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>> But, while saving to retire early is an important goal, it has to include some enjoyment now. Nobody can examine your spending habits but you. Perhaps your trips are 20% of your income. If you deem then worth it, they're worth it. If you can cut back on alcohol or find a hotel with buffet breakfast included, do it. But don't sacrifice EVERY LAST BIT OF EXCITEMENT, travel and adventure for the almighty dollar. Travel in our 20s and 30s comes at a different price than it would in our 50s... but it also provides different opportunities. <<

Well, to me this is the thing. Someone posts on a board about how to retire early and mentions nearly 9% of pre-tax income on travel. Clearly this person can afford to do that because he has no debt and is still able to set about 10% aside for retirement.

But let me try this again, because it sounds like some people think a few of us are being a little harsh on the travel expenses.

If he's to make the early to mid 50s target (let's call it 20 years since he's 33), he needs to turn what amounts to $60K in current retirement savings (not including e-fund and short term savings here) into $1M in 20 years. If this is $1M in nominal dollars in 20 years, it's likely to fall woefully short of needs due to inflation. So I am going to assume it means $1M in real dollars.

If one assumes $6,000 a year in real dollars added to retirement accounts and a rather optimistic 6% REAL return, in 2028 he'll only have about one-third of a million starting from $60K.

If we assumed he means nominal dollars and we assume a fairly optimistic 10% return and 4% annual contribution increases, in 2028 we still have only $725,000 or so by my calculations.

So for all you travel buffs out there, I'm not saying his priorities are wrong, just that unless he can grow his income considerably faster than inflation, a million in 20 years seems rather unlikely even in nominal dollars and a virtual impossibility in real dollars (at or near current contribution rates). So in the end, the OP has to weigh the tradeoffs and make some decisions about how important early retirement is relative to vacations and travel. Only the OP can decide that.

But in order to have a decent chance of coming close to the goal -- turning $60K into $1M in two decades -- then clearly quite a bit more money needs to be channeled into retirement savings.

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