How I Retired at 35

Twelve years ago, I graduated from college with student debt and an abysmal understanding of personal finance. Thankfully, with my engineering degree, I was able to land a well-paying job upon graduation. Then I immediately went to the bookstore to try to educate myself on how to manage my money.

1. Immediately upon graduating from college, I set up a personal finance system (thanks to I Will Teach You to be Rich by Ramit Sethi), which helped me save and invest my money wisely.
2. Using Mr. Money Mustache's simple yet logical formula, I calculated how much money I needed to feel financially comfortable in retirement.
3. I quit my job when I hit that number (or close to it). This might actually be the hardest step!

I don't have a "get-rich-quick" scheme to teach you. My parents stopped financially supporting me once I graduated from high school. And no, I didn't forgo lattes, avocado toast, or a rich life of fun and travel in order to retire early. (No shade to the FIRE movement, but abiding by that lifestyle often requires giving up certain luxuries in order to retire early, which I didn't do.)

(I now realize I'm following the Coast Fire retirement plan, which basically means I worked a high-paying job to save up a nest egg for retirement. After taking almost 4 years off, I switched careers and now work a lower-paying job with a much better lifestyle that simply covers my living expenses. Essentially, I have enough in my retirement accounts that, without any further contributions, will grow to cover a “traditional” retirement.)

I Will Teach You to Be Rich by Ramit Sethi

Upon graduation, I knew virtually nothing about personal finance. In fact, I opened my first credit card during my senior year of college and then promptly forgot to make payments on it. Whoops! I ended up paying it off and closing the account because I was scared of the fees. It's a miracle I remembered to pay my bills throughout college, and that I didn't completely ruin my credit.

Growing up, money was a source of worry and confusion for me. A part of me felt like I was doomed to continue down that path; however, I was determined to do what I could to prevent that from happening. One of the first things I did after graduating was drive to Barnes & Noble and search their personal finance section for anything that would help me. I bought three books on personal finance, one of which was IWT. I think the others were by Suze Orman and Dave Ramsey (the classics). I devoured all of them, but IWT made significantly more sense to me.

Ramit's honesty and humor in describing why so many people struggle with money were relatable; I felt like he was talking directly to me. Additionally, IWT provided me with a straightforward action plan for setting up a personal finance system, which I still utilize today. After completing the IWT program, I finally felt confident that I was capable of managing my finances and that money would no longer be a source of anxiety for me.

Because I set up this system immediately after starting my big-girl engineering job (and didn't wait), my money blossomed the way it did. I strongly encourage everyone to read this book, but a few key takeaways are:

• "Save early and often." To be more specific, save as much as you can as early as possible. Compound interest is your friend, not just something you learn about in that boring statistics class.
• Invest a large portion of your savings wisely. Ramit explains that boring index funds are sexy. No, you don't need to learn how to pick individual stocks or become a day-trader. It's actually way simpler than you probably ever thought it was.

I Mustache You What Your Number Is

Last year, after working as an engineer in oil and gas for 11 years, I retired. Thankfully, I felt completely at ease with quitting because I had hit my financial goal for retirement. This is where Mr. Money Mustache comes in. I was listening to him as a podcast guest on my morning walk when I heard something that completely changed my life.

He proposed a very simple formula for retirement planning that contradicted every boring retirement planning lecture I had sat through. I couldn't wait to get home and determine what my magic retirement number was and how close I was to getting there.

Lo and behold, when I calculated my MMM retirement number, I realized that if I sold my condo and kept my current cost of living unchanged, I could retire in a few years. I couldn't believe it; I was elated, staring at my Excel spreadsheet in disbelief. How did this happen? (Maxing out my retirement accounts and investing in boring index funds, starting when I was 22, that's how.)

In fact, based on my estimated spending living #vanlife, I had enough money to retire now. (I didn't actually believe I would live in my van forever, but it was a nice thought exercise.)

Bottom line, I felt comfortable quitting engineering for the foreseeable future.

Update from 2025

I have since learned that I am now living the Coast Fire philosophy. Essentially, this means that you work a high-paying (and high-stress) job, possibly sacrificing your ideal lifestyle, until you reach a certain number. Once you've attained that number in your investment portfolio, you can then "coast" doing something that will earn just enough to cover your living expenses.

