Early Retirement

My Early Retirement Plan

Early RetirementI have a whole post dedicated to the reasons for saving money. However, I think it’s about time for me to open up and let you know what my PERSONAL plan is for the next few years. What is my main reason for saving, finding ways to earn more, and growing my net worth without sacrificing happiness? Why am I dedicated to this lifestyle so much that I want to shout it from the digital rooftops? The answer is time and freedom. So here’s the situation:

I am 30 years old.

I plan to “retire” before I reach my 40th birthday:

  • Failsafe Goal: Retire by 39
  • Realistic Goal: Retire by 36
  • Aggressive Goal: Retire by 34

When I say “retire”, what I really mean is reaching financially independence. I no longer need a salary to live out the rest of my days. For me, that means moving on from a 9-5 grind.

How I plan to get there

  1. Salary: I have been fortunate enough to make what I consider a decent salary in NYC. I have climbed a few rungs up the corporate ladder, but I still don’t make the $80k per year that some claim is necessary to live in NYC. If you are interested in retiring early, you have to have an income of some sort. Working to increase your income will get you there faster.
  2. Saving: I plan on cooking many of my own meals, as well as avoiding cabs. I refuse to pay for cable, sign up for Groupon, or let my monthly bills get out of control. I should be able to save a large portion of my income with these saving strategies and I will actually improve my quality of life by eating healthier, tastier meals, avoiding too much TV, and walking more.
  3. Index Fund Investing: I will continue to take a large portion of that savings and pump it into my 401(k), IRA, and taxable accounts at Vanguard. The money there will work for me, creating more money, which in turn creates even more money! When I have enough money that 4% covers my expenses for the year, I’ll be ready to retire*.
  4. Real Estate: I am in the early stages of my real estate investing strategy. Thanks to FI Fighter and his posts about turnkey real estate investing, I have discovered this new path to passive income. I have a very simple formula for accounting for my real estate income: Annual expenses – annual real estate income = net annual expenses. I will use 4% rule described above on my net annual expenses, meaning I should be able to reach financial independence faster and be able to retire sooner.
  5. Passive Income Projects: I hope to look at various online projects that will make me passive income. This is last on the list because I have a lot to learn to understand this and if I can even pull it off. I promise to keep you updated along the way!

Along the way

You might think that I will need to make sacrifices in order to reach my goal. I’ll be living a life that is “less than” in the meantime. Nothing could be further from the truth. I still get to live in one of the greatest cities in the world and I plan on taking full advantage of that. I will go on NYC adventures[link]. I will experience the amazing art scene of New York. When I do eat out, I plan on eating delicious, cheap, and fun foods that make New York so unique. I will still spend money on traveling as I have prioritized travel over purchasing “things”. I will get to spend time with friends, as well as my band. I will be generous with my time and make my charitable giving go further.

Oh, and I definitely plan on drinking (and brewing) beer. The next few years could very well be the most full years of my life! No, I won’t feel as though I am sacrificing my lifestyle.


What happens when I retire

Early retirement means different things to different people at different times – so I’m not 100% sure. That’s part of the fun. But I know that I won’t be bored. If I retired today, I have plenty of activities and areas of focus to keep me busy. I’d have a chance to visit other states as well as do more of the activities I currently love**. However, four to nine years from now, my goals, hobbies, and priorities may change drastically. As long as I keep asking myself what those priorities are, I will never be bored. And just because I retire, doesn’t mean I am forbidden from ever doing anything that could make me money in the future. For instance, if I wanted to create a non-profit that promoted financial education for kids or start a new e-commerce site, just for fun, I would. I wouldn’t let the fact that technically I would be “working” stop me from pursuing those goals. The difference is, I am free to pursue those goals or not on my own terms (plus if a project doesn’t work, I can easily move on to the next one). The freedom to pursue goals, relationships with friends and family, travel, and get out of my comfort zone are what financial independence is all about.


* I plan to save a little more than 25 times my annual expenses, as a failsafe for future plans. I have to be careful here though because it would be easy to go overboard and never feel as though I have enough of a nest egg.

** If I retired today, you would all likely have to endure even more posts from me!

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17 thoughts on “My Early Retirement Plan

  1. Aldo@MillionDollarNinja June 16, 2014 at 4:17 pm

    This is a great plan to have. I also would like to retire early, but as of right now I’m not making too much money outside of my job. I’m slowly working my way up and maybe in a year or two I’ll have a better idea of where I stand. Maybe I’ll be able to “retire” by 40 as well.
    Aldo@MillionDollarNinja recently posted: MDN Now A CommentLuv Enabled BlogMy Profile

    • Mr NYBudget June 16, 2014 at 8:34 pm

      Nice – yeah, I truly believe if you keep working at it and keeping it as a serious goal, it can happen, through earning more and spending less.

