Early Retirement

This article addresses the joys, challenges, and some practical aspects
of retiring young. The author retired in 2001, at the age of 37 (same
age as Rossini when he retired).

The Depressing Truth

Ask a wage slave what he’d like to accomplish. Chances are the response
will be something like “I’d start every day at the gym and work out for
two hours until I was as buff as Brad Pitt. Then I’d practice the piano
for three hours. I’d become fluent in Mandarin so that I could be
prepared to understand the largest transformation of our time. I’d
really learn how to handle a polo pony. I’d learn to fly a helicopter.
I’d finish the screenplay that I’ve been writing and direct a production
of it in HDTV.”

Why hasn’t he accomplished all of those things? “Because I’m chained to
this desk 50 hours per week at this horrible
[insurance|programming|government|administrative|whatever] job.

So he has no doubt that he would get all these things done if he didn’t
have to work? “Absolutely none. If I didn’t have the job, I would be
out there living the dream.”

Suppose that the guy cashes in his investments and does retire. What do
we find? He is waking up at 9:30 am, surfing the Web, sorting out the
cable TV bill, watching DVDs, talking about going to the gym, eating
Doritos, and maybe accomplishing one of his stated goals.

Retirement forces you to stop thinking that it is your job that holds
you back. For most people the depressing truth is that they aren’t that
organized, disciplined, or motivated.

Be Happy or You’re a Loser

In olden times, the average person didn’t expect to be happy. Life
could be a struggle for survival with hard work and adversity at every
corner. Marriages were arranged by parents and if, after 20 years, the
couple hated each other, there was no option to divorce.

This article is written primarily for Americans. We have “pursuit of
happiness” written right into our Declaration of Independence. A
working person, however, does not expect to be happy all the time.
Every job has unpleasant elements and drudgery. The working person
imagines that if he didn’t have to work, he would be happy 24/7. It
would be like going to Disneyland every day.

Suppose that you are retired. At this point, your one job is the
pursuit of happiness. If you are not happy, therefore you are a failure
at your job and in your life. But how can you be happy 24/7? Perhaps
if you moved into a hotel in Orlando and went to Disneyworld every day
you would be pretty happy. But if you retain the responsibilities of
home- and car-ownership, much of your life will continue to be mundane,
boring, or unpleasant. Will you wear a big smile on your face as you
change the lightbulbs in the hall? Will you be delighted paying bills
or begging the plumber to come over and fix the shower? Will you be
ecstatic when it comes time to get your car inspected?

The idle rich in the old days were truly idle. They had servants, and
butlers to supervise those servants. Unless you are retiring today with
$50 million or more, however, you probably aren’t rich enough to live in
a cocoon. You still end up running the same errands that you ran when
you were a wage slave, but now they stick out more. The errands aren’t
keeping you from attending a boring meeting at work; they’re keeping you
from a fun horse-riding or helicopter-flying lesson.

Interaction with Other Humans

Most jobs come with a social life. You show up to work. You have
casual conversations throughout the day with a variety of people, most
of whom you know and many of whom you like. If all you do when you go
home at night is sit and read or watch TV by yourself, you’re still a
reasonably social person. When you retire, however, this built-in
social life goes away.

If you’ve got a spouse and kids, you’re all set. You’ll spend enough of
your day talking to other people. If you’re single, however, be aware
that you will need to create a social life. This can be tough in many
parts of the country and with your existing friends. Your friends who
have jobs aren’t available during the day and, most of the time, will be
too tired in the evening to get together.

The author has been personally fortunate in several respects. First,
his preretirement apartment is located in near Harvard Square in
Cambridge, Massachusetts. This neighborhood is full of interesting
people, such as graduate students, with flexible schedules. Second,
several years before retiring he adopted a Samoyed puppy. Walking
around town and into shops with a Samoyed is a guaranteed way to start a
casual conversation. It might be limited to “What kind of dog is he?
What’s his name? How old?” but it seems to be sufficient to stave off
the feeling of solitary confinement. Third, the author took up flying
as a hobby and general aviation seems to involve a lot of middle-aged
guys goofing off and hanging around. (see this
separate page on “Aviation for Retired Guys (and Gals)”

One strategy that might be effective is to spend every Sunday night
planning activities for the week. As your friends get older, it becomes
more difficult to arrange dinner parties and other get-togethers. They
just don’t have the energy or inclination to hang out like they did in
college or just after.

