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Author: jammerh Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 748860  
Subject: A Key To Early Retirement Date: 7/16/2002 12:57 PM
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I retired early about 20 years ago. I was able to do through a combination of increasing the amount of money working for me, and decreasing the number of my needs.

I'd like to suggest to all of you that you can retire if you really want to do so. It is more a matter of priorities than a question of "...do I really have enough money?"

Start off by asking yourself what currently have in your life that you really need, and what you have that you don't really need. In trying to figure this out for each thing. Try to keep in mind how much you want to be retired, and how much you might like to get rid of the things that keep you from attaining this goal.

It is not an easy job. Often we buy things or get involved in things that take up our time, money and other resources without realizing how much they are keeping us from something we really want.

If you like your work, this approach may not be for you. However, if you sincerely want to be independent the goal may be closer than you realize.

It is a question of priorities because independence is attainable if you're willing to make the sacrifices. If you don't want to give up the fine dining, the fancy car, or the luxurious apartment etc.. that's your choice, however, you should realize that these things are what may be keeping you from your independence. Realize that these are the things for which you are selling your time.

When it comes down to it all you really need is enough money to pay for a roof over your head, and enough food to eat. Even these costs can be minimized to as great an extent as you feel appropriate.

After this anything extra you can accumulate is gravy, but it doesn't take much to generate enough to pay for these bare minimums. That can get you to a meager "independence" level---probably not an appealing alternative to most people, but keep in mind its a starting point, and not a goal in itself. Once there as long as you can occasionally earn some income, either by working occasionally, or saving money from any other source you will make some headway in making any savings work for you.

I'm not advocating quitting your day job if you have little more than enough to pay for the bare essentials. I'm saying that once you've achieved an ability to generate enough money to pay for your basic needs of food, and shelter, and either have a little extra to put to work, or continue working occasionally for additional income, you can move on to a higher level of spending if you choose. How much you spend, or how much you sacrifice toward the goal of increasing your security is a question of personal values and balancing trade-offs.

"What kind of life is that?" you may ask. Well, it is can be the beginnings of a life free of working for others. How much it appeals to you may depend on how badly you want to get out of the rat race. I describe it as a viable alternative because I think many people underestimate its potential.

Living on the basics still offers quite a bit. The number one advantage is that you can spend your days the way you see fit. Your time becomes your own. You can take a walk, write, read a book, grow a garden, enjoy your friends and family, travel, or do many other things that don't cost a lot of money.

I quit working over two decades ago, but I now have a lot more money working for me than I did then. I continued living very frugally in order to give my grubstake a chance to continue compounding. Living Far Below Your Means can have a dynamic effect on your ability to do this. Everything goes into the money machine. The money machine works for you. It offers you financial independence and security. It protects you from many of the problems of the world.

Even if you never use it that much, it can be comforting to know it is there. Ask yourself how much you really need that last thingy you bought for the garage... Ask yourself how much you want to be independent. Early retirement isn't for everyone, but if you are convinced you are the best manager of your time, and you'd like more control over that time, you might want to consider it.



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