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My Early Retirement Journey Recap

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Early Retirement Journey recapRecently, it dawned on me that Retire By 40 is a bit disorganized. It has been almost four years since I started writing, and that means there are a lot of blog posts.  A new reader can drop in and read a few articles, but it’s not easy to get the whole perspective on this early retirement journey that I’m on.  So I thought I’d put a recap together and add it to the Start Here page. That way a new reader can get up to speed before continuing on to other articles.

Life is great when you’re young, isn’t it? You don’t have much responsibility and you still have plenty of fun even when you’re poor. Our family immigrated to the US when I was young and we struggled financially for many years. The whole Financial Independence/Early Retirement concept is foreign to the working class and I didn’t even know about this until I was well into my career. It seems like an upper class concept, but that’s not true. There are many ways to reach Financial Independence and I think anyone can do it. Of course, it’s much easier if you make good income.

Early career

1996 – I graduated from college with a Masters degree in computer engineering and started working for a big technology company right away. At this point, retirement was the last thing on my mind, but my dad convinced me to invest in the company 401k. I increased my contribution every year and I was maxing out the 401k contribution after a few years. I also saved and invested a little bit on the side, but it wasn’t a huge amount.

I got a new car (compact Ford), went to concerts, took some international trips, and enjoyed myself. I wasn’t living large, but I wasn’t that frugal either. My income was pretty good and I lived within my means. Debt wasn’t a problem because my parents help paid for my education and I never ran up my credit card.

I went to college with Mrs. RB40, but she went off to join the Peace Corps for a couple of years. We got married in 1999 and moved into a house shortly after. She struggled for a few years to find the right job that suited her personality, so she kept her frugal lifestyle. I knew she didn’t like to spend money while in college and she had always had frugal tendencies since she was a kid.  This was good because we could have spent much more money in our 20s.

Mid career

2003 – I enjoyed being a computer engineer when I started working. There were challenging problems to solve, new technologies to learn, and sometime it was even fun. Sure, I worked long hours, but it wasn’t a hardship because most of my friends worked long hours, too. I got a few promotions early on and I was making pretty good money by 2003. By this time, the company was asking me to take on more leadership responsibilities. I tried, but I wasn’t very good at it. I didn’t know how to deal with people who didn’t perform and I got very stressed out. Anyway, we had the benefit of a 10 week sabbatical every 7 years, so I took the time off to get away and think about my career.

When I got back, I changed jobs and transferred to a different group within the same company. I told myself that I’d give engineering one more chance and picked a job in the area that I really enjoyed (hardware debugging if anyone is curious.) Things were good for a few years until I was asked to take on more leadership roles again. I declined and job satisfaction went downhill pretty quickly. There were a lot of reorganizations and my manager was let go in 2009. I wasn’t having any fun and I hated dragging myself to work every day. Some of my friends left the engineering field altogether and that’s when I realized there was an alternative to sticking it out in the same career for 30 years.

Financially, we were doing quite well during this period. Mrs. RB40 went back to college, got her Master degree, and found a more stable job that she liked. We paid down our mortgage a bit, invested in the stock market, and maxed out our 401k and Roth IRA.

I’m not exactly sure when I learned about the Financial Independence for the regular people concept, but it must have been around this time. I was reading a lot of personal finance sites because I wanted to learn more about investing. I stumbled onto Jacob’s Early Retirement Extreme at some point and I thought, wow, what a great idea. However, I still thought I need to change jobs or companies to keep the income rolling.

Late career

2010 – 2010 was quite a pivotal year for us. Mrs. RB40 told me that we were going to be parents. I was getting really stressed out at work again and even the engineering technical work wasn’t fun anymore. I was goofing off more and more at work by reading and commenting on many blogs. One day I was at my desk and I had an epiphany – “retire by 40!” That’s an awesome blog name. If all these regular people can blog, why can’t I? Imagine telling your pregnant wife (who can be a bit of a workaholic) that you want to quit your job. She didn’t take it well at all. But she saw that the job wasn’t the right fit for me anymore, and besides, she was tired of hearing me complain.

I was 36 so I had 4 years left before I turned 40. We had been cutting back and living a more frugal lifestyle over the previous few years so our expenses were pretty good. We never really lived it up anyway, so that wasn’t a big deal. Anyway, my exit strategy wasn’t full financial independence. We just needed to function financially without my paychecks.

I began to think more seriously about generating more income streams to offset my paychecks.

  • I converted most of our growth stocks to dividend stocks in our taxable accounts.
  • We were renting our old house out at this point and picked up a 4-plex and a small condo during the downturn.
  • I tried peer to peer lending.
  • Most importantly – I started making a little income from Retire By 40!

