Most people go through their entire life following the plan. You know the plan: grade school, college, marriage, mortgage, long hours, occasional vacations, retirement, death. The large majority of those hours are spent building your career and saving for retirement. Here’s the average day:
- 8 hours sleeping
- 9 hours working
- 1 hour commuting
- 1 hour eating
The rest of the time is spent keeping up with chores and watching TV because any other form of entertainment is too exhausting after the laborious day of working. This has been me, except replacing the TV watching with building an internet business.
Earlier this month I realized that this path was no longer for me, my passion for working as an engineer was gone, and my desire to spend more time with my kids while I’m still healthy and they are young has finally outweighed my Calvinistic need to work hard. Fortunately for me, I’ve always lived frugally and saved money aggressively which has put me in a position to retire extremely early, probably at the age of 35 (I’m currently 33).
I have not made this decision lightly. It’s been a month of very deep thinking, first solidifying my personal life philosophy followed by formulating an economic strategy, and finally coming up with my first draft plan for exiting the life I currently live. I’ll be using this blog to continue to modify my strategy and share my successes and failures going forward, just in case anyone has similar desires as i do.
Here’s my master plan:
First I’ll be getting a new job in a new town that will pay similar but likely less salary, but will pay my moving fees and closing costs on selling my house (roughly a $30K value). This will allow us to dump our $400K money sink of a house for something significantly smaller, which we will pay outright. My first on-site interview in Colorado is next week and looks promising. I’ll work there for 2 years, and quit in February of 2013, before my 36th birthday.
I’ll be spending the next 2 years driving down our costs to $36K per year for my family of 4, which shouldn’t be too difficult considering there will be no house payment (only taxes and insurance). I’m getting rid of my car (I still have a motorcycle), and will have my bike.
I have ~$900K in assets, and hopefully more depending on what I get when I sell my house. After 2 more years of work and what I hope is a reasonable return on my investments, I hope to be around $1M to $1.1M by the time I retire in 2013. By my calculations, I should be able to spend 4% of my savings each year and see that number rise or remain flat over the long haul, though I may target 3% to be sure. This would give me $30K-$33K, just short of my target budget. Fortunately my wife and I also have a small online business that rakes in about $10K/year that we mostly do for fun, so that gets us over the top.
So why am I doing this?
I have a number of reasons. Some of them are very good ones, some not as much. 😉
- I want to spend more time with my family. Technically I could slack at work, do far fewer hours, get paid big bucks like I do now, and it would take years for them to do anything about it (i.e. fire me). But I can’t make myself do it. I don’t know if its pride or my competitive nature, but I haven’t been able to do less hours despite trying.
- I want to learn and do more. Currently I have one skill, engineering. There are plenty of micro-skills within the field that have allowed me to do very well (in my career), but at the end of the day I have one thing that people want to pay me for. I can’t fix a car, I can’t boil an egg, and I can’t keep my pool clean (which, of course, I wish I didn’t own). I just pay people to do these things, but I’d prefer to know how to do it myself.
- I want to live healthier. To most people I seem very healthy, up until 2 years ago I was running ultra-marathons several times a year. I go to the gym a few times a week, and I’m not overweight. But my eating and drinking habits are atrocious, both in quality and quantity.