Travel: No to the Beach; Yes to the Organized Tour

One of the great things about retirement is the freedom to travel and
explore new parts of the world. Should you take the trips that you
dreamed of when you were working? Maybe not. When you worked 50 weeks
per year, the idea of sitting on a beach by yourself with a stack of
novels might have seemed an appealing escape from the crush of
interaction that afflicted you on every working day. In retirement,
however, you’re free to sit in your living room by yourself every day
and read novels. Nobody is going to disturb you. Why go to the trouble
of getting on an airplane if that is all you want to do?

An ideal retirement trip might be one in which you learn some new skills
and have built-in interaction with people. The author enjoyed a 10-day
trip to Panama, for example, in which he took helicopter lessons on
most of the days. There was some sightseeing, of course, but not the
same old “Where else have you been in Central America” sorts of
conversations that pure tourists have. The organized tour that appalled
you during your working life might be just right now that you’re
retired. You’ll be sightseeing but also getting to know some
potentially interesting new people.

Remember that travel can be hard work, especially if you’re doing the
planning yourself. Some experienced travelers plan a day or two each
week in which they “take a day off” from traveling. They don’t move to
a new city. They don’t sightsee. They might do laundry or other

[Photo at right from Tourists as Subjects.]

Non-profits are NOT the Answer

You were probably able to retire young because you are vastly more able
than the average person. Now should be an ideal time to find a
non-profit organization whose goals you share. You would expect them to
be delighted at your offer to pitch in as a volunteer, bringing the
skills that enabled you to start and grow a profitable enterprise.

Let’s start with a story. Back in ancient times, I worked at an
open-source enterprise software company. We had about $20 million per
year in revenue and, even after paying out $3 million in
year-end bonuses to the programmers, we had at least $3 million left over in
pure taxable profit. So we looked for opportunities to do some
non-profit work. One of our customers was the MIT Sloan business
school. They wanted an information system to coordinate all
student-teacher and student-student interaction in their classes.
Basically the system, dubbed “Sloan Space”, covered all the IT needs of
the school except for accounting. Sloan Space kept track of who was in
a class, who was teaching a class, what the assignments were and when
they were due, the submission and grading of assignments, private
discussion forums for each class, and everything else that the Sloan
staff decided that an online community of MBA students needed.

Sloan wasn’t paying our company as much as other clients but we found
the contract worthwhile partly because many of our employees had been
MIT students and had a sentimental attachment to the place, but mostly
because we thought that we could reuse the software and get other
universities to adopt it. Our software was free and open-source but the
richer organizations that used it would generally pay for support and
extensions. Universities don’t pay taxes and they sometimes cry “poor”,
but after years of claiming to lose money on every student they somehow
end up with substantial assets. (Harvard, for example, has about $30
billion in its checking account; enough to buy at least five aircraft
carriers, complete with fighter jets.)

Just as Sloan was preparing to launch their system to students we heard
about a new tuition-free engineering college. They were about a year
from taking in their first students. We liked what they were doing and
contacted the president of the new school. We explained our contract
with MIT Sloan and the fact that all of the software we’d built for
Sloan was free and open-source and could be reused at their school. We
offered to assign two full-time programmers, each with an MIT degree in
computer science, to the project indefinitely. These two programmers
would extend the MIT Sloan software to meet any requirements that the
new school set forth. Basically we would handle all of their IT needs
at no charge. All of our software was open-source and if we disappeared
after a year they could hire the programmer of their choice to maintain
and extend it. The president seemed delighted with this idea and turned
us over to his head of IT to work out the details. That’s where the
project stopped. The head of IT already had a plan to hire programmers
and build a big system from scratch, working in various Microsoft
products (most of which were subsequently rewritten or discontinued)

Non-profit organizations exist to provide their staff with great jobs
and the fun of making decisions and spending money. The folks who work
at a non-profit organization are very interested in drawing a salary
higher than their skills and working hours would command at a for-profit
enterprise subject to competition. They are not especially interested
in efficiency or accomplishment. If you’ve come from the commercial
world, in which McDonald’s must be ruthlessly efficient for fear of
being destroyed by Burger King, working with or in the typical
non-profit organization will likely drive you to insanity.

Once word gets around town that you are retired, non-profit orgs will
start rattling your cage. Whatever your IQ, education, certifications,
and skills might be, the assumption will be that you are past it, a
doddering old fool incapable of doing more than writing a check. If you
believe in their mission, however, it doesn’t make sense to write them a
check. Donating money to charity is great for busy people with jobs and
the obscenely wealthy who are maintaining their social status with
displays of spending surplus cash. As an early retiree, however, your
comparative wealth is mostly in the time that you can choose to spare.
If the non-profit organization can’t come up with a way to use your
brains, skills, and time, tell them to get their cash from the
time-starved working rich and the multi-billionaires.

