23 Ways to Retire in Your Thirties

Have you ever been on your morning commute, behind the wheel of your fancy new beamer that is barely creeping along the freeway toward a destination that you’d rather not, yet you do every single morning, drinking the same venti vanilla latte as you do every weekday, and thought to yourself, “When does it end? Is this how life is supposed to be, day after day after day?” It’s as exhausting as my opening sentence is long, but I am guessing yes. I’ve done it. Almost everyone I know does or has done just that. Well, I decided to do something about it. I quit. But this isn’t about quitting your job and finding an enriched path to nirvana, no, this is about how to retire in your thirties.

I know there are countless articles about this. Save all you can, create passive income streams, generate wealth…BLAH…BLAH…after BLAH. That’s all great, but how? If you are the definition of my opening sentence, then you are sabotaging yourself before we get started. Can you point out the two mistakes that our poor soul in his beamer has made? And all we know about him (or her) is that he is simply on his way to work.

Let’s dive in with our 23 ways, shall we?

1. Make this your goal. Well duh? That’s why I’m reading this you dimwit. I know, I know. But you have to say it! Or better yet, write it down. Keep a journal and make this your number one entry. Now, everything you do will support this goal, and if it doesn’t, then don’t do it. You go to school from 0-18 years old, you live to be 80, you work until you are 65. That leaves you 15 years to enjoy life (provided that you are healthy enough at that age). That’s no fun. So, make this your goal. RETIRE EARLY. Write it down. NOW! Then we can proceed. Okay, ready? Good.

2. Invest. How much? Ten, twenty, or thirty percent of my income? The answer is Yes and No to all those. Invest as much as possible. Percentages are silly when it comes to this. No one lives off percentages, they live off dollars. Have you ever gone to the grocery store and they charge you a percentage of what you make? No, they charge you $4.99. Same here. Invest as much as you can, but invest something! Don’t think you make enough to invest, think again. Use an app called Stash. You can invest as little as $5. (In fact, if you use our link, you’ll get $5 FREE, just for signing up. Why not do it? It’s free money!) It all helps. Investing is better than saving. And you don’t have to just invest in the stock market. Invest in businesses, real estate, anything you see fit. The idea is to make your money make you more money. The so called “emergency fund” that experts say you need in cash (6 months of living expenses), is false. Cash does nothing but sit there and beg to be spent. You can just as easily withdraw from investment accounts if things go bad…but they won’t, because you are great! And YOU are going to retire in your thirties!

3. If you live at home, pretend that you don’t. “At home,” in this case, means with your parents. This is becoming (or has become) the norm for most in their early twenties. Rent isn’t free though, and even though your parents don’t charge you, pretend that they do. Sock that $600 per month away. Where? Well, this is the money that you can invest. Again, I give you Stash. Or anything! Just don’t go the bar and blow it. Pretend you are paying rent, and even utilities. It’s good practice for the real world, and will give you a huge head-start. Let us pretend that this is you. You got your first “real” job and you are going to stay at home for one year. You put $600 per month into your investment account (Stash, Etrade, whatever). At the end of the year that’s $7200 if you made $0. Chances are you’ll make between 6%-8%. That’s over $7500 saved! Great job!

4. Buy a duplex. Say what? I wish I would’ve done this, seriously. Time to move out of mom and dad’s basement and into your own place. Do not rent. Let me say that again, do not rent. Why? Well, why be the tenant when you can be the landlord? Buy a duplex. Live in one side and rent out the other. Chances are, your tenant will be paying enough to cover your mortgage. And if not, it’ll be really close. When you can live for free, as you saw by living at home, you can save and invest bundles more! Also, you just accomplished Way #22. You’ll see later. Just do it, buy a duplex. You won’t live there forever, probably less than a year or so. And then what? You are going to rent out the half that you lived in, and get yourself something else, like another duplex, a better one, lather-rinse-repeat.

5. Live modestly. I know people, family members even, that are allergic to money. They have to get rid of it like it’s a bad case of poison ivy. Get off me cash, get out of my wallet and into someone else’s, I do not want you! This isn’t you. And if it is, fix it. All that money you are saving by not having to pay for a dwelling must go somewhere. Let’s make sure it stays with you, and not in the pockets of Coach, Robert Graham, or BMW. That’s right. Our poor soul in our opening drives a beamer. Why, to impress people he doesn’t even know or like? No need for that. Let’s live a little modestly and invest the difference. Notice how I am phasing out the word “save” and converting it to “invest.” Saving makes $0, investing makes something. You are thinking that investing can also lose…we will revisit that in a few and you’ll see that it doesn’t lose, trust me.

6. Avoid subscriptions. This is the biggest money sucker of Americans. You get your paycheck via direct deposit, and it goes away via direct withdraw. To the gym, cable, magazines, massage memberships, discount clothes boxes, etcetera, etcetera, ETCETERA! STOP! If you want a magazine, go buy one. Want a massage, go pay for ONE. Need some clothes, go to the store and buy them. Eventually you’ll not need that subscription, but you won’t cancel it. And if you do, you won’t do it right away. That’s how these places make money. Don’t fall for it, please.

