
Meet Mr. Money Mustache, the man who retired at 30 - ilamont
http://www.washingtonpost.com/business/meet-mr-money-mustache-the-man-who-retired-at-30/2013/04/26/71e3e6a8-acf3-11e2-a8b9-2a63d75b5459_print.html
======
jasonkester
Interesting how so many of the top comments thus far fall into a few
categories:

"He did this at a time when the market was going up"... therefore it's
impossible and I don't need to try doing this and it's OK to just keep doing
what I'm doing.

"He could only do this by living in _poverty_ "... which would totally suck,
so I'm better off not doing this and just continuing the way I am.

"He can only pull this off because he's renting his house, which is totally
still _work_ and therefore he's not really retired"... so this is all made up
and therefore not something I need to think about or potentially emulate.

How about instead, we look at some of the things he talks about: Live as cheap
as you're comfortable with, save as much as you can, build a stack early on
and get to a point where you don't need to have a full-time job just to pay
the bills.

That's all very doable, and it will pay off very much like the author
describes. I followed the same path (a few years ahead of the author), and
ended up in a similar place in my 30s.

Rather than dismissing this as impossible, the critics here might all be
better served by taking a bit of it on board.

~~~
Swizec
As a counterexample, here is a list of things you should do before you turn
30: [http://www.policymic.com/articles/7704/29-amazing-things-
you...](http://www.policymic.com/articles/7704/29-amazing-things-you-must-do-
before-you-turn-30)

While many of the examples are silly, I agree very much with all the advice to
travel _a lot_. That takes money. Actually most of the things on that list go
way beyond "live cheaply", and I agree with that.

Anyway, as my economics professor said in college. There are those people who
plan out how much they must save for an early retirement, and there are those
who _live_.

~~~
jasonkester
> travel a lot. That takes money.

Not at all. If you talk to a few dozen people who "traveled a lot" before they
turned 30 (including me, the person to whom you're replying), the single most
common thread in all those stories will be how cheaply they did it.

Life on the road costs ~$500/month. Life in an apartment costs ~$2000/month.
One of the simplest ways to save money when you're not working is to ditch all
your possessions at home and go find a nice cheap tropical beach to park it
on.

Having "retired at 30", using the author's definition and a similar
methodology, you'd be surprised at how much _living_ I did along the way and
have done since.

~~~
Swizec
$500/month? But a simple train ticket that takes you 600km away will set you
back $100. Here in Europe at least.

And I probably spend $500/month just on food and caffeine.

Hell, the basic government fees (insurance, pension etc.) to keep my sole
proprietorship running costs me 300 euro/month. I really don't see how you
could live on the road on $500/month, you're making stuff up.

~~~
jasonkester
Sure, but how much are trains and coffee in Thailand? China? India? Malawi?

There's a lot of world out there beyond Europe. For the vast majority of it,
$500 goes a long way.

Try to keep in mind that there are lots of things that are possible that you
don't yet know how to do. It sounds like you're just now learning that you can
travel cheaply on the road (from people who have actually done so, no
foolin'). Rather than accuse us of lying to you, you might be better served
taking some of it on board.

Then book a flight out here. I'll use 1/1000th of my monthly budget to buy you
a beer!

~~~
jawngee
I live half the year in Vietnam, half the year in NYC. I'm mildly frugal, but
Vietnam still runs me about $2K a month, $1.2k if I don't leave my apartment.
NYC, a frugal month costs me $3.5k.

SE Asia is cheap, but its not as cheap as people think it is.

~~~
mdturnerphys
My wife and I spent a month in Thailand a few years back. We paid $120 for an
apartment in Bangkok for the month, including utilities, and spent about
$6/day on food. Travel to and hotels in Laos, N. Thailand, a beach town, and
Cambodia probably cost us about $300.

I do speak the language, but that only helped with finding a cheap (i.e. Thai-
priced) place to rent.

~~~
dualogy
> a few years back

There you go. Things develop at light speed down here in SE Asia!

That being said, GP's version of Vietnam living is perhaps like my Phnom Penh
version: "costing as I would in Europe, but get way more bang for the buck"
(to qualify---not _that_ kind of bang, thank you very much..)

So down here I can get a furnished condo thingy with
pool/gym/view/flatscreen/balcony for the same bucks that would get me an
unfurnished hole without _all_ of these in say Berlin, to not even mention
other parts of Europe.

BUT, it's still a multiple of $120. If I were harder-pressed financially,
indeed $120 would also rent me .. "something".

------
encoderer
I don't like how judgmental he is about lifestyle choices alternative to the
ones he's made. I, personally, enjoy going out to eat, I enjoy the "$100 happy
hours," I'm in Turks and Caicos right now on a stretch of the most beautiful
beach I've ever seen and I enjoy that, too. Oh, and I don't particularly
dislike working. I'm a well paid highly skilled engineer building cool things
for a fantastic .com that takes care of its people.

I get it, he has options and choices and that is an ideal. If I wanted to
retire right this very second, I couldn't. But you know if my wife wanted to
give birth right this second she couldn't. It requires about 11 months of
planning and prep work and the fact she hasn't put that time in already is in
no way a bad thing or a disadvantage for her. She LIKES splitting a bottle of
wine with me at dinner and eating seared tuna and ice cream desserts and
coffee and dirty martinis. So, not yet, for us.

I just wish he could be a better advocate for his extreme frugality and
savings lifestyle without building it on criticizing the alternative with
every other breath. (And even if some things aren't strictly criticism they
are de facto criticism by painting them in a less then gracious light.)