Most important, do not retire in the expectation that it will be easy to
find rewarding non-profit volunteer work.

(If you aren’t sufficiently discourage by the foregoing, read my ideas for new non-profit projects.)

Teaching might be the answer

Volunteering as a teacher has proven very rewarding for many early
retirees. People like teaching for a variety of reasons. One is that
the traditional lecture course provides a venue in which people are
forced to listen to the teacher. If ambitious working people no longer
care to hear what you have to say, at least students who don’t want to
fail the class will listen. A more powerful reason is that talking to
young people is an activity that matters. If you are talking to someone
over the age of 40 about life decisions, chances are that you both are
simply wasting breath and killing time. You can talk about how great it
would be to live on the other coast or up in Alaska but both of you are
so tied down by a web of obligations from friends and family that it
will never happen. A young person graduating from college, on the other
hand, is almost certain to choose a new career and move to a new city.
Input that you provide on these subjects could be critical to their
future happiness.

Tattoo Your Net Worth on Your Forehead…

… otherwise folks will greatly overestimate your wealth. If someone
at a party asks you what you do and you answer “retired”, if you appear
to be under the age of 50, almost always they will greatly overestimate
your wealth. Americans cannot imagine stopping work before they’ve
either (1) purchased everything that they could conceivably want, or (2)
collapsed from physical exhaustion. The magazine Elite Traveler,
distributed free to airport general aviation lounges where corporate
looters alight, depicts the lifestyle to which Americans aspire. A
watch costs $30,000, a survey of hotel accommodations in Mexico or New
Orleans shows suites ranging in price from $3,000 to $20,000, getting
from point A to point B costs $5,000 per hour in a private jet, partying
for a week involves chartering a yacht for $200,000. These costs are no
problems for the readers of Elite Traveler because (a) most
of them are borne by the shareholders of the public companies for which
they work, and (b) the median annual income of an Elite
reader is over $1 million (see their media kit online).
When you say “I’m retired” the other person at the party hears “Even
without working anymore, I can afford to live the Elite

Suppose that you say, for example, that you can’t make firm travel plans
because your little airplane doesn’t have a turbine engine and deicing
equipment and therefore you’re very dependent on the weather. Folks
will ask “Why don’t you get a Gulfstream and blast through the clouds at
4,000 feet-per-minute with the same engines that power a Boeing 737?”
It becomes a little awkward to admit that you’re approximately $50
million short of the $50 million required to join Jack Welch in the
flight levels (of course Mr. Welch, despite being retired, doesn’t pay
for his use of a GE business jet, the fuel, or the pilots; the public
shareholders of GE do).

An answer that brings the conversation back down to earth is to remind
your interlocutor of all the older folks he or she might know who are
retired. They aren’t rich, are they? They have enough money, one
hopes, to live in a comfortable house and do the things that they most
enjoy, not enough money to gratify every conceivable material desire.


This subject is sufficiently complicated to merit its own page: “Investing for early retirees”.

Giving Money to Children (While Still Alive)

What’s a good way to give money to kids without spoiling them?
My idea: For every dollar they earn, give them $N. That way they have to
work, but they don’t have to work a repulsive yuppie job to enjoy
a comfortable lifestyle. The main objection to this approach is that it
is tax-inefficient. If the kid earns $50,000 per year doing something
he finds rewarding and you give him $150,000 that year, you have to pay
a big gift tax. Some sort of trust fund and/or life insurance policy
that the kid can claim after you die would be more efficient.

Is an increased tax liability so bad? Not for the truly rich. These
guys intend to give most of their wealth away to non-profit
organizations. The federal government funds roads and airports that we
all enjoy using. The feds pay for health care for the poor and the old.
Our tax dollars pay for intrepid military personnel who go out and kill
angry foreigners (in most cases) before they can arrive on U.S. soil and
kill Americans here at home. For a non-profit organization of its size,
the federal government is surprisingly efficient. Most federal
employees work in big box-like office buildings, not in $300 million
monuments to an architect’s ego. George W. Bush gets paid only $400,000
per year, less than half of what a lot of university presidents earn.

Can we tweak the $N bonus idea at all? What if a kid becomes a
repulsive yuppie despite the lack of financial necessity? Won’t
his siblings become envious when Chad, Jr. gets a $3 million check
from Chad, Sr. to supplement his $1 million/year earnings at
J.P. Morgan? Perhaps there should be a sliding scale for the bonus
where the first $100,000/year is muliplied by 4, the next $100,000 by
3, the next $100,000 by 2, and the rest of the kid’s income is
not subject to a parental bonus. Or there could be a lifetime cap of
$10-20 million per kid (no Gulfstream for Johnny 🙁 ).