  2. Kassandra June 16, 2014 at 4:28 pm

    Dave, you sound like you know where you are heading and why. The why is key. I am shooting for FI by 45 at the earliest but I think I’ll always work to some extent whether it be paid or not because I enjoy being productive and accomplishing goals. We just bought our antenna from Amazon and it works like a charm. For fun I checked the basic cable package on TWC and it was $40 for 20 channels…SMH.
    Kassandra recently posted: A Tribute To My Step-FathersMy Profile

    • Mr NYBudget June 16, 2014 at 8:35 pm

      Best of luck Kassandra on your quest for FI! And nice work on the TV front!

  3. Mel @ brokeGIRLrich June 16, 2014 at 4:48 pm

    Dang, good luck! It seems like if you’ve already got a plan, you’ve got a lot of the work done already… although just sticking to it is the touch part. Good luck with the turnkey investing. All real estate stuff seems so overwhelming to me.
    Mel @ brokeGIRLrich recently posted: 12 Thoughts About Death and FinancesMy Profile

    • Mr NYBudget June 16, 2014 at 8:37 pm

      Thanks Mel! Yeah, real estate seemed a bit overwhelming to me as well. I just kept reading about it, listening to podcasts, and talking to people about it until I felt comfortable ENOUGH to dive in (I don’t think you ever feel as though you’ve mastered it until you do it for a while).

  4. Andrew@LivingRichCheaply June 18, 2014 at 12:21 pm

    Great post! I’ve become a big fan of early retirement…started reading all of MMM posts, ERE, Root of Good, etc. But one thing that they had in common (and not to take anything away from their accomplishment was they lived in low cost of living areas). To retire early in NYC would be very impressive and I would be very intrigued in the details. I will have no problem “enduring” more of your posts. I’m doing the same things, saving, investing in index funds, hoping to get into real estate (thanks for bringing that idea to my attention- it may be a game changer)…but I’m still very unsure whether retiring before 40 is possible. You’re planning on staying in NYC after early retire right? Anyways, we gotta meet up one of these days and I can pick your brain!
    Andrew@LivingRichCheaply recently posted: Is a Family Trust Right for You?My Profile

    • Mr NYBudget June 18, 2014 at 8:43 pm

      Thanks Andrew! Yeah – it is a lofty goal doing this in NYC, but from everything I see and the money I am saving now, the numbers seem to be working out. We should definitely meet up one of these days – I am sure there is a ton I can learn from you as well!

  5. FI Fighter June 19, 2014 at 1:14 am

    Love it! Very clear, organized plan you have laid out here. Definitely wish you all the best of luck on your journey to early FI, and I’ll be rooting for you from afar, in Cali.

    You can do this!!
    FI Fighter recently posted: Congratulations to the Class of 2014! What I’ve Learned in Seven Years…My Profile

    • Mr NYBudget June 19, 2014 at 4:40 am

      Thanks Bud! Yeah – I’ll definitely be following and rooting for you on your journey as well! I can’t wait until you quit your 9-5 and hopefully I’ll follow very soon thereafter.

  6. Laura June 19, 2014 at 3:33 am

    Good luck! Like others have said doing it in NY would be a great achievement. My husband just turned 35 and hopes to retire at (the latest) 45. We prioritise travel too – funnily enough NY is our favourite place to go – but we try to do it on a budget.
    Laura recently posted: Our budget is getting downsized too!My Profile

    • Mr NYBudget June 19, 2014 at 4:38 am

      Thanks Laura! Obviously I agree with you on NY being a fantastic place to visit. If you are ever in the area again and want to meet up, I am always up for meeting new folks!

  7. DC @ Young Adult Money July 3, 2014 at 12:57 pm

    Nice plan! I don’t have plans to retire early, at least nothing solid, but if I could get enough passive income streams or sell a company for a large lump sum I would totally do it. Right now my wife and I are just plugging away with student loan paydown, working to increase our income, and consistently have money funneled into our 401k and HSA.
    DC @ Young Adult Money recently posted: Top 10 Things Our Generation Will Be The Last to SeeMy Profile

  8. Stefanie @ The Broke and Beautiful Life July 9, 2014 at 8:41 am

    I don’t know that I consider what I want in ten years “retirement”, just location and time independency. Running my own business, entirely on my own time.
    Stefanie @ The Broke and Beautiful Life recently posted: The New York City ExperienceMy Profile

    • Mr NYBudget July 15, 2014 at 11:58 am

      That makes a lot of sense. I think for me, I want to be able to work on projects that make money, but not necessarily be tied into a full on business, even if it is of my own creation.

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