Why I Want to Retire by 45 and How I Plan to Get There
My Ultimate Goal – I Want to Retire by 45
I want to retire by 45. There, I said it. That’s my goal.
I don’t know if I’ve ever stated that before on this blog. There’s always been a vague end point somewhere down the line. After all, this blog is about financial Independence, investing and saving money. Well, what am I saving for?
I’m saving so I can retire by 45.
I’ve recently started to think setting goals is important in actually achieving things. It helps you plan ahead and gets your mind thinking about those goals more in the present.
It’s a simple enough goal. I was lucky enough to get started down this path when I was younger as I was never one to spend a lot. I was always a frugal dude so even when I wasn’t earning much, I was still able to save because what else is there to do with my money? I had a degree in finance and found the stock market interesting so I saved it there instead of under my mattress.
I saved that money and by the time I was in my early 30s, I decided I wanted to get a bit more serious about it. A few years after that, after not really defining what getting serious about it was, I started this blog to keep track of what I was doing and set some annual goals for myself.
Well, now I’m setting the ultimate long term goal. I want to retire by 45.
It’s nice saying it and knowing that it can actually happen. I’ve been thinking about it a bit more lately. I think it’s a common thought when you’re around my age and start wondering if this is really it when it comes to life and your career.
I’m in my mid 30s now and been in the working world for ten years and the thought of doing this for another 30 years isn’t all that appealing to me. I know some people are driven and motivated by work but I’m just not. That’s not to say that I hate my job and my life is horrible because it’s not.
In fact, I’m pretty lucky in that my job is actually pretty decent and relatively safe even in this environment. It pays decently well for what’s expected of me. On top of that, my colleagues are actually pretty great and I consider some of them solid friends. That’s become increasingly clear in this environment when so many people are out of work and struggling. I’m glad to have what I have and am thankful every day for the position I am in right now.
I know that many others don’t have it anywhere as good as me and many even despite and hate their jobs. I do not but that doesn’t mean I don’t yearn for something different.
In fact, there’s a few things that have become clear to me in the past few years that have crystallized that decision. This has become even more apparent during these rough times our country is going through.
The Reasons I Want to Retire by 45
I Want to do Something Meaningful with my Life
Listen, my job is fine. However, at the end of the day, it’s a bullshit corporate job where I don’t do anything that brings personal meaning to me. I work in the insurance business so what can I really do to make things better? Honestly, often I feel like my job is a net negative to the world and that kind of sucks.
Sure, I make money for my company and the stock price goes up but I don’t really give a crap about that. I know the world seems to revolve around stock prices these days and I also know that I benefit from it since it’s one of the reasons that I might be able to retire by 45. However, that’s just a means to an end and not the most important thing in life.
These last few months have made that clear to me. The discrepancy around the stock market and the real world is concerning and many acting as if things aren’t sorta kinda bad because stocks are back to all time highs is a bit disillusioning.
From a work perspective, I do manage some people now and I do get enjoyment out of the fact that I can improve the lives and skills of the people that work with me. That’s a pretty cool feeling and it really makes me think that I could be doing more with that. After all, it’s great but it’s just a small portion of my role and all that other stuff I do is just so blah. It’s repetitive, annoying at times and stressful too. It’s just not my bag.
I know what you might think. Shut up and be glad for what you have. Totally, I am, you’re right, I’m first world problem crying here and I get it but even though my spot here is pretty damn good, it’s human nature to want to make things better for yourself.
Well, then, find a job that brings meaning to you today. Maybe that is the answer but I haven’t gone down that path yet. I do believe that most corporate jobs are the same and like I said, mine is actually pretty decent in that regard. However, I have started to think about a career change more often recently.
The one risk with that is that my job right now is a great mix of pay for the hours worked. That’s key in maintaining a pretty good quality of life until I hit that magical mark of dollars saved. It’d be a shame to risk that for something that might just suck. There’s plenty of jobs out there that are terrible and I’ve got a good thing going so even if it’s not personally fulfilling, it checks all the other boxes in allowing me to find fulfillment in other ways outside of work and helping me reach my savings goals.
Plus, it might be better to just earn more money here and find that meaning for the 8-9 hours I’m here when I’m ready to quit. After all, when I hit that magical mark of 45(or earlier), I don’t necessarily have to stop doing everything. I can volunteer or even work at a place without concern for pay.
