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What Everyone Should Know About Early Retirement // An ONL Clip Show

After nearly four years of blogging here, and 363 posts (this makes 364), many of which tally 2000 words or more, I’ve written a lot. But thanks to that volume, much of what I most wish people knew is buried deep under hundreds of posts, or isn’t especially well optimized for SEO and doesn’t pop up on Google searches. (Mostly because I don’t care one bit about SEO and so do zero of it.)

But when I step back and think about it all, I can pull out several big principles that I want everyone to know, whether you’re just beginning to consider embarking on an early retirement journey, or you’re well into it.

But rather than rewrite old posts to bring some of those most important principles to the top of the queue, today I’m doing something I’ve never done before and giving a full run-down of what I believe everyone should know about early retirement in clip show form, with links to prior posts that will let you go deeper on the ideas that feel most relevant to you.

And let me know at the end: what do you want to know but haven’t seen addressed anywhere? (There’s a good chance I have an old post that speaks to it, just based on playing the odds, and I can share that link.) Or what have you learned that you don’t see people talking about here or elsewhere?

What everyone should know about early retirement and financial independence // Our Next Life // early retirement blog, financial independence blog

Early Retirement Can Happen Quickly — But It Can Feel Slow

One of the things that still feels most surreal about our early retirement is how quickly it happened. We obviously had benefits that not everyone has of more pay than we needed, no kids and good luck in that nothing bad or expensive happened to derail our savings plan. But while most people work 40 years or more, we peaced out after fewer than 20 years, only about six years after getting serious about saving for early retirement. Of course, that’s fast in the big picture, but day to day, the journey can feel like it’s taking forever. In those years when it feels slow, here’s some fodder to urge you on, from how to head off impatience and get through the slog, to a reminder of where I was financially only a decade before retiring.

You Don’t Have to Be Frugal About Everything To Do It

It is absolutely not true that you need to eschew driving a car and subsist on rice and beans to retire early, and much of what this community sometimes calls “extreme” is really just normal frugality or everyday life to most people in the country and around the world. If you make intentional spending choices, you truly don’t have to be frugal about every little thing to save at a high rate. (But it certainly helps to continually find ways to earn more!)

But You Should Be Frugal About Some Things

But despite being against most things in the extreme, I do think there’s something important about being frugal — or selectively hardcore — about a few things in your life. Doing so will certainly save money, but it may teach you much more.

Don’t Take Conventional Wisdom at Face Value — Even the Unconventional FIRE Conventional Wisdom

It can be easy to treat certain ideas like dogma, like that the 4% rule is gospel, or that HSAs are the undisputed best thing since slice bread. Or that you should choose where to retire on the basis of who has an income tax, without considering things like health care and actual early retirement tax liability. But there’s good reason to investigate every seemingly great idea thrown out there in discussions of financial independence and early retirement and to see if it actually fits in your situation. Here are a few examples.

A Good Early Retirement Plan Is Multi-Faceted

When you’re planning for decades and decades of your life, filled with more unknown unknowns than known knowns, it’s essential that you build out not just a financial plan, but a life plan, and that the financial plan that supports it has room to adapt to new interests and to compensate for bad money outcomes. Your plan should have multiple types of investments, several contingencies, a plan for heading off risk (especially sequence of returns risk) and perhaps even two phases: early retirement and traditional retirement.

Health Care Should Be Top of Mind

Recently I spoke at Camp FI Midwest, and I did a popup Q&A session on health care. Nearly everyone attended, affirming that it’s a high level concern for most of us eyeing early retirement, but it was also clear that a high percentage of people do not have an especially deep understanding of the health care options out there for retirees, how to go about researching the best options for themselves or what’s included in a standard health insurance plan. This stuff is super important and it doesn’t have to be scary or intimidating if you make it your mission to understand it all. Here are some posts to get you started.

You Can Earn Money And Still Be Retired

In fact, if you’re smart and focused enough to save for early retirement, you will probably find it impossible not to earn some money after you cease needing money. Weird how that happens.

Pursuing Early Retirement Can Make Work Better (Or You Can Already Love Your Job and Still Want to Retire Early)

The wish to escape work is often a big motivator to pursue early retirement, but focusing on that wish only makes the journey slower and the slog harder. Instead, if you can change your mindset about work — aided in large part by the confidence that comes from becoming increasingly financially independent — it’s amazing how much work can change, and how much good you can do on your way out.

It’s All About Living a Purposeful, Meaningful Life

Of course none of this is really about escaping work. It’s about living big, meaningful lives that we can look back on and feel proud of. So make sure you do some real thinking about your purpose, how you’ll define yourself post-career and how you’ll use your power to leave a legacy of good.

That’s a Wrap!