How about tweaking the tax liability? Perhaps the money could go first
into an irrevocable trust, but only paid out by the trustee as a
multiple of income. I’m not sure if this escapes gift/estate tax.

[Note: I drafted this idea at the request of a late 40s rich, but not
retired, friend. He ended up implementing it for his teenage children.]

Where to Live?

This subject is sufficiently complicated to merit its own page: “Choosing a place to live for
early retirees”

Whatever you do, make sure that you read Real World
before settling in a state and exposing yourself to
its family law system. Moving one mile over a border could mean the
difference between losing half of your savings after a one-day
marriage and losing none, or the difference between being a parent
after a divorce and being an every-other-weekend aunt or uncle, or the
difference between paying $100,000 per year in child support or $13,000.

Time Management

How much work does the average college student get done? Almost none.
Yet the same person, injected into a corporate bureaucracy, becomes a
reasonably effective worker. Why? Most people have terrible time
management skills. This limitation is of no consequence in public
school. The school tells you where to sit and what to do and when, at
least for six hours per day. This limitation is of no consequence at
most jobs. The employer tells the workers where to sit and what to do
and when, at least for eight hours per day.

If you’re retired, however, nobody tells you how to organize your life.
If you have goals that you’d like to accomplish and your time management
skills are poor, you might end up disappointed in yourself.

In researching this article, I ordered all of the popular books on time
management from Amazon.com, but didn’t like any of them well enough to
recommend. Here are some reasonably good ideas from the books and from
my friends:

  • make lists of the things that you want to accomplish and subtasks
    toward those goals; keep these lists in prominent and convenient places
    (most of the books)

  • schedule lots of lessons and other things in advance so that your
    days have some structure (my own; I tend to schedule flying and horse
    riding lessons during the summer, for example)

  • come up with a rigid scheduling spreadsheet for your days as though
    you had a job, setting aside time for writing, reading, answering email,
    going to the gym, etc. (my own, I drafted a spreadsheet once but never
    tried living it because I was instantly ridiculed for my efforts by a

  • publish a public Web diary of what you do every day, thus
    discouraging you from wasting time because you’ll be ashamed to admit
    that all you accomplished yesterday was a 15-minute oil change and a
    trip to Target (my own, but never implemented)

  • don’t read the newspaper or email in the morning because it will
    scramble your brain with lots of disconnected ideas and you won’t be
    able to accomplish any serious work for the rest of the day (very
    productive friend who has just completed his fourth book)

TIME Magazine Happiness Issue

As mentioned above, pursuit of happiness is the main goal of the early
retiree. TIME magazine’s January 17, 2005 issue contains a special
section entitled “The Science of Happiness”. At least 50 percent of
happiness is genetic, so don’t expect a huge change from how you felt
when working.

Some good news for early retirees:

  • important sources of happiness are often those that require some
    free time to pursue, such as spending time with children and friends

  • “your degree of control over your life and destiny” was an important
    factor as was “the things you do in your leisure time”

  • older people are happier and less subject to depression than young

  • reported happiness is positively correlated with income (88
    percent of people earning over $100k/year say that they are happy “most
    or all of the time” compared to just 68 percent of people earning less
    than $35,000 per year), though some other studies show that this is not
    a large factor once above the median income

Potential bad news: “engagement and meaning are much more important
[than pleasure]”. If you don’t have a job or kids, you might not be
very engaged and what you do might not have any meaning or purpose.
“Cerebral virtues–curiosity, love of learning–are less strongly tied
to happiness than interpersonal virtues like kindness, gratitude, and
the capacity for love.”

Concrete steps toward more happiness:

  • keep a gratitude journal, once a week, in which you write down three
    to five things for which you are current thankful

  • practice acts of kindness to make yourself feel generous and capable
  • thank a mentor–in detail and, if possible, in person
  • write letters of forgiveness to people who have hurt or wronged you
  • invest time and energy in friends and family
  • sleep and exercise
  • spend more time with other people (“almost every person feels
    happier when they’re with other people,” says one expert quoted in the
    issue–note that this makes computer programming a particularly poor
    career choice)

  • laugh more (watch Zoolander instead of a serious subtitled French movie)
  • move to a country, city, or neighborhood where you are substantially
    wealthier than average (being exposed to lots of richer people will make
    you envious and less satisfied with whatever you have)

  • move to a country where people around you are happy (East Asia
    bad; Latin America good; U.S. quite good as well)