You can use this free calculator to find your Coast Fire retirement number, which is a lot easier to hit than the MMM number. For example, if you are 35 and plan to retire at 65 with an annual spending of $70,000 (a quite conservative estimate), you can start "coasting" once you have $550,000 invested.

If you want to take a few years off to completely not work and then take a cushy job like I did, you simply need a number that's higher than the Coast Fire number but less than your MMM retirement number. For example, the MMM number might be 1.5 M, but your Coast Fire number might be $550,000.

Make the Decision

That's when I made the decision. I'm going to retire. As soon as I can sell my condo, I'm quitting. Unfortunately, it took significantly longer to sell my condo than I had anticipated, even in the 2021 red-hot housing market. It turns out that no one wants a 1-bedroom condo in downtown Houston - who knew? But I finally did it! I sold my condo and then quit my job with no future job lined up.

Why emphasize the actual quitting part?

Because most people don't. Even when they know how much money they need to retire and then meet that goal, they still don't retire. They hem and haw, make excuses, and keep on working a job they don't like. For some, it's due to fear, such as the fear of the unknown, the fear of running out of money in retirement, or the fear of being bored, among others.

It's also human nature. The more money you make, the more money you want to make in the future.

"If only I could make $50k!" quickly turns into $70,000 and then $100,000. Similar to retirement: if your goal is to save $500,000 for retirement, once you reach that goal, you immediately start thinking about how nice it would be to have $600,000, and so on. #momoneymoproblems. It's really difficult to make the decision and then act on it. (Thanks to the Science of Well-Being course that I took last year for helping me understand this.) Fortunately (or unfortunately) for me, I found my current job to be quite unbearable, and no future prospects looked that promising. I had to leave. There was little room for discussion.

So You Actually Retired?

I use the term "retirement" loosely. It means I've achieved financial freedom; I now have the freedom to work as I want, when I want. I have an amount of money saved up that's in between "I might need to work some day" and "F YOU money." It means I no longer have to stay in a career that I just fell into because it paid the best, and I was tired of being a broke college student. (Can we normalize accepting a job offer because we want to afford to buy a couch one day?) And that right there is the ultimate freedom IMO.

Now, if you actually love your job/career, you may never want to stop working. That's awesome! But if you're like I was, it's great to know how and when you can retire. Knowledge is power, and in this case, this is some of the most powerful knowledge you can have.

Personal Finance is Personal

One thing to note is that I do not have kids. If you have kids or other dependents, your saving versus spending rate might look drastically different from mine, and it may take you longer to achieve what I have. Alternatively, I'm also not married. Read: No one is supporting me. Having someone who supports you financially could also drastically change your situation in comparison to mine, allowing you to retire much sooner than I did. Hooray! I would also be remiss to mention that I am an able-bodied white cis-female working in the US, which also comes with certain privileges.

Personal finance is personal. Everyone's situation is different. The point is to set yourself up for the most financial success that's possible, given your unique situation, figure out when you can retire, and go for it!

Buck the System

Most people go through life never knowing when they can retire; they simply assume that everyone has to work until they are 65. In fact, every retirement planning session I have attended made it clear that no one can retire until they're 60. Exhibit A: the penalties you incur if you withdraw from your IRA or 401k before 59.5. It's to the advantage of the businesses and government for you to keep working until you're physically incapable.

I know I'm sounding a little extreme here, but it's to illustrate a point. There is no single path to retirement, nor is there a single definition of what that means. Yes, it's easier to use one model and one definition for everyone; however, we all know one size does not fit all. Your retirement age is up to you ... whether it's at age 35 or 75.

Furthermore, you don't have to stay in the same career or industry for your entire life. Most retirement planning assumes you will continue making your same or higher income from now until you retire, meaning you won't take a break from work at any point. Forget maternity/paternity leave or sabbaticals. Heaven forbid you leave work to go back to school or take a pay cut to work a different career. Maybe you slug it out in an IT job for 10 years, making an average $200k/year that you hate, and then decide to become an artist and make $30k for the rest of your life? Cool!

I've said all this to say, question the system. You do not have to follow the script when it comes to career progression and retirement. Additionally, I believe we abandoned the script during the COVID-19 pandemic. Lit it on fire and buried it somewhere. #Fuckthescript