~~~
PKop
But why? Seriously, why can't he come to his own conclusion about said
lifestyle choices? You don't have to agree with him, but why can't he judge
certain lifestyle choices as better or worse? Just as you have done for
yourself. I think if he doesn't clearly define what _he_ thinks is better and
why, then what advice is he really providing? People can choose to agree or
not, without taking it as a personal insult.

~~~
jamesaguilar
It's not really the same. If I pick a lifestyle for myself, that's not a
judgment on other people's lifestyles. If I pick a lifestyle then start
calling other people wasteful, that is a judgment on others. Be it true or
not, that rubs some people the wrong way.

Personally I don't care if he judges me. He's living within a few tens of
percent above the poverty line (based on his comments in this article). Of
course the lifestyle of someone spending even $40k a year is going to seem
wasteful to him.

~~~
tripzilch
> Be it true or not, that rubs some people the wrong way.

Huh? If it _is_ true and it rubs some people the wrong way, is that bad?

> He's living within a few tens of percent above the poverty line

I'm not sure what living a few tens of percents above the poverty-line really
means, unless you mean tenths of percents? Still, that is not what poverty
_is_. There are more than enough people in the US living in actual poverty but
I'm pretty sure this guy has it pretty good. This is because, and that is part
of his message, that how good you have it in life is only in so far dependant
on how much money you have to spend. It depends on all sorts of factors of
relative wealth, of which he has collected a great amount in various ways.

~~~
jamesaguilar
> Huh? If it is true and it rubs some people the wrong way, is that bad?

Do you go around telling ugly people they are ugly? Fat people they are fat?
Dummies they are dumb? Why not? Is it because it rubs them the wrong way,
despite it being true? Is it wrong for them to feel that way, even if you are
right? IMO it is neither wrong nor right to feel that way. It is just how you
feel.

> Tens of percent

I meant tens of percent. According to the numbers he posted he's something
like 20-30% above the poverty line. That's a few (3ish) tens of percent.

~~~
PKop
Is he indiscriminately leveling criticisms? Of characteristics people have no
control over (ugly)? Or is he perhaps criticizing choices and behavior, of
which people can change and pick and choose themselves? Hmm? Not a valid
analogy you made there. Do people make value judgments about diet and exercise
so as to help so called fat people get into better shape? All the time they
do, yes. If I care about someone, and think they are making choices that are
detrimental to themselves, I'll tell them. If you don't, because it may hurt
their feelings, are you doing them a favor?

------
nlawalker
I always recommend the following two posts to anyone who has discovered MMM,
as I think they best sum up his context, history, mindset, goals and living
situation - all of which are good to understand before you start taking what
he writes as guidance:

[http://www.mrmoneymustache.com/2011/09/15/a-brief-history-
of...](http://www.mrmoneymustache.com/2011/09/15/a-brief-history-of-the-stash-
how-we-saved-from-zero-to-retirement-in-ten-years/)

[http://www.mrmoneymustache.com/2012/06/01/raising-a-
family-o...](http://www.mrmoneymustache.com/2012/06/01/raising-a-family-on-
under-2000-per-year/)

It's important to keep in mind that his goal was to end his reliance on a full
time job for income as quickly as possible, full stop. He did pretty much
everything in his power to reach that goal, and it's clear that he's very
dedicated.

For anyone who glances at this interview or at his blog and thinks, "I'd like
to do that," make sure you read the two posts above first. If your idea of
retirement is fuck-you money, a yacht and a summer home in the Hamptons, his
advice isn't going to work for you - although his blog provides a good
opportunity to gain some perspective on how people not like yourself treat
money and what they consider the ideal retirement to be.

~~~
millstone
Good posts. But for the other side, read these posts:

[http://www.mrmoneymustache.com/2012/07/27/youll-never-be-
nor...](http://www.mrmoneymustache.com/2012/07/27/youll-never-be-normal-
again/)

[http://www.mrmoneymustache.com/2012/07/22/protecting-your-
mo...](http://www.mrmoneymustache.com/2012/07/22/protecting-your-money-
mustache-from-spendy-friends/)

It seems as if the lifestyle has colored their ability to enjoy things like
going out for ice cream, or dinner with friends.

~~~
ernestipark
I can see where you're coming from - but I think they would say they don't
need to be spending money to enjoy the company of their friends or family. The
end goal should be to spend quality time with people you care about, and
unfortunately in our culture, that almost always revolves around spending lots
of money and doing wasteful things. They acknowledge that they don't mind
going out and spending money once in a while for a good night out, but
overall, they've developed a sort of gag reflex to it since it's not necessary
for them to be happy.

~~~
personlurking
This happened to me back in California where my 'friends' would stop inviting
me out or contacting me because I am frugal and they're not. Even somewhat new
(to the country) immigrant friends adopted this behavior.

Then I moved to Brazil where there's plenty of cheap or free things to do and
I went from going out almost never to going out up to 4x per week. Now I'm
living in Portugal and, strangely, it's the same as Brazil. Plenty of ways to
go out and spend $15 or under. On the flip side, of course, there are plenty
of ways to spend way more per night out.

------
georgecmu
_early retirement doesn’t only happen to Powerball winners and those who luck
into a big inheritance._

Right. It also happens to those who get lucky in the stock market, and chose
the right job at the right time.

[http://money.msn.com/retirement/article.aspx?post=dd544488-f...](http://money.msn.com/retirement/article.aspx?post=dd544488-f716-496b-b314-8e25b69e7aa9)

 _I was able to save more: $5,000 into the retirement account, $3,000 into an
employee stock purchase plan, and $10,000 in cash. Year 2 'stash: $23,000
($13k cash/shares, $10k retirement).

Year 3: This was late 1999, and both the job and stock markets were on fire. I
cashed out the stock purchase plan shares from Year 2, which were now worth
$10k

The investment gains on stocks started accumulating, adding about $10k to our
earnings this year. So we still ended up increasing the savings by close to
$100k after tax. Year 5 'stash: $250k.

Investment gains on the existing savings contributed another $20k. It is
complicated to remember what portion of income was taxable salary, and what
was nontaxable gains inside of retirement accounts and such. But a reasonable
estimate of the total is Year 6 'stash: $365k.

Year 7: No increases in salary, but similar amazing earnings and moderate
spending, combined with $30k of investment gains. Year 7 'stash: $490k._

I wonder why more people don't do this.