  • get a dog: studies show that dog owners were happier and less
    subject to depression, people were able to do difficult or unpleasant
    tasks more easily and with lower blood pressure when accompanied by a
    dog; dog owners get more exercise and find it more enjoyable

  • (tough to fake) become a sports fan and cheer like an idiot
  • (even tougher to fake) become religious, ideally Buddhist — those
    who have a lot of religious faith tend to be happier and find meaning in
    life; among mainstream U.S. religions, Protestantism is good for
    happiness and Judaism is bad

The TIME issue is negative on marriage as a means for increasing
happiness. Married people are happier, of course, but mostly because
they were happier and better adjusted to begin with. TIME ignores the
fact that they previously talked about how children and grandchildren
were critical to happiness. For most people, it is not practical to
have children outside of marriage, so it seems that people would be
happier if they stayed married at least long enough to have some kids.

Prepare to Die

Retiring young has benefits and risks to life expectancy. You’re not
sitting at a desk all day every day anymore, so you’ll probably lose 10
lbs. simply by being more active. You won’t be going on business trips
and gorging yourself with expense-account meals. On the other hand, you
now have time to ski, snowboard, skydive, whitewater raft, fly light
aircraft, travel to Africa, and engage in other risky
activities. Best to plan for your ultimate demise.

Unless you think the government is doing such a great job building a new
and better Iraq that you want to pitch in even more, you may wish to
consider ways of avoiding estate tax. Only the first $2 million of an
estate is currently exempt from taxes, scheduled to rise to $3.5 million
2009, be unlimited in 2010, and come back down to $1 million in 2011.
Some states collect their own estate taxes (see http://www.retirementliving.com/RLtaxes.html
for a list). The total tax burden on an estate can be more than 50

The standard tools that rich families use to preserve their wealth down
through the centuries include the following:

  • give money to a grandchild instead of a child; by skipping a
    generation, the government gets only half as many opportunities to
    collect estate tax (reduce estate tax by 50 percent)

  • take money that you were going to give to someone upon your death
    and, instead, buy a huge life insurance policy with it; when you die
    they collect the proceeds of the insurance policy tax-free (reduce
    estate taxes by 100 percent)

  • various trusts to hold insurance proceeds and other money so that
    young and/or irresponsible inheritors don’t burn through the money too
    fast (doesn’t really save tax, but lets you control people from beyond
    the grave)

  • charitable foundations and organizations that are supposed to work
    for the public benefit, but in fact provide jobs and luxurious vacations
    (“board meetings”) for members of your family for decades to come; the
    Enron executives were into these. Supposedly it is illegal and the
    family foundation ought to recruit employees on the open market, but in
    practice people are able to say “the only person we could find to review
    grant applications at our family foundation was our cousin Margaret at
    $100,000 per year” (reduce estate taxes by 100 percent)

A good lawyer can put together a package with a Will, a single trust,
and maybe an insurance policy, for about $2,000. Even at big firms,
some of the more honest lawyers will do this work for a fixed fee.


Here are some books and movies about people who don’t work.


  • Broken Flowers, the 2005 movie with Bill Murray
  • Shop
    , by Steve Martin (the book, not the movie); the shop girl’s
    boyfriend is a mostly-retired guy whose wealth derives from “a few lines
    of computer code”; Steve Martin has a very confused notion of how a
    leftover computer nerd might live in terms of fashion and taste


  • The Whirlpool (1897), by George Gissing
  • About
    a Boy
    (1998) by Nick Hornby; also
    on DVD

Text and pictures copyright 2006 Philip Greenspun


Reader’s Comments

Very interesting. Most of my happiness comes from accomplishing goals (creating software products is very satisfying) or from interacting with my spouse, children, extended family and co-workers. I can imagine doing all these things in my free time if retired. I do build software on my own ‘just for the heck of it’. And incidentally, thanks for all the free software engineering stuff, I can’t read enough (even on my own time).

W Chadwick, December 13, 2006

Phil, this is a great article and one that hits the heart. I left a certain famous search company after 5 years of employment with a lot of wealth and haven’t been working since. I think there needs to be more written on this subject of ‘now what?!’ and basically support for some of us young (im 36) retirees who have lost a bit of ambition and direction after leaving the rat race.
Anyway, after reading your article, i dont feel as guilty anymore splurging on a thing or two (namely justifying buying another car), but more importanly to focus on new things and not lose confidence that you’ll have the motivation to be working hard again one day. I also never knew that being wealthy has its stigmas…ie alienation from certain friends and certain family, etc. You really have to be creative in this situation. Keep the ideas and updates on this subject coming…

A Guy, December 19, 2006

I really like your list of how rich families preserve their wealth down to many generations; especially the suggestion on buying a huge life insurance policy and getting monthly annuity payments from it, set for life! According to this site, it is also not advised to take out a lump sum distribution from a 401k because:

*Starting from 2006, the highest one time lump sum payment that a 401k retirement saver (between 62 to 65) can receive is $175,000. This limit is lowered for younger people.