If you can account for these principles in your early retirement planning, and in your life in general, I think you’ll be in pretty good shape. If you want even more, you can find many of my favorite posts ever near the bottom of the start here page. (Including this one, probably my favorite ever.)

So your turn! What topics would you like to see discussed or researched more? What questions do you have for early retirees (or for us specifically) that you haven’t seen addressed? What have you learned that you don’t think is common knowledge? Let’s discuss it all in the comments!

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28 replies »

  1. Even though I’ve read all of your articles already it’s good to have a concise set of links by category. You’ve done a great job of covering these topics look forward to continue reading about your experiences in early retirement. Hope to see you at fincon!

  2. I read your posts about the middle years over and over again. We’d been better than average at saving and avoiding lifestyle inflation for awhile, but about a year ago we realized that we could make early retirement happen in about 6 years. Looking six years into my past, I can’t believe how fast that time flew by. But you’re right, sometimes the day to day, or even month to month feels like watching grass grow. It’s those times that I’m most tempted to make a big purchase as a sort of palliative measure. I’m constantly looking for alternative ways to get that dopamine hit–tacking a big to-do list item, going for a run or hike, cooking something complicated, or even de-cluttering.

  3. Thanks for this! I wish all the bloggers I’ve been following these last few years would do a round-up post like this. As boring as taxes tend to be I wish there were more articles on the subject. The benefits of an LLC taxed as an S-Corp vs just doing a simple LLC, can you put too much money in pretax accounts, etc. Enjoy your Saturday! ER, Wednesday I mean.

    • ;-) Someone recently asked if there was a way to get a condensed summary of my posts (besides the Start Here page, which is pretty comprehensive, too), and that gave me the idea to do this post. I agree everyone should do this! And while I recommend Go Curry Cracker for all things tax-related, I will be writing more about LLCs and S corps very soon. Stay tuned!

  4. I’m definitely going to have to re-read your posts about the middle years because we are finally paying off the last of our debt (besides the mortgage) and beginning to ramp up our savings. Together, we make under $100K before taxes, so it’s going to be a long haul that I am not looking forward to. I’m going to be exploring awesome things in my “off time” from work* to try to just keep myself excited/motivated while also not being able to jet off and backpack around Yellowstone for a month or two at a time. *I just got a part-time job, on top of my FT job, to earn/save even more.. It’s only an extra $400/month or so..but it’s a better use of 15 or so hours a week than sitting around on my butt. Also, I hope that my partner and I can start to take beautiful photography pictures and sell them. I know photography is one of those things lately where the business is going down because the cameras on peoples phones are so good..So, we’ll see if we’re able to eek out a bit of a side hustle from this new endeavor. ¯\_(ツ)_/¯ I sure hope something comes of it!

    But yeah.. gonna need to re-read about not going crazy in the next 5-10 years! :D

    • Also, going through previous posts..you grew up in GB?! I grew up north of, and now live in, MKE! Small world!! Maybe if you are ever back in “town” (state?), we can do a pot luck or something.. hehe! I dream of living in a place with vertical topography of some sort. Do you ever miss living by the lake and fall colors?

      • I sure did! I don’t get back often, but when I do, I will for sure do a meetup. And yeah, I have to say I prefer vertical topography. Fall colors are nice, but we have lots of lakes here (including one of the prettiest ones anywhere), and I’ll take mountains over fall colors (and mosquitoes, humidity, etc.) any day. ;-)

    • If you haven’t already, check out How to Retire Early by Robert & Robin Charlton: https://amzn.to/2MMk45n. I also interviewed them here: https://ournextlife.com/2016/01/13/interview-with-robert-robin-charlton-authors-of-how-to-retire-early/. They retired in 12 years of total saving and only cracked six figures combined in the last few years. They share all their numbers, and you might find it encouraging! And as for the rest, I highly recommend thinking about it as just living your life. The worst thing would be getting to your goal and looking back to realize you’d wasted a decade pining for the future rather than focusing on the present. Focus on living a life you enjoy now, and that will help a ton. :-)

  5. I’m so with you on living meaningfully whether it means being connected to family, a community, or a life mission with a lot less financial limitations. FIRE is basically being able to pursue interests that otherwise wouldn’t be possible due to financial resource limitations since many people are not born into bountiful economic resources.

    Being FIRE doesn’t mean all problems vanish. Life goes on, and problems continue to arise, but the journey leading up to FIRE has buillt up resilience, doggedness to stay the course, and waking up each day with focus, purpose, and dedication. Like training for a marathon that becomes a lifestyle.

  6. Thanks for the roundup! I’ve enjoyed your insights into the mental mindset of becoming FI, and the non-financial aspects of being FI. There are only so many articles you can read on the 4% rule :).

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