Want to retire young? Believe it or not, you already know how it is done

Published April 20, 2015   Posted in How to Retire

Let’s face it – the large majority of Americans know how to retire young.  Most of us know that to retire significantly before our 60s, we must save our money rather than spend it.  Ultimately, it is the accumulation of wealth that enables us to quit our jobs and live out the rest of our lives in jobless bliss.  Truthfully, this isn’t rocket science.

Many-a-finance article, especially through our mainstream media, publish seemingly helpful tips and techniques to help you retire before you hit 60.  Things like savings and investing in the stock market, utilizing your company’s 401k plans, generally not spending on shit that nobody really needs.  Same stuff, different day…over and over again.  Almost never anything new.

Hell, I’ve done this too.  I’ve talked about how costly that morning trip to Starbucks really is.  I have also talked about some pretty basic techniques to save money while eating out and my wife has written about saving tips.  But honestly folks, there’s nothing all that ground-breaking about all these “helpful” articles or blog posts.  Most of us know that we need to save.

As an aside, this is why I have been writing more and more about how to THINK and the virtues of taking control of your lifestyle.

Most people know that they can’t just keep buying a bunch of crap and expect to be able to quit their jobs and…just live.  Even the most financially-dense among our population has probably figured out an interesting pattern: the less money you spend, the more money you have.

The problem isn’t that people don’t know HOW to retire early; now more than ever, people are fully aware of retirement accounts, long term savings and generally what “investing” is.  They may not know them in excruciating detail (and, quite frankly, the details aren’t that important anyway), but still – people get the point.

The problem is people simply refuse to leave their comfort zones.  News articles and blog posts can talk about saving 15% of your income until the author is literally blue in the face.  But, until their audience is willing to escape the luxurious confines of their comfort zone, not much is going to change.  And so, enough with the how-tos on early retirement, Mr. Mainstream Media.

There are a couple much larger issues at play.

Early retirement isn’t for everyone

Believe it or not, I have no problem with people who make the choice to work longer into their elder years in order to live less frugally while young.  Several of my friends admit that the lifestyle that they choose to live NOW will affect their ability to retire LATER.

They fully realize that the hundreds of dollars they spend to upgrade their pocket-sized personal computer (widely referred to as the modern “cell phone” in the United States) every year is cutting into their long term savings.  They know that the homes they live in, cars they drive and the stuff that they have and things they do affect their ability to retire early.

And they are okay with putting in a substantial number of additional years at the office to make their current lifestyle possible.  These people are adults and capable of making their own decisions.  They made a choice and are sticking to it.

And quite frankly, I respect a person’s reasoned decisions – like I said, early retirement isn’t for everyone.  People’s goals are all different, and there’s no law of the land that instructs people to actively seek early retirement.

The real tragedy here is with people who DO want to retire early, but refuse to make the lifestyle changes necessary to make it happen.  “I know I should save more” is an often-uttered phrase when talking to one of these people.

They just “can’t save”, they lament.  It’s darn near impossible.

After all, that 70″ flat panel television needs to be paid for somehow.  Or their BWM sitting in their garage, expensive wrist watch on their arm, $2500 surround sound stereo system in their living or game room.  All that stuff needs money.

Even while spending substantial amounts of money on unnecessary luxuries, people know how to save.  Most also recognize that money does not grow on trees, and retirement will require a certain level of wealth.

The true problem: they choose not to save.

Early retirees escape comfort zones

Naturally, we all want to feel comfortable in our lifestyles, and I am certainly no exception.  I love knowing that the decisions that I am making are actively supporting the goals that my wife and I have setup for our future.  Every day, it is a joy knowing that we are working towards the glorious goal of jobless bliss.

But sadly, people’s comfort zones represent the biggest factor in the inability to achieve the goal of financial independence and early retirement.

It is a mind-game that people are playing with themselves.  Spending is an addiction, and people’s minds keep planting the seeds of comfort within the decision-making process.  “Come on Steve, that new Corvette will make you happy”, my mind once said.  “Oh dude, wouldn’t it be cool if you supercharged that Corvette?”

Shut up, brain.  You’re totally killing my ability to retire from this rat race whenever the hell I want.  Just stay up there and mind your own business.

The key to early retirement isn’t necessarily in the HOW.  Instead, the key lies with the MIND.  Once the mind has been tamed, one can truly begin to control their own destiny.

After all, it’s your mind that tells you what’s comfortable.

