How to Retire in Your 30s With $1 Million in the Bank

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How to Retire in Your 30s With $1 Million in the Bank


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Carl Jensen experienced what he calls “the awakening” sometime around 2012.

He was a software engineer in a suburb of Denver, writing code for a medical device. The job was high-pressure: He had to document every step for the Food and Drug Administration, and a coding error could lead to harm or death for patients.

Mr. Jensen was making about $110,000 a year and had benefits, but the stress hardly seemed worth it. He couldn’t unwind with his family after work; he spent days huddled over the toilet. He lost 10 pounds.

After one especially brutal workday, Mr. Jensen Googled “How do I retire early?” and his eyes were opened. He talked to his wife and came up with a plan: They saved a sizable portion of their income over the next five years and drastically reduced expenses, until their net worth was around $1.2 million.

On Tuesday, March 10, 2017, Mr. Jensen called his boss and gave notice after 15 years at the company. He wasn’t quitting, exactly. He had retired. He was 43.

Hacking Your Way to Retirement

Although Mr. Jensen’s story may seem exceptional, a more modest version of the stockbroker who makes a killing on Wall Street and sails off to the Caribbean, he is part of a growing movement of young professionals who are intently focused on quitting their jobs forever.

Millennials especially have embraced this so-called FIRE movement — the acronym stands for financial independence, retire early — seeing it as a way out of soul-sucking, time-stealing work and an economy fueled by consumerism.

Followers of FIRE tend to be male and work in the tech industry, left-brained engineer-types who geek out on calculating compound interest over 40 years, or the return on investment (R.O.I.) on low-fee index funds versus real estate rentals.

Indeed, much of the conversation around FIRE, on Reddit message boards or blogs like Mr. Money Mustache, revolves around hacking one’s finances: strategies for increasing your savings rate to the hallowed 70 percent, tips for cheap travel through airline rewards cards, ways to save nickels and dimes at the grocery store.

Some practice “lean FIRE” (extreme frugality), others “fat FIRE” (maintaining a more typical standard of living while saving and investing), and still others “barista FIRE” (working part-time at Starbucks after retiring, for the company’s health insurance). To be “firing” is to slash one’s expenses to maximize saving while amassing income-generating investments sufficient to support oneself. To have “fired” is to have achieved that goal.

“A lot of people think you’re a new-age hippie,” said Mr. Jensen, who sold his four-bedroom, four-bathroom house, downsized to a more modest home and maxed-out retirement accounts while firing. “They can’t even wrap their minds around it.”

In retirement, Mr. Jensen and his wife and two daughters plan to live on roughly $40,000 a year generated from investments. Because his wife currently works, they have yet to draw on those accounts. But already, it’s a life rich on time but short on luxuries: Groceries are bought at Costco, car and home repairs are done by him.

“People always assume there’s an external circumstance: ‘Oh, you must have received an inheritance,’” Mr. Jensen said. “We’ve just chosen to live far below our means. That itself is a radical idea.”

Equally radical is opting out of the work force in your 30s or early 40s, a time of life when men and women are normally leaning into their careers, or, less happily, enduring the daily grind to pay the bills until Social Security kicks in.

Jason Long, a pharmacist in rural Tennessee who retired last year at the ripe old age of 38, said his father had a hard time understanding why Mr. Long couldn’t continue to work and collect his $150,000 salary.

But Mr. Long said he was deeply unhappy in his job, where over his career he witnessed drug costs skyrocketing, sick people battling with health insurers and the over-prescription of opioids and the resulting addiction crisis. His customers, angry, confused, financially stretched, often lashed out at the person behind the counter.

“There were days when I had 12- or 14-hour shifts where I didn’t use the restroom, where I didn’t eat, because so much work was piled up on me,” Mr. Long said.

Like Mr. Jensen, he had been saving a sizable portion of his income over the past decade, and he and his wife had a paid-for house and an investment portfolio worth a little more than $1 million. Why stick around?