2011 – Mrs. RB40 gave birth to our son and I took a 3 month sabbatical to try out being a stay at home dad. The experience was great and I wanted more. I promised myself that if we could live without my income for 12 months, then I would quit my job. This test run is very important because it showed Mrs. RB40 that we could do it.

2012 – By 2012, I was a mess at work. I didn’t get much accomplished and the stress was seriously screwing up my physical and mental health. I took a medical leave to figure things out and quit work soon after. Mrs. RB40 was fully supportive of this change. The important thing I realized was that you don’t have to be financially independent to quit your career. You can make up for the short fall by working a bit and have some backup plans.

Find your own path to happiness


Life has been pretty good since I left my job in the summer of 2012. My health improved tremendously and our family is better off for it. Financially, we also did pretty well. We were able to keep our monthly cash flow positive for the most part and our net worth increased about 40%, thanks to the strong stock and housing markets.

One important thing I learn since I started blogging is everyone has to forge their own path to financial independence/early retirement. Some people are very successful at real estate investing and they will have a reliable source of income for the rest of their lives. Some people built a business and sold it off for a large enough amount to retire. Some people live a very frugal lifestyle and can achieve FI without a huge paycheck. There are many paths out there and you’ll have to find your own way.

Here are the keys to my early retirement.

  • Start saving and investing early. I started saving and investing right away when I got my first full time job. On the surface, it looks like my early retirement journey only took a few years, but that’s only possible because I started investing in my early 20s.
  • Live a moderate lifestyle. We always lived within our means and avoided consumer debt. We could have lived it up a lot more, but our financially unstable youth encouraged us save and invest instead. Avoiding lifestyle inflation will pay off in the long run.
  • Mrs. RB40 on board. Mrs. RB40 was hesitant to get on board the early retirement train at first, but I convinced her eventually and she has been very supportive since. Having the right partner is essential to building your wealth.
  • Have a clear goal. I suspect a lot of people can reach early retirement/semi-retirement pretty easily if they put their minds to it. Most people just don’t realize that it’s possible so they keep working and spending.
  • Motivation. For me, it was the desire to get away from the engineering career that wasn’t the right fit anymore. If I liked my job, then I’m pretty sure I would still be working.
  • Side incomes. In the beginning, the income from Retire By 40 wasn’t that much, but it made me realize that a little active income goes a long way in early retirement. Even if I stop blogging, I can work part time and make $500-$1,000/month and our finances would still be just fine.
  • Flexibility. Here is the final hurdle that a lot of people with a high paycheck have trouble with. They are afraid that they won’t have enough money to fund their retirement. If you’re smart and disciplined enough to reach FI (or just get close), then you should be able to solve future financial problems. If the stock market crashes, perhaps you can stop withdrawing and work for a few years. Retirement doesn’t have to be permanent. If it doesn’t work out, you can always go back to work. I guess it takes a certain amount of blind optimism to quit your well paying career.

Well, that’s my early retirement journey so far. What do you think? The next big turning point for me will be when our kid goes off to school full time. I will have a lot more time on my hands then and I’ll need to figure out what to do with my spare time. Perhaps I can start a micro business…

Are you on a journey to financial independence/early retirement? How long will it take? What’s your motivation?

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{ 30 comments… add one }

  • Clarisse June 6, 2014, 3:57 am

    I worked in a company 4 years ago, but then I decided to be a full time mom and my hubs wanted me to do that also, to focus on our only daughter. Last 2011, I tried to sign up on a website that offered to work at home and I’m happy that my first client was so very good to me. By living a moderate lifestyle and having a clear goal and motivations would really help me a lot.

    • retirebyforty June 6, 2014, 9:29 am

      Great job making your vision a reality. So many people dream of retiring early, but they just don’t do anything about it.

  • Melissa June 6, 2014, 4:15 am

    Thanks for this post as I am fairly new to retire by 40 and so will point me in the right direction for some reading. I think you are right that everyone has to achieve financial independence their own way. Some people do it fast and others are taking the scenic route. It will take me a while to reach FI as I went part time when my daughter was born and even though I could go back full time again, I am more than happy working part time. It means less money but means I don’t start hating my job!

    • retirebyforty June 6, 2014, 9:30 am

      Working part time is a great option. Work isn’t a central focus of your life and you can do more of the things that you like to do. It’s a great compromise.

  • The Stoic June 6, 2014, 4:30 am

    It may sounds silly, but having a clear goal and finding motivation seem to be my main problems theses days.

