Is it really possible to quit your career and leave it all behind before you’re 40? That’s the question I had when I started blogging in 2010. I had been a computer engineer at Intel since 1996, but the job wasn’t the right fit for me anymore. They needed senior engineers who can spearhead projects and mentor people. That wasn’t me and the job became more and more stressful. My physical and mental health deteriorated and I knew I had to get out.
Journey to early retirement
I started Retire By 40 to keep track of my early retirement journey. It was a place to share my aspiration for Financial Independence. This was where I planned my exit strategy from the corporate world and our readers kept me accountable. I had to make a detailed plan and follow through. Eventually, I gave my notice and left the corporate world forever in July 2012.
Wow, did it take just 2 years to achieve FIRE (financial independence retire early)? Not really. I had been saving and investing since I started working full time in 1996. My wife was also a huge part of the equation. She is frugal and fully supports this journey. She was pregnant when I told her I’m starting a blog – Retire By 40. Of course, she didn’t like that one bit. However, she got on board when I showed her that we could maintain our lifestyle without my engineering career.
We tracked our cash flow and saved all my income from 2010 to 2012. Those 2 years gave us a chance to see if we could really survive with just one paycheck, our passive income, and my online income. We also reduced our annual expenses during that time and increased our net worth to 30x expense. (That’s better than the 4% rule.) The test run gave me the confidence to retire early from my engineering career. Mrs. RB40 is still working because she enjoys her job.
Here is how we pay the bills.
- Mrs. RB40’s job – I’m extremely lucky that Mrs. RB40 likes her job. Her employer-sponsored health insurance saves us a ton of money. She plans to retire in 2022.
- Real Estate Crowdfunding – I invest in commercial real estate projects with CrowdStreet. This is a great source of passive income.
- Dividend Income Portfolio – I moved most of our after-tax investment into dividend stocks. Dividend is the best passive income and it will grow every year.
- Rental properties – We have a couple of rental units, but I’m planning to sell them soon. Being an active landlord is too much work for me. These days, I prefer to invest in Real Estate Crowdfunding these days. I get a lot more diversification that way.
- Online income – I’m making some income from this blog and other online ventures. This is nowhere near my old paycheck, but I’m my own boss and nobody tells me what to do. I used to spend 20-30 hours/week on this, but I cut it down to about 15 hours/week now. Everyone should start a blog. It’s a great way to build your brand and explore your online earning potential. Here is my tutorial on – How to Start a Blog and Why You Should.
We still live modestly and continue to save as much as we can. When I first retired, our passive income couldn’t cover our expenses. Fortunately, we grew it over the years and now our passive income can comfortably pay all our bills. You can see how I’m doing with my passive income here.
Where does Joe go from here?
Can my brand of early retirement last? After 8 years of early retirement, it looks like we will be fine financially. We have seen some ups and downs and came through pretty well. 2020 was a really difficult year for many of us. Fortunately, we stay invested and our net worth increased significantly. Our income decreased, but we didn’t have to downgrade our lifestyle too drastically. Well, we were stuck at home most of the year so that helped. Anyway, our finance is like a well-oiled machine at this point. It’ll be smooth sailing from here on out.
On the stay-at-home-dad front, things are much easier now that our son is going to school full time. I have more time to spend on my blog and I can volunteer at his school. We’re in the sweet spot now. He’ll probably be more trouble as he hit the teenage years, but that’s a way off. For now, being a stay-at-home-dad is very easy. (2020 was more difficult because he was virtual schooling. Hopefully, things will go back to normal in 2021.)
At this point, I know I will never work for a company again. We’re doing well financially and life is great. That chapter is over for me. I love being self-employed and would never trade it for a bigger paycheck.
- Mrs. RB40 plans to retire in 2022. We’ll travel for a year and then figure out what to do next. Stay tuned and see how it works out.
- I worked about 15 hours/week on Retire by 40 last year. That’s the sweet spot for now. It keeps me busy and gives me something to do. Eventually, I plan to work just 5 hours/week. That’s a long way off, though.
If you have any questions or comments, write me through the contact page. It might take me a little time to respond, but I will try my best to get back to you.
Don’t wait until retirement to enjoy life!
Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects across the USA so check them out!
Joe also highly recommends Personal Capital for DIY investors. They have many useful tools that will help you reach financial independence.