* Starting from 2008, the assumptions (such as interest rate, life expectancy & rates of return on investment) that we used will change from the 30 year Treasury bond rate to the corporate bond interest rates. Since corporate bonds have higher risk than treasury bonds, their interest rates and yields are consequently higher. Therefore, the lump sum payments that you receive will be even lower.

The only disadvantage of getting monthly annuity payments for the rest of your life is if the life insurance corporation goes bankrupt, you could lose your monthly payments. However, the Pension Benefit Guaranty Corporation (PBGC) will step in and compensate you for the lost annuity payments (usually much lower). But all in all, the life insurance policy suggestion is the best to preserve wealth down to many generations!

James Bartela, February 1, 2007

Dismissing all non-profits because they exist for the benefit of the employees is just a little cynical. When I stopped working in the corporate world (MSFT) I started working for a non-profit to educate myself and figure out if I wanted to do it long term, and have discovered a wealth of viable causes, and committed people who really are contributing to making the world (sometimes one individual at a time) a better place for the rest of us to live. Sometimes it takes a group of people with different skills to create change, whether it be locally by clearing the trails in a local park, or building a house for others, or globally, thru education and information. However, when it comes to volunteering, be prepared to be clear about what you are offering and be willing to show up in a committed way, showing up once or twice for a couple hours probably won’t be beneficial to anyone. (altho at YES! magazine, we have successfully used a seminar format to pick the brains of people, in a consulting format).

Audrey Watson, March 5, 2007

From 2001-2004 I was a CEO of a public software company and after a major turnaround, we sold it, and I made enough to “comfortably” retire in my 40’s.

Since then, I have had both the same joys and frustrations that you mention in your article. I have enjoyed working out more, reading, traveling all over the world, time with friends and family.

Yet, like most ambitious people, I keep asking myself, “Is there somethhing more?” “Am I really done with my career?” etc.

Retiring in your 30’s, 40’s, 50’s or 60’s, we will all have to come face to face with the reality that we are all so much more than our jobs, careers, status symbols captured and enjoyed.

I don’t have my final answer. I am still struggling through, “Get another CEO Gig” or “Fully pursue all my other passions in life”.


Craig Brennan, March 16, 2007

I’m getting ready to retire fairly early- 53- not through having made a killing in the stock market or working 60-80 hours a week or being in a fabulous Internet startup, but by simply living below my means, maxing out my 403bk contributions, and adding to a seperate brokerage account when I could.

I found a good broker/money manager who has actively managed my account and averaged about 12%/year after expenses. Over the last few years he’s guided me in moving from higher volitility investment to lower volitility, as well as some tax sheltered investments, and I’m in a position now where I can count on keeping up the same income level I had pre-retirement, along with the growth necessary for inflation, as well as keeping a cushion against the inevitible recessions.

There are three kinds of “money managers” out there. Most are salemen for insurance companies who will stuff you into low-yield annuities and pcoket large commissions. A lot are drones who will sell you what they’re told to sell by their employers. But there is a small subset who make their money and their reputation doing wealth preservation for reirees and people who have inherited wealth. If you can find one who’s interested in taking on someone who doesn’t yet have a fortune, that can be a good way to go.

Michael Edelman, May 2, 2007

If you do want to volunteer your time; organise a conference! Find something you’re passionate about (free software, gardening…) and see if there’s a related grass-roots conference in your area (for example the “Yet Another Perl Conference”s, the various “Open Source Developers’ Conference”s etc). If so, volunteer to help with the next conference; if not, create one. It’s a great way to spend time with people, encourage the growth of your field of interest and increase your personal fame within it. It also comes with a specific due date, so you can walk away at the end if you don’t want to do it again.

Jacinta Richardson, November 1, 2007

Wonderful article Philip,

Here are some ideas (many similar to yours) that have worked for me to retire at 51.

[1] Move to a country where you are richer (I moved from the UK to the USA) Other suggestions would be: Tunisia or Morocco.

[2] Learn something new that’s HARD. (I took flying lessons at 45 and I am now a private pilot) Other suggestions would be: play piano, learn chess, get an MA or Phd.

