I’ve been retired for 9 months now. Several people have asked me how I managed to retire at such a young age. My typical answers have been, “I saved at a high rate” or “I never enjoyed spending much money”. However, those answers only scratch the surface.
After feeling wholly dissatisfied with the answer I recently gave my mentee, I engaged in further reflection. I asked myself, “How did I become this way?”. The answers became clear as though I had lifted a fog from my brain that was causing me to provide such automated and reflexive responses. As far as I know, there was no magic involved. (The image below is one of the beautiful digital artworks on display at digitalblasphemy from a variety of artists).
Scratching the Surface: My Early Years
I reversed the polarity of my brain at a very early age before I even started earning my own money. When I spent money, I sometimes felt pain. Whenever I saved money, I felt pleasure. This applied even to my parent’s money and the government’s money. A well documented fact is that it’s easier for people to spend other people’s money as opposed to your own. This principle extends to the governmental operations as well.
Before I was of school age, I’d aim to drive down our family’s grocery bills when we went shopping. I’d put items back onto the shelves that my younger brothers had placed into the cart. Perhaps I had observed earlier behaviors from my parents and was merely mimicking their behavior. I was born in the early 80s during dual recessions, so behavioral mimicry would not surprise me.
Late in my elementary school years, I was living with my Mom. She told me that if I wanted to attend college, I’d need to pay for it myself. I became focused with earning scholarships to help me pay for college at this young age.
Middle School Years: Makings of an Early Retiree
By the time I had entered middle school, my Dad turned over the balancing of the checkbook to me. I could see all the inflows and outflows of money, what things really cost, and the financial operations of the household.
My younger brothers and I spent two years practicing Taekwondo. This length of time was just enough for each of us to earn first degree black belt. My most important takeaway was learning self-discipline. I feel my Dad was very wise to urge and encourage us to participate in martial arts.
Also during middle school, my Dad moved from one house to another. His real estate agent exposed me to an amortization table. Prevailing interest rates at the time were much higher than they stand today. I could not understand why someone would be willing to pay 3 times the “sticker price” for their house! This created a certain allergy to debt within me.
The middle school years were also a time when my family had qualified for the reduced school lunch program. I refused to take part in it to the dissatisfaction of my Dad. I knew that he was on Economic Outpatient Care and that, in reality, I should not be qualifying for the program. My position was simple — I’d rather not eat lunch at all than to take money from other people. My Dad’s frustration with me only grew further in later years when reduced lunch became free lunch. To this day, I still believe there’s no such thing as a free lunch.
High School Economics and Philosophy
In my junior year of high school, I began earning my own money. From having recently studied economics and government, I treated every dollar I spent on something as a vote for that thing (i.e. good or service). Every dollar not spent as a vote against said thing. My feeling was that if I chose to buy something, then I was creating demand for a thing and the producer of the thing would feel compelled to put yet another of that thing back onto the store shelf.
If I spent a dollar and didn’t feel as though I had derived high value from whatever I purchased, then I felt pain. To me, sub-optimal spending felt like receiving a paper cut. Ten dollars wasted or somewhat wasted; ten paper cuts received.
My junior year of high school also exposed me to Stoic philosophy during my philosophy class. Thank you Mr. Whitlow! The Stoic set of ideas appealed to me and further cemented my already frugal nature.
My Working Years
For my undergraduate, I studied computer science and economics. I had an internship that allowed me to work full time every summer and winter break and make good money. I began investing and making my own mistakes. I understood the time value of money and knew that eventually inflation would eat into the money I saved. The early days were a trial by fire though for me.
When the great recession hit, I shifted my frugality from 4th gear to 5th gear. I ratcheted up my self-learning on investing and personal finance optimizations. The mid 2000s also brought the green revolution and I took on many additional environmental ideals despite feeling I was already fairly environmentally conscious. My general finding is that what is good for the environment is also good for the wallet. Sometimes a simple shift in thinking is required to focus on the long term cost/benefit analysis instead of just the short term. My having a high savings rate already made this easy.
In summary, my spending has always been at my conscious level. Three separate formative periods between age 1 and 17 made me who I am today. I avoided the constant bombardment of the messages and opinions from the consumerist society all around me — Stoicism aided me in this. I’m not a magician; I’m an early retiree. Now that I’m not “working”, I have the freedom to pursue the kind of work I really want. Peace is my profession. Work really is better when you don’t need the money!
Peace be with you,
Trip Seibold 子兴
What will you do once you’ve made the ultimate luxury purchase — your time?
What is (or was) your largest challenge on your path to freedom?