment. You are very right that it doesn’t “just happen”, regardless of your upbringing. I don’t think anyone disagrees with the notion that external factors *outside of one’s control* can affect a person’s ability to succeed in their goals, but those things don’t tend to either hand your goals to you or prevent you from reaching them altogether.

  19. I found your blog through your comment on Dividend Mantra’s post about why he didn’t go to the Chautauqua in Ecuador. I agreed with your comment that it was a little odd to spend money to learn about saving money but that misses the point of the trip – finding community and inspiration. Plus, I brought my fiance along on the trip to supercharge our motivation & help him to understand where I was coming from. It worked! ROI achieved.

    I agree with your comments on the privilege to pursue ER. I think there is a lot of negative talk about how ER is just for the high-income crew (and so many of us do work in tech which doesn’t help that) but there are so many examples of people achieving FI on any income.

    It certainly is easier to supercharge your savings though when you have more to save. Although the individual can optimize their income as a strategy just as much as optimizing their savings. I majored in Political Science but weaseled my way into a career in IT for that reason.

    1. Thanks MB, I appreciate your thoughts on this. It is true that many of us do make good incomes; but, that doesn’t mean all of us do. A high income does make it easier, but it’s not what makes this whole thing *possible*. 🙂

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