~~~
chadcf
I've read his analysis before and I had the same issue. It's quite easy to
retire early if you have a high income and live frugally. Unfortunately a lot
of people have to live frugally just to get by. Your average middle class
family couldn't even dream of putting away $490k in 7 years even if they lived
frugally and got lucky on stocks.

I read another blog, I think it was a different guy, who talked about how he
did this by living on 30% of his income and putting away the other 70% and
then went on and on about how anyone could do this. Of course, he made about
$300k a year. He talked about how even if you make way less than this you can
still do it, you just have to be willing to live on 30% of your income. That's
easy to say when 30% of your income is more than 100% of most people's
income...

~~~
mgkimsal
Seconded, yes. I've known some people recently with multiple kids (4 and 6,
respectively), trying to get by on odd-jobs and $10/hour full-time jobs. Even
slogging away night and day, floating a family of 8 (two parents, 6 kids) on
$30k/year, and trying to do that on "30% of your income" - it's just not
possible.

These people had/have income issues, not spending/frugality issues. In one
case, one family moved to get a better job and is now at something like
$45-$50k - still tight, but doable.

------
sethrin
On the one hand, I agree with most everything MMM says. On the other hand, a
life of consumerism is its own reward -- and who is to say it is not earned?

I am nomadic. I have no dependents, and a severe case of wanderlust. My
impression, after many conversations on the matter, is that this is a mild
form of insanity. I think that I have my lifestyle more or less sorted out at
the moment, but I have in the past been more or less willing to trade
stability and an income above the poverty line for the freedom to search for a
place that perhaps I want to live. I'm from Alaska originally, and don't
particularly enjoy or identify with the rest of the US, so hopefully this is
at least somewhat understandable.

I digress. I know exactly the kind of perspective from which $25k per annum is
considered wealth. I also know the freedom that comes from not being owned by
possessions -- and I hope that MMM does as well. You can still practice
accumulation on a budget, but it's hard to see that as a healthy motivation.
Being rich is not dying with the most toys. Although I don't believe the
majority the HN community would agree with that sentiment.

To be a nomad, you are forced to make a very deliberate choice about every
possession. Each one adds a burden that must be carried to each new place --
quite literally carried, in my income bracket. There is the temptation to
transform this practicality into a moral virtue, but there are many other
reasons besides.

On the other hand, there are many virtues in accumulation. Besides the
advantages conveyed by a visible display of wealth, owning many things serves
as a buffer against misfortune. Consumer goods provide pleasure, and capital
assets can be themselves a source of profit.

I feel like I should be the most fervent disciple of MMM, and yet I would say
instead: neglect not your comforts, nor your consumerism. The trades you may
make in pursuit of a purer life, are at the least uncomfortable, and at worst
dangerous. Poverty may be virtuous, and while you may yet find that virtue,
seek it not for its own sake. If your charity compels you to be poor, accept
that with good heart, and do not be miserly no matter how much you own. If,
alternately, you are not compelled towards sainthood, at the least enjoy your
comforts in the knowledge that you are living a blessed life, which may like
as not never come again.

~~~
azatris
You described everything very well what I am like and what I think of the
subject. It is nice to know that I am not alone.

I am also nomadic, although yet a university student, still making it
eventually possible working in an industry capable of earning over $100k per
annum. Nothing would change if it was not as prosper.

------
palebluedot
Interesting article, and it would do well for most people to consider
increasing wealth through investments.

From the article: _Our bread-and-butter living expenses are paid for by a
single rental house we own, which generates about $25,000 per year after
expenses._

One nit, perhaps, on that - is the rental house completely managed by someone
else? If not, I assume there is at least some minimal amount of work
associated with being a landlord... so I would hesitate to call him _fully_
retired, such that he does not need to do any work for money.

The other thing I always think when I read articles such as this - if everyone
took such advice and eschewed purchases (cars, lattes, drive-throughs, etc..),
I would imagine unemployment would increase dramatically. However, it is safe
to give such advice, because it is enough of a sacrifice / delayed
satisfaction that it is unlikely to get enough people following the advice to
negatively impact the economy. But _someone_ needs to buy the stuff that is
made, for the makers to have jobs!

~~~
sebastianavina
Lets be fair, I'm 28 y/o, and fairly rich, I love to work, and I live to work,
and maybe it's the only thing I may do ever in my life.

I could sell all of my bussiness, I could lease the buildings, and retire. But
doing nothing is the hardest work I've ever do. I took a sabatic year after I
graduated from college, traveled around the world, fucked some really
beautiful girls, and after livining a dream-life, my life became quite
frustrating.

This guy wont last too long retired, because, after all, he will just grow
tired of playing golf, and doing nothing.

~~~
carbocation
> _fucked some really beautiful girls_

I downvoted you for this crass sexist drivel that drags down the level of
discourse.

~~~
guylhem
If it was about guys, written by a female poster, would you have downvoted it
too ?

If it was about guys, written by a make poster, would you have downvoted it
too ?

Where exactly is the crass sexist drivel ? the "fuck" word ? Upvoted both you
guys to compensate. Context is important.

Here the poster only said he was intimate with members of the oppositive sex,
who were attractive. Nonthing crass, just fact contributing to the discussions
and saying why he recommends against that.

