Lovebird
JF-Expert Member
- Sep 27, 2012
- 6,878
- 10,515
At 23 years old he began working and saving
and saving some more. By age 30, hed amassed some $800,000 in cash and investments, and then entered early retirement.
The Rule of 70%
While a popular rule of thumb is to try to save 10% of your income every month, in the race to retirement Mr. Money Mustache saved and invested close to 70% of each paycheck until he had about $800,000 racked up. At that point he felt comfortable quitting his job, as the dividends from his stock portfolio and income from a rental property were finally enough to support his familys lifestyle. I just figured based on a 4% withdrawal rate of your savings, if you have $800,000 saved, you could draw an income of $32,000 a year from that. Our needs are less than that, so we actually dont need $800,000 in savings.
How I Retired at 30 - Yahoo! Finance
The Rule of 70%
While a popular rule of thumb is to try to save 10% of your income every month, in the race to retirement Mr. Money Mustache saved and invested close to 70% of each paycheck until he had about $800,000 racked up. At that point he felt comfortable quitting his job, as the dividends from his stock portfolio and income from a rental property were finally enough to support his familys lifestyle. I just figured based on a 4% withdrawal rate of your savings, if you have $800,000 saved, you could draw an income of $32,000 a year from that. Our needs are less than that, so we actually dont need $800,000 in savings.
How I Retired at 30 - Yahoo! Finance
