Early Retirement Extreme

Financial independence, frugality, self-sufficiency, ecology, capitalism, and voluntary simplicity

If I retire with a million dollars how well can I live?

Published in January 22nd, 2008

Posted by Jacob in assets, budgeting, cost of living, financial security, personal finance, standard of living

If you’re new here, you may want to subscribe to my RSS feed. Thanks for visiting!Financial planners universally use a rule of thumb that you can deduct about 4% of your retirement account annually without compromising your principal(*). With a retirement account of $1,000,000 you can therefore spend $40,000 a year.
As for how well [...]

I don’t need an emergency fund, I have a credit card

Published in January 14th, 2008

Posted by Jacob in budgeting, compound interest, financial security

8 Comments

I don’t have a disaster fund or an emergency fund. For emergencies, I use a credit card. Why do I do that? The reason is that emergency funds must sit in a checking account to be liquid. While sitting there they earn less than a savings account (in general) typically only a few percent.
If I [...]

Do I need a million dollars to retire?

Published in January 7th, 2008

Posted by Jacob in compound interest, consumerism, cost of living, expenses, financial security, frugal, household, rat race, standard of living

7 Comments

People keep telling me that I need at least $1,000,000 to retire comfortably. This concerns me somewhat since I don’t have one million and because it would take about 10 more years to save for one. Now, one million would throw off a cost of living adjusted $40,000 a year in capital income if it [...]

How to get wealthy on minimum wage

Published in January 2nd, 2008

Posted by Jacob in budgeting, cost of living, expenses, financial security, standard of living

11 Comments

This is an interesting challenge which I believe I could do if I had to. To reiterate: This posts shows what I would do. As always, I am not you, and it is your responsibility to decide whether you want to and whether you need to hire a certified financial professional to consult before following [...]

How I became financially independent in 5 years - Part I

Published in December 26th, 2007

Posted by Jacob in compound interest, cost of living, expenses, financial independence, financial security, frugal, inflation, job, liabilities, motivation, personal finance, standard of living, voluntary simplicity

8 Comments

If you enjoy this post, please consider subscribing to the blog. You can subscribe by using one of the options in the upper right corner. Personally, I prefer readers, email and google in that order. Simply click on the links and things should happen automatically.

I posit that most people can attain financial independence in less [...]

Forget about net worth, consider the bottom line

Published in December 25th, 2007

Posted by Jacob in assets, cost of living, financial independence, financial security, inflation, investments, liabilities, net worth, personal finance, saving

1 Comment

I think the income or p&l statement which catalogues earnings and expenses is more telling about a person’s financial situation on a day to day basis than the balance sheet which is where you calculate your net worth. The balance sheet is more useful when you are considering buying or selling assets. So for example, [...]

Wear sunscreen and retire early

Published in December 21st, 2007

Posted by Jacob in budgeting, cost of living, financial security, personal finance, standard of living

1 Comment

Spoken to the tune of “Wear Sunscreen”.
If I could give you a single piece of advice. This would be it: Live within your means. The long term benefits of living within your means have been proved by economists whereas the rest of my advice has no basis more reliable than my own observations.
Buy a [...]

It’s only money…

Published in December 6th, 2007

Posted by Jacob in compound interest, consumerism, financial security, money

No Comments

One thing you will hear if you adopt an extreme savings program is the popular refrain “It’s only money”, “There are more important things than money”, etc. I agree with the last statement, but it is NOT just money. It is what money represents that matters.
Money represents many things.
Money is time. It represents the time [...]

Newer Entries »