What happens when you begin to control your mind rather than your mind controlling you?  You begin to REASON, and reason is good.  It’s good people.

For example, fast food every night would probably taste good – after all, your mind wants that level of satisfaction.  But, your ability to REASON intervenes.  If you eat too much fast food, you grow fat and unhealthy.  Your standard of living sinks.  Then, you may die.

And likewise, your mind tells you that spending money on useless crap will make you happy.  And it may very well give you a sense of happiness, at least for a little while.  But then, your mind moves on to different things, and the crap you bought last month no longer has the same appeal any longer.

Your lifestyle will begin to change for the better after the inclusion of REASON.  The crap you [used to] buy every week to make you happy will no longer affect your mind, because now, REASON is in control of your mind.

Your mind usually knows the right answer in almost any situation.  Somewhere in the ol’ cranium, your ability to REASON has already figured it all out.  The answer is almost always there.  Great, so what’s the problem?

Your mind has covered up that REASON with a thick layer of rubbish.

The great untamed mind might carry on a short, but financially devastating, conversation that goes something like this:

You: “I really need to save more.”

Your mind: “But you probably want that new iPad more, don’t ya?”

You: “Yeah, but Mr. Mind – I really need to save.”

Your mind: “Oh get real – retirement isn’t for another 20 years; have a little fun, get that new iPad.  You’ll love it.”

Control your mind, control your destiny

You know how to save.  You also know what it takes to retire.  Trust me, you really do.  If you think that you’re confused, that is probably your mind playing games with you.  It’s that layer of rubbish over your REASON.

The key to early retirement isn’t reading the newest “Five Insane Tips To Retire By 40!” article through some heavily-funded content factory (i.e.: a magazine or newspaper).  It also isn’t about reading blog after blog that talks about the gory details of 401ks or the eccentricities inherent within average rates of return, stock yields or investment diversification.

Those are all perfectly legitimate topics to fine-tune your retirement strategy later on, but if you don’t yet have a strategy to speak of, take a step back.  See the forest for the trees.  Don’t get distracted by those topics.

But also, don’t let your mind tell you that this early retirement business is too complex or just downright impossible in your situation.

Nine times out of 10, that’s just your brain screwing with you.  

Get a hold of your ability to REASON and start controlling your mind.  Real comfort does not come from buying a bunch of stuff during your weekend trip to the store.  Comfort – and I’m talking about the most fundamental element of comfort, is what results from figuring out what your level of happiness is all about.

For me, it’s about drinking a cup of extra bold coffee and sitting on my [probably hand-made] deck looking out over beautiful red rock country of Sedona, AZ.  On a Monday morning.  When I’m 40.

What about you?  Has your ability to REASON broken through the rubbish?

We track our net worth using Personal Capital


15 responses to “Want to retire young? Believe it or not, you already know how it is done”

  1. Yes reason definitely helped break into the FI/RE mindset. I’ve never been a spendy pants by definition, but I was much more lax in my spending in the past. When I moved to NYC, I saw the spendy pants galore with everyone eating out multiple times a day, brunching, drinks, etc. I decided to use my higher pay in a high COL to boost my savings rate. I was able to sell my car and dramatically reduce my cost of living by making a few sacrifices. Sure it would be really nice to have my car in the city for when I wanted to travel outside the city but my reason decided the $400/month to park it here, the insurance, etc. was not worth it!

    • Yep, it’s “Spendy McSpenderson” syndrome. And I was right there with ya, too.

      Good on you for getting rid of your car. Yeah, the cost of parking alone is outrageous enough to make the reliance on public transportation that much more appealing. Shesh, $400 a month is significantly more than we pay for gas and insurance for all three of our vehicles here in AZ (one being a motorcycle). Looks like you made a great decision.

      Thanks for your comment. I always appreciate the read. 🙂

  2. Even Steven says:

    I think some of the plan for early retirement bloggers is that we have chosen what’s important to us. I have a big screen TV, it’s really nice, but before that I had the same TV since I bought one in 2003. I didn’t put this TV on a credit card, I paid with cash. I didn’t upgrade to the entire movie/sports/online package, I downgraded to the internet and few local stations. I know missing a sports game or missing a favorite TV is nothing close to even the idea of Financial Independence and if choices like that will get me their, I might just go get my old college TV.

    I used the TV as an example but obviously the bigger the item ie the Big 3 (house, car, food) the faster you can reach FI or for that matter spend, choices are available to everyone, it just depends what’s important to you.