“The reality is the numbers are there for me,” Mr. Long said. “To go to a job that’s making you miserable every day, it doesn’t make sense to pad the bank account at that point.”

Why These Millennials Hate Work

Quitting the rat race isn’t a new concept. From the Shakers of the 1700s to the back-to-the-land hippies of the 1960s and ’70s, a strain of Americans has always embraced simple living. One of the bibles of the FIRE movement, “Your Money or Your Life,” which teaches readers to reduce their spending and value time (or “life energy”) over material gain, was published in 1992.

But if, as Ms. Robin said, FIRE adherents “don’t have the aspirational part” of earlier generations, why are they so determined to quit the work force? Many millennials haven’t been working longer than a decade, if that.

It’s about having agency, Ms. Robin said: “The worker in this economy has very little sense of control over their existence. People are expendable. You’re a young person and you look ahead and you say, ‘What’s there for me?’”

The idea, Mr. Adeney said, is “to reap the high salary” of a place like Silicon Valley, “then take that nest egg out to any of the thousands of nice, affordable cities and towns we have in this country and begin a second stage of life on your own terms.”

“The whole retire early thing is unimportant to me. It’s more about gaining control of your time,” Mr. Rieckens said. “If you dive into the definition of retirement, what you’re retiring from is mandatory labor. It’s not necessarily about piña coladas on the beach.”

When You Retire Before Your Parents

A retirement that starts well before you go gray and lasts 40, 50 even 60 years is an anomaly in modern life. How do you fill all those days, months, decades?

On a recent weekday afternoon, Mr. Jensen was taking his two daughters, ages 8 and 11, to the Boulder County Fair. “I told them, ‘O.K., we’re going to wait until Thursday for half-price day,’” he said. “And by the way, we’re walking there. It’s two miles from our house.”

Fearing boredom, Mr. Jensen at first took on way too much, and he found it strange to be at the local rec center exercising alongside senior citizens, or shopping at empty big-box stores on a Tuesday. He also beat his own mother to retirement, which made for awkward family get-togethers.

But one year in, he has settled into his life of leisure, enjoying time spent raising his daughters, making sure they never see him vegging in front of the TV. Mr. Jensen also practices an activity that for many FIRE achievers seems to be the new golf: writing a financial advice blog.

Other FIRE retirees turned bloggers include Early Retirement Dude; the husband and wife behind Our Next Life; the Frugalwoods, a young married couple with children, who wrote a book about their transformation from suburban Boston high earners to retired Vermont homesteaders; and Ms. Shen and Mr. Leung, who when not traveling the world are calling for a Millennial Revolution (“Stop working, start living”).

It’s hardly surprising that a tech-savvy generation would proselytize on the internet. Also, blogging can provide the holy grail of early retirement, an additional income stream.

Perhaps Mr. Long, the pharmacist in rural Tennessee, has given the most detailed, thoughtful account of someone who has fired. In a series of posts to Reddit’s financial independence message board, Mr. Long chronicled with dry wit and self-effacement his first year in retirement.

One month into FIRE, he wrote of the guilt he felt spending money (on video games), and his concern that he would be over his household budget. He spent his days with family, at the gym, doing housework, exercising. He had no regrets so far: “I made the right decision. This is life.”

In the second month, Mr. Long reported a 2.8 percent increase to his portfolio over the first two months, even after living expenses, and listed his accomplishments as more reading, more cooking, volunteering and “faster Rubik’s cube solves.” Stress levels were way down, he wrote: “A friend of mine said the sense of dread from my face was gone.”

In the months that followed, he rewatched the mini-series “Roots,” lost all interest in talk of FIRE now that he had achieved it, feared a looming stock market crash, had nightmares that “I’m back at work and arguing with morons,” finished a marathon in a personal best sub-three hours, felt moments of social isolation, took a two-week road trip across the heartland, and went twice to the beach in Florida with his wife and watched their net reach its highest point, despite not working, which he attributed to “the passage of the tax cut for wealthy job creators like myself.”



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