One of my primary goals in life is to retire early. If you’ve consumed any of my content, you’ve probably heard me write or say that the standard “life model” is flawed in my opinion.
Going to school into adulthood while not learning skills very relevant to living a satisfying life, working at a job you probably dislike with people you barely tolerate until you’re in your 60s or 70s, and finally retiring at 70 to sit around and barely be a functional adult isn’t my idea of a great life. Retiring early and being able to truly enjoy life while you’re relatively young is effectively the only way to live an effectively well-lived life. But that leaves several questions. 1. Why Should One Retire Early?
2. What does it mean to truly retire?
3. How does one retire early?
In this article, I want to dive into all 3 questions and answer them to the best of my ability.
WHY YOU SHOULD RETIRE EARLY
First of all, I want to wedge the concept of early retirement into your brain. Believe it or not, it is possible to retire early. And it doesn’t necessarily require you to be a millionaire. However it will require work. And it will require some simple financial concepts. But I do think it’s doable. Now, when it comes to why you should try to retire early, I want you to understand two things:
Time is Valuable
Time changes you
I think at a subconscious level, we understand these two things to be true. But we don’t quite allow our conscious minds to think or act upon these concepts. Time is your greatest asset in life. The quicker you can move from concept to execution to achievement of a goal, the better. People also neglect that time will change you. You’ve experienced this before but I imagine you haven’t thought much about this on a deeper level. You haven’t extrapolated this thought. As you get older, you change and the world changes as well. This happens in a manner dependent and independent to you. For example, as a male your physical capabilities will decline as you age. Sure, modern medicine can delay the decline. But certain things like your sex drive, your energy levels, physique, etc. will fade away as time goes on. This applies to women as well. As you age, your beauty and desirability declines. Your ability to maintain a certain weight or size will decrease. Sure, modern science can slow the process. But this change is inevitable. Sadly, whether we like it or not, the world will change based on how we change. A young man that’s in peak physical condition might be seen as admirable or competent without even opening his mouth. He might garner attention based on his projection in life. As the world encourages him, he becomes more confident. However, the same man in old age will likely get little to no attention as his traits have changed. A 50 year old man that’s yet to accomplish much will be seen as a loser or simply unremarkable.
The same man likely can’t gain the same attention even for his physical capabilities as his testosterone has dropped and his ability to command an audience has dropped. In short, he’s past his peak and everyone’s looking at the new generation.
Let’s also use an example for women. A young lady in her twenties might effortlessly garner massive attention. Every man she meets, regardless of age or status, might desire her. They might be willing to invite her to parties, events, and mingle with high status individuals. Her age and beauty could effectively make her rich when we consider the doors that could open up to her. However, the same girl in her 50s likely won’t have nearly as much attention, if any at all. The world around her will become a reflection of who she has become. All of the doors that were once open to her have closed and the rooms she used to have access to will require a new key or perhaps an unorthodox method of access. Age affects us all. This is one of the major reasons why waiting until old age to retire is an absurd concept to me. Frankly, it’s illogical because money can’t replace time. But time was the price you pay for money if you wait until old age to retire. Keep in mind, I haven’t even factored in the likely possibility that sickness might take you away from the world before you even get to retire. Or, perhaps that dream of relaxing on a beach in Monaco or Tulum won’t be so appealing when your liver no longer functions properly. Or once you’ve had several hip surgeries and struggle to walk. Or if you’ve had skin cancer. Or one of the many other afflictions that old age invites. I’m not being negative. I’m simply being realistic. Time and money are best enjoyed in your youth. This is why I believe everyone should strive to retire young. Abandon the classic model of retirement.
WHAT DOES IT MEAN TO RETIRE EARLY?
Now, I need to make something clear. I have a different definition for retirement. It’s likely one you’re unfamiliar with. I want to make something clear to you. I view the idea of retirement as having the means to use your time as you see fit. It’s freedom in a nutshell. But freedom on your terms.
In general, retirement is waking up when you want. Going to bed when you want. Interacting with who you want. Spending your day the way you want. It’s doing what you want. There are many ways to accomplish this. However, I’m going to share with you the way I almost did it soon.
Before I get into it, I need to make this concept clear to you. Retirement involves the following idea: Your Passive Income > Your Expenses. If you can make this happen, you’re one step away from retirement. Does this idea seem simple? It should. Because it is simple. It might not be easy to accomplish (and I’m not saying whether or not it is or isn’t), but it is simple to understand. You need your monthly income to exceed what you spend. Once you can accomplish this, you’re free to use your time as you desire. Typically, when you retire you might receive a pension. This is money provided monthly that your employer or the government gives you. My recommendation: Take retirement into your own hands. Use the formula to your advantage. And live life to the fullest immediately.
Believe it or not, I’ve seen instances in which a pension doesn’t adjust well for inflation. This means that a retiree receives a monthly income that doesn’t adequately cover their basic living and food expenses.
So, what does this means? Well, it means that retiree that waited decades to stop working will sadly need to work everyday until their death. Unless a family member can supplement their lifestyle or unless they win the lottery.
I’ll be honest. I’ve personally known older people in their 70s that were working 2 jobs. Not by choice. Not because they loved it. Not because they were bored. Because they had to. The money they’d receive from a pension or something similar just wouldn’t cut it. Again, stop and think for a moment. Do you love your job? Are you willing to work your current hours at your current pace at your current pay until the last day you’re alive? If the answer is no, then keep reading. You need to make early retirement your new goal.
