If you're new here, this blog will give you the tools to become financially independent in 5 years on a median salary. The wiki page gives a good summary of the principles of the strategy. The key to success is to run your personal finances much like a business, thinking about assets and inventory and focusing on efficiency and value for money. Not just any business but a business that's flexible, agile, and adaptable. Conversely most consumers run their personal finances like an inflexible money-losing anti-business always in danger of losing their jobs.
Here's almost a thousand online journals from people, who are following the ERE strategy tailored to their particular situation (age, children, location, education, goals, ...). Increasing their savings from the usual 5-15% of their income to tens of thousands of dollars each year or typically 40-80% of their income, many accumulate six-figure net-worths within a few years.
Since everybody's situation is different (age, education, location, children, goals, ...) I suggest only spending a brief moment on this blog, which can be thought of as my personal journal, before looking for the crowd's wisdom for your particular situation in the forum journals.
If you enjoy the blog, also consider the book which is much better organized and more complete. You can read the first chapter for free, listen to the preamble, or see the reviews (1,2,3,4,5,6,7,8,9, A,B,C,D,E,F,G,H,I,J,K,L,M,N,O,P,Q,R,S,T,U,V,W,Z). Subscribe to the blog via email or RSS. Get updates on the facebook page, join the forums, and look for tactics on the ERE wiki. Here's a list of all the ERE blog posts.
The consumer model is in a sense an old-fashioned and fairly primitive and definitely a wasteful way of satisfying your needs. The consumer model is based on the concept of more more more. However, we have reached the law of diminishing returns for this idea to provide greater happiness. We find that the pursuit of more now leads to stress and unhealthy lifestyles. We need to replace more with better. We need to live a richer live. Not richer in terms of products — certainly many nations have not yet reached this point, but we surely have — but richer in terms of experiences, accomplishments, collaboration, connections, and skills. We need to live better lives. It is possible to live better without requiring more. The idea that higher incomes lead to happiness is bunk. Higher incomes generally require people to stay connected to their offices instead working all the time. The idea that you need a million dollars to retire is based on old-fashioned ideas of total dependence on the mall. You do not need more stuff. You need better stuff. You do not need to do more and work yourself to an early death to accumulate more. You need to do better; both for your own sake as well as for the sake of future generations.
That is all there is to it and this is where we are going!
Originally posted 2009-04-22 16:37:06.
