I’ve just spent the last hour on a website I just discovered, and am so inspired I wanted to share it with you. Early Retirement Extreme is my kind of site. The guy who writes it (Jacob) is in his early 30s and financially free… without ever earning a six figure income or coming into any sort of inheritance or windfall. He is an extreme saver, saving 70 -80% of his income during his working years. He now works about four hours a week on the computer, which provides enough income to cover his expenses. I love reading stories like this; they inspire me and motivate me.
Jacob lives in an RV, and leads a very simple – and happy – life. My family has a house with 3/4 of an acre of land, but we also lead a simple, happy life. Our expenses are quite a bit higher than Jacob’s, mainly because of the house. But we have a 15 year mortgage with a fixed 4.625% interest rate, and we’re working hard to pay it off in less than half of the scheduled time. Once we do, our expenses will drop considerably, since our mortgage accounts for about half of our monthly expenses.
We’re also working towards our goal of growing most of our own food, which will further reduce our expenses (food is our highest expense after the mortgage). Buying a house with a large yard was a big part of our long term plan, and it feels great to make extra payments on our mortgage every month, knowing that we’re working towards owning our own mini-farm someday.
Right now, we’re saving about 50% of our after-tax income (I include the extra we pay toward the mortgage in this figure). I’m so impressed by Jacob’s story, and inspired to keep focusing on our long-term goals. Retirement means different things to different people, but I think that everyone would appreciate more time to devote to things that they love rather than things that they must do in order to earn money (for a small percentage of people, these are one and the same, but for most people, there are plenty of things they would rather do than whatever it is they do to generate an income). If you’re interested, check out Jacob’s blog and get inspired to start saving for your own independence day!