    After paying off all the debt and securing housing I didn’t have another clear goal in mind. Sure, the “idea” of early retirement always seemed appealing, but I think what I wanted deep down was work that allowed me the flexibility of working on my own terms. I’m slowly beginning to shape that reality, but it’s been surprisingly difficult to let go of an employee mentality.

    Have a great weekend!

    • retirebyforty June 6, 2014, 9:33 am

      Working on your own term is a great goal. Getting finance out of the way is the first step. When you don’t have to worry about paying the rent, then you have a lot more options. Good luck!

  • Justin @ Root of Good June 6, 2014, 6:29 am

    Joe, what I like about your story and your personal history is that it’s applicable to nearly every young person starting out. You did the right things to set yourself up for a lot of flexibility later in life (by later, I mean right now!). Sometimes it was at your dad’s urging to contribute to a 401k, and you lucked into a frugal wife who was on board with your plans.

    By the time you hit mid-life, you were financially set to do what you want and didn’t have next week’s mortgage payment to worry about.

    Congrats on earning the life you want!

  • Funny how your career experience resembles mine, and many others. The management culture at most companies just has a way of wearing people out. I too have been asked to make the jump to management and many people are dumbfounded when they find out I have no interest in it. Seems a bit like joining the Borg (sp??) to me. I have no interest in being a micro-manager who spends 70 hours a week double and triple checking everything, getting massively overweight, divorced and miserable. Why is that so strange??

    • Pennypincher. June 6, 2014, 2:15 pm

      Your post is right on about the corporate culture wearing people out. Much of the time, it was every man for himself, survival of the fittest. Seems like alot of employees love the nuts and bolts of their jobs, the actual work, but don’t want to deal w/managing and all the politics. Management is best left for the talented few in that dept.! And you’re fortunate if you have a talented mentor/manager.

  • Even Steven June 6, 2014, 9:39 am

    I’m on my way to financial independence, we are a little behind since we have some personal debt. However we are making up for it with 2 rental properties, side income, and above average salaries. We are on a 7 year plan with a re-focus after the first rental property is paid off which is in 2.5 years.

    It’s exciting we are ramping up our efforts more and more, the wife is likes some of the ideas a lot, so getting her on board is coming along nicely:)

    My motivation is simple I want to have options. Options to go golfing with my Dad for a month, options to travel for a year, options to volunteer and help out more, options to stop everything and go to a graduation party for family.

    • retirebyforty June 6, 2014, 10:46 pm

      Good luck! I’m sure you can do it. It would be great to work and live life on your own term.

  • We definitely all have our own paths. Sometimes I feel like I’m the only blogger pushing thirty without a husband or family. I just don’t feel ready to make those commitments financially and otherwise. I love to “fly off to Rome on a moments notice”.

  • Dividend Mantra June 6, 2014, 12:53 pm


    Great post.

    And I couldn’t agree more with the general theme of the article – that there is more than one way to skin a cat.

    And I think your point on flexibility is really important. You may start the path to FI one way, and then switch it up in the middle, and then even change it again near the end. There’s no one right or wrong way to do it, and staying flexible and open minded is really important. And knowing that a little active income goes a long way is also a great thing to keep in mind. Even just getting to the point where 50% or so of your expenses are covered via passive income is life-changing.

    Best wishes!

  • Pennypincher. June 6, 2014, 2:20 pm

    Joe, great ‘Early Retirement Journey So Far’ post! Everyone should read this, especially young people starting out. Excellent advice. Thank you!

  • Steve June 6, 2014, 7:58 pm

    Nice recap Joe. Now that summer is here, maybe you can update the email sub picture of you bundled in a scarf 🙂 I seem to be doing FI/RE backwards to you, feeling better at work now that I’m FI, unable to pull the RE maneuver. I keep coming up with excuses for ‘one more month’… Retire by 41 doesn’t sound as catchy…

  • David Ning June 7, 2014, 8:49 am

    Thanks for sharing Joe. Like you, I quit my job because I just wasn’t having fun there. And thanks to the Internet, many people like us can have a site to share our thoughts and skip the 9-5 corporate drain!

    • retirebyforty June 7, 2014, 1:53 pm

      Yeap. The 9-5 corporate life is a good fit for some people, just not everyone. We shouldn’t have to live like that if we don’t have to.

  • Maxxie June 7, 2014, 8:52 am

    Joe, I have a question for you. Supposing that your wife decides she is no longer willing to be the main breadwinner for your household? What is your backup plan in this case? Thanks and I like your blog! Maxxie

    • retirebyforty June 7, 2014, 1:53 pm

      Well, our original plan B was to move into our rental home. We can pay off that home and our monthly expense would be minimal. We’d have enough income to cover that level of monthly expense even if both of us aren’t working full time.
      Now that we sold the rental home, I’m not sure. We can move to a location with lower monthly cost and then make it work from there.