Despite the things I like about the job, the job, and all jobs does have some downfalls and one became crystal clear this year.
I Want to Get Out of the Soulless Corporate Grind
This pandemic has made it clear that most companies DO NOT REALLY GIVE A CRAP ABOUT THEIR WORKFORCE.
I am lucky enough in that I can do my work at home. I’m just a excel jockey at the end of the day. I can stay safe in the comfort of my own home and do my job at 100% efficiency.’
That is true for many, many jobs.
However, and I’ve seen this with a lot of friends, there’s a lot of companies like that whose thought about that is, hey screw you, here’s some hand sanitizer, wear a mask, we’ll clean your desk more often and put some social distancing signs on the doors, so get your ass in the office right now cause you’re totally safe.
This is not uncommon.
Sure, there was a short period of time where everyone worked at home. I’m lucky again in that my team is allowed the flexibility of continuing to work at home when I need it. I can also go into the office(and have been in the office at times).
However, for those that don’t have that flexibility, this whole thing sucks.
What’s the point of coming into the office and risking our health if I could get everything done at home? It’s so freaking dumb. The best way to prevent this stuff from spreading is to minimize exposure and forcing people to come into the office when they don’t need to is not the way to do that.
Sure, maybe it’s a bit less efficient or whatever but hey, how about you give up a bit of efficiency for the sake of your employee’s health and mental health?
My wife’s company is doing the same thing as are a few of my friends. On the opposite side, there are some good companies that actually said, hey, let’s work at home until this whole thing blows over. I’m hoping those companies get rewarded in the future by siphoning all the talent away from those that didn’t.
And listen I get that there’s value in being in the office and having that option for employees who want it is great but forcing those that don’t have to go to work isn’t the right move in my mind.
That’s not to mention all the other things that suck about office life. There’s commutes, crappy bosses, crappy co-workers, being overworked, underpaid(lots of industries reducing pay during this while maintaining profits) and having gross people cut their nails in the cubicle next to you or burp all around the office. Not every job is like that and if you don’t have any of that to deal with(and I mostly don’t), you are lucky but many are and that sucks. If you do, then it’s enough to make you feel like this.
I may be a bit pessimistic here but I understand that not all companies are bad. In fact, I believe in capitalism and believe it does allow us the high qualify of life many(but not all) get in this country.
However, I’m also realistic in that there are problems with the system and that the end of goal of financial performance tends to leave certain people behind. I know that profit does matter and while my boss and my team may care about me very much(as I care and advocate for the people I manage), at the end of the day, when push comes to shove, I am just a number on a page and as pessimistic at it sounds, I know I can be let go just like that.
Large corporations do not have feelings. That’s the reality of life. I see it more clearly now as a manager when I try to get raises for my high performing employees. It’s damn hard to get anything out of these companies despite record earnings. They will pay you as little as possible if you don’t advocate for yourself or have a good manager who does. They will utilize you as long as you’re useful and dump you when you’re not.
I hope many understand that and that the idea of having loyalty to companies is coming to an end because most don’t have loyalty to you. It’s a transaction, not a relationship. I provide a service(my work) and they provided me with benefits and cash. It works but it’s not a friendship by any means and can be terminated at any time by both parties.
In the end, I just don’t like the idea of someone else having this power over me and I want to get out of it. That’s why I save money, that’s why I set goals and that’s why I want to quit.
After all, there are many people who don’t have the choice of working at home. People who HAVE to go into their place of work and you’d think companies that can would want to indirectly protect those people by limiting the exposure we all get.
I guess they just don’t care and want the 5% productivity boost.
Also, for those people that have to go to work, at least those companies gave them all big fat raises and hazard pay right? Oh, no? They put up thanks for being a hero signs and maybe gave them a free lunch a few times? Cool, cool, cool.
Many corporations and businesses kinda suck guys. I know their goal is profit and I get why they do it but that doesn’t make it any less lame to experience when negative things happen to you. I’m already in a spot where I could probably take a year or two break if I needed to without too much worry. However, most people aren’t and corporations totally take advantage of that in somewhat immoral ways. I don’t dig it and want to get out and potentially(through this blog and other volunteer things I do), help others get out too.
Even if you’re not aiming to retire early, saving money gives you flexibility and options and that’s huge when it comes to your career. You win when you have the power to make the right choice for yourself. Others win when you don’t. If you’re lucky enough in a spot where you’re earning a substantial amount of money, you should be taking advantage of that aspect of life.
My Time on Earth is Limited
People die. This year has had a slew of surprising deaths and every time one happens, it really makes me think about my future and how long I have left.
It’s a morbid thought but at the end of the day, it’s a very valid one. Our time on earth is limited and spending it in a cubicle isn’t my idea of a good life. That’s why I want to get out earlier than the standard timeline and do other things with my life.
Let me tell you something guys. Defining a life well-lived is different for every one of us. However, for me, I know that going into that office every morning isn’t a part of that definition.
That’s not to say that one should count every penny until they retire at 45 and THEN start living. That’s not what I’m saying here. It’s important to build the life you want to live WHILE you work and then improve it when you don’t have to work anymore. The reverse certainly applies here. You could save all your money for something and die well before it happens, that sucks too!
After all, my goal is to retire by 45. What if I don’t make it until then? What’s all this money saved for if I can’t use it to enjoy life after 45. That’s why I think it’s important to have a balanced approach to life when it comes to things like this.
This is not a blog about eating rice and beans so that I can retire with a $17,000/yr budget when I’m 34. It’s a blog about living the life you want now but also saving for a future that may come, a future that looks mighty appealing if I no longer have to work.
I do like my life now but I know I’ll like it even more when I don’t have to work anymore. That’s why I want to make the best out of my time here and the money I save and have the opportunity to do something else after my working years are over. For me, 20 years working seems like enough and I plan to utilize the rest of my time to do something different, whatever that might be.
After all, the odds of me living past 45 to enjoy my retirement years are pretty decent but those odds get worse as that age climbs up. I’d rather play the odds and retire by 45 than wait it out and work longer.
I’m Pretty Lazy
I just want to lounge around and not do anything for weeks at a time.
Is there anything wrong with that? Not having a job will allow me to do that. I can read, learn new recipes, write, work out, hike and even travel a bit without having to worry about coming back to work after the weekend or the short vacation is over. Maybe we’ll even move, perhaps I’ll garden and learn a new language. The possibilities are endless. I can really feel like this when I retire.
I can imagine that a two week long trip to Hawaii would feel much different when you don’t have to come back to a pile of work on your desk.
There’s a reason they call it the Sunday Scaries. I can’t wait to experience a Sunday where I don’t have to think about that Monday is coming next. After all, when I retire by 45, my Monday’s will just be another Sunday.
For some that sounds bad. I get it, some people love having schedules and jobs and things to do. I do not. Some people say they’d be so bored if they didn’t have to go to work. I don’t have nearly enough time in the day with work to do all the things I want to do.
I love the idea of being free to do what I want. I have hobbies, I have things to keep me busy. I will thrive in this environment.
I Want Freedom
In the end, it comes down to this.
Choice is very important to me and I started saving money because I wanted to have choices in my life. I never want to be dependent on my employer or the government or something that could hold a lot of power over me.
Not spending a lot and saving more gives you that freedom in the long run.
I’m ten years away from 45. I don’t know what 45 year old me will want when I get there but I want the freedom to choose. Perhaps, I’ll still do something that pays me, perhaps not but I’m certainly on a path to have that choice and to retire by 45.
It’s a good spot to be in and this whole year has made this goal crystal clear in my mind. I hope I can get there before 45 but I know I will get there and retire by 45. I’m thankful to past me for setting future me up with some nice choices. Best of all, I’m happy to live the life I have now so I haven’t really had to give up much to get here either.
How I’ll be Able to Retire by 45
This post is about why I want to do so but I’m sure some of you who haven’t read my blog are wondering how I’ll be able to do it.
If you want more information, read my blog or any of the other great blogs about early retirement and financial independence. In the end, it’s all about saving money and taking advantage of compound interest to grow wealth.
However, know that, in essence, while this is pretty simple, it is not always easy. Here are some key high level steps to get there.
- Live a simple life. Most things in life are free and you can enjoy so many things without spending a dollar if you know where to look.
- Controlling expenses is a huge part of it. If you earn $50,000 and spend $50,000, it won’t work. The expenses have to be much lower than the income for this to work as you need to save quite a bit to retire early, think near 50% of your income.
- This is a simple concept but one that’s hard to execute. It took me a few years to realize that there isn’t much value in just buying stuff. Now, I focus on buying less stress, more freedom and a different future via saving. This can be easy or hard depending on your personality. If you’re a natural spender, it might be a big change. If you’re a natural saver, it might not be a big deal.
- Cutting expenses is key but you also don’t want to live a life you hate. There’s a limit to how little you can spend a still be content. It’s important to adjust the income side of the equation too. The more you save, the faster you can build wealth. This does require some luck and some hard work. There’s no doubt about it.
- Grow your income. This is important but not always easy especially in this climate. Find the spot that’s right for you when it comes to expenses then grow your income by learning, providing value and valuing yourself fairly. Don’t be afraid to jump jobs to grow that income. If you don’t advocate for yourself, your company certainly won’t.
- This CAN be done on a reasonable salary. My salary has averaged ~70k in my ten year career in a higher cost of living area and I am well on pace to retire by 45. Whether you think 70k is reasonable is another question but you don’t need to be making big six figures to make this work. The more you make, the faster this will be and the less you make, the slower it will be. I’m still working on improving my income and make more than $70k at this point in my career but made a lot less at the start. You should never stop trying to grow your salary. It’s key in making this work.
- Once you figure out your expenses and have a good grasp on them, save the rest. Read a good beginner investing book and save as much as you can.
- The stock market will go up and down. Ignore it. Most investors do poorly because they buy and sell at the wrong time. Buy a diversified stock and bond portfolio today and plan to hold forever. If you’re well diversified, you should only have to sell when you need it for income upon retirement. Have an emergency fund so you don’t have to sell at the wrong time.
- If you enjoy investing and finance like I do, you can do something different, but for most people, a simple portfolio you can learn about in a good investing book will be enough. In fact, most people who try individual stock trading or other strategies will only end up poorer results due to emotions, taxes and poor decision making. It’s quite hard to be a good investor, it’s very easy(and profitable) to be average in investing.
That’s it. It’s simple, don’t over complicate it. There’s one key distinction in that simple is not easy. It does and can require sacrifice and hard work and passing up certain things others may have.
That’s the trade off. However, for me, the trade off isn’t that big of a deal because I don’t value those things. For you, it maybe be a bigger deal and you may want to work longer. I don’t know, I’m not writing your story or know your wants and desires. This is a personal journey for everyone to take.
Some enjoy work and want to work past 65, others may want to retire earlier than me but for me, 45 seems to be the sweet spot. I don’t hate work but I certainly don’t love it enough to want to do it forever. I want to do other things. I still do those things now as I want a fulfilling life while I work but saving will help me do those more often in the future and that’s the key goal.
In the end, I want to have a number in mind too. I think mine is for us to have about $2M invested before I call it quits. It was lower before I got married but two people changes the equation a bit(it also changes the income equation too which can help with savings). That could easily fund a $60,000/year lifestyle which is more than enough for me and my wife.
On top of that, my wife seems to enjoy her job and is one of those people who’ll likely want to keep working. However, once I quit, she might change her tune since I can see that she’s already getting a bit tired of that good ol’ corporate bullshit.
We’ve discussed this plan as a team and are saving for the assumption that both of us want to quit around the same time. She’s a bit younger than me but has already increased her retirement contributions as well. I will say that this actually becomes easier when you’re a team since splitting expenses makes saving more much easier.
In the end, things are still pretty good here. I don’t have a ton to complain about and this isn’t a complaint but a statement of my intentions. I’m lucky in that I found a job I don’t hate, found a path that suits me and started saving early. I’m on my way to retire by 45. I find that it’s very nice to lay down a path that you can follow into the future and that’s what this post is about. I’ve set goals before but now I’m setting the one that matters most.
What happens after? I don’t know. Right now, I’m helping some company get better earnings. I think I can figure out a better use for my time later when I retire by 45.
Refugee from Academia
Just a thought: you may not think you provide value to society, but actually you do. Insurance allows people to avoid the poverty that would result without it. Just think about life in Colonial times: no life insurance, no fire departments. A fire could wipe you out and you would be without home, clothes, or maybe the means to carry on. The breadwinner could die of cholera and everyone else could starve. Your work is noble, if humble.
It’s too late for me to retire by 45, but you can do it and I applaud you for having this goal!
That was a great and thoughful article! Some parts really resonated with me : The soulless coporate grind, not seeing yourself going there for 30 more years even though as such it is not that bad, the “we will give you mask and put signs everywhere, so come to the office,…” and indeed having a fulfilling occupation