~~~
gknoy
The crassness is, I presume, in the fact that he even mentioned it. He might
have used different verbs: met, spent time with, dated. I'm not sure _why_
that's impolite to speak of, but it certainly seems to be that way in most
peoples' books.

------
jonknee
I have a hard time seeing the appeal of intentionally living long term with a
near poverty level income. I could never be content watching my son bike to
school in 20 degrees because I don't want to work. Let alone spend years
bragging about it.

~~~
firefoxman1
I bike to school and work in 20 degrees because my dad wants me to learn the
value of a dollar before I'm in the "real world" (he also started me investing
pretty early). I have 0 resentment and complete respect for him because of it.

~~~
jonknee
I think it's questionable what knowing what a dollar is worth if you orient
your life in a way to make as little of them as possible. I think you should
value a dollar, but also work hard and apply yourself.

It's a strange combination... He got the investment income is the secret part,
but then seemingly stopped at the earliest opportunity. It just seems lazy. I
agree with him that spending more than you make is irresponsible, but I also
think there's a happy medium where you can both have a coffee and a retirement
account. You're not taking any of it with you anyways, might as well enjoy a
few moments of it.

~~~
firefoxman1
I completely agree with this. My grandfather is a millionaire...apparantly. I
never would have guessed it. He drives a near-broken-down 1980-something
honda. He takes frugality to the extreme. I love talking to him and hearing
his investing advice, but it gets irritating hearing about how he saved $0.50
on a book or hitch-hiked to Colorado for a family event. I don't see him much,
but I've hardly ever seen him smile.

I think we have to be very careful in a society that promotes living in such
excess. It's a hard balance to find between casting off all expenses to the
point that it becomes frugality for the sake of being frugal, and frivolous-
spending yourself into debt.

~~~
chadcf
I think being extremely frugal is about as bad as frivolous spending (the
frugal folks will hate me for this...). They're just two sides of the same
coin, and the really frugal people tend to be VERY obsessive about it and
stressed out from trying to not spend money. Case in point, this blog post:

[http://www.mrmoneymustache.com/2012/07/27/youll-never-be-
nor...](http://www.mrmoneymustache.com/2012/07/27/youll-never-be-normal-
again/)

Does being stressed out and anxious over driving a few miles and spending some
money on ice cream really sound like a happy life? If you take spending to the
extreme and don't live within your means, you'll be stressed about how to make
ends meet and pay your bills. But at the same time, if you take frugality to
the extreme, you're just trading that for being stressed over spending too
much money.

Life is short. Be smart, keep a good balance and enjoy yourself.

------
ctbeiser
I think the point is being missed here, to some degree. This is not
necessarily the best way to live. But it's worth considering: what would you
do if you weren't tied to a corporation for 8 hours a day in order to feed and
house your family? My immediate instinct is not quite "Let's commute for an
hour a day and grind out code for some project I don't really care about."
Your life may vary, but while he's at an extreme, it sounds like one that's
less sucky than that.

~~~
scarmig
I think he'd agree that the particulars of his situation are hardly
prescriptive.

But it's also hard to argue with the reality that, if you eschew stupid
expenses and live frugally, you can very rapidly build up a very healthy
savings. Given that, it's trivially easy to retire by 50 or even 40 for most
people; for a software developer (like MMM), it's quite possible to do it by
30.

Honestly, though, I would argue that his plan gives him a sense of false
security: no one knows what the economy will look like in ten years, let alone
twenty or thirty, and building his retirement on the assumption nothing
drastic will change in it or his personal life is folly.

And he spent the first... seven or so years of his working life in some soul-
sucking corporation. That's a shit load of time wasted. So his problem?

I'd say it's that he retired too late.

If you take his definition of retirement as "having enough money that you can
do what you want to do," all you probably actually have to do is save up
100k-200k, plus or minus a bit. That's because most people want to have some
integration into the economy; they just want it on their terms. And
integration into the economy means you're getting paid some amount. Given a
fluid nest egg to last you a frugal decade or so really gives you all the
financial security you need. (Of course, shit can happen, but any shit that
can burn through that kind of nest egg is likely to ruin whatever plans you
have anyways.)

If you have $200k saved up at this point and no real commitments but have
grand plans for how you'll retire sometime in the next five to ten years and
then do what you really want to do--teaching, or open source projects that
interest you, or traveling around the world as a photographer/blogger--more
likely than not you can do it now, within a year. You should. Money will come
to you, and there's no reason to put off your dreams.

~~~
UK-AL
Your plan needs the nest egg + house paid off. I will have 150k USD(100k GBP)
by the time I'm 26 but no house. so i doubt I could survive a decade on it.

~~~
scarmig
Nope, it doesn't. A single person can very easily live on $15kpa. Even in the
Bay Area. I've been doing it for 3 years, in fact, at $12-$16kpa.

It probably does mean having housemates and being careful about where you
choose to live, but it's imminently doable.

~~~
femto
As you're alluding, half the battle with knowing when it is "safe" to hop off
the treadmill is having a very good idea of your expenses. About 10 years ago,
I spent a year or so recording how I spent my money to the cent. I found that
it delivered a lot of freedom, even if I didn't live frugally, since it
allowed me to know exactly how much money I would need going forward, and plan
accordingly.