  • Ernie Zelinski June 7, 2014, 6:43 pm

    You state that you had ” . . . the desire to get away from the engineering career that wasn’t the right fit anymore.”

    That was my desire as well so many years ago. At the age of 30, I ended up being fired from my engineering job for taking too much vacation. That was the best thing that ever happened to me. I left engineering for good 34 years ago and haven’t had a real job since.

    Although I couldn’t retire by the time I was 40, I was able to survive well enough on an income that some people would consider meager. I essentially semi-retired when I was 40, refusing to work more than 4 or 5 hours a day.

    By working smart and not hard, I have created a situation where I will make my highest income ever at the age of 65. Indeed, I should be a one-percenter this year, making a better income than 99 percent of the people my age. The best thing about my situation is that now I only have to work one or two hours a day. I can even stop working for three or four months and still make a great income.

    These are some of my favorite quotations relating to work, success, and achieving financial independence:

    “Have you ever heard of a wage slave? Even worse … are you one? Wage slaves may live in big houses. They might drive Porsches. It doesn’t matter how “rich” you look, if you can’t walk away from your job – even for a second – because you would no longer be able to pay the bills, you’re a wage slave.”
    — Sara Glakas

    “It’s more satisfying to dig a ditch with friends than to design a skyscraper with a team of sociopaths.”
    — Jessica Hagy

    “The irony of America’s fixation on jobs is that according a 2011 Gallup Survey reported in Forbes, 70% of employees hate their jobs. So the question is: why are we so preoccupied with getting a job most of us will eventually hate?”
    — Phil Cooke

    “It’s better to do a sub-par job working on the right project than a great job working on the wrong project.”
    — Robert J. Ringer

    “The fastest way to succeed is to look as if you’re playing by somebody else’s rules,
    while quietly playing by your own.”
    — Michael Korda

    “The amount of money you make will always be in direct proportion to the demand for what you do, your ability to do it, and the difficulty of replacing you.”
    — Earl Nightingale

    “Riches do not respond to wishes. They respond only to definite plans, backed by definite desires, through constant persistence.”
    — Napoleon Hill

    Just a note that I used to define “financial independence” as simply having more money come in than goes out. To this I now add, when you have achieved “financial independence”, you work because you want to, not because you have to.

    Ernie J. Zelinski
    The Prosperity Guy
    “Helping Adventurous Souls Live Prosperous and Free”
    Author of the Bestseller “How to Retire Happy, Wild, and Free”
    (Over 200,000 copies sold and published in 9 languages)
    and the International Bestseller “The Joy of Not Working’
    (Over 250,000 copies sold and published in 17 languages)

    • retirebyforty June 9, 2014, 10:46 am

      Thanks for sharing! I’m semi retired and only work 3-4 hours/week too. That’s the way to go, in my opinion. Of course, I’d love to make my highest income ever when I turn 65. I think the key is to stop working for 3-4 months and have the income keeps rolling in. I need to figure out how to do that and execute. Well, I have a lot of time so I’ll work on it.

  • Waid June 9, 2014, 4:08 pm

    I’m a new reader of your blog and am really enjoying it! This was a great re-cap. I was medically retired at age 41 after 18 years as a Police Officer. Although I really didn’t want to leave my career, I decided to embrace the opportunity to be retired at such a young age. After 8 months I was terribly bored and knew I needed to get another job. I have been in my new job (psychiatric social work) for 9 months now and am not only making good money (pension plus new salary), but really enjoying the work and I feel I am helping many people. I was also able to start contributing to my 457 plan again, which was huge. I don’t want to work full time forever, I am already planning my exit from full time work in a few years. I really liked what you said about retirement not necessarily being permanent. Retirement can be in stages and cycles. And knowing one has the freedom/option to do that, sure feels great. Keep up the good work.

    • retirebyforty June 10, 2014, 11:56 pm

      Thanks for sharing. The medical retirement must have been tough. I hope you’ve recovered now. It’s great that you had a pension too. You can always work part time and it sounds like you’ll still do very well.

  • Coach June 21, 2014, 5:01 pm

    Thank you for sharing your story. I practiced law for 15 years and figured out that benefits of the law firm partnership track was a myth. I bailed on the law and took a chance on teaching at my kids’ school and coaching the football team. That was 2008 when the stock market tanked and the economy went into a tailspin.

