Is Early Retirement A Smart Goal? (Bestie Ep) #1015

Episode Transcript
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Speaker 1 (00:00):
Welcome to Out of Money. I'm Joel, I'm Matt, and
today we're asking the question is early retirement a smart goal?

Speaker 2 (00:26):
We are talking about early retirements or retiring early. I
think we're going to refer I was realizing as I
was thinking through this episode, you've got the financial independence
retire early or is it financially independent retired early? There's
so many different ways of saying and that obviously that's
the acronym fire, which I think a lot of folks
might have been introduced to the idea of early retirement

(00:49):
via Fire specifically.

Speaker 1 (00:50):
But there are all sorts of different people in the
Fire movement and different kind of takes on retiring early.
But yeah, we have had different conversations about this in
the past, but we want to talk about a whole
lot of different things when it comes to retiring earlier,
whether it's a good goal to have, and then yeah, yeah,
maybe how to skin that cat if that's.

Speaker 2 (01:07):
What you're going for. We like to talk about you
and I as we are planning and thinking through the
different topics we're going to discuss. We always come up
with different metaphors and examples, and I feel like fire
early retirement is just one of those things that folks
have heard about. It's kind of like in the background,
it's in their subconscious. They've seen maybe different articles floating around,
but they don't know exactly what it is or how
they should be thinking about it right now. It kind

(01:29):
of makes me think of AI, like that's all the
rage right now? And is it coming from a job
or is it just a chief trade exactly? Is it
a good thing, is it a bad thing? I don't know.
But before you you know, one hundred percent go after
something and say that this is going to solve all
of our problems. And in this case we're talking about
early retirement, it is worth thinking through the different ramifications
that it might have on your life.

Speaker 1 (01:49):
Yeah, we're going to talk about it today with one
hundred percent assurance. Chat GPT is not going to solve
all the problems avail us. It might, like, you know,
help on the edges. It might make some differences, but
like it can't fix the pain in my bad or
anything like that.

Speaker 2 (02:00):
Yeah, that's true, so it won't. But before we get
to that, man, I've got a question for you because
I was talking with Kate the other day and she
made me aware of these shoes. I'm pretty sure they're
buy a company called Golden Goose, which is incredibly ironic,
as listeners will will soon here if they already don't
know what these shoes are all about. But these are

(02:22):
some really really expensive sneakers, right. And here's the thing.
I'm not against spending some money on some sneakers, right, like,
in particular, if they're really high quality shoes, or if
they have like a lifetime warranty, like no matter what,
just send them back in and we'll resoll them for
you for the rest of your life, or if like
if there are specialty shoes, right. But no, they're just
for the most part, they're just normal looking white sneakers.

(02:45):
But here's the kicker. They come pre manufactured with dirt
on there. I guess, like I think they just print
it onto the rubber. They just print it on to
the leather, make it look scuffed, to make it look scuffed.
These are normal looking shoes otherwise, and these things cost
upwards of four hundred bucks. I saw some some pairs
are like I think six or seven hundred dollars for

(03:07):
these silly Golden Goose sneakers. But I wanted to get
your thoughts, like, what are your what are your thoughts?
I think you know my thoughts. I think you know
my thoughts.

Speaker 1 (03:15):
I think it's ridiculous, and it just makes me think
of what is it like Neeman, Marcus and some of
those kind of expensive retailers selling you pre ripped jeans,
right sure that costs or with like paint splatter all
over them. And you can do that to your jeans
yourself if you want to, and you can just buy
a pair of that cost less up front. And I,
like you said, like, I'm willing to pay more sometimes
for nicer goods, Like my jeans aren't twenty dollars jeans.

(03:38):
I've found out early on that buying the twenty dollars
jeans meant I wasn't gonna wear them, and they became
misshapen quickly.

Speaker 2 (03:43):
Yeah they'll shred.

Speaker 1 (03:44):
Yeah, So I like you know, to buy I don't
mind buying one hundred dollars pair of jeans because I
literally have been wearing the same jeans for ten years, right,
the same pair of jeens, So I don't mind spending more.

Speaker 2 (03:53):
Or the same pair of jeans for one year straight.
You can't wear them like all the time. If you
were for.

Speaker 1 (03:58):
I've got like three pairs of jeans that I rotate,
and one of them I have had for a decade.

Speaker 2 (04:01):
But it's it's one of those things where I'm just
everyone's picturing like Joel's ratty jeans and feeling bad for Yeah. No, no,
I'll get new jeans if I need them. Okay, I can,
I can make that happen.

Speaker 1 (04:12):
But no, I think this is just kind of like
it's really it's a attempt to signal that you get
the cool goods.

Speaker 2 (04:20):
That's that's one hundred percent. So that's conspicuous consumption. Yeah right,
that like there is no additional value that you're paying for.
It's just proving that you have the funds available in
order to buy some of these shoes. It's signaling. And
that's the part that feels wasteful, Like that's the part.
And that doesn't mean I don't.

Speaker 1 (04:37):
Want to go to Walmart and get the ten dollars
pair of shoes, okay, like.

Speaker 2 (04:39):
Like a middle ground somewhere, and again, like I don't
want to yuck on someone else's YOUM but I have
a hard time getting excited. I have a hard time
getting behind someone who's gonna say like, yes, I'm gonna
buy these shoes that intentionally come dirtied up, and like
that's the other silly part because if you buy rip jeans,
well that's a real rip. But when it comes to
these sneakers, these shoes not like rubb and real dirt

(05:01):
on there. It's it's like it's pre decided, it's designed
dirt and it's printed on there. Okay, what makes me
think of Zoolander. It's like the dar Lak campaign.

Speaker 1 (05:11):
Yes, okay, So one time my mom bought me some
some Converse All Stars some Chuck Taylor's Classic for my
birthday because I like Chucks. They're great, and they're a
pretty inexpensive shoe, what like thirty five forty forty five bucks, right,
depending on the making model you're getting of Chucks. And
she said they actually came pre scuffed, and she's like,
I cleaned them before I gave them to you, because
I thought that this was like a flaw or something

(05:32):
that I didn't know if they were pre worn or whatever.
And I was like, I think that's how they care.

Speaker 2 (05:35):
I don't know. It was funny, Yeah, are you sure
that it wasn't just a returned pair? It could have been.
That's what I'm saying. I don't know. It's like getting
goods on Amazon. Now you're getting more and more things
that you can tell somebody has like, yeah, oh they
tried it on.

Speaker 1 (05:47):
Like they didn't look worn on the bottom. So I
just like cleaned up the white part real quick. But
you're like, oh, mom, no, I don't care.

Speaker 2 (05:52):
All the cool kids, there'shes already stuff like that. Hullo
stuff myself if I need to anyway, all that being said,
if you are somebody who likes issues, so I'm certainly
not gonna hate on you. But it's yeah, not my
cup of tea. Yeah, exactly. All right, matt Let's move on.
Let's mention the beer we're having on this episode. This
one is called Ferris Coffee Imperial Stout by New Park Brewing.
This one was donated to the show by listener Matthew.

(06:15):
We'll get to our thoughts on this one at the
end of the episode. Yes, so let's get into it.

Speaker 1 (06:18):
Let's ask the question. Is early retirement a smart goal?
And we've all had someone tell us to kick the
tires before buying a car, or to look before we leap,
before we make a big decision.