Since then. my life has changed a lot, to the point where the confidence in
predicting my expenditure is wearing off. I'd describe it as a slightly
panicked feeling of having to work harder, since I'm trying to cover the worst
possible situation that my mind can invent. I probably should invest the time
to collect another set of hard data...

~~~
gknoy
Have you considered joining Mint, using plastic for your purchases, and
considering cash as "already spent" expenses? (Stay out of debt, mind you --
use the cards as a way to ensure that it's accounted automatically.)

------
bittercynic
Love it when two sites I love, like MMM and HN cross paths.

I'm disappointed, but not surprised, by the animosity here. Too many HN
posters seem to be obsessed by hitting it big monetarily, instead of
developing exciting projects. Is it that mysterious to value freedom from
monetary worries so you can focus completely on the projects you think are
important, for whatever reason? Seems to me that is exactly what MMM is doing.

------
stevenwei
While I do think there is value in aggressively saving and reducing
unnecessary expenses (avoiding excessive 'lifestyle inflation'), I can't help
but feel that MMM has taken it too far to the extreme. There are tons of
interesting and worthwhile experiences out there that you're going to miss out
on if you intentionally constrain your budget to $25k/year for the entirety of
your life.[1]

There are folks here who have achieved true financial independence by building
and selling companies or producing 'lifestyle' businesses that continue to
churn out cash without much daily involvement. I find stories of their
experiences much more valuable (and educational) than someone who has simply
moved the goalposts closer.

[1] Not to mention that doesn't leave a lot of breathing room if you run into
an unexpected, expensive emergency situation (e.g. medical expenses).

~~~
Taylorious
It all depends on where you live. I doubt where he lives (Longmont CO) is that
expensive. There are plenty of places in the USA where 25k will go a long way.
Remember he has no mortgage and other debts. If he has relatively low property
taxes and doesn't care about having a new car every 5 years etc., then 25k a
year is more than enough. It certainly isn't poverty level or anything.

I don't get why people on here are so negative about it. Don't be bitter
because you live in the valley and spend 2k+ a month just for a crappy
apartment. It just sounds like this guy values his time more than money. He
might not be spoiling his kids with tons of toys or free college, but at least
he is there for them. I'll warrant many of the entrepreneurs hackernewsers
look up to don't spend nearly as much time with their family as this guy.
Their too busy making money as a way to keep score in their "life." This guys
just living his life.

~~~
chadcf
I agree he sounds happy, but it's important to remember that happy means
different things to different people. Life is short and you only get one shot
at it, so if you get a lot of enjoyment out of a new car every 5 years, hell,
go for it. Be smart about it, make sure it's something you really enjoy and
not just a temporary distraction, but do it if it brings you lasting
enjoyment.

Some people, in my experience, really enjoy being frugal. Having a wad of cash
in the bank is what makes them feel secure and happy. Others, not so much. To
each their own.

One nice thing, being able to live reasonably happily on $25k is nice to see
if nothing else than that's probably what a lot of today's middle classers are
likely to get in SS benefits down the road. And given the dismal savings
rates, that's a fine thing. The trick is to pull it off you need to have a
paid for home and live in a relatively affordable location.

Of course that's another thought, retiring at 30 means your SS benefits are
going to be small or non-existent. If this guys rental properly burned down
and his investments tanked, that could turn into a pretty bad situation
someday. As much as I hate to rely on SS for retirement it's the closest thing
to a guaranteed income many of us are going to get, and retiring early means
opting out of that.

------
hyperbovine
I wish they asked about health care costs. For a family of three with no
corporate job in sight, those have got to eat up a large chunk of the $25k.

~~~
pfisch
25k/3 people is like a welfare amount of money to live on.

~~~
citricsquid
You would need to know the value of their house to fully judge their
situation. If we assume they live in a reasonable house that would cost $1,500
per month to rent / mortgage and we assume they save $750 per month on the
costs of working (commuting, baby sitting, eating out) they have an effective
income of... $52,000. The median household income in the U.S is $51,000 and
that's for households that will often have debt too and not be very good at
spending little money.

~~~
brown9-2
Why does the value of their home factor into their annual income? You can't
pay for healthcare with pieces of your house.

~~~
citricsquid
The value of their home factors into their annual income when comparing to
other household incomes. The grandparent said that $25,000 is a level of
income someone would expect on welfare, however MMM does not have costs that
people on welfare have. For example I spend $18,000 per year on my rent, I
would need to earn $25,000 + $18,000 to have the same effective income as MMM.
For most households housing costs are one of the largest (if not the largest)
ongoing cost, when comparing MMM and others (as the grandparent did) you need
to take that into account.

------
jonemo
Link to story in non-print layout:
[http://www.washingtonpost.com/business/meet-mr-money-
mustach...](http://www.washingtonpost.com/business/meet-mr-money-mustache-the-
man-who-retired-
at-30/2013/04/26/71e3e6a8-acf3-11e2-a8b9-2a63d75b5459_story.html)

------
rphlx
His advice is solid, but you have to consider how much of his personal success
was due to being born at the right time: graduating with an engineering degree
in the low-unemployment mid-90s (prior to globalization putting heavy pressure
on wages), then buying a house (actually, several) before the debt-fueled
housing bubble made shelter a massive % expense for everyone under 30 living
with fewer than 3 roommates. And also being lucky enough to enter adulthood in
a period of low taxes, oil & commodity prices, when companies were still
willing to hire & train non-senior engineers. etc.

Given the current state of the world - it seems quite unlikely that the
_average_ 21 year old US SW engineer graduating today will be able to
replicate his results (~$500k within 7 years).

------
dkrich
Interesting read, but I have to disagree with one of the tenets of the
article. At one point he suggests that people should almost inevitably
relocate at some point to a less-expensive area of the country in order to
save for retirement.

Wealth is relative. You can increase your own in only one of two ways- either
earn more or spend less. Obviously his advice is the latter, but if you fall
into the former category (and let's face it, if you're a frequent visitor to
this site you almost certainly are) then that is probably terrible advice.

I happen to live in D.C. and I can tell you that things are _very_ good here.
The job market is one of the hottest in the nation, real estate prices are
astronomical and ever-growing, and most people you interact with around the
city are above-average wage earners compared to the rest of the country.

Yes it is expensive to live here, but a rising tide lifts all boats. If you
want to prosper, it helps to sell in a market that is ripe with people who
have the means to buy what you are selling. That could be your skills if you
are looking for work or a product or service if you are trying to get
something started. All things being equal, a strong economy helps all
participants. If you move to the middle of Kansas, chances are you'll spend a
lot less, but you'll probably earn a lot less too.

~~~
ruswick
The wages in DC, although higher than the national average, are not
astronomically so. The Mean anual wage in DC is ~$60k, while the national
average is roughly $45k. This likely doesn't equate to a distinctly higher
quality of life. Moreover, poverty is far more pervasive in DC than in the
rest of the country, and, crime rates in DC vary, depending on the type of
crime, generally between two and five times the national average.

~~~
dkrich
_Moreover, poverty is far more pervasive in DC than in the rest of the
country, and, crime rates in DC vary, depending on the type of crime,
generally between two and five times the national average._

From somebody who lives in D.C. now and has lived in several other places to
compare by, I can tell you that for all practical purposes, that just isn't
true. The statistics you cite, while perhaps factually correct are basically
meaningless. D.C. is not a very diverse city from a socioeconomic standpoint.
There are basically two sides to D.C.- a metro area where everything looks new
and clean, people are well-heeled, and housing is expensive. Ballston,
Arlington, Georgetown, DuPont, Bethesda. They are all just expensive
variations on the same theme- one community after another of well-paid,
highly-educated people.

Outside D.C. on the eastern and southern edges just inside Maryland is the
D.C. that brings those averages into the territory you are citing. They add no
practical value to a discussion of the city's economic health for those
fortunate enough to not have any exposure to that side of the city. To
consider that relevant to the discussion is like saying the average pay in a
Fortune-500 company is $50k to counter the point that C-level execs of a
Fortune-500 company are overpaid. While it may be statistically accurate, it
is for all intents and purposes a meaningless data point in the discussion.
What a first-year business analyst earns has absolutely fuck-all to do with
what the CEO earns.

The assumption I'm making is that a person who has above-average skill will do
exceptionally well in an economically-strong area like D.C. when compared to a
city with a small or sluggish economy.

------
grosskur
For me, the most interesting part was: "Back in the day, I would just empty
out my bank account after each paycheck and distribute it into my investments
of choice: Vanguard's S&P 500 index fund, their small-cap value index fund, a
bit went into paying off my mortgage early as well."

While he could have diversified further by including international stocks,
this simple investment strategy was surprisingly sound. This is the real
takeaway---not his philosophy of extreme frugality. If you follow a low-cost,
diversified index investment strategy, you'll likely end up much further ahead
than if you put it all in the bank.

And once you get past all the bad advice out there, sound investing is
actually quite straightforward:

[http://www.longtermreturns.com/2012/03/selecting-
investment-...](http://www.longtermreturns.com/2012/03/selecting-investment-
strategy.html)

~~~
conroe64
If you are not going through a tax free retirement account, I'd advise against
mutual funds, since the profit is taxed every year. Instead, I'd recommend
using a stock newsletter.

There is a rating service that independently tracks the profits of 180 stock
newsletters and has done so since 1980. It's called the Hulbert's Financial
Digest. From this you can pick one with a good track record, and then invest
directly in stocks.

This allows you to plan your taxes much better (sell the losers for a similar
company in the same industry and keep the winners). I'm up over 70% in
unrealized, and therefore untaxable, gains this way.

~~~
grosskur
I agree mutual funds are less tax efficient. However, they have an advantage
of trading at NAV, which means you don't pay a bid-ask spread when buying or
selling.

According to The Bogleheads' Guide to Investing, the January 2001 issue of The
Hulbert Financial Digest stated: "Among the 160 or so newsletters the HFD
monitors, the market-timing recommendations of only 10 have beaten the stock
market over the last decade on a risk-adjusted basis."

So statistically there are very few newsletters with a good track record. And
assuming you pick one of the few that beat the market over the past decade,
you have no guarantee it will continue to do so. Past performance is not an
indicator of future returns.

I'd much sooner use ETFs than individual stocks to achieve tax efficiency. VT
holds 4871 stocks worldwide in capitalization-weighted proportions. It would
be too unwieldy to get this same diversification by holding individual stocks.
And I'd argue that you really do want this much diversification. See The
15-Stock Diversification Myth:

<http://www.efficientfrontier.com/ef/900/15st.htm>

What you describe with selling the losers and buying similar stocks to replace
them is known as tax-loss harvesting and is possible to achieve with ETFs as
well. For example, you can hold VTI+VEA+VWO instead of VT, and tax-loss
harvest into SCHB+SCHF+IEMG. It may not be as effective as with individual
stocks. But I'd argue you it's hard to find a direct substitute for an
individual company, so you take on more risk that way, whereas it's easy to
find a nearly-perfect substitute for a broad ETF.

Overall, your strategy of holding individual stocks may work out very well for
you. I just think you're taking on disproportionately more risk for the amount
of gain you hope to get compared to an ETF-based indexing strategy. Also, I'm
not sure how long you've held your portfolio, but we've had a strong bull
market for the past four years and even VT has gained ~45% in that time:

<http://ycharts.com/companies/VT/performance>

~~~
conroe64
Thanks, I didn't know ETF's were treated like stocks for tax purposes.

------
AlexDanger
He gets a nod from me just because he isnt one of these financial self-help
gurus who primarily makes his living by selling financial self-help
products/services. I'm always staggered to see how blatantly chicken-egg some
of these people talk about their financial freedom.

~~~
ericd
Yeah, especially when the advice is to mimic them and create informational
products or similar.

------
foobarian
I thought that harping on riding a bike was a bit disingenuous. I used to do
do it daily, but after a close brush with death (got doored by a car stopped
at a red light) I've come to think the risks are high enough that continuing
it would be irresponsible for a family man.

~~~
dnr
Note that his family isn't dependent on his income or earning potential
anymore, so it's not like he'd be leaving then destitute if he got killed.
Purely financially, they'd be better off.

That said, everyone has to choose their own acceptable level of risk.

Edit: Plus you can argue that biking all over the place decreases his risk of
dying of heart disease or similar later in life, which may balance out or
outweigh the risk of dying in a vehicle collision.

~~~
Robin_Message
You are correct, the evidence is that the health benefits outweigh the risk of
death about 50 to 1 (see meta-study at
<http://www.ubcmj.com/pdf/ubcmj_3_2_2012_6-11.pdf>).

------
swalsh
A bit meta here, but I feel like its rude to link to a websites print feature.
Sure its easier to read, has less ads etc. But those ads are the way the
washington post is paying to write the content you're consuming. The thousand
hits they just got from you are now purely a cost, instead of potentially
revenue generating. The end result is that sites will either stop providing a
print feature, or will start placing ads in them.

------
diminoten

        He rides his bike to school, even when it’s 20 degrees
        outside. He prefers making his own toys with me in my 
        workshop to buying them in the store, because he is 
        rarely exposed to TV ads. So his piggy bank tends to 
        accumulate in an uninterrupted fashion.
    

Or so you believe.

------
amix
In the Scandinavian countries (or at least Denmark) it's possible to "retire"
early (or at least cheat the system and do this), but I would not really wish
anyone this. Working on what you love to do is important, especially in the
modern society. And in Denmark your kids can still get into the best schools
and you can get free healthcare without having a job. This said, being on
welfare and "retiring" early is not something most Danish people dream about
and I doubt most of these people that retire "early" are that happy about
their life.

------
takosuke
Somehow this has made me realize the big lifestyle gap between me and everyone
I know versus the people writing what I read around here. Me and virtually
everyone I know live that way, but instead of retired at 30 we are hustling
and struggling at 30. Sure, hipsters on food coupons, you can laugh all you
want, but no future all the same. Wish we could be on that path, but it's too
late, we made the wrong decisions, we are forced to thrift like everyone else
now.

------
tunesmith
I think his formulas are based off of assumptions that don't fit reality for
people. A good example is lifetime stock market average. I did a study
recently where I tracked the date and cash amount of every retirement
contribution I've ever made, and pretended I simply bought an S&P-500 index
fund on each of those dates. I then calculated my lifetime APY, and it was
nowhere near the averages that the magazines claim. I've been a pretty
consistent retirement saver but the point is that my savings past tracks what
is probably true for most people - I've had more to save in years where times
were good (and the stock market was higher), and less to save in years where
times were bad (and the stock market was lower). When you take the same
formulas that he claims as gospel and plug in more reasonable "stock market
average performance" each year, you get vastly different conclusions.

~~~
rscale
The standard figures are definitely optimistic, but when you check your
returns make sure to include dividends reinvested. In recent years, they're
good for about 2%/yr if you buy something like the S&P 500.

I find it somewhat baffling how many financial tools ignore the effects of
dividends when calculating returns.

~~~
tunesmith
It is a good point - first time I ran the numbers I realized I was missing
them, but now my numbers use the "adjusted close" from yahoo which take
dividends into account. As of today, my all-time APY would be 6.02% - lower if
you take inflation into account. And it's worth noting that almost all of the
time before now would have had a lower APY than that.

~~~
rscale
Using the adjusted close assumes that you put your dividend receipts into a
mattress so it's still slightly low, but I doubt that's more than .1% or .2%
for a typical portfolio over a moderate timeframe.

I wholeheartedly agree with you that it's dangerous to bet your retirement on
a level of return that many won't achieve.

~~~
tunesmith
Actually, can you explain that more? Since yahoo adjusted close says it takes
dividends into account, I took that to be the same as immediately reinvesting
your dividends in the same holding. You're saying that instead, it's the same
as issuing the dividends as cash and then forgetting about it?

If so, then how do people actually backtest long term holdings to assume
reinvested dividends? As far as free historical data sources, I thought it was
basically yahoo or nothing.

~~~
rscale
I was wrong. I thought Yahoo adjusted for dividends incompletely but they
appear to handle them fully.

My apologies for the confusion.

------
porter
When I'm old I'm afraid I'd regret not working harder and accomplishing
things. With that said, this does sound like a viable strategy for startup
founders. It basically gives you an infinite runway at age 30, which means you
can keep swinging the bat for the rest of your life.

------
josscrowcroft
Weird coincidence, I just rediscovered his site today. Keeps getting better.

------
mscarborough
> By the time you get to be a big fancy adult with a career and a house, your
> daily routine is basically just a collection of unconscious habits: You make
> coffee, commute by car, attend meetings and answer e-mails, shop in certain
> stores, watch TV and repeat. It becomes effortless. Your brain goes into
> autopilot.