HOW DOES ONE RETIRE EARLY?
So I’ve explained what it means to retire early and why you should retire early. Now, it’s time to cover the how. Understand this. Ever since college, more or less, I knew the methods to retire early. I actually knew of several ways. However, life takes it’s course and causes you to deviate from your path. At one point, I was potentially exactly where I needed to be to be on the path to early retirement. But I lacked two basic tenets. I lacked patience and I lacked insight.
Now, I’d like to say I have both. While it’s excellent that I’ve made these mistakes so young and I’m working toward my goals, I still would like others to learn from my mistakes. If you’re young, then that’s excellent. Give my following tips about 5-10 years and you’ll be set. You won’t need to be the 70-year old working 2 or 3 jobs while still taking shit from everyone else. And even if you’re older, you should still be happy. I’d say that about 95% of people never even consider early retirement to be possible. And if they do retire, they’re stuck on such narrow margins that they can’t enjoy the remainder of their lives. Either way, trust me when I tell you that this article is extremely valuable.
Now, if you’re in my newsletter (which you absolutely should be) I already broke this down a little. You could’ve been asking questions and executing. But you probably haven’t yet because you’re not in my newsletter.
Join it as soon as possible because I’m going to be sharing a lot there first (and often exclusively). Also, unlike most people online, I’m going to go as deep as possible without charging you for everything.
However, in this article, I’m going to expand on what I taught in the newsletter. My goal is to set you on your path to retirement by the end of this article. As always, join my telegram group if you have any questions. Now, for the 6 steps to retire early.
In order, these are the 6 steps I recommend to retire early.
1. Work as much as possible at your job (this includes overtime)
1a. Calculate how much you spend per month and per year
2. Get a second job or side hustle (if overtime isn’t an option)
3. Find a property for sale (preferably in the vicinity)
3a. If possible use an FHA loan on a multiplex
3b. Live in one of the units and rent out the remaining
4. After a year, move out of the property and repeat step 3 5. Hire a property manager
6. Do this until your passive income exceeds your spending
Very recently, while journaling and reflecting, I tried to formulate a process to retire. I tried to review what I’d already done recently that may have moved me toward my goal and what’s moved me further away.
As I journaled, I realized that I was already on track. However, my lack of patience and insight pulled me away from my target. Hindsight is 20/20, right? While I missed some key opportunities and steps at the time, looking back allowed me to see the gifts that I missed. My hope is that by reading this, you’ll be able to pick up the gifts and opportunities I left behind and get further ahead with them.
The six steps mentioned above were the gifts that I’d missed several years earlier. These were the steps I could’ve taken to retire.
Once I realized those 6 steps above, I chuckled to myself a little. My goal could’ve been accomplished a lot faster and with far less stress. I’m going to go into each step and what I would personally do if I could go back in time. These steps should be considered frameworks. To be honest, I don’t think you’ll need to do these steps to the exact same degree that I would currently do them in. I’m a bit of an anomaly. I can literally wake up at 5am and work until 12am the next day. I enjoy working though, so working for me is similar to a young man playing video games. It feels like an accomplishment.
But I think that tackling the above steps without working all day and every day can still yield amazing results. With all of that being said, I believe that my way and steps above will allow you to accomplish the goal of retiring in the shortest amount of time.
1. Work as much as possible
Several years ago, I worked at a well-paying job and also did several jobs on the side. In total, I was making about $60k per year. Which, for a 26 year old, is a pretty good income in my opinion. Despite the work I was doing, I still had plenty of free time. I was undisciplined. And in my free time I’d waste tons of effort chasing girls and wasting money at bars and clubs. This is one of the worst ways to use your money and free time.
To be honest, if I knew better I’d invest all of my free time trying to learn skills to start a side hustle that could be done remotely and that could eventually evolve into a business. Regardless, even if you’re not so entrepreneurial to start your own business, I’d still recommend working at job as much as possible. Your goal by doing this is to hoard capital. Stockpile as much money as you can!
In order for the next few steps to be possible, you need to have liquid money on hand. Do not invest it in a 401k. Do not invest it in an IRA. Do not use it to invest in ads for a thousand other ideas and businesses. Trust me, from personal experience I can tell you that this is a bad idea.
These financial tools are designed for the slow retirement plan. This is for someone that wants to give someone else control and retire in their old age. While these tools aren’t the worst things in the world, I think it’s easy to feel comfortable and get seduced by the. My steps will be better in the long run. Stay focused. Work a lot. And save your money with the intent to use it adequately in the next few steps. Understand that if I could go back in time, I’d simply sacrifice two years of my life to working non-stop. I’d go out on dates very little. I wouldn’t commit to any girls. I wouldn’t go on any extravagant or costly vacations. I’d simply work. My reasoning for this is because the more work I can do, the more money I can make in the shortest time period.
Dating, parties, and clubs are very fun and can be rewarding. However, they don’t typically add immense value to your life. Plus, they’ll always exist. There will always be pretty girls to date, there will always be bars to drink at, and there will always be clubs or events to get lit at. You might feel FOMO. But believe me, you’re not missing anything besides reaching your full potential and living a happier lifestyle if you don’t try to retire as quickly as possible.
1A. Calculate how much you spend a month/year
This is an important step. I’m a big believer in the expression what doesn’t get measured is not managed. In order to know the numbers you need to hit (which I’ll explain in a moment) you need to know what they are. Do the following steps: