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Extreme Early Retirement?


When somebody says they are about ready to retire, what do you picture? Probably somebody with gray hair, their fair share of wrinkles, and a 40+ year work history. We all naturally think of a retiree as somebody that has worked for a very long time and probably has a few hundred thousand dollars in the bank for their retirement years. This is, in fact, the typical retirement, so it makes sense that we would all have this mental image when we think about retirement. But, if you have read my posts recently, you should understand that retirement has nothing to do with age. It actually has very little to do with your years on this earth, but it has everything to do with your finances and your mental readiness to leave your job.

Extreme Early Retirement

20111117 - transition into retirementIf you would Google, “Early Retirement”, you might find stories about how people retired at age 55 or 57. Sure, they retired before the age of 65, but is this really all that early? I mean, you’re still working a job for more than 35 years, and at that age you really aren’t agile enough to do all the fun things that you might have done in your early 30’s (you know, like hike up a mountain or something). No, I would much rather dig into extreme early retirement and look at living life a little differently.

As I have been paying down my mortgage and have thought about the next steps of my financial plan, I have really had to take a step back and ask myself, “What’s next?” Sure, I have thought about investing in rental properties (and I still do plan on this), but with additional income coming in from rental properties should I start to consider doing something other than my regular full time job? Would I better enjoy something else? This is when I stumbled upon extreme early retirement.

Apparently, there is a little cluster of people in this world that have retired in their early 30’s and have never looked back. People like J.D. Roth, Jim Collins, Mr. Money Mustache, and the Mad Fientist (he’s very close anyway) have all looked at life a little differently. They have decided to live frugally, save intensely, and have left their careers very early in life  so that they could blaze a trail of their own. Some still earn money by writing, others invest in real estate, and still other just live off the money that they have saved up for the last 7-8 years. By living the way that they do they can still have some fun and more importantly, they can flat out choose to do whatever they want! Does this sound intriguing to you? I know it does to me, especially since I am moving closer toward complete debt freedom.

What Does It Take To Leave Your Job?

My coworker recently asked me why I live so frugally. Why do I think it is so important to pay off my debts? Basically, he wanted to know “What’s the point?” Since everyone else lives in the moment from day to day, my mindset around the office is quite strange. Some think I just want to hoard my money and sit on the huge balance all my life. Others actually think that I am not financially savvy because I am paying off my low interest rate mortgage. Very few actually understand what I am trying to do (ha, and even at times, I might have to put myself in this category as well!).

My initial response to my friend’s question was simple: “Options. I am paying down debt, saving up money, and investing to give myself options to do whatever it is that I want to do.” Perhaps in 10 years I won’t be all that interested in corporate finance and might want to try something else. At times I think I might like to try my hand at writing, and maybe even speaking to help others with their personal finances. If I have no debts, have $5,000 a month in real estate income, and a savings account with $20,000, it would be pretty safe to try something new wouldn’t it? This is what extreme early retirement is all about. It certainly isn’t about doing nothing. Rather, it’s about doing what you love without having to worry about the money.

How does extreme early retirement sound to you? Do you think you’ll ever try to retire early?



My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. Watch it buddy! As you get older you will find 55-57 is not OLD… not by today’s terms! 🙂

    reality is you are an unusual case. not to say that’s a bad thing, but its reality…

    • Hi Nancy! Ha, I never said 55-57 was old, I just wouldn’t label that as retiring all that early. I mean, can you still do the same things that you used to do when you were 30? Would you like to have quit work early in life and done what you wanted? This is merely the point I am trying to make (and considering myself). I understand that I am a special case, but I just wanted everyone to know just how possible it is! For many (that are in their 20’s currently), this can be a reality!

  2. Derek, you’re on to something big and remember the 80/20 it always applies. Only 20% of people understand what you are trying to accomplish, the rest, well they will keep on doing what they do best. Work-pay bills- and live. I really think many don’t gave the vision or their ego, arrogance, or simply being different is uncomfortable. Congrats & more power to you.

    • Thanks for the comment David. You are right though, not everyone is going to relate to my thoughts. Some might enjoy working in their jobs and don’t necessarily want to make a drastic change. For me, I enjoy writing about personal finance and I think I will enjoy fixing up houses and land-lording as well. Between these two areas I can earn enough income (through some earned, but mostly passive) to live in whatever way I wish. 🙂

  3. Derek,

    I am 52. I personally cannot sustain energy like I use to. Too, recovery is longer. But, that doesn’t mean you
    can’t do the things you want to do. You can, you just need to rest more often and, eat energizing food. Not junk.

    My husband 54, loves climbing mountains. 🙂 His recovery time is longer too but, he does whatever he wants at
    his age.

    We knew a man twenty years our senior that could run us into the ground. He was the energizer bunny. He
    has since passed. But, he lived life to the fullest right up until the end.

    You 50’s will be great if you take care of yourself. Too, you can be just as flexible if you incorporate yoga into
    your exercise. 🙂

    • Thank you for the comment Joy. I apologize if my post was insensitive. I did not mean to speak against people in their 50s. If you had the chance though, would you go back and spend money differently? Do you think I’m on to something with this early “retirement”?

  4. I do think early retirement is awesome. 🙂 We had never had a thought of early retirement. We didn’t even understand that it was a possibility. It wasn’t until reading MMM and, ERE that I said, WHAT? Live off passive income? That was 2.5 years ago. Thankfully, we were saving and, had/ have no debts. So, in 2.5 years we will be retired. My husband says one year.
    We’ll see. Yes, one year could do it if all goes well. Yet, there are no guarantees with the stock market. We don’t want to be landlords. I want to have a few years living expenses in the bank so we won’t need to touch our money in lean years.

    • I was first introduced with the idea of retiring young when I got involved in a network marketing business. I didn’t make millions as I had previously anticipated, but I gained a ton of knowledge that lead me to the belief that it is most certainly possible to retire early through many other avenues as well. And then the search began… 😉

  5. Derek, if you will, take a quick look at this blog ””

    Today’s post is great because the author introduces her friend Mr. J. The author is 71. She hasn’t had any work
    done. She loves style and, her pictures are fab. Her husband passed away from cancer in April 2011. Today’s post gives thought to how life and, love and, health continues into old age. 🙂

    In nursing school one of the assignments we were given, was to go out into the community and find the elderly that are living well. Statistically at that time we were told only 25% of the elderly were sickly/disabled, the others were living well. My assignment led me to a retired 89 year old man who looked 58 or 60. He said he had never been sick a day in his life. When I asked him for advice for living well into old age he said, “Stay away from doctors.” He cleaned businesses after hours to bring in extra income and, stay fit. 🙂 He was a very good looking lean man at 89.

    • I did take a look at the blog. Thanks for the recommendation. Once I refocused my eyes (from the initial distraction of her wardrobe), I was then able to read her latest post and take away some great nuggets about life and love. I totally agree with her perspective on life, so why not ditch this job of mine and focus on the important stuff? 😉 Thanks again for the comment.

  6. Derek,
    I LOVE your enthusiasm! You go – and quit apologizing to “old ladies” – ha! like me and Nancy VT – we’ve been around long enough to not be offended by youngins’ enthusiastic comments. I suspect that Nancy VT was just messing with you. But, she is absolutely right. Don’t go thinking you’re going to be “old” when you’re in your 50’s. My parents didn’t even start snow skiing until they were in their mid-50’s.

    All of this depends upon weather or not you’ll have kids. Once you do, YOUR life goes on the back burner and you put everything into raising, protecting them. You can’t have a life of doing whatever your dreams are AND raise kids at the same time. One cancels out the other. Been there, done that and I’d do it ALL over again for the privilege of having a little angle, babe (or 2 or 3 or more) to raise, love and guide.

    You go – realize your dreams. You’re sooooooooooooo close. Yay for you! Hubby loves your posts. I’m beginning to see why. Best of luck.

    • Very nice to meet you Mrs. Jim! I laughed out loud at your comment and appreciate your humor. As for the kids, my girlfriend and I have spoke (philosophically) about this and we love the way that Mr. Money Mustache has gone about his financial freedom. It wasn’t just so that he could do whatever he wanted. It was more so that his kids could actually grow up knowing their parents (and not the daycare managers). We feel the same way and would love to have the option of being around the house whenever we chose to be. I hope to hear from you in the future Mrs. Jim! 🙂

  7. One thing I’d add is the international perspective, which can include a desire to follow a nomadic lifestyle.

    This is on the heels of Timothy Ferriss’s book “4-hour work week”.

    He dropped out of college and setup an online vitamin supply business where everything was done by other people, e.g. order fulfillment, and this was all factored into his pricing.

    That meant he could “operate” the business from anywhere in the world, as his single task was maintaining the website.

    In the book he talks about finding a country where your money will go further, e.g. in Argentina you get good weather, and a steak dinner with wine costs US$8.

    In the Philippines, you can get your motorbike fixed for US$15.

    Indeed this has spawned an entire industry of people selling information on such destinations as Ecuador (which has the US$ as their currency), Panama and Belize.

    Their target audience seems to be US nationals who have some money, but not enough to live on and pay health care costs in their own country.

    Here’s the blurb from such a book, just to give you a flavour of the next step people in your situation often consider:

    “The premise is simple: Enjoy a happier, healthier, more fulfilling retirement than you could possibly afford in the U.S. or Canada by finding the right overseas retirement haven. The book reveals those affordable havens and the strategies for successfully making the move that could save your retirement. Aimed at retirees and near-retirees in the U.S. and Canada, this book’s strategies apply just as well to younger people and people with families who are looking for ways to improve their quality of life while at the same time lowering their cost of living. It includes solutions for the challenges of continuing to work and earn money abroad, too.”

    When such information is advertised on broader websites like Yahoo (where Susan Peddicord’s recommendations were featured) many of the comments were hostile, saying things like the humidity in Panama was unbearable and you had to have bars on your windows, and questioning the political regimes in some of these countries.

    Nevertheless, if health care costs at home are astronomical and can be affordable elsewhere, then it does seem sensible to look where your money goes further.

    However, it is not without its risks, especially the exchange rate risk. I am aware of Brits in Thailand who saw the Thai currency appreciate significantly so that their UK Pounds-denominated pension bought half what it had bought when they arrived.

    And even just hopping over The Channel to France put British pensioners in the Euro-zone and some are now complaining that they can’t afford to heat their homes in France in the winter, as the exchange rate of the Euro has gone against them.

    So my point about taking an international perspective is aimed at 2 types of people:

    (1) super-early retirees (around 30 years of age) who want to travel and deliberately choose to have an internet-based business so they can operate from anywhere in the world with an internet connection, who may enjoy Ferriss’s book and who may like to do a Google search on

    “nomadic lifestyle blog”; and

    (2) retirees who fear they don’t have enough money to retire in America.

    Some information providers (like Gary A Scott .com) have an incredibly broad offering, from Shamanic healing, to super healthy foods, to taxation worries, to beach-side condos, to intensive Spanish teaching in Florida, to multi-currency investments with a Danish bank, to a lovely little hotel out in the countryside in Ecuador.

    So I applaud your targets of a real estate business giving you monthly income, becoming debt-free and having 20k in the bank, and I hope this comment has illustrated what others have looked into, and made businesses from, when asking about afterwards:

    “I’ve hit my 3 immediate targets – what next?”

    Indeed I have never seen a blog post making the opposite case, which might say:

    “How to cope with living costs and health care bills when you refuse to go abroad to live”.

    Maybe it is truly impossible to live in the USA for 12 years with $5k a month income and 20k in the bank. I have no idea.

    Whoops! I’ve just thought – maybe you don’t want to face such considerations at the moment. Maybe this is looking too far ahead. Oh dear – I hope I haven’t spoken “out of turn”. My apologies if I have.

    (I say 12 years on the assumption that the person retires at 65 and lives to 77 – presumably the timeframe will be significantly longer for super-early retirees).

    • Hi Lagoonboy. Yes, I have read Tim Ferris’s book, but traveling to remote areas of the world isn’t for everyone. I once moved to Florida for 3 years, missed my family, and decided to move home. I can’t imagine living somewhere where I knew no one and was in constant fear of being kidnapped for my wealth (because I would obviously be out of place in an area like Ecuador). We shall see when the time comes though. There will definitely be areas that I wish to explore, and perhaps these areas will lead me to others, which will then lead me to these inexpensive lands. But, for now I will work to retire locally. If I enjoy a different area that is cheaper, then that will just be a bonus.

  8. You don’t have to move to a foreign country to afford a modest retirement. Many states in the USA are inexpensive.

    In AR, where I live homes are inexpensive compared to the national average. Too, property taxes are inexpensive. My home is 28 yrs old, updated, 1.5 acres, 2000 sq ft, a pond, for 150’s. Property taxes are around 875.00 annually. We live 10 miles from town. Now, if you want all the major retail shopping, you have to travel 40 miles. But, that isn’t something I choose to do very often. We have plenty of grocery stores, 2 very nice health food stores, restaurants, and a nice hospital.

    Living so close to the Ozark Mountains there is always places to go and explore, trails, rivers, lakes, views, parks etc…

    It is very easy to live on 2,200.00 a month here, with the house paid off. That budget has plenty of frivolous spending too.
    Now, living on that amount one can also have subsidized health care. I think this is a much safer plan than moving away from your family, friends, and living in a country that could decide at anytime you need to leave their country.

    My father worked in Iran in 1977-1979. I was 17 when the Shah was overthrown. We had to leave the country in a very big hurry. Things were very scary. That is when the Iran hostage crisis took place. I haven’t any desire to visit or, live in a foreign country.

    As a child I lived in Germany. I still remember how the German children hated us. We were on a military base. The children would come to the fence and, call to us. When we went to visit them they cursed at us and, pulled out knives. Thankfully, the fence protected us from their hatred. Mind you those children didn’t come up with that hatred on their own.

    I do realize not every citizen in foreign lands hate us. But, the few I encountered ruined it for me. I should say that in Iran grown men threw rocks and, dirt on me. They were angry I was there and, told me to go home! Too, they were angry that I wasn’t wrapped up in a black sheet. Although, at that time the Shah was trying to westernize Iran, so many women in Iran weren’t covering up either.

    • Those are fascinating accounts, Joy. Thank you again for all of your comments! I have always been a little scared to visit a foreign country. Since I am white, 6’8″, and obviously not a local, I feel like I would be an obvious center of attention (and this is definitely NOT my preference!).

      Anyway, I’m sure many visits would be fine, but I would ultimately like to live near family as I do now, and things are relatively cheap here too. My entire house (3 bed, 2 bath, 1,500 square feet) cost only $78,000 when I bought it. Once the mortgage is gone, I figure that I could easily live on $1,500 a month.

  9. Joy,
    Wow – did your latest message bring back memories. When I was in college in Iowa back in the 1970’s we had Iraqi and Iranian students forming 2 different lines and facing off – both lines with their signs and SCREAMING at each other in a language(s) I didn’t understand and all the American kids had to walk in the middle of their “protest” just to get into the building for classes (and they were none too kind to the American kids). Didn’t think much of it at the time – seemed back then everyone was screaming and protesting about everything. Little did I know! Not sure how this relates to personal finance exactly other than to say, when you’re in college, get your ass into class and study. Someone is paying hard earned $ for your education. If you do that maybe you will get a great job, actually learn how to budget and then you might be able to retire early. (Derek, thanks for indulging me. I did try my best to bring this back to early retirement – ha!)

    • Hahaha. You made me laugh again, so you’re good. Don’t worry about the financial tie. This site is called, LIFE and my finances. This is life, right? 😉 Thanks again for the comment Mrs. Jim. 😉

    • Mrs. Jim,

      Thanks for letting me know things were happening in the states too. 🙂 I had no idea. When I returned home nothing was happening in the small town of Ozark AL. In fact, I had changed so much that, I had nothing in common with my one time friends. Life was incredibly lonely for a time.

      Derek, you are a good sport. 🙂 Too, 150’s is appraisal price for our home. We paid 120’s. We do want to downsize.
      It is just the two of us. Who wants to clean, cool, and heat all the extra space? Too, the 1.5 acres and pond haven’t any kids to play on it. 🙂 Who wants to cut all that grass? Or, worry with the pond? Ponds get over growth of weeds too.
      I want a great open floor plan with maybe 1100 sq ft. We think solar and, wind energy sound like something we want to look seriously into. We’ll see how it all plays out.

      My adult kids are consumers. My fault. I am trying to teach them what I have recently come to understand. But, they are not interested. They don’t want us to downsize. They like coming home. It is a struggle for us but, it is in our best interest to downsize both financially and, physically. We want all that energy for other things. 🙂

      • Well obviously the decision is ultimately up to you. It sounds like you’re ready to downsize and should go for it. I’m sure you wouldn’t mind the extra cash in your pocket right? 😉

  10. Thanks for the pass. Guess I overlooked the LIFE part of your blog title. I think I may just be loving your blog more than hubby – ha!

  11. Love your answer: options. That is why I do it too. By having options, I can do whatever I want, when I want. I am not tied to working a job I hate just so I can pay my bill every month.

    It’s sad that this mentality is so “out of this working thinking”. So many people are working just to support all of the stuff they have. If they could learn to be happy with what they have, they would have a completely different life experience – a better one I would argue too!

    • I would argue the same Jon. I am so much more happy when I am not chasing after stuff and just taking the time to enjoy my surroundings. I have recently let a few coworkers in on my house payoff and they are soon realizing that without a mortgage and no debt, I could live for a very long time on just a meager savings. It’s true. Without any debt, I could survive on $20,000 for about 2 years!

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