How to play with your income to retire at an early age

JP Livingston 29 was sitting in a cafe in the West Village of New York wrapped in a comfortable sack. Drinking tea and talking about his current project retirement. Livingston reports that withdrew from the labor force last year with 2.25 million dollars having worked in finance for only 7 years. Increasingly, young and Livingston point you have to let the baby boomers have their typical “retirement” with its delayed gratification and uncertain benefits.

income to retire at an early age

They instead play with their income savings rates and investment to be economically independent, retire at an early age a process known as FIRE for its acronym in English financially independent, and retire early. Typically, Americans spend most of what they earn and fall short of money to save on traditional retirement.

These young people are the first generation to plan your financial freedom: 63% of wealthy millennial prefer financial independence to retirement, while 37% are saving to leave the entire workforce, according to a study by the firm Merrill Edge. Anyone can achieve economic independence: simply you need to save a lot. Most of those who can afford to retire at an early age do saving at least half of their income. In addition, Livingston set its goal very high. She saved at least 70% of everything they earned during 7 years. In addition, he chose a career-and a city- that would help in its aim to maximize their revenues, despite the high cost of living.

She had a mission. How otherwise could call if you start planning your retirement is practically a teenager? Of course, had several things going for it (than most) graduated from Harvard University in only three years, with no debt and with some savings? He also landed a job well paid in the financial sector, which initially included a six-figure salary that was increasing exponentially.

He also had a plan that would allow it to be financially independent before she and her husband formed a family and spending inevitably grow. Although her husband still works (by choice, not because they need it or need the money), Livingston savings are sufficient to cover the cost of two dollars-about 67,000 per year for the rest of their lives. I come from a family that grew up very poor Livingston, who now writes a blog under a pseudonym on how to retire early called explains The Money Habit.