Early Retirement

[Anonymous No.10793415]

Some of you probably know the mrmoneymustache financial blog. He basically says that it's possible to save 2/3 of your income, invest it in index funds and after 7 years you'll be able to "retire" and live of an annual return of around 50k.

Is this legit? He comes of as a 30 year old boomer but his numbers add up. Obviously living frugal is extremely helpful but I'm not sure about the index fund part. Is it really that reliable? He also talks about making money with real estate like it's the easiest thing in the world.

[Anonymous No.10793454]

i read his stuff about 8 years ago, implemented his suggestions as much as was able. invested in crypto instead of index funds for max returns. been retired for 1.5 years. feelsgoodman.
t. 33 yr oldfag (not boomer)

[Anonymous No.10793462]

>>10793415
The index fund advice is pretty solid, given that this is an advice echo'ed for the last 60 years by many authors and investors. It's a slow, conservative long-term strategy, but it definitely works.

Not sure about the annual return of 50k or the time frame of 7 years (this probably depends on your income), but you'll definitely have a significantly higher return than if you would leave it in a savings account over the same period, for example

[Anonymous No.10793504]

basically the math says if you save 25x your yearly cost of living and get 4% returns every year, you'll never need to wagecuck again. get the frivolous spending down and do as many things yourself as you can; it's that easy. one example - learn to cut your own hair.

[Anonymous No.10793586]

>>10793454
Whats your story anon? Sounds interesting desu

[Anonymous No.10793610]

>>10793586
He bought crypto in the early 2010s, that's his story. Everyone who could HODL over the years and was smart enough to sell a fair bit in december got rich

[Anonymous No.10793805]

>>10793415
you will not get an annual return of 50k unless you are making 150k net every year you are saving

[Anonymous No.10793826]

>>10793805
He calculates the 49k from the 10 year average return of 7% and a saving of 700k

[Anonymous No.10793901]

>>10793826
and how exactly would you save 700k in 7 years, it is almost impossible.

you can also safely withdraw no more than 4 (more like 3) % from your portfolio each year
so yes you can retire if
>you manage to save 700k in 7 years (impossible)
>you are happy living on 21-28k before tax annually

[Anonymous No.10793932]

>>10793901
>you manage to save 700k in 7 years
https://www.mrmoneymustache.com/2011/09/15/

He explains it here.

[Anonymous No.10793937]

>>10793826
saving 700k in 7 years thats 100k a year, 2/3.
100/2*3=150k a year
Well I guess its possible if you make 150k a year, but I don't know anyone who makes that kind of money in their early 20's. Very unrealistic except for special cases.

[Anonymous No.10793938]

>>10793415
The numbers, especially the emphasis on % of your income saved, do add up (http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/))

Two caveats: Partially due to current valuations and partially due to Boomers retiring, many sources project 10 year real returns for stocks around...0%. So don't blindly apply the 4% rule and call it quits tomorrow.

Second, 4% is a Boomeresque calculation about how much you can withdraw from a portfolio over an average 30 year retirement and end up with a balance, not equal to the real value you started with, but *above 0*. So if you're assuming 4% and young, or we end up cracking life extension, you may need to return to wageslaving. 3-3.5% is about the cutoff for an indefinite portfolio.

[Anonymous No.10793992]

Took a look at his blog, alright hats of to him for doing this. Pretty good. But he does say that the tech boom and such contributed to this case. Again I think its not so much a methodic plan as it is more circumstances. However I think that if you're smart with money you can definitely pull it of. I don't want to say oh he got lucky, cause he did actually put an effort into making this happen, had the wind in his back and it worked out. But to assume this is a methodical approach that will work for everyone if you just follow the steps is a very wrong assumption.

For example, by the time you start working the stock market could enter a bear market, making atleast 2-3 years of your income wasted if you'd invest.

[Anonymous No.10794008]

>>10793992
>For example, by the time you start working the stock market could enter a bear market, making atleast 2-3 years of your income wasted if you'd invest.
Yeah that was my biggest concern about starting investing my savings now too. Aren't we in a 8 year bear market? There has to be a financial crisis in the next few years and it would be way smarter to invest then.

[Anonymous No.10794016]

>>10794008
>Aren't we in an 8 year bear market
You mean bull market, but yes the stock market is in a gigantic run, I think even the biggest in history so far.

[Anonymous No.10794051]

FIRE is the true redpill

t. on track to retire by 40 at latest

[Anonymous No.10794063]

>>10793610
still holdling

[Anonymous No.10794076]

>>10793586
see >>10793504
you can extrapolate from there

[Anonymous No.10794126]

>>10793992
this is true. timing is a factor, but the biggest hurdle to overcome is to cut spending and that can e started now. once you get into that mindset permanently, the money starts piling up. once you do that, the investments will be available. start saving now, worry about investing it when the opportunities arise

[Anonymous No.10794146]

>>10793932
>https://www.mrmoneymustache.com/2011/09/15/
yeah BUT
>he did not save 700k in 7 years
>he counts his wife and his networth combined, so he actually only contributed a bit over half of whatever he saved
>he had a very good salary
>he started investing at a very good time

>>10793938
this
I'm holding only cash now because there simply is nothing good to invest in at this moment

>>10794051
how much is your target NW?

[Anonymous No.10794152]

>>10794146
>how much is your target NW?

1.5M

[Anonymous No.10794179]

>>10794152
same here, good luck!

[Anonymous No.10794265]

>>10793504
Could have had 18x yearly cost of crypto in January and didn't cash out bc I was waiting for 25x

[Anonymous No.10794302]

If there is a major correction and you lose 30% of value, his whole strategy goes out the window.
It may work under ideal circumstances and when markets are doing well, but its hardly bulletproof

[Anonymous No.10794357]

>>10794126
Single 24yo boomer. How do I retire???

[Anonymous No.10794426]

>>10794357
>How do I retire???
lol welcome to America

[Anonymous No.10795158]

>>10794302
(((correction)))
don't be a stupid goy

[Anonymous No.10795743]

>>10793937
He had dual income, lived in a low cost of living area. Made good money in the software boom.

It is possible. When saying saving 100k per year you aren't taking into account that investments earn 7-10%. When 600k is saved in the last year 10% return is 60k... so you only have to save 40k... it compounds faster than you think. The first 100k is the hard part. And lotto winnings and crypto gains happen too fast to instill the values to know how to "use" money long term.

Building up slowly is frustrating but allows you to build those frugal muscles like he says. It's worth it. Just my 2 cents.