[3] Be creative. I draw and sculpt. Other suggestions would be: paint, garden, design stuff

[4] Realize that love and sex gets better the older you are. in your 20s your inexperienced,
in your 30s your making babies and money, in your forties your getting divorced, but in your 50s your relaxed and enjoying life.

[5] Teach young people your skills and passions. You will both learn from each other.

[6] Keep buying popular music. Don’t just listen to the hits of your youth but embrace current trends and you will not turn into an old foggie with a bad haircut and dreadful clothes. My hero whom did this perfectly was John Peel BBC DJ.



Simon Holland

Simon Holland, June 28, 2008

Thanks for the “food for thought” . I have lived within my means and worked a goverment job -for 23 years paying union and pension dues. My pension will be (well under the recommended 70 percent of my $70,000 per year gross income) at 53 percent , wih no debt.

The human brain needs refreshing , new stimulation to be healthy; dong the same old job decade -after-decade tends to rot the brain and dry up the soul. My employer seems ill equipted to provide a renewing, refreshing, stimulating workplace.
I am getting out asap at 53 years old, whatever the world brings it will have to be better than the stale, unmotivated, retired-on-your-feet condition of many long term goverment employees.

Peter James, October 28, 2008

Great information. Sadly, I now know that I will have no more motivation
in retirement, than I do now (which is little). I do still look forward to no longer going to a job I no longer like, even a little bit. My last day is 12-22-2008 @ age 50.

I will take many of your suggestions to heart.

Anita Alexander, November 11, 2008

While I am not ready for retirement yet, I found much of use in this article. I was inspired to start a Gratitude Journal on my blog. Feel free to join in on my Thankful Thursdays, starting on 1/15/09. http://www.akalranch.com/2009/01/thankful-thursday/

Simrat Khalsa, January 13, 2009

I too have not found any good time management material until recently. There is one lecture I found that is actually useful and goes beyond anything else I’ve seen. It is the Time Management lecture given by Randy Pausch the ‘Last Lecture’ guy who died of pancreatic cancer recently. The time management lecture was not his last lecture, but a separate one he gave. It is sad to think how critical time management was for a person who was dying, but I think he was using these time management skills all the time. Here is a link to that lecture: http://www.cs.virginia.edu/~robins/Randy/

Jelly Bean, March 28, 2009

I retired at 32. I’m now 56. Of all the “things” that I’ve done, or junk I’ve bought and disposed of over the years, the most rewarding thing in my life has been my Buddhist practice. And it hasn’t been a walk in the park.

Kevin Jenkins, December 10, 2010

I have to disagree with much of what you say about non-profits, or at least state that it does not apply to the ones I’m familiar with. For the record, I’ve worked in the corporate world, a government agency, and am currently working in a non-profit.

“Non-profit organizations exist to provide their staff with great jobs and the fun of making decisions and spending money.”

Wow, that totally does not apply to the non-profits I know. Maybe if you’re talking about some cushy art museum, but certainly not your run-of-the-mill non-profit or charity that actually *does* something. My observation is that the non-profits with the biggest budgets seem to be those with the suckiest missions. The non-profits and charities that actually do something good for people always seem to be the most desperately under-funded. Probably because rich people like to give money to organizations in comfortable parts of town that they don’t feel awkward visiting.

“They are not especially interested in efficiency or accomplishment. If you’ve come from the commercial world, in which McDonald’s must be ruthlessly efficient for fear of being destroyed by Burger King, working with or in the typical non-profit organization will likely drive you to insanity.”

Again this is totally false. I work every bit as hard as I did at my corporate jobs, and many of my colleagues work even harder. With fewer resources and support. Sure I’ve known some slackers at my non-profit, but those people have all been laid off by now. We have to be ruthlessly efficient because we have lots of work to do and very few resources to do it with. Fewer all the time, because donors don’t like to give money for operating expenses (see below) and we always seem to be losing people but the job never gets scaled back. We’re always scrambling to find ways to squeeze a little more out of the resources we do have.

Regarding accomplishment, non-profits exist to accomplish things, in particular things that are not profitable. Non-profits *have* to accomplish things so that they can point to them when they ask for more money to continue their mission. Most people I know who work at non-profits would just go get a cushy corporate job if they didn’t care about the things their organization was trying to accomplish. Maybe the problem is with the particular non-profits you’ve been exposed to.

“If you believe in their mission, however, it doesn’t make sense to write them a check.”

