I just found this blog: http://earlyretirementextreme.com/. The title certainly is NO exaggeration! The author, Jacob, is a 30something PH.D. who lives in the Bay Area. According to his blog, he has consistently saved 70% of his net salary for several years, and have managed to have an extreme early retirement in his 30s.
Wow. Can I just say, WOW. I can’t fathom how he did it. I think somewhere on his blog he talks about fairly advanced investing techniques that has produced a nice return. Of course, he also sacrificed to save like crazy.
That path isn’t for everyone. Many people can’t imagine leaving the workforce forever in their 30s. Perhaps in my 50s – if I have accumulated a VERY significant nest egg – I’d consider doing non-profit or part-time work – of course then there’s health insurance to consider…
Even though I don’t plan on leaving the workforce anytime soon, Jacob’s blog inspired me. I am more and more drawn to the idea of living simply – of being content for what I have – of not consuming thoughtlessly (my 6-month clothing hiatus was a step in that direction).
Anyhow, back to Jacob – I really admire him for what he did, but that path isn’t for me. I find it challenging – but possible – to save a third of my gross salary at this point in my life, and so I make my choices accordingly. I am hopeful that with raises and bonuses in the coming years I will be able to save even more, percentage-wise and in absolute terms.
Those who really are gunning for an extreme early retirement, check out Jacob’s blog.
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Hey thanks for the introduction.
70% of net. My effective tax rate is about 11% so it would be slightly over 80% of gross.
I’m not retired. Just financially independent. At my age I can’t really imagine not doing anything productive at all.
Here’s a link to the whole story
http://earlyretirementextreme.com/2007/12/how-i-became-financially-independent-in-5-years-part-i.html
The investment methods albeit advanced did not produce superior returns. They just reduced risk.
I read jacob’s blog too. I like it because it is completely different than the rest of the pf blogs out there. i mean, he wrote a post on why NOT to buy index funds, which I found quite unique!
It isn’t quite for me either (saving 70%-80%…. I’m having trouble with 25%! But yeah, it’s good stuff
Having the discipline to sock that much away into savings is incredibly impressive. I don’t think I’d want to live off lentil soup and tuna salad and go without TV, but kudos to him for sacrificing so much for financial independence.
It is interesting, until I read that I was perfectly happy to work until 50-60, just because “that’s how things are done”, but he’s got me thinking. I think I’m the type of person who will always be doing some type of work, but it would be nice to to need to.
I was sick for a few days a while back and got bored stiff lying around the house and doing nothing for four days. I can’t imagine not working and don’t look forward to retiring. What I would look forward to is having enough saved where I could make decisions about what kind of work I do solely on the basis of what I would enjoy and what would be the most beneficial to others and not on how much it pays.