    We moved our kids to a school that could weather the economic storm and I moved with them. Over time it has been a great experience as I have now moved into the administration of the school, but I am starting to feel the walls closing in as I did before in the law firm. I am looking again at my viable options. I truly believe freedom of movement is the key to happiness in your occupation, and of course a wonderful and supportive spouse that makes it all possible.

    As long as things are equally great for your employer and you, there is no need to change. However, any imbalance or lingering unhappiness should result in a move that is ultimately good for both parties. As far as “retiring”, I think that is really secondary to being where you are supposed to be and figuring out how to make it work. Your site is full of stories of people who do just that and I imagine there are countless other stories out there on how to best use your time and resources to bring you and your family happiness.

    Thanks again for the website. I appreciate your hard work.

    • retirebyforty June 22, 2014, 5:07 pm

      Thanks for sharing your story. It’s great that you were able to change career. That’s what I’m saying about leaving your job. If you’re resourceful, you can always find something to do. Good luck with your next chapter.

  • Mark Ward July 11, 2014, 1:38 pm


    Just came across your website today and getting started reading all the great advice. I really related to your story as I am now 36 & work in a corporation in IT as a Systems Analyst and frankly I’m just tired, tired, tired of it! And honestly, this is probably the best job and company I have worked for in my career but I just know this is not something I can bear thinking of doing for another 30 years. I plan to get married in 2015 and certainly it won’t be long after that we start a family since we are fast approaching 40.

    I’m in decent financial shape and like you the one good decision I made right out of school was to start investing in my 401(k) & IRA. My dad was a financial planner and drilled that into me, so glad he did! I have a rental property already due to the housing crash. I expect the townhouse I live in and my fiancee’s condo will be rental properties 2 & 3 for us when we find a place together. Both are well suited as rental properties.

    I started cutting expenses last year by cutting the cord with cable and couldn’t be happier. Saved about $400 in Year 1 vs what I spent with the cable company the year before and expect to save $600-700 in Year 2 & going forward with no setup costs now that I have all the streaming devices and technology in place to suit our needs.

    Working on some debt payoffs in areas I probably shouldn’t have spent but what is done is done, can’t change the past. Good luck to you, looks like you are truly enjoying life. Thank you for sharing all this information about your journey.

    • retirebyforty July 12, 2014, 12:25 am

      Sorry to hear about your job situation. The corporate environment just isn’t right for everyone. If you know it’s not working out for you, work on getting out. It might take a while, but I’m sure you can do it your own way. Great job with the 401k & IRA. The rentals plan sounds good. Try it out and see if you can get some income going that way.
      Good luck with everything.

  • brydanger December 4, 2014, 8:05 am

    Hi Joe
    Just stumbled upon your blog and am enjoying what i’ve read so far. So nice to find others in portland striving for great things!

    Our story is an odd one…but slowly working out.
    I took a good paying job because of fear for the 85k in student loans i had coming out of school. Promised myself i’d only stay 2years to pay down some of the debt but instead ended up with more debt and was there 14years.

    My wife finally convinced me to leave our jobs (me at 35 she at 37) and travel despite my being terrified of the unknown and what would happen if we didn’t “keep the hamster wheel turning”. We purged all belongings that didn’t have a foundation, loaded into our vw bus and drove through mexico and central america for a year, assuming we’d find a beach and never come home.

    Oddly, we realized how much we love portland (and the people in it) and decided to come home, even though it costs multiples more to live here than on that beach. We had a few epiphanies as we re-immersed into popular culture and ended up converting our garage into a home so someone else could pay our mortgage. Huge!!

    We are now finding ways to get by, but both free of jobs and living minimally in one of portland’s best neighborhoods. We don’t have it all figured out, but we’ve never been happier and the curve is still trending up.

    Love to connect, grab a coffee/beer at some point and see what hints and ideas we might share. Best of luck to you and keep up the good work!

    • retirebyforty December 4, 2014, 9:30 am

      Thanks for sharing your story. It sounds like you had a great time. I’d love to take a trip like that someday. It’s nice to live simply without having to answer to a boss. 🙂
      I’d love to get together.

  • dan1 April 19, 2015, 12:31 pm

    Just stumble upon your blog today as I have a second guess of my decision of quitting my engineering job a few months ago. I am 47 and had a similar situation before quitting my job, but a different outcome as didn’t plant it right financially. I am now struggling to find a job again, but one thing that makes a difference is that I don’t have kids that I need to worry about so financially I am not that bad, just trying to watch out my expenses. But, in looking at other people experience, I am glad that I am not alone and shouldn’t be blaming my self for making a bad decision. Thanks for putting this blog as it gives me some hope and learn how to turn my situation around.

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