If you have been reading early retirement blogs, then you probably noticed that engineers are over-represented in this niche. Why does it seem like every early retirement blog is written by an engineer? Is engineering the perfect career for early retirement? I was an engineer for 16 years so I thought I’d share my experience and see why so many engineers retire early. There must be some defining characteristics that set engineering apart from other professional careers, right? Then I’ll need your help to brainstorm and find the other best careers for early retirement. Engineering can’t be the only career that encourages early retirement.
Engineering changes as you gain seniority
I was 7 years old when I saw my first computer at my uncle’s house in Bangkok. He was a college professor and he had an IBM personal computer at home. I asked is this a TV? (A TV was pretty uncommon in the 70s and we didn’t have one.) He showed me how to insert a 5 ¼ floppy disk and booted up Asteroid. Wow! I could fly a little spaceship around and blow up asteroids! This was better than TV! I loved it and played with those old games whenever I visited. Man, kids are so spoiled these days. RB40jr loves playing Angry Birds on my Moto X. It’s amazing to see how far technology has come in 30 years.
When we moved to the US, I found a computer at the local library and that gave me the opportunity to learn more about them. I learned BASIC and wrote “Hello World.” Computers was a growing field in the 80s and many people recommended going into engineering. I was good at math and science so engineering was a natural fit when it was time for college. Computer engineering was a grueling major, but I pushed through and earned an MS after 5 years.
The PC boom was still underway when I got a job with Intel right out of college. The Pentium was hot and Intel was raking in money hand over fist. I worked in research and development and it was exactly what I wanted to do. I loved designing and debugging the computer chips. I think every engineer likes solving logical problems and that’s what we got to do at the beginning of our careers. In the old days, you could stick with solving technical problems your whole career and retire as a senior engineer. Now, companies demand more from senior engineers. Solving technical problems isn’t enough anymore. Senior engineers need to be a “force multiplier” and work through others. This means supervising or mentoring junior engineers, delegating your technical work, and attending a lot of meetings. Some senior engineers stick with the technical side by becoming a specialist in a particular field. That’s one way to stay technical, but it has its own peril. Your specialty can become obsolete and you’ll need to become specialized at something else. This can be difficult when you’re older and have a family. Many technical jobs could also be outsourced pretty easily.
Engineers who are good at their job and love working on technical problems will get promoted and gained more responsibilities. Eventually, they will need to figure out if they want to go into management or become a specialist. This is an inflection point. I didn’t like either option so I quit engineering. Most of my friends from college also had moved away from R&D. They are in management, marketing, IT for a financial company, venture capital, and teaching. Only one of my friends from college is still in R&D.
Work load and stress
Companies demand a lot from engineers these days. I used to work 80-90 hours per week (at deadlines) when I was in my 20s. It was fun at the beginning because I enjoyed the technical work and I didn’t have much of a social life anyway. Eventually, I got married and I didn’t want this kind of work commitment. It isn’t compatible with having a happy family life. Engineering can also be very stressful when you are near the deadline. Companies will inevitably demand “all hands on deck” to push a product out the door. Working long hours in a stressful environment is a young person’s game. Well, I guess some older people likes it too, but I don’t. I’d rather work at my own pace and self employment is the way to go.
Many engineers get burned out from the stress and long hours. This is why we see so many engineers transition out of R&D at the inflection point I mentioned earlier. There are exceptions of course. Some engineers achieved FI and they can pick and choose the work they want. They can say no to overtime and not worry about the annual performance review. One of our readers, Freebird, is at this point and he’s enjoying engineering again.
Above average pay
Engineers are paid relatively well. This is crucial because you can’t retire early if you don’t have any saving. I maxed out my 401k and Roth IRA for most of my career and that’s the foundation of our retirement saving. We lived a modest lifestyle so we could save and invest more in our dividend portfolio and rentals. There are many other professions that make more money than engineering, though.
Most engineers are trained to think logically and advanced mathematics is a requirement in school for us. We can easily understand the concept of compounding and that encourages us to save. We know we need to save for retirement. If you don’t save now, you won’t have money later. It’s logical.
All engineers also love optimization and that carries over to our personal finance. I’m always looking for ways to optimize our monthly bills. If you don’t watch much cable TV, then cut it and watch shows on DVD or the internet. Most people don’t like changes and will stay with the same plan even if there are more affordable options. Engineers will actively look for ways to optimize their life. I think that makes us naturally more frugal.
Here is one I forgot, but our readers caught. Most engineers have an unassuming lifestyle because we don’t have to impress clients and co-workers. I only wore a suit to work once in my 16 years career. Yes, it was for the interview. Most engineers wear casual clothes, drive economy cars, and life in a modest home. That keeps our monthly expense down to a reasonable level. Lawyers and finance people have to dress the part and drive nice cars to impress their clients. Most engineers don’t spend a lot of money to keep up appearance so it’s easier to keep our lifestyle modest.
So, what do you think? Is engineering the best career for early retirement? It’s the combination of everything above that pushed and pulled me to early retirement. Of course, only a few engineers choose this path. Most engineers just change field or carry on working in the corporate world. That’s good too. We still need senior engineers to develop those new technologies.
What other careers are a good fit for early retirement – say before 50? Let’s stick with regular careers that anyone can get into and skip sports stars and other entertainment careers.
Best careers for early retirement
- Investment Banking/High Finance – The finance people get paid much better than engineers and they work crazy hours, too. They know the value of investing and this gives them the option to retire early. I see many blogs by high finance people too.
- Police officers and firefighters – I think police officers and firefighters can get their pension pretty quickly so retiring at 50 is a good possibility.
- Entrepreneurs – If you strike gold with a popular product, you can easily retire early. Most entrepreneurs probably would continue innovating, though.
- ??? – Great comments below. Check them out. I’ll just summarize a bit here.
- Oil industry, seaman – Great pay, but a lot of travel and long hours.
- Military, teachers, federal jobs, and other careers that offer early retirement. Most of these jobs offer early retirement at 55 if you put in the time.
- Law – Good pay, but long grueling hours. Probably need to spend a lot of money to keep up appearance. That’s another advantage to being an engineer. We can dress down and drive beaters and nobody cares.
- Airline pilots – Good pay and career may not last long. See John’s comment below.
Worse careers for early retirement
Bonus – some careers that are terrible for early retirement.
- Doctors – It takes forever to become a doctor and you will most likely have a ridiculous student loan. Doctors make a lot of money, but they invested so much time and money to become a doctor. Most of them probably would hesitate to retire early.
Okay, I only got a few so I need some help with this list. What do you think are the best careers for early retirement?
Image credit: flickr by Tulane Public Relations