    • Yep, I completely agree. Life is a series of trade-offs. Making the best decisions to support your goals is what accounts for success in my opinion. Most early retirement bloggers are doing just that, and kicking some serious ass in the process.

      Thanks for visiting!

  3. This made me think of the conversation I had with my brother today. He recently wired me $12K because he was going to buy a 1965 Lincoln something or another. I tried to convince not to buy it and do something more productive with his money.

    The deal fell through. So I took the opportunity to offer him some investment ideas that I told him I would manage for free for him.

    He has been saying he wants to start making some money on his money. I told him about a particular investment I am looking at that pays 7% through a private REIT. He asked how much he would make. I told him if he didn’t reinvest his dividends that he could expect to make about $70 per $1,000 he invested.

    He decided it wasn’t worth it to him.

    He will likely go and blow the money on something else.

    At least I can say I offered. He want’s a get rich quick or nothing at all…don’t we all???

    It doesn’t work like that. Compounding in powerful, but it is not magical. You can’t start with nothing and expect a fortune. You have to start with something. And compounding gets more powerful over time.


    • It is really sad because so many people are in this boat. MOST people have every opportunity to save their money and invest in their future, but they just don’t. Then, they lament the fact that retirement just seems so far off.

      Retirement is a moving target. The less you spend, the closer retirement gets. The more you spend, the further away it gets. It ain’t rocket science, but it does seem to be a difficult thing for the “instant gratification” folks in our society.

  4. This article is so true. Saving up for retirement isn’t rocket science, yet some people fail to do it. I agree that some of us might live paycheck to paycheck even with the most frugal lifestyle possible, but for people who do have some spare cash to save but still “can’t” save for retirement, it’s time to change their mindset and lifestyle.

    • I am hoping that the more of us who succeed at this whole early retirement thing, the more possible it will appear to those who may not have made the decision to save every penny rather than spend it. Almost anything is possible in this country – you just gotta want it. 🙂

  5. Mrs SSC says:

    You make a great point – even though we have been trying to cut our spending and live with less for over a year, we still struggle occasionally with wanting to buy something excessive. It can be hard to go without, especially if all your friends and coworkers are the spendy types. In theory, saving is ridiculously simple, but in practice it is made so much more difficult in our consumerist society.

    • To me, this journey isn’t about perfect. I’m far from perfect, too, but I think we both have our minds focused on the end goal of exiting the rat race early. Imagine how you’ll look to your friends when you’re retired decades before they would even consider such a thing. But I agree, sometimes it isn’t easy. Staying strong is the key.

  6. There’s a reason budgeting/finance is compared to a diet. Yes, that chocolate looks amazing, and it will probably taste great. But if you eat it, that’s one step backwards from fitness.

    That doesn’t mean you *have* to avoid it. It’s a matter of being aware of the consequences, and then making a choice based on that. Some days, the chocolate is worth it. Other days, the fabulous (and slightly snug) dress takes precedence.

    • Yep, life is nothing but a series of choices. The more informed you are regarding these choices, the better decisions that you ultimately make. Effectively, you’re giving REASON a chance. And yes, some days, chocolate really is worth it. 🙂

  7. Steve,

    Yeah, good stuff. Early retirement definitely isn’t for everyone, which is okay. No problem if you like the idea of working until you’re old. The problem, however, is when you don’t like that idea.

    I liken saving money and achieving financial independence to losing weight. Both are simple, but not easy. Taking in less calories than you burn or spending less money than you take in are both simple concept, but they’re incredibly hard to master and stay consistent with in real life. Just one of those things. I guess that’s why “the same old, same old” pops up every day – to keep people on the righteous path.


    • It is funny how similar saving money and losing weight really are. They both can be tough, but they are also equally rewarding. Believing that it can happen in the first step towards making it a reality.

      Cheers to you as well. 🙂

  8. We definitely know people who may never retire — some are workaholics, some like the spending. And hey, if that’s your thing, rock on. It is soooooo not our thing, of course!

    The struggle with reason is real for all of us, though, not just bad savers. Even since we’ve been in focused ER saving mode, we’ve still bought a few things by justifying them as one-time purchased. And yeah, that surround sound system is sweet and all, but was it worth giving up 45 days of early retirement? Doubtful. (At least some major parts were secondhand.)

    One day at a time… 🙂

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