Speaker 2 (06:28):
There are all good advice.

Speaker 1 (06:29):
Yeah, they are all sorts of like slogans that caution
us to perform our due diligence before we make a
big decision. And I don't know why, Matt, this got
me thinking about the movie Cinderella, and.

Speaker 2 (06:40):
Like, the the one from the eighties. Was it the
eighties the animated.

Speaker 1 (06:43):
No was before that tea, Yes, Gus, it was like
nineteen fifties maybe even was it. Yeah, it's really old.

Speaker 2 (06:48):
Yeah, I guess that makes sense. Yeah, no, it's like
a super It was like one of the original I
remember watching it as a kid. It was one of
my favorites. I want to say, fifty seven them all
about those mice, Yeah, I thought they were awesome. Okay, Well,
here's the thing.

Speaker 1 (07:00):
It's a weird story when you actually stop and think
about it, right, The Cinderella and the prince they dance
for one night, and then he ends up sending his
goons around town to find the girl whose foot fits
the glass.

Speaker 2 (07:10):
Slippers perfectly normal so they can get married.

Speaker 1 (07:12):
It's like, well, dude, me thinks, maybe you're getting attached
a little too quickly. You don't even know her yet,
and she might not be who you think she is because,
like you said, Matt, she talks to animals. Okay, so
she could be a little whack a doodle in the brain,
But there's like a reason that you go on dates
for at least a few weeks before you propose, and
hopefully even longer than a few weeks. But sounds like

(07:32):
looking before you leap right, exactly. And so it's a
matter of due diligence really when we're getting to know somebody,
you know, to ensure that the person isn't a psycho
before we commit to spending the rest of our lives
with them. And similarly, early retirement. On its face, I
think can seem like the best pursuit. It can seem
like a good idea and a worthy goal, and it
might be for some folks out there, but we would

(07:54):
say not before thinking it through on a bunch of fronts.

Speaker 2 (07:57):
That's right. Yeah, you might find out that earlier tournament
is the perfect pursuit for you. More power to you,
but definitely do your homework before deciding that this is
the end goal that you want to achieve, because it's
going to come with some significant ramifications, not quite as
significant as you know that the person you choose to
marry if you're the prince, but if you're going after
your life and let's be honest, she was a cat.

(08:18):
She's a great girl, Cinderella. If you're going all in
though on early retirement before performing that due diligence, you
might be in a world of hurt. So we're going
to offer our thoughts on how to decide if retiring
sooner than your peers is going to be a good
goal for you. We're going to tackle a number of questions,
both like financial and math related, but also questions kind

(08:42):
of more on the personal front as well. And we
think that these factors, considering all these factors and answering
these questions are going to help you to decide if
early retirement is going to be a goal worth pursuing.

Speaker 1 (08:53):
Yeah, and I think some folks might get to the
end of this episode and they might say, Hey, that
sounds like my cup of tea, like I want to
join the early retirement movement. And others might say, yeah,
it doesn't sound like it's really my jam.

Speaker 2 (09:02):
But they can go either way.

Speaker 1 (09:04):
I think like internet articles often make it sound though,
Matt like early retirement is the Bee's knees, and I
think true, that's part of the problem is they're selling
a bill of goods or making it sound like it's
just the greatest thing since sliced bread. And there was
a recent headline I saw on market Watch and it
read this fire couple retired at the age of twenty nine.

(09:24):
For them, it's always the weekend, and Bully, that sounds appealing.
I read that twenty nine, I'm ten years too late
to pursue this goal and what a slacker. And weekends
are awesome, Like, I'm not against weekends. I have a
lot of good good times on the weekends. We go
for family hikes almost every weekend, or bike rides, or
we get out in nature. We do lots of great

(09:44):
stuff together, we make awesome memories. But do I really
want my life to be like one long, perpetual weekend.
Do most folks want that?

Speaker 2 (09:52):
Maybe? Maybe not?

Speaker 1 (09:53):
Like maybe the weekend is so great because it marks
the end of a successful week, not because it's never ending.
And it just makes me think of like the another
movie reference here, Groundhog Day, right, and you know the
classic from the fifties, right that it's actually from the eighties. Yes,
And it's just a great film, of course, But if

(10:14):
you recall the movie Matt Bill Murray, he starts to
tried to kill himself in multiple ways because you know,
living the same day over and over actually starts to
get kind of boring and ultimately kind of depressing. So
I don't know, it's it makes me think of that, Like,
these are the kind of things that we want our
listeners to consider before they say, ooh, early retirement weekends

(10:35):
and never end, sign me up. Like, the reality is
that most folks who decide to pursue this lifestyle there,
you know, they aren't even doing it with the goal
of perpetual weekends, right. Often they're they're doing it with
like I would say, an even worse goal.

Speaker 2 (10:48):
They're trying to run away from a job than they Yeah, no,
I totally agree, man, Yeah, like they think their job sucks.
And it seems that like that that's one of the
top reasons that we see folks gravitate towards early retirement
as ultimate goal. They are running away from something, not
necessarily running towards something. But if that's the case, though,
you know, if that's the main reason, we feel like
there are other potentially more appropriate solutions that folks might

(11:11):
want to pursue, which we'll discuss later in the episode.
But for others, it can be dreams of what retired
life could look like. Right, And it's not a bad
idea to have a picture of retirement for yourself, but
it is important to be to be grounded in reality,
because I think the fantasy of retirement can often be
more delusional than an actionable plan. And you know Joel

(11:33):
earlier a few weeks ago in episode six twenty three,
we talked about ways that you can maximize your income.
We are all for folks trying to find ways to
maybe leave an employer that isn't going to be great
for the career, maybe that doesn't have the like the
most healthy environment. But simultaneously, I think for a lot
of folks, just by changing their how it is that
they view their work, right, Like, I'm just talking about

(11:55):
more of like a like a mindset shift that might
take place, or just displaying more ownership. I think these
are ways that you can demonstrate to yourself that it's
not that my job sucks. I've just been thinking about
it wrong this entire time. I think that could be
in just a very simple way, to help folks to
realize that, oh wow, my job actually doesn't suck all
that bad. I've just been thinking about it incorrectly.

Speaker 1 (12:16):
What makes me think of the show Dirty Jobs with
Mike Row and how he would always he would talk
to people who had what a lot of us would consider.

Speaker 2 (12:23):
The worst job, absolute worst, dirtiest, worst job.

Speaker 1 (12:25):
Yeah, the crummiest, dirtiest jobs, climbing through sewers and I
mean all sorts of nasty stuff. I didn't really watch
the show myself, but from what I could tell, a
lot of people that had those jobs seem to take
great pride in their profession. And I think you're right.
A lot of it is kind of a mindset shift
about how we view our work. And it doesn't mean
that you can't get out of a and shouldn't get
out of a toxic work situation or look to find

(12:47):
something better in the future. I think growth is important
and that matters too, But you're right. I think just
running away though from work altogether, is like a bad
motivation when it comes to pursuing early retirement. And let's
talk about the origins of retirement and early retirement for
a second, Matt, because like retirement is a pretty new
concept overall. And so yeah, where did it come from

(13:09):
and how long has this been like a pursuit well,
government financial.

Speaker 2 (13:13):
Support for the elderly.

Speaker 1 (13:14):
It started in the eighteen hundreds, late eighteen hundreds in
a country, former country called Prussia, right, And when social
Security was instituted in the United States, that was like
not none until like nineteen thirty five, right, Matt, when
the Social Security Act was passed, and it had a
completely different goal, not to fund decades of retirement, decades
of leisure time, but really to aid the most vulnerable

(13:37):
folks in our society who ended up living longer than
the average lifespan. So that concept of moving to Florida
for three decades and walk in the beach with your
significant other like that is.

Speaker 2 (13:50):
Not gonna say with your metal detective that too. That
might be your significant other some day. That's that's more
my speed.

Speaker 1 (13:56):
I could say you've fallen in love with one of
those Yeah, that's awesome objects like scoop and or for
lost rings and watches, but some people like that. I
just want to make it clear, like we are less
than one hundred years removed even from the institution of
Social Security, as a concept, and so the modern idea
that we have of retirement is so new right, and

(14:18):
we're living longer now than ever before, and that's why
I think social security has more of an impact on
those retirement years. But that's also part of the reason
that social security is bound to become insolvent. We haven't
fixed any of the problems. It's pretty hard to fund
decades worth of leisure for a huge segment of the population,
so it's becoming untenable in our politicians don't seem to

(14:40):
want to do anything about it. They don't seem to
want to fix the problem. And we talked about that
back in episode four thirteen, Matt, something's got to give.
Nobody wants to address the elephant in the room. I
think it's possible to find a way to make social
security sustainable, but it's easier said than done, especially when
you're talking about elected officials who don't really have any
desire to do anything. They just want to grainstand about it.

Speaker 2 (15:02):
Sure well, they're not willing to do anything about it
because like nobody wants to be the grown up in
the room. It's like, it makes me think of like
when you're a parent and you've got kids, and all
they want to do is eat candy. But you have
to be the parent that says, no, you can't just
sit there and watch TV and eat candy. You go
to your room, clean your room, do your homework. And also,
you're gonna eat real food. You're a newcumber right now.
You're gonna eat some protein and some vegetables, some fruit.

(15:24):
You're gonna have a real meal. At this point, that's
what needs to happen with Social Security.

Speaker 1 (15:29):
But I think that kind of just reframing and making
it helping our listeners understand that this idea of retirement
hasn't been around for hundreds of years. It's still pretty
brand spanking new to think about it. And now it's
kind of like expected, well, sure, I need to save
for forty years of retirement, and now the early retirement
community is saying, no, we want to save for like
sixty or seventy years of retirement, which is even newer.

Speaker 2 (15:51):
Sure, yeah, it is much like it seems like it's
almost something that's as old as like the United States,
but yeah, much much younger, yeah than the founding of
our country. It's a novel concept and actually nineteen ninety
two feels like the first time that early retirement became
a popular concept. That's when the book Your Money or
Your Life came out VICKI Robbins and Joe I Forget

(16:12):
Joe's Lost Joe. And actually it wasn't really until like
twenty twelve, twenty thirteen, ten years ago. This was not
that long ago that different blogs and podcasts and different
books on the subject of early retirement started to be released.
And so, yes, traditional retirement is pretty young. Early retirement is. Honestly,
it's still in its infancy, and it's important to realize

(16:33):
that because a lot of things are still unsettled within
the world of early retirement. For instance, can you work
at all and still be retired? A lot of fire
folks still make money doing different fun projects or starting
their own businesses things on the side, But that's not
the traditional view of retirement match and I would say exactly,
So it's different, right, like, are you wanting to quit
work to pursue your own thing or are you looking

(16:55):
to travel and perpetuity? Does that make it a more
legitimate retirement? Are you actually retired if you're still making money,
or at that point are you considered to be semi retired.
I think that's one of the criticisms of early retirements,
and a lot of folks have voiced that. Actually, somebody
reached out to us because we highlighted a friend of
the show, Rachel Richard's, in our newsletter. We talked about

(17:16):
how she retired early, but simultaneously she's busier than ever,
which I see the maybe we shouldn't have turned it
in that way, because honestly, what Rachel has done, she
certainly shifted careers, but she's still working.

Speaker 1 (17:29):
She I think she's working on her third book as
we speak, and she's probably working harder than ever. But
it's more entrepreneurship in her case than you what oftentimes
folks considered to be early retirement. I think when we
talk about early retirement, oftentimes people are saying, like, I
could afford to live a meager lifestyle and wouldn't have
to work if I didn't want to. But most people

(17:50):
choose to do something meaningful with their time, because that's
kind of what humans reremds do in a lot of ways.
And we'll talk about that as well on today's episode.
But there's also just different kinds of early retirement, right,
So it's the definition is hard to understand. But then
there's different monikers that have been created for a bunch
of specific routes that you can take on the path
to early retirement. In these different routes attempt to acknowledge

(18:13):
the reality that it's going to look different depending on
your goals, your age, and your level of financial preparedness.
For example, coast fire is when you've got a healthy
chunk set aside in your portfolio and then you can
take your foot off the gas. So basically, for let's
say ten to fifteen years, you're saving a ton your
nose to the grindstone mentality. You're front loading the sacrifice

(18:34):
in a major way in those early years, which gives
you more options to increase your spending or just to
quit completely your job or quit saving for retirement at
least after that initial phase, that initial stint of front
loading those contributions. Or there's like lean fire adherents who
mostly just want to amass.

Speaker 2 (18:52):
Enough to squeak by. Right. There are ultra frugalites, and
so those are the folks living in a trailer in
the woods, living on like twenty thousand dollars a year.

Speaker 1 (19:01):
Yeah, they want to save just enough so that they
can do whatever they want, but whatever they want has
to be within massive amounts of reason because they have
they have to live frugally because they haven't saved enough
to do much beyond that. And so, yeah, when you're
considering whether or not early retirement is for you, it's
not a one size fits all proposition either, which makes
it a little trickier. You got to figure out what
kind of early retirement lifestyle you want to live first

(19:23):
before you even start to answer the other parts of
that question, that's right.

Speaker 2 (19:26):
Yeah, So not only are there different flavors of fire
for folks to consider, different types of early retirement that
might fit their situation the best, but we also have
a number of different questions that listeners can ask themselves.
We've got some specific like financial or number related questions,
as well as some non monetary factors that you need

(19:48):
to consider as well, and so we will get to
all of those right after this. All right, Matt, let's
keep going.

Speaker 1 (20:02):
We're talking about early retirement and whether it makes sense
for the average person, and it's definitely not for the
average person, right, because I think if you.

Speaker 2 (20:09):
Both of those instances, I thought you were gonna say
the average bear. It was like it a yogi. Yeah, well,
did you ever watch that one back in the day
a little bit? I mean that was talked about old
school cartoon. I know that was pretty old too, But
we're falling into this like nostalgia mindset that we need
to probably stop.

Speaker 1 (20:25):
Yeah, well, I think it's it's definitely not for the
average person because you have to be very different than
average and have a different kind of mindset if you're
going to achieve early retirement. You can't just kind of
do what the average person does because, like when you
look at the averages, the average person doesn't have enough
money to cover a four hundred dollars expense, The average
person doesn't have very much money in their emergency fund,

(20:45):
and their savings rate, the average person savings rate is
in a three percent range. So you got to be way, way,
way above average if you want to achieve early retirement.

Speaker 2 (20:52):
I think you said average nine er ten times probably.

Speaker 1 (20:54):
Yeah, so yeah, don't be average. But yeah, let's talk
about the the We're gonna talk about the non financial
aspect here in the second of what you're going to
want to consider before you set your course for early retirement.
But first let's talk about some of the money mechanics
for a minute, Matt and like, how will people know
if they have enough money set aside in order to
retire early? And the math behind early retirement is actually

(21:17):
not terribly complicated. Mister money Mustache, who's one of the
foremost profits of the early retirement movement, he has a
post called the Shockingly Simple Math behind Early Retirement, and
he's right up until the point, like, I think the
math in his post is not terribly complex, and at
the simplest level, the number that you need to have
saved up inside your investment accounts is twenty five times

(21:38):
your annual expenses in order to not run out of money,
And mister money Mustash he assumes a five percent rate
to return after inflation and a four percent annual withdrawal rate.
I think the simplicity of that post and of his
approach are really great. On one hand, they can help
you visualize how few trade offs, just a few trade
offs can help you ratchet up your ability to reach

(22:00):
financial independence more quickly. But it's also far from perfect,
given a bunch of other factors that we need to
consider here.

Speaker 2 (22:08):
That's right, factors that include some of the different expenses
that we experience in life, and so a large part
of knowing that you have enough is to forecast your expenses.
And a lot of folks in the early retirement community
are banking on certain things just continually being true that
they're just going to remain stagnant. But it is hard
to predict the future. So inflation, for instance, that could

(22:30):
throw a wrench in someone's early retirement plans. It's something
that we've seen recently, especially if they're opting for more
of the lean fire, right, like more that lean, hyper
frugal lifestyle.

Speaker 1 (22:40):
When eggs cost, you know, just double in price in
the course of a year, that's going to mess up
if your lean fire and you're but.

Speaker 2 (22:46):
Your grocery bille just went up fifty percent, is that tight? Yeah,
that's going to have an impact. Yeah, a few months
of those higher costs here and there are going to
add up if you're trying to live on twenty five
thousand dollars a year. So we think that if you
really want to retire before your peers, that it is
important to save more than you think you'll need. Don't
just purely count on that twenty five times your annual expenses. Again,

(23:07):
it's a great rule of thumb, it's a great place
to start. But we think it's good to have more
on hand than you need. That'll give you just additional options,
that'll give you some peace of mind. Because hotter inflation numbers,
you know, they're still going to be tough to endure
in the moment, but they won't completely wreck your personal finances.
They won't completely throw you off track.

Speaker 1 (23:25):
And I was kind of joking about egg prices like
wrecking someone's budget to the point where it completely derails
their early retirement. But that is, you know, people's grocery
bills have been affected in a major way obviously by
rising inflation. But something even more important that's going to
be a bigger line item in your budget is your
car insurance. And car insurance rates have been skyrocketing too.

(23:45):
People in our Facebook group have been saying, oh, my
car insurance went up six hundred dollars this year or
something like that, and it's been like, that's a lot
of money to absorb.

Speaker 2 (23:52):
Significant if you're.

Speaker 1 (23:53):
Not Yeah, if you're not bringing in any money and
you're trying to live that early retirement lifestyle. And so
it's important not just to bank on a best case scenario,
you have to have kind of contingency plans right in
place in case inflation runs out four years on end,
and in case you're you have to have that flexibility,
right Matt, Like you were just talking about additional options,

(24:15):
and if you're banking on things working out perfectly with
that twenty five x annual expensive scenario, you might be
in for a route awakening, a pretty sobering surprise. But
let's talk about something else that early retirement adherents often
run up against, and that's that they end up spending
more than they think they will once they do retire.
JP Morgan did a study of traditional retirees and they

(24:37):
found that those folks often experienced what they called a
spending surge in the two to three years post retirement.
They often spent on home renovations and fun trips, which
makes sense like early retirees are likely to experience something similar.
What's the point of bagging work if you aren't going
to exploit your newfound freedom and go on some cool
trips and do some excursions and stuff like that. Of course,

(25:00):
I would say people in the early retirement community, they're
likely to take those trips frugally right, utilizing credit card
card points or hostile stays or you know, other low
cost methods that are going to ensure that these trips
don't cost them nearly as much as the average person.
Of course, they're certainly not guaranteed to spend more, but
it's something to be aware of because again, you know,
more padding, like you were talking about, Matt, a larger

(25:21):
cash cushion can allow folks to increase spending for some
of those post retirement excursions without completely freaking out exactly.

Speaker 2 (25:28):
And it makes sense too from I guess the traditional
retirey standpoint, because oftentimes when you retire, you're you're not
anchored to a specific location from a geographic standpoint, You're free,
right like you are no longer tied to a specific city,
which I think oftentimes means that you can then maybe
move to wherever the kids are. You can move to
the beach, because you do want to be on the

(25:48):
beach with the sane Scooper metal detector. But either way,
I think it is it's smart to not necessarily count
on the most meager, lean existence possible. And it's something
else to account for is the high cost of health care,
and so I'm specifically talking about the premiums that we
pay that folks pay, But the same is true if
you end up using your coverage, right if you actually

(26:10):
get sick, or if you have to go to the
doctor or the hospital. Makes me think of a quick,
frugal or cheap that we could do about me making
an appointment goal for a doctor's visit that I resolved myself,
but we won't go there. Let's not. But there are
certainly going to be ways to reduce these costs, obviously,
but they're not full proof. So for instance, there's going
to be more subsidies out there for folks who are

(26:31):
buying policies on at the website healthcare dot gov these days,
but that may not always be the case. Health sharing
companies that can be another option that can make sense
for younger, for healthier folks who are willing to self insure,
but again they're not for everyone because it's not technically insurance.
And actually it can be easier to get cheaper health

(26:52):
care if you plan to live overseas instead of here
in the US here in the States, but obviously, like
what if you don't want to go move to Portugal
with everyone else who's retiring and going abroad, who doesn't
want to move to Portugal. Yet, it's hard to have
a full proof plan because there's just no silver bullet
answer to the question of these ever increasing health care
costs that are going to fall squarely on our shoulders

(27:14):
once we've decided to quit our jobs.

Speaker 1 (27:16):
Yeah, that's definitely. I mean, I think if you're pursuing
early retirement or thinking about it and you haven't thought
through the high cost of health care, then you haven't
been thinking about it long enough, because that is going
to be one of those the most burdensome costs that
falls squarely on your shoulders.

Speaker 2 (27:30):
Like I said, it's going to be it's all on you.
It is, simultaneously, it shouldn't. It's likely not going to
be prohibitively expensive, right because I think oftentimes in folks minds,
that is a roadblock and it keeps them from even
considering early retirement. But go out there and crunch the numbers,
see how much it's going to cost you, because yes,
it's going to be expensive. It's in particular if you
haven't been with a company who I mean, there's a

(27:50):
lot of new companies out there who are covering like
virtually all of the health care costs of their employees.
And if that's you, you are in for a rude awakening.
But for everyone else, you know, I don't know, if
you've employed by a normal company where you've had to
flit some of those bills yourself, you might find that
it's actually not all that more expensive than it was
being employed.

Speaker 1 (28:09):
But I think, like you said, it might not be
right now because of the great subsidies for so many
people on the exchange. But those subsidies could go away,
and so so much depends on who's in power and
what sort of legislation pass when it comes to how
much you got to pay for the health insurance that
you want. Sure, Yeah, all right, Well, let's talk about
something else that early retires have to think about, and

(28:30):
that is sequence of returns risk. So let's say you've
got your expenses all figured out, you've got enough invested
to be able to retire, and you can afford to
spend a little extra, and you can afford now that
expensive health care policy. Well, it's a bold market and
your net worth is growing. But the market could just
as easily cool, and like we saw a stock market

(28:52):
route in March of twenty twenty, right, and last year
was pretty rough for investors too, But what if the
market remained in a bear market holding pattern for a
few years complicates things, in particular for early retirees who
are attempting to live off their investment portfolio. And of course, yes,
the market has returned an average of ten point two
percent over the past fifty years, but the fact is
the market is unpredictable in the short term, and you

(29:15):
might retire at the wrong time into an era of
low to no growth, which if you're looking at predictions,
which we don't really we try to stay away from
predictions most of the time, you're seeing a lot of
predictions for meager growth in the coming decade, and that
could be a difficult thing for regular retirees to endure,
even if they have social Security to provide some income
mixed with those investments. But if you retire at the

(29:36):
wrong time, and you're early retiring, you might find yourself
attempting to draw down four percent of your portfolio a year,
year after year at an inopportune time, draining some of
that capital, straining your ability to actually retire.

Speaker 2 (29:48):
Well, yeah, that's right, Yeah, that's sequence of returns risk. Right,
Imagine you're going to live off of your portfolio over
the next thirty years, and imagine somewhere within those thirty
years you're going to have two years in a row
of returns at negative twenty percent. Well, if you experience
those two years right after you retire, you're gonna have
much much less on hand than if those two years
were to occur at the very tail end of those

(30:10):
thirty years. It has a massive impact on your lifestyle
and your ability of the ability of your portfolio to
hold up over that period of time. And this is
also the fear that keeps folks handcuffed to their jobs essentially, Right, Like,
folks say that the market could tank, So I'm just
gonna work a little bit longer. But at some point
we have to be able to confidently retire, you know,

(30:31):
even knowing that we can't predict the future, or even
knowing that our own health what that's gonna be, or
what the market's gonna do in our first jobless decade
or you know, first twenty years. For thirty years. But again,
this is where having just maybe a little bit of
extra wiggle room and planning for more than just that
twenty five times your current expenses is gonna be helpful
because you might not always want to live as frugally

(30:53):
as you're living now. You might think, well, no, I'm
always gonna want to do the van thing and drive
around the country. You may not, you know, you might
do it for maybe you'll get the seven year itch,
like maybe you'll do it for five, six, seven years,
but at that point it might be something that you
want to move on from.

Speaker 1 (31:08):
Especially the things that you are okay with in your twenties,
like I'm not I know, I'm not to brouch forty
and I love being frugal, but I'm not frugal in
the same ways that I wasn't my twenties exactly. I'm
just not willing to travel or to do some of
the things that I would have done back then to
save a buck now.

Speaker 2 (31:22):
Exactly, and that you know, you may not need to
save and invest like a fat fire adherent right like
where you're just living high on the hog and you've
got tons of nice expenses that you're accounting for. But
the lean fire approach is it's kind of scary, it's
a little more risky from our vantage point.

Speaker 1 (31:38):
Yeah, let's talk about something else too that really inhibits
your ability to retire early. Again, not that it's not possible,
and not that it's not a decent goal for some people,
but we're kind of trying to I guess we're like
steal manning the case against retiring early here right now.
But a lot of people would say, I want to
retire early, but I'm literally not old enough to withdraw
from those retirement accounts yet, which is a big deal.

(32:00):
We talk a lot about investing in those tax advantage
retirement accounts a reasonable argument, yeah, and so well, how
am I going to get my money out of these
things when the government tells me I have to be
fifty nine and a half, which is still just odd.

Speaker 2 (32:10):
Why half? I don't get it.

Speaker 1 (32:12):
But that is the age you need to be in
order to withdraw funds from those accounts in order to
tap them without having to pay penalties, right, And that
makes it even tougher to map out a strategy for
early retirement while maximizing the most efficient buckets for investing
for your future. And that's why a whole lot of
early retirement adherence opt for a strategy that involves wroth accounts,

(32:33):
so then you can pull those contributions out tax and
penalty free when a very time nice real estate, because
that gives you cash flow, not just seeing your investment grow,
but you're actually making returns on a month month basis.
Taxable brokerage accounts you don't get the tax benefit, but
they're to the same extent, but they're more flexible HSA's.
They're somewhat flexible with maximum tax advantages in addition to

(32:55):
the regular ole four to one K or four or
three B that we love as well. There are ways
to take money out of those tax advantage accounts even
before you hit retirement ags, but they're not ideal, and
so coming up with a strategy that allows for additional
flexibility is key to making early retirement possible. It's not
as easy as just maxing out your four oh and
K for a decade and then leaving work, right, you

(33:18):
have to think about how you're going to be able
to get the money out in an efficient manner that
doesn't come back to bite you and eat away at
the cash that you've so diligently saved up. So now
I think we've gone through a lot of money questions
here a lot of the financial aspects of what it
looks like to retire early and how there's a lot
of stuff you need to think through before you just
all of a sudden say, yeah, that's my goal, I'm

(33:39):
going to shoot for it, and you really nilly kind
of start me entering down that path. You really need
to kind of have your ducks in a row from
a money perspective in order to do it well. But
it's not just that, right, Let's talk about the non
monetary and personal aspects of approaching early retirement. We'll get
to some of those right after this.

Speaker 2 (34:07):
All right, we are still asking the question is early
retirement a smart goal? In jol We just covered a
bunch of the different financial implications, some of the different
financial questions that we need to be asking ourselves. And
we've looked at both sides of the equation. Right, We've
talked about the income side of the equation, different fluctuations
in the market and that how that can affect our

(34:27):
ability to retire early, as well as some of the
different expenses that we're all going to face. But now
let's talk about the non monetary side of the earlier
retirement lifestyle. Let's talk through some of those questions, because
we think it's worth asking a few of these questions
before going all in. One of those is to think
through your time and how it is that you're going
to be spending that right, like do you have enough
hobbies and interests to pursue if work is no longer

(34:51):
going to be a part of your day to day,
And so, in an effort to make sure that you
are prepared potentially for early retirement, we want you to
start thinking through what your idea day is going to
be like and what you're likely to spend your time doing.
Friend of the show Wes Moss. He talks about how
the happiest retirees out there, how they have an average
of three point six core pursuits and these can be

(35:13):
anything from like volunteering at a local homeless shelter. It
could be playing music, like playing the piano. It could
be what are working or pickleball? That's the newest one,
so hot, right, folks right in to the list. And
he's actually got a core pursuit finder over at a
site that will link to in our show notes. But
don't expect to easily be able to find and then
work on these pursuits only once you've left your job.

(35:36):
We think it is important to prioritize them before you
pull the early retirement trigger. We want this process to
be something that feels more seamless, as opposed to a
clear partition where all right, that was life when I
was still working, and this was life afterward. We want
it to be something that feels more just like, more organic,
more blended.

Speaker 1 (35:57):
What you're saying is people aren't just going to turn
over a whole new leaf and become a new person
and find awesome new hobbies once they reach retirement age.
They got to start working on those things now.

Speaker 2 (36:04):
Yeah, makes me like that to cultivate those interests.

Speaker 1 (36:07):
Yeah, and so maybe you will like pickleball when you're retired,
But have you even gone out to try playing once?

Speaker 2 (36:11):
Now?

Speaker 1 (36:11):
I mean if not, Like, I could see myself playing
pickleball in retirement, but I've not played once yet, and
so I would want to make sure I gave that
a thorough go before I all of a sudden assumed
that I was gonna beat the pickleball court three days
a week. Makes me think of my mother in law.
She's retired and they ended up buying just a giant
RV to drive around in right afterwards, and they realized
pretty quickly. We thought we were going to spend our

(36:34):
times rving around the country, but we didn't like living
out of an RV and there that happens to so
many people. Well, that's why buying a used RV makes
so much sense, or because that happens to a lot of.

Speaker 2 (36:42):
Folks, or even is like running one exactly given it
a two week ago and seeing how that.

Speaker 1 (36:47):
Works for you exactly. Like think about how you're going
to spend your time, but don't just think of it
in abstract terms. You use information from how you spend
your time now in a non retired state to say like, well,
could I do more of this than I'm current doing.
But if you're just thinking, oh, I definitely see myself
doing that, well you don't really know until you've tried.
And you can picture an ideal lifestyle, but it might

(37:08):
not be what you think it is, and so you
have to kind of, yeah, give those things a go before,
like you said, pulling the trigger altogether and saying I'm
retired early now I'm going to dive into these that
is not a great way to pursue it. Another question
to ask is like, what are my closest friends and
family going to be doing, because, if you're honest, many
of them will likely still be working if you opt
to retire, let's say in your thirties or your early forties, right,

(37:31):
are you going to be happy not going to work
when the folks you want to spend more time with
don't have the time and flexibility that you have. Maybe
you're at the bar, but they're not, and so then
now you've got a problem because now you're drinking alone,
and that's not a good thing. I think a lot
of people envision that they're going to be spending their
early retirement years with people that they love, but the
truth is that is harder to come by, right unless

(37:55):
you're planning to save up enough to pay for their
early retirement too, which you're probably not. So those are
the kind of things that need to be considered when
we're thinking about early retirement, well, like who are we
going to be spending time with and what are my
days going to look like. It's not that there aren't
all sorts of interesting pursuits that you can get into
as an early retiree. You just have to know what
they're going to be, and you have to have thought

(38:16):
through what that's going to look like before you decide
to put your job and put in your two weeks notice.

Speaker 2 (38:21):
Totally. Yeah, And I'll say you kind of mentioned this earlier,
but it seems like we're kind of we're creating an
argument against early retirement. But to kind of flip that
script a little bit, I think it can be helpful
to maybe change how it is that we think about
those retirement years as well, because I think the vast
majority of folks they see like they're working years, they
see that as like the main course, like that's the bulk,

(38:42):
like that's the feature film part of their life, and
they see retirement years essentially as like the leftovers. But
I think it can be helpful if we actually consider,
because what we're talking about here is a long period
of time, given life expectancy, that we're going to continue living.
And if we sort of flip that script a little
bit and then you those quote unquote retirement years as

(39:03):
the main course, I think that could essentially change how
it is not only that we view relationships, but also
some of the different hobbies that we pursue. Right Like,
basically I guess what I'm saying is nobody sees leftovers
as like a good thing except for me. Perhaps I'll
love leftovers. But if you change how it is that
you view the you know, the literally we're talking about
decades of life here, I think that might allow some

(39:25):
folks to realize, oh well, I think it makes some
of the detriment years seem less daunting essentially, because like
we are talking about a big chunk of time, right, Like,
although COVID has impacted life expectancy in recent years, like,
there's still a good chance that healthy how to Money
listeners are going to live a really long time. When
you look at the actuarial tables, Like, if we're talking

(39:46):
about a healthy sixty five year old couple, there is
a forty six percent chance that one of them is
going to live to the age of ninety five. So
do the math there, ninety five sixty five from ninety five,
you're talking about three decades. That's thirty years. And you know,
like that's just what someone who is retiring at the
quote unquote normal age is going to have to account for.
Early retirees might have to plan for something like double

(40:08):
that length of time, right, And that only complicates the
calculations from a financial standpoint. But again, right now we're
kind of talking about the more the mental and psychological
factors to think through. And again this doesn't mean that
early retirement is not a worthwhile goal, but it does
add some important context to the equation. But I do
think that by viewing those thirty years, or if you

(40:28):
are an early retiree and we're talking about sixty years left,
I still think that there's a lot of life to live, right,
Like not to discount all the friends that we've made
up until the point that someone retires, and not to
discount the time that could have been spent pursuing some
different hobbies before you retire as well. So honestly, it
makes me think of a gentleman who is sort of
like a mentor, I guess, but he is a generation

(40:50):
ahead of me. He had kids that were closer to
my age, and I remember asking him one time if
he felt that the period of time that when he
had his kids at home, if those were like the
most important years, and he was like, honestly, he's like,
it's been awesome being an empty nester, Like having the
kids away from home the time that my wife and
I have been able to spend together has been so
incredibly sweet, and he was still working a little bit.

(41:12):
The work that I'm now able to do has been
so incredibly fulfilling and gratifying. So I don't know. I
guess I'm just putting an argument out there that the
time after we quote unquote retire can also be incredibly
fulfilling if we don't necessarily look at it like this
left over time. Yeah.

Speaker 1 (41:27):
Well, and I think if we don't think about it
in just self indulgent terms, which I think a lot
of people think of retirement in those ways as well
as opposed to like productive years, it's very like, how
am I going to entertain myself and enjoy the time
that I have? And I think if we think about
it in terms of like service to others, I think
early retirement or regular retirement can take on new and
deeper meaning. Right, So totally, And let's talk about transitioning

(41:49):
into retirement, because I think it's important to mention when
we talk about early retirement, we're often talking about something
fairly extreme and feels like an all or nothing sort
of proposition. Well, I'm either retiring at thirty five, I'm
just gonna keep going till I'm sixty five. But it
doesn't have to be that, and it doesn't have to
be just this all or nothing sort of framework. And
before you decide that you never want to work again
and that there is no alternative, you'll even consider think

(42:12):
about easing into retirement instead. And I think that could
look like cutting back on your hours at work now, right,
This is actually a trend that's kind of starting to
happen in general these days. I think people are working
on average one to three percent less than they were
in twenty nineteen, which I think is a great thing.
Like baby step speak, Yeah, exactly, take it back just
a little bit, work a couple hours less a.

Speaker 2 (42:30):
Week then all right, all right? Yeah.

Speaker 1 (42:32):
And so if you're like, if you're like, I'm really
interested in this early retirement thing, I don't want to
like work fifty hours a week until I'm sixty five.

Speaker 2 (42:39):
I get that.

Speaker 1 (42:40):
I get that, But why not test out working twenty
to thirty hours first before you call it quits. You'll
still have income, which is great, but you'll also have
extra hours to fool around with, and you'll kind of
get to see what are my days going to look?
Like when I have let's say Thursday and Friday. For you,
I'm only working Monday through Wednesday. It's kind of like
waiting into the waters of early retirement before you just

(43:02):
quit your job altogether. And it makes me think of
my mom, Matt, that's what she did. She's working three
days a week. She's about to fully retire, but she's
you know, traditional retirement age. But that kind of helps
to see, well, how will I spend this day? And
you're kind of going into it slowly as opposed to
going from like full on to completely off.

Speaker 2 (43:20):
Yeah. Yeah, it kind of depends if you were like
weight in, you know, into the shallow wading kind of person,
or if you're more like cannonball off of the diving board.

Speaker 1 (43:27):
You and I, I think it's important to mention this, Like,
we work half days on Fridays.

Speaker 2 (43:31):
So almost forgot it's it's kind of gotten normal for us.

Speaker 1 (43:34):
Yeah, and we've talked about how maybe at some point
we would consider doing like no no Fridays at all,
or maybe half days Thursdays and half days Fridays, and
so like there's ways in which well, especially it's easier
when you're self employed, I guess, but it's there are
a lot of traditional employers who would say, no, we
still want to keep you around, but you don't want
to work on Fridays. Sure, it's going to involve a

(43:54):
cut to your pay. Yeah, But if they don't want
to lose you, they'll often say they'll sign on the
dotted line and say, sure, that's fine, that's fine with us.
But those are the kind of things I think that
cutting back on those hours can help. You see, well,
what would I do with that freedom? Am I completely
lost here? Or am I jones in for more time?
You know, six months into that experiment?

Speaker 2 (44:11):
Totally? Yeah. I think this is why we're such huge
proponents of Coast Fire, because by having done that heavy
lifting early on that Coast Fire gives us options to
then start something like a podcast about money that may
or may not make any money. You know, like five
years ago we were it felt kind of risky, but
we also would have been totally fine because we had
set ourselves up in a decent position. Obviously, we've continued

(44:34):
to invest since then, and we are in an even
better position over the past five years. But essentially, what
I'm pointing out here is the fact that we've got options,
and that is absolutely one hundred percent something that we
want everybody to be able to experience. So you're talking
about cutting back the number of hours we work kind
of like on a regular basis, but I think looking
at essentially taking our vacation days, I think that is

(44:56):
really important as well. Honestly, this might be like the
very first up because fewer workers are actually taking time off,
and the number of folks who are taking significant chunks
of time off for personal enjoyment has been in decline
for decades. You know, even with the quote unquote unlimited PTO,
like that is becoming a more frequent benefit than.

Speaker 1 (45:16):
I guess just a dirty trick the employers are offering
on there laying it's not cutting it because they know
how we react, and they know that unlimited PTO means
we're not gonna ta We're gonna do it unless they're
guilted into not taking it.

Speaker 2 (45:26):
Unless there's a culture set of that being the path
that you should be following. And so if you say
that you want to retire early, but you're not willing
to even take your vacation days off, and it might
not be a great fit for you. You know, at
least make it a point to take the time off
that you're given at first and again. Not to point
to you and me jaw as like these shining perfect examples,
but this is something that I'm proud of us for

(45:47):
improving on because I think, you know, a few years in,
like maybe let's say three years ago, we're like, oh,
the podcast is doing pretty good. We don't. It's it's
hard to break away from it. It's hard to step
away and say, all right, we're gonna let's take a
week off. Let's take a couple weeks off for Christmas.
Let's take a week off, or you know, like a
summer beach trip something like that. But I think was
it earlier this year We kind of looked at the

(46:08):
calendar and we might be taking something close to two
months off by the end of this year, not all
at once, but kind of scattered around here and there.
I guess I'm tooting our own horn here. But I
think that's admirable and I think it's something that's worth
working towards, not just from us.

Speaker 1 (46:22):
You're not going to get there overnight. It's technical long
time to get there, but I think it's a good goal.
I'm a little nervous about this year, how much time
we're trying to get off, but I'm also excited about
it too.

Speaker 2 (46:29):
Yeah, but I think it's good though, because we are
working on it. Obviously, we've worked on it from a
financial standpoint, right, we have prepared and we are hopefully
in a financial position to be able to handle that.
But it also takes practice on an internal mental level
as well, even aside from the finances of it. From
a mental personal standpoint, do we have the guts? Do

(46:49):
we have what it takes to step away from work?
And I know that sounds silly to say, but I
think it takes more courage than people realize, because oftentimes,
when you enjoy your work, it can be so easy
for us to find ourselves like gravitating back towards it,
essentially as opposed to pursuing some of those other things
that we have identified as being so important.

Speaker 1 (47:07):
Especially when we didn't grow up in a culture like
Australia where they take like two month holidays like every
single year, which is which is awesome, mates, but that's
just not the culture that we live in here, and
so we feel, I think guilty when we take our
vacation time or we feel guilty by saying, hey, listen,
I want to work thirty or so week and not forty.
Those are the kind of things that in the US culture,
those are not normal, But I think they're worth pursuing

(47:30):
instead of saying it has to be all or none.
These are like in between steps that people can and
should consider and take before they get to that point.
Totally for that mental reason, but also for financial purposes too.
And I think many retirements are just another option, like
consider taking a full month off or longer, maybe a
few months. And especially with the fact that people are
working remotely now in such large numbers, this is something

(47:50):
people can do. They can work from abroad and take
weeks off while they're abroad and get a taste of
what it would look like to live somewhere else, if
that's what they're acting or Friend of the show coach Carson,
he describes many retirement like this, and I really like
this what he says. He says, any extended break that
alters the rhythm and ingrain patterns of your work and
home life, which is a great approach, Like throw a

(48:11):
wrench in things like it and give them many retirement
a shot, you know, and more companies are offering things
like sabbaticals for employees who have been there a number
of years. You might not be able to get paid
for it, but who cares. Like, if you're getting to
that financial position where you think you're ready for early retirement,
take the sabbatical first, and kind of even if it's unpaid,
give it a shot, because early retirement's even more complicated

(48:34):
than a two month stint off, right, and a shorter
endeavor makes sense to me. I think before you go
all in and you say early retirement lifestyles for me, well,
how do you know? And have you taken the approach?
Have you tried it out yet? And we'll link to
one of a blog actually that Coach Carson wrote about
many retirements. I think is really helpful for people who
are considering one.

Speaker 2 (48:53):
Totally. Yeah, So what is it ever since you mentioned
the Australian and you said mates, so after high school,
what is it called when they take essentially take a
year off when they'd like travel the world? Rump Springer, No,
I'm just kidding. I don't know, like there's there's something different,
there's a term for it. But but yeah, I mean
I agree. I think there's a lot of different life
experiences that we should be opening ourselves up to. Whether
it's after a career of having worked for multiple decades

(49:16):
and it's just time for us to start testing the
waters a little bit and saying, oh, is this something
that I want to pursue or achieve sooner or even
you know, like right after high school. I don't think
it would be a bad idea to travel the world
and see all that is out there before you sign
yourself up for four years of indebtedness. Uh, it's a
high cost of gap yere. Yeah, take a little gap here,

(49:37):
gap year, that's the that's the word. Yeah.

Speaker 1 (49:40):
So I thought you were talking about what Australians do
and I was like, I don't know what they do. No,
oh you're talking about it's just yeah, generally speaking, you
take year, you take a gap year? Yeah, Well, I
mean and well I took three months off I quick.
I got my first job in radio. I did it
for six months and then I was like, you're not
really working out for and so I quit.

Speaker 2 (49:55):
You casey, you know, you're probably you're you're getting to
the end of your bank account basically, right.

Speaker 1 (49:59):
Well, well, the pay was not very high, but I'd
saved up like five grand and I went on a
three month trip around the United States.

Speaker 2 (50:05):
I mean you're three months. Oh? I thought you said
the three months didn't work out. No, the three months
was great, Okay, it was the job that wasn't working out.
I was like this, I don't really want to be
here a buch longer. And so but I'm young enough.
I can find something else when I'm done with this,
and I can live so cheaply in the meantime that
it doesn't matter, and that three months well worth it.
I've got the best memories from that. So I don't
want people to think that this is like some sort

(50:25):
of like pro work until you die episode.

Speaker 1 (50:28):
And I hope that we've come across pretty clearly in
that regard that you and I like, I'm planning to
retire at some point, probably about to turn forty. I'm
not going to retire like in my.

Speaker 2 (50:39):
Jels like I'm not gonna live forever, not gonna retire.

Speaker 1 (50:41):
Anytime soon though, but taking these interim approach, at least
I think for you and me, Matt, that makes more
sense for us. It's like, yeah, let's take a significant
amount of time off during the year. Yeah, let's do
half day Fridays, and but let's also still have meaningful
work that we enjoy to do with part of our lives.
So I don't know, it's all about kind of finding balance.
And yeah, it's not going to look different for everybody

(51:02):
else totally. Yeah, Because I mean so early retirement is
going to attract a certain crowd. I think for some
that goal is going to be incredibly enticing. We're all
for increasing your savings rate. We're all for ramping up
your financial margins so that you are going to have
more flexibility and more choice in your life. But quitting
work all together like cold turkey right about now, even
though we likely could, that doesn't sound all that great,

(51:24):
you know, like we've chosen instead to pursue something that
we love instead of opting out of work altogether. And
so we wanted to talk about this today because we
are trying to encourage everyone out there to choose your
financial goals wisely, because I think they're going to impact
how it is that you live life now, because like
early retirement, it might make the most sense for you.

(51:44):
I want you to think about some of the alternatives
that will make your life awesome potentially in the here now,
before you've dedicated your life to a goal that might
not actually make you happy. And you know the other
thing too, If you pursue early retirement while you neglect
your health and relationships, it's not going to be worth it.
That's something as we have friends who are in the

(52:05):
fire space, that is something that they have continued to
come back to. They've said that if they could do
it all over again, they would possibly continue working, holding
the job that they had with all the great benefits,
but that they would have prioritized different things like taking
care of their body, meaningfully investing in some different relationships
along the way, as opposed to that nose to the
grindstone mentality when a lot of them were working fifty

(52:27):
sixty plus hours to achieve this goal in a shorter timeframe,
which led to unhealth for a lot of those working years.
And so I think that is one of the trade
offs that a lot of people trying to pursue early
retirement end up making. And so those interim years until
you reach that point, they become kind of a slog,
They become kind of hard to remember. Maybe you didn't

(52:47):
get to enjoy yourself maybe you missed out on a
fun trip with friends, because no, no, no, all my
extra money's got to go into my four one K
and HSA, right, because my goal is retiring early. But
I think if you take that hard nosed approach to
early retirement, I think you can retire early and do
it well. But I think if you take that hard
nosed approach to retirement to early retirement, you're likely going

(53:08):
to have missed out on a lot of great stuff
along the way, exactly.

Speaker 2 (53:11):
And those are years that you may never be able
to get back, you know, like youth and flexibility and
other And you and me we're in the ability to
go without a whole lot of sleepy as saying this
as somebody who hate to have their kid wake up.
We're already did the more times in the middle of
the night.

Speaker 1 (53:25):
Last night, you and me, we're already the point in
our lives where we can look back on some of
those years with fondness, and it's like we're removed enough
from youth that I look back and I'm like, oh,
those were good times, and I'm glad that I wasn't
like hold up in an office working too much, trying
to pursue this goal, like to dedicated to the cause
of special independence, and it's not that like so, like
you said, frugality and investing and developing more margin in

(53:48):
your life aren't important. But man, if it means that
you're missing out on the rest of the good stuff,
then that to me, I think that's a mistake.

Speaker 2 (53:54):
Exactly totally agree. Man, Let's get to the beer. You
and I we enjoyed a Ferris which is a coffee
Imperial stout. This is a beer by New Park Brewing.
Another one sent to us by Matthew. Thank you so
much for sending this one our way. Joel. What were
your thoughts on this one?

Speaker 1 (54:10):
So this one was roasty and a little bit bitter,
which I kind of like because it was made with
coffee from Jay Renee. Okay, I guess that's the coffee
roaster that's there in West Hartford. Okay, Yeah, So I
would say this was a really good, a really good stout.
And some people really like the sweeter, milk style stouts.
I prefer kind of a more bitter coffee stout. So

(54:32):
this one's up my alley with a.

Speaker 2 (54:33):
Little more pep in the stuff. It's almost like an espresso.

Speaker 1 (54:36):
Yeah, kind of like an espresso style coffee coffee stout,
So I dug it, what about you?

Speaker 2 (54:40):
Yeah? It was pretty so not espresso from like in
a citide bite kind of way, because I would say
that this drink really smooth, like it almost was like
a milk stout. Had a nice creamy mouthfeel too, like
there was some lactose in there or something. Yeah, but yeah,
really well balanced. Definitely enjoyed this one. And did you
pick up on the label? By the way, this was
called Ferris. Do you understand the graphic? Nope? Have ever

(55:02):
seen like magnets when they interact with like metal shavings.
So Ferris is like the symbol for iron, right, Oh yeah,
And so I think it's supposed to be like the
way that metal or iron reacts to magnetic fields. Right,
science nerd, you get it, you get it. You're the
bill Ny out of money, Matthew. At first, I was like,
what is on this label? And then when we read

(55:23):
the name of the beer, I was like, oh, Ferris
like iron, not like Tim Ferriss spelled differently. Anyway, We
hope that you've enjoyed this episode, if you got a
lot of value at this one and you haven't yet
left us a review over at Apple Podcasts or honestly
even over at Spotify. The make it so easy, just
mash They got the five stars right there, you know,
go all the way to the right. Include all five

(55:43):
stars if you don't mind. But it really does help
us to get the word out, helps others to learn
about different personal finance concepts like early retirement. We'll make
sure to have links to some of the different resources
we mentioned during this episode up on our show notes
at how tomoney dot com. No doubt.

Speaker 1 (55:58):
All right, that's gonna do it for this episode, would Matt?
Until next time, Best Friends, I'm best Friends Out

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Joel Larsgaard

Matthew Altmix

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