7. Avoid a car note. After rent/mortgage, a car is the biggest expense for nearly everyone. Since you don’t pay rent and someone else pays for most or all your mortgage, this will now be your biggest expense. I am not saying don’t have a car. Most people in America need a car. America was designed with the automobile being the main mode of transportation. However, you do not the most expensive model that you can afford. I get it, you don’t want a 12-year old cash car that is falling apart. Fine! Perfectly fine! Just don’t spend $35,000 when you can spend $15,000. A car is a car. It’s a mode of transport, don’t make it a status symbol. Make drinking coffee with your wife at 10am overlooking a lake or mountain vista when you are 35 years old your status symbol, not some conglomeration of metal and plastic. Also, pay it off right away. Try to pay cash for it, interest is a money sucker. But what if my interest rate is less than my return if I were to invest? FINALLY! If you asked that, then good! You really do want to retire early and listen to a little of my advice. The answer: it doesn’t matter. Pay it off!

Remember when you were thinking, “but I can also lose if I invest?” Yes you can, in the short term, and your car note is short term, so pay it off, NOW! The stock market has never had a losing 10-year period…ever. Even from 1929-1939. Short term you can lose, long term…well your risk of ruin is nearly zero!

8. Don’t smoke. Forget the health benefits by not smoking, this is a finance article. $7 per pack, 1.25 packs per day, 30 days a month, $262.50 per month. The price is always increasing and always will, plus it’s addictive (obviously). The price of tobacco has risen over 300 percent in the last twenty years. Let’s reduce that to only 10% per year and pretend you want to retire in 15 years from right now. If you smoke, you will want to sit down for this. You are now spending $262.50 per month which is $3,150 per year. We are increasing the price at 10% per year for the next 15 years.

First year $3150. Second year $3465. Third year $3811. Fourth year $4192. Fifth year $4611. Sixth year $5073. Seventh year $5580. Eighth year $6138. Ninth year $6752. Tenth year $7427. Eleventh year $8170. Twelfth year $8987. Thirteenth year $9886. Fourteenth year $10874. Fifteen year $11962. The grand total that you just spent on smoking for 15 years is: $100,078…UGH! I’ll just leave this right here.

9. Limit your alcohol. While not nearly as bad as smoking, alcohol can drain your wallet. Have a beer or a glass of wine at dinner, it’s fine, really! I am not asking you to stop living, but do you need 5 beers at dinner? A whole bottle of wine? Probably not. Remember, your goal is to retire early, so tell yourself that when you spend. You’ll see why in Way #11.

10. Don’t go to Starbucks…ever. Okay, this my last “don’t!” I wanted to have zero negatives in this post, but you need some coaching and we must plug some leaks to get you to playing afternoon golf during the week instead of being stuck behind two fivesomes on the weekend. Want a 3-hour round? Then drink the free coffee at work or the 18-cent per cup at home, sleep the extra 15 minutes it takes to sit in the drive through with the other poor souls, and…you guessed it, invest the difference! It makes no sense to cut costs if you just spend it elsewhere. Make this $6 per day make you 60 cents per day…doesn’t seem like much, I promise it is. Compounding my friend, you saw it in the cigarette chart, make it work for you instead of big tobacco. Sorry, Starbucks, not sorry.

11. Write it down. Write what down? EVERYTHING. That journal you made at the beginning, you know, the one that says, “I want to retire early,” underneath the heading write down every dollar you spend. You’ll get tired of writing, so you’ll spend less. When you have to write it down it’s a disappointment, I promise, and you don’t want to disappoint yourself. This is also the number one way to lose weight, write down what you eat. You’ll soon stop having candy bars and soft drinks, because well, “Tuesday at 1pm I had a Snickers and a Coke” just screams epic fail. Write it down! It helps, I promise. And smokers, you’ll soon get tired of scribbling, “one pack of Menthol for $6.89,” it could save your life, really.

12. Live below your means. Basically a summary of a few points that we have visited, but let’s include it anyway. Just because you can afford a $300 jacket, doesn’t mean you need one. The $100 one looks just as good and keeps you just as warm, it does. This is hard. For me, this was the hardest. I spent way more when I made more, and obviously spent less when I made less, everyone does. In case you are wondering, I make WAY less now, so I spend less. Find a number. Most people make between $3000-$5000 per month. If you are comfortable on $3500 a month, then when you get a raise invest the raise. When you get promoted, invest the extra. Remember, invest is not save. So, buy another duplex, rent it out, don’t just stack the cash in a box (I’ve done that, learn from my mistakes please).

Alright, we are halfway done. You’re investing instead of saving, you have quit smoking and drive a sensible, but stylish car that’s 100% yours. You pay little or nothing for a place to live, you are on your way to freedom. Don’t stop now, the best is yet to come. Let’s continue, shall we?

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