In 1999, I started my first job out of college with a salary of $30,000 per year. I spent most of the day coding in a cubicle. It was analytically satisfying but not what I truly wanted to do. It was also quite stressful, and the hours were long. I had chosen computer science because I was moderately good at it, and I hoped it would help me pay off my $50,000 in college loans.
In my first week of work, I realized I needed to find a way out. I had a hunch that the path I was on would not end well. I found an online group of people with similar thoughts. They were into "simple living," inspired by a book called "Your Money or Your Life." After reading it, I created a spreadsheet and started plotting numbers. I calculated that by continuously reducing my expenses and saving everything beyond a minimal lifestyle, and investing it in index funds, I could reach a point where my investments matched my spending.
For the next 25 years, I kept reducing my spending and invested the surplus into the S&P 500. At the time, that was considered a very aggressive move, as a more conservative strategy was recommended. But, I decided to give it a try. I forwent a consumer lifestyle. I didn't travel much and spent most of my free time reading. When I eventually started a family, I devoted time to them. I had to put on blinders, though. The cars, houses, lavish vacations, fancy dining, clothes, gadgets—I ignored all that. I bought houses in the poorest neighborhoods and fixed them up. I drove the cheapest cars that were reliable. I adopted a simple wardrobe. I bought second hand. I figured out how to make nutritious, delicious meals from the least expensive ingredients. Often, I felt like I was missing out compared to my peers, especially as wages in the industry grew. But, I endured and stuck to the plan.
These days, this movement seems to have evolved into FI/RE. Although it's not quite the same, it probably has similar goals.
I saw a few people make huge payoffs from startups and IPOs, so I tried that too. But it was terrible for my mental health, and I quickly learned that the board and the CEO were not on the side of the common worker—they had no intention of sharing their payouts. I worked for four failed startups with some more steady work in between. In hindsight, I don't recommend it. It wasn't worth it. I made less money than my peers, and I put too much of myself into the products I helped build. In the end, only those with money made more money. The rest of us got shafted.
But the moral of the story is, if you have 25 years, you might also be able to do it. Times have changed, though. But there's still probably an intersection point. The opportunities are greater than they ever have been. Given today's wages, I could have probably reached my goals 10 years earlier.
The transition to retiring early wasn't without its pains. I hadn't fully envisioned a future, and when I finally met my goals, I realized time had changed. In the years that followed, I experienced significant anguish because the dreams I once had (becoming an artist, going into academia) were no longer realistic. I needed over two years just to recover from burnout. But now, I'm finally somewhat satisfied but still quite lost and with anxiety. But, I feel the best I've felt since my 20s, and things get better every day.
> it would help me pay off my $50,000 in college loans
If you have teenagers who want to go to university, consider encouraging them to learn German and then study in Germany. In 2021, the average monthly spendings of a student at a German public university were between 783 - 1.896 €, depending on the location.[1] (University fees are included in this number and range between 14 and 136 € per month. Sometimes there apply moderate additional fees for non-EU students, depending on their nationality.) Non-EU students are at least eledgible for working at the university as research assistants and thus, if they are clever, can earn an income to cover some of these costs.
German schools also ruthlessly cull students beginning in grade 4 or 5. Only a small number ever get the opportunity to go to university at all, let alone at those fees.
German universities are relatively cheap because they keep the eligibility pool small. That reduces the cost to the state.
> Only a small number ever get the opportunity to go to university at all
In 2022, 56.4% of people living in Germany of a yearly cohort started university (including universities of higher education/Fachhochschule). 51.7% of males, 61.5% of females. 473,665 people (this number includes some foreign students, though) out of a population of aprox. 84 million. All in all, 2,915,700 people studied in Germany. I would not call that number "small".
The student quotient for the US is somewhat higher, but German and foreign systems are often not well comparable, because there are a lot of advanced vocational training programs in Germany outside of university that are equivalent or even better than many university programs in other countries.
In my first week of work, I realized I needed to find a way out. I had a hunch that the path I was on would not end well. I found an online group of people with similar thoughts. They were into "simple living," inspired by a book called "Your Money or Your Life." After reading it, I created a spreadsheet and started plotting numbers. I calculated that by continuously reducing my expenses and saving everything beyond a minimal lifestyle, and investing it in index funds, I could reach a point where my investments matched my spending.
For the next 25 years, I kept reducing my spending and invested the surplus into the S&P 500. At the time, that was considered a very aggressive move, as a more conservative strategy was recommended. But, I decided to give it a try. I forwent a consumer lifestyle. I didn't travel much and spent most of my free time reading. When I eventually started a family, I devoted time to them. I had to put on blinders, though. The cars, houses, lavish vacations, fancy dining, clothes, gadgets—I ignored all that. I bought houses in the poorest neighborhoods and fixed them up. I drove the cheapest cars that were reliable. I adopted a simple wardrobe. I bought second hand. I figured out how to make nutritious, delicious meals from the least expensive ingredients. Often, I felt like I was missing out compared to my peers, especially as wages in the industry grew. But, I endured and stuck to the plan.
These days, this movement seems to have evolved into FI/RE. Although it's not quite the same, it probably has similar goals.
I saw a few people make huge payoffs from startups and IPOs, so I tried that too. But it was terrible for my mental health, and I quickly learned that the board and the CEO were not on the side of the common worker—they had no intention of sharing their payouts. I worked for four failed startups with some more steady work in between. In hindsight, I don't recommend it. It wasn't worth it. I made less money than my peers, and I put too much of myself into the products I helped build. In the end, only those with money made more money. The rest of us got shafted.
But the moral of the story is, if you have 25 years, you might also be able to do it. Times have changed, though. But there's still probably an intersection point. The opportunities are greater than they ever have been. Given today's wages, I could have probably reached my goals 10 years earlier.
The transition to retiring early wasn't without its pains. I hadn't fully envisioned a future, and when I finally met my goals, I realized time had changed. In the years that followed, I experienced significant anguish because the dreams I once had (becoming an artist, going into academia) were no longer realistic. I needed over two years just to recover from burnout. But now, I'm finally somewhat satisfied but still quite lost and with anxiety. But, I feel the best I've felt since my 20s, and things get better every day.