There are plenty of routes you can take that don't involve giving up on life.

To me, this article exemplifies how empty making more money can make you feel.
The author just sounds sad.

Go do something that makes you happy each day, earn some money, then go home
and do something else.

------
timedoctor
The idea of borrowing to buy a car is a ridiculously bad financial decision
that most car buyers make. There are some exceptions (such as if you
absolutely need the car for your business), however in most cases people would
be way better off in buying a cheaper second hand car.

There are countless other examples. It annoys me greatly when people in the US
state how the "cannot live on less than $100k per year". And these same people
have no money saved in the bank. So they earn a very high salary and are still
living month to month. Incredible.

~~~
mscarborough
Financing a car isn't a decision that is solely based on the amount of money
you have saved.

I have a healthy rate of savings, but still decided to buy a new car and
finance part of it. I'm happier and safer than I was in my old car, and the
rates are pretty good. My V8 gets the same mileage my old 4-cylinder did, and
hopefully I helped create some work by buying a model designed & built in
Detroit.

So, stop conflating living month to month with having debt. There is a
happiness component that doesn't show up in your spreadsheet.

------
kevinpet
Does he disclose how much he currently makes from the blog and credit card
offers? Because it's pretty easy to "retire" when you make a decent living off
a low effort job.

------
orangethirty
Does not having a corporate or regular 9-5 job mean retiring?

~~~
citricsquid

        According to me, retirement means you no longer have to work 
        for money. You then proceed to do whatever you like, without 
        regard for whether or not it earns you money.
    

You could be retired and have a 9 - 5, as long as you're doing it for fun and
not the money, according to MMM's definition.

------
incompatible
Nice article, since it's very similar to what I did. However, I had to work 11
years longer for it. I guess I wasn't as well paid, or not as efficient. Also,
after 6 years of retirement, I don't know yet if my situation is completely
stable. Low interest rates and continuing inflation may take a toll. Real
estate investment just isn't a sensible option where I live, so I rent.

------
stevewillows
"Embrace challenge and shun convenience for its own sake"

This line really resonated with me as the real success he discovered.

------
stesch
Desktop version: [http://www.washingtonpost.com/business/meet-mr-money-
mustach...](http://www.washingtonpost.com/business/meet-mr-money-mustache-the-
man-who-retired-
at-30/2013/04/26/71e3e6a8-acf3-11e2-a8b9-2a63d75b5459_story.html)

------
rshlo
I think he has some valuable lessons on spending less, investing more. But
there are ton of good advice from non-anonymous bloggers, don't think you
should take advice from someone who is not willing to identify himself.

~~~
sejje
I disagree entirely. Good advice is good advice, regardless of the source.

------
greghinch
Sounds pretty boring to me, but to each their own.

------
EGreg
i've been reading this blog for a few years, and this guy is the real deal. I
think this post encapsulates his philosophy:

[http://www.mrmoneymustache.com/2011/10/02/what-is-
stoicism-a...](http://www.mrmoneymustache.com/2011/10/02/what-is-stoicism-and-
how-can-it-turn-your-life-to-solid-gold/)

------
celebdor
Try doing that as an employee also in ex-eastern bloc countries. Now... That
would be impressive...

------
dantheta
It surprises me how much the closing paragraph sounds like certain elements of
Buddhist philosophy.

------
return0
Why would anyone want to retire at his peak?

~~~
mmphosis
Why would anyone want to "need to work for money" at her peak?

------
OGinparadise
Retired? His blog has advertising and affiliate programs. He sounds like those
guys getting rich by selling "Get rich like me" books.

------
cmccabe
If everyone was as stingy with their money as this guy is, the economy would
crash. We need spending to drive growth and provide employment. If everyone
hoards cash and refuses to spend it, you get the crash of 1929 and the Great
Depression.

Time invested in saving money is not always worth it. If you're making the
equivalent of $50 an hour, an hour spent agonizing over how to save $25 is a
net loss for you. You are not maximizing your utility.

Saving money will never be an end in itself. It is only a means. Who is more
admirable: the guy who saves obsesses over spending the minimum amount of
money and lives in a cabin Montana, or the guy who goes deep into debt to get
a PhD, become a doctor, and save lives? I think we all know the answer to
that. I'm not saying that everyone needs to get a PhD or that you shouldn't go
off in a cabin if that's what you want, but don't put yourself on a pedestal
for your self-indulgence.

~~~
salvadors
> If you're making the equivalent of $50 an hour, an hour spent agonizing over
> how to save $25 is a net loss for you.

Only if you would have spent that hour working instead, and if you would
actually earn an extra $50 (net) for working that hour (many people wouldn't),
and if that potential hour's work is now lost to you.

It's pretty rare for all three of those things to be full, and most of the
people I've ever met who have been in that scenario have learned pretty
quickly that working every hour possible isn't really a fun way to spend your
life.

~~~
cmccabe
You're missing the point again. The time spent IS work. The question is
whether you want to effectively take an informal side job that pays you
poorly, called the "saving money job."

------
Evbn
Retired? He is a hard working self-promoting blogger, and also does handyman
work. By his tortured definition, most middle class people are retired, as
they could survive without work if they have to.

------
obilgic
Why does MMM have ads on his blog?

~~~
doorhammer
"More recently, even my hobby of writing the blog has started producing some
cash, which I hope to reinvest and snowball into a big charitable operation as
well as funding interesting projects related to the blog."

~~~
Evbn
I am retired, and I code on the side, for which I get money, which I use to
finance charitable giving and interesting related projects.

I am glad that about half of HN doesn't fall for this guy's Rich Dad Poor Dad
schtick. The other half, though...