Oh my gosh this is so false! Non-profits *desperately* need people to write checks to them, especially for operating expenses! When people *do* write big checks, these donations often come with restrictions or are attached to some project that will have the donor’s own name emblazoned on it in large letters. This is often a building project (see your comments about Harvard). Donors love to have buildings or pieces of buildings with their names on them, or one-off projects that prominently say “Sponsored by DONOR”, but they don’t seem to care about paying the utilities or replacing old equipment or paying the staff.

The problem is that these ego-boosting building projects are unsustainable. The place I work is saddled with debt because we did a large building project ten years ago. It has donors’ names all over it, but it’s dragging us down. If those donors had given us unencumbered funds, or put money in our endowment, we’d be in a lot better shape.

I don’t know how to sum this up, other than to say I’ve worked every bit as hard at my nonprofit job as at my corporate ones because I’m passionate about the organization I work for and its mission. Also because I know my work contributes to something I believe in rather than lining the pockets of some rich guy who will get to retire early while I’ll probably be slaving away until I die. Sorry about that last comment, but reading about rich people who get to retire early brings out my inner socialist.

geoffrey jost, April 26, 2011

I enjoyed reading your column and I like some of your ideas. I would think in this difficult economic climate, it is a challenge for retirees to manage their lifestyle into their 80’s. As a young retiree at 50 years old, my family and friends looked at me with surprise as they expect me to work at least up to 60 years old. Since I have lost my drive to work in the corporate world, I decided to volunteer in non profit organizations, read avidly, blog actively, join a bible study group, travel overseas once or twice a year and spend the rest of my time reviewing my investments. I have developed my own benchmark for happiness which I reviewed on a yearly basis and improve on areas where I have been lacking. Although I could say I am doing quite well so far, my greatest challenge is to manage my time, money and talents wisely. I pray that with God’s grace, I will become more creative in developing new hobbies and even more discerning in my investments and my business ventures.

Sandy Ling, May 20, 2011

I’m preparing myself (physically & mentally) to leave the corporate world and become full time homemaker. I browsed the internet looking for some valuable ‘advice’ on how to face reality with early retirement and your article came up among others on google page. I am quitting my job as a CEO of a small investment mgt. company at age 43 (am serving 3 months resignation notice fr 6/3/2011) after the job responsibilities became too taxing & stressful for me to endure. Also, the job has taken away my ability to perform my other duties as wife and mother to 4 children well. Nevertheless, the prospect of being left with no ‘office work’ to do from 9-5 after 21 years is still quite unimaginable for me…after reading your article; it helps to put certain perspectives in place. 1st, I have to get my priorities right!. Family first, personal second. I welcome more advice and words of wisdom – maybe from those who retired early & still have school-going children to manage themselves

Junaida A.Jalal, July 4, 2011

This article really goes in depth on many areas effecting early retirees but one area I think could possibly be added is to learn self-sufficent skills. I personally think anyone retiring without a huge retirement fund should learn how to repair and/or build a home, fix their cars, grow their own food, start a business, etc.

These skills have come in handy for my early retirement and saved me a nice bit of money. Since your probably going to have much more time during retirement you can spend some of it upgrading or learning some very practical and money saving skills.

John Alfered, April 30, 2012


An interesting post you’ve written.

I think it’s a bit disrespectful to say that non-profit workers are under-skilled and over-eager for pay. I worked in an non-profit and I know that I was working harder than most of the people I know in the private sector and getting paid less. There were constant demands on my time and I had to be able to deal with a wide variety of people and changing circumstances on a regular basis. Working in education or with the under-served is never easy. When I worked in the corporate world, I enjoyed endless air-conditioning (yes, these silly things can be an issue), a computer that ALWAYS worked, free coffee, and other perks. I don’t want to seem inane by stating these small perks, but what I’m getting at is that life in the corporate world is just easier because it’s more comfortable on many levels. Not having to walk 20- 30 minutes to your job site from the parking lot (which you had to pay for) with a load of materials, is very nice. In short, in the non-profit world, I had a world of goals and objectives to reach, but had fewer resources to reach them with. 🙂

I’m sorry that your relationship with non-profits has been negative. I can’t say that mine was entirely positive. Being underpaid for endless amounts of work is never a fun experience. But put that aside, it was the lack of coherence, follow through, and transparency on the part of some of the management that was difficult to deal with.


madina da, August 16, 2012

charitable foundations and organizations that are supposed to work for the public benefit, but in fact provide jobs and luxurious vacations (“board meetings”) for members of your family for decades to come; the Enron executives were into these. Supposedly it is illegal and the family foundation ought to recruit employees on the open market, but in practice people are able to say “the only person we could find to review grant applications at our family foundation was our cousin Margaret at $100,000 per year” (reduce estate taxes by 100 percent)


madina da, August 16, 2012

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