Many of you know that I grew up on a family dairy farm in Pennsylvania. If you have seen the increasingly popular and ridiculous show Amish Mafia, then you have seen the backdrop to my childhood.
Life was a lot of work, even with five pairs of calloused hands keeping our farm afloat. Under the weight of two milkings per day, fences and equipment repair, the planting of crops, the harvesting of them later in the summer heat, and tracking down newborn calves in the back meadow, we all groaned, griped, and whined. Having a grandfather who loved to bark orders at us did not help the situation, and made us rather resentful.
As I grew older and dug myself out of the manure trenches, I started to understand why my grandfather loved to bark orders from on top of machinery or from his apartment upstairs to us working-folk; it was because he had already put in a lifetime of hard labor. Through his 50s onwards he had a limp. And that limp was from doing 40+ years of precisely the type of daily, back-breaking work my family was subjected to.
I didn’t want that for myself.
Working day in and day out from before the sun rises until after it descends and seeing such little money stay in my parents’ pockets made me reassess the seemingly linear relationship between work and money. When you work yourself to the bone and you see little monetary return five, ten, and fifteen years out, you really change your perspective. You start to respect money. Money to me was never about being a vehicle for getting what I wanted; it was about keeping as much of it as possible to have something to show for all of the work I was doing. I didn’t want to hand crank the survival cycle of hard work and low pay for the next 30+ years. Don’t get me wrong, I was never averse to work and some weeks could be the poster child for a workaholic. But I wanted something more.
For all of my childhood and most of my 20s I was curious about people who did not seem to have to work themselves to the bone for pay. Not envious, just extremely eager to observe, learn, and implement whatever they were doing. While I dreamed that one day I would be able to sustain myself without having to work to the bone for everything—a pipe dream if my grandfather ever heard of one—deep down I just didn’t know if it was possible. And then something wonderful happened. I figured out that life didn’t have to be so hard, and that earning decent money did not mean I had to physically exhaust myself. This coincided around the time when Paul and I paid off our non-mortgage consumer and student loan debts and our cash flow opened up. Our bottom line grew, and with it our financial independence and security. Suddenly everything seemed possible, including early retirement.
Check out my recent news segment on Fox 26 news about Early Retirement Extreme–>Houston weather, traffic, news | FOX 26 | MyFoxHouston
You Need to Redefine the American Dream
As I mentioned in my recent Fox 26 news segment, if we want to be able to dream about and potentially live in early retirement, then we need to redefine the American Dream. Whose American dream is it to be mortgaged or financed? In whose dream is someone thinking about a scenario where they can rent-to-own? I would venture to say that no one would associate these financial terms with their American Dreams. And yet, many of us fund our “American Dreams” with loans that ensure we stay deeply entrained in the survival cycle. Under the current mainstream system of “buy now, pay later”, we are literally trading years of our lives in sometimes back-breaking work for trinkets and “luxuries” today. Trust me, these trinkets and luxuries on loan today will not shine so brilliantly when you are stuck working extra years in a cubicle and/or high-stress job.
So what does the new American Dream look like? It is paid for as you go, it is simple, and at the core are the true gems: financial independence, security and freedom.
You Need to Redefine “Retirement”
Most people within the extreme early retirement world are targeting not only an early age for retirement, but also a different kind of retirement than the traditional one. Retirement, in the traditional sense of the word, is when you resign from your last 9-5 job and take up, well, living. If you have saved enough money and can withdraw a decent income (from a mixture of savings, social security income, pensions, 401(K)/IRAs, etc.), you can do practically anything that you want to. That is, once you turn the typical age of 62 years or older.
So what could an extreme early retirement look like? The extreme part about it is that you will be much younger when it happens. This is partially achieved through a large sum of savings that you have set aside, and partially achieved by redefining the traditional definition of retirement. Retirement could perhaps be a second act of employment where instead of working a 9-5 job you only marginally enjoy to pay the bills, you are working an enjoyable part-time job, hobby job, or passion job to help buffer your retirement savings. Instead of living in a relatively expensive area and or country, you research and move to a cheaper area or a cheaper country that offers free healthcare. Perhaps you change your entire spending habits around like Jacob who saved more than 75% of his income for 5 years and has lived on just $7,000 a year for over a decade now.
Living the Principles of ERE will Redefine Your World
Not working in a 9-5 job for 40+ years of your life is truly a revolutionary and sometimes counter-culture idea. If you choose to go down this path, prepare to have your life change dramatically (they don’t call it “extreme” for nothing). Even if you don’t want to follow the path through to its eventual end, living by some of these principles will give you more financial security, more financial freedom, and less money headaches. It will also teach you that paychecks aren’t a life-sustaining force, growing and declining just enough so that we can feed ourselves.
On the “extreme” early retirement scale, my husband and I are probably considered moderate to extravagant. We still have vehicles, we have a home, we did more than go to the county courthouse when we got married, and we don’t even have a target age of when we would like to “retire”. That’s right; to us it’s more about living the principles of ERE and benefitting from it long term rather than actually retiring at a very young age. But compared to many people’s lives, we are considered extreme.
In the next article I will discuss the steps you need to take in case you want to start down the extreme early retirement path, as well as share with you more of our lifestyle to show you how it parallels with this concept.
What is your target retirement age? Are you on the path to extreme early retirement?