4 Tips To Get You To An Early Retirement From Someone Who Did It
I LOVE what I do for a living. But, there was a time that I HATED everything about my job, and all I could think about was how to retire ASAFP.
I dreamed of a day when I could retire and travel the world, not caring about coming back to a job that I felt I had sold my soul to. I wanted nothing more than to not have to worry about schedules, work drama, and customers.
Now, luckily I was able to get out of that hell hole job that I hated, and into a job that feels like a hobby (aka it doesn’t feel like work). But STILL, I dream of retirement.
At the rate I’m going now, I may reach retirement when I’m 98. I’m not really doing anything that will get me toward that end goal of traveling the world.
ICYMI, there is a movement that is sweeping the nation, and I want to be a part of it!
It is the FIRE movement, which stands for “Financial Independence/Retire Early,” and it sounds like a great movement to join!
LUCKILY, 38-year-old millionaire, Mia Pham, is part of this movement, and she has some “simple strategies” that will get us closer to retirement than we ever thought possible.
4 Tips That Will Allow You To Retire Early
Some of this stuff may seem hard, but my father always said, “Anything worth doing is going to seem hard at first.”
Some of the things you may have heard before, but that’s because they are 100% true.
Some of this you may want to pretend doesn’t work, but I promise you it does.
1) The first tip is to INVEST EARLY. I have heard this time and time again, but have I put it into practice? Nope.
I don’t even really know how to get started.
My husband, who is a confessed nerd, has said for YEARS that we need to invest in a Roth IRA, and this is something that Mia Pham agrees that you should totally do.
Just fill out the form and send it in.
Don’t wait until you are older. The earlier you sign up for your Roth IRA, the more time it has to earn interest!
You will find there is magic in the compound interest that your Roth IRA earns. (Think, FREE MONEY!!)
Invest, Invest, Invest, and then up your contributions. You will eventually be earning money just for having money in your Roth IRA.
2) Mia says she was all set to buy a house when she learned of the FIRE movement.
Then, she got to thinking about the possibility of retiring early, and that big house didn’t seem so important.
When we realized that stocks generally outperform real estate — except for this pandemic rate — we decided to buy a smaller house.
Mia Pham
She got a smaller house, and INVESTED THAT MONEY that she would have spent on a larger house.
What does she invest in?
Side Note: Now, I’m not going to pretend to know what all these are. That’s what financial counselors are for. LOL!!
She starts by maxing out both her Roth IRA and her — retirement account — Then, she’ll focus on putting money into a brokerage account. In all of these accounts, she primarily invests in index funds, although she does hold Berkshire Hathaway Class B shares and Apple stock.
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She also says you can automate your contributions. That means you automatically have the funds taken out of your account, and then you don’t have to worry from month to month about contributing — or simply forgetting about it, in my case.
3) I know you aren’t going to want to hear this. This is the one that is definitely no fun.
Mia suggests to live below your means. *Sad Face Emoji*
If there is one thing Americans excel at, it is living above our means. But, if you want to retire early, you HAVE to live below your means now.
They rarely eat out and opt for potlucks to satisfy any meal-based social cravings. They drive a 2005 Toyota RAV4 that they purchased in 2012 for about $8,000 in cash. They take advantage of free public resources like the library to entertain their kids, splurging on one yearly membership to attractions like the zoo or LegoLand, rotating which pass they have each year.
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It’s like Dave Ramsey (money guru) says, ““If you will live like no one else, later you can live like no one else.”
I’m not going to pretend I won’t miss the 2 beach vacations a year, yearly trips to Disney World, and eating out just about every day.
It’s going to suck for a little while now. BUT, in the long-term, just think of all the money you will save for retirement.
Take that money you were going to spend on that trip or that eating out, and invest it.
4) PLAN for your retirement.
Use tips and tricks to help you continue to save your money.
For example: If your pay increases next year, keep living like you didn’t get a raise. If you invest that extra money, your savings will only grow!
Odds are, you won’t even feel the extra money that is going into your savings accounts, because you are bringing home the same exact thing you are used to making.
Also, religiously check your accounts. The more you see them increasing, the more eager you will be to keep investing that money.
I have faith. You and I can both retire early. Maybe we can meet up when we get there, and have a “We Did It” party!
