The Retire By 40 Movement

retire by before at 40The Retire By 40 Movement is taking the world by storm. Recently, I have been hearing and reading more about people who want to retire before 40, by 40, or at 40. Perhaps I’m more in tune to it because of my blog, but it is undeniable that the idea is getting more popular. I’m not really sure why 40 is such a popular early retirement target. I guess it’s because people think 40 is the midpoint in life. If you aren’t happy at 40, then it’s time to change it up.

Where does this desire to retire before 40 come from? Baby boomers typically work until they are in their 60’s before retiring. The generations before that also worked hard, bit the bullet, and provided for their families. What make us so special that we think we can leave our jobs this early in life? There are many reasons to retire before 40. Let’s take a look at some of them.

Job Dissatisfaction

This must be the #1 reason why people would want to retire early. Let’s face it, if you love your job, would you leave it when you are so young? According to a Gallup survey, 70% of workers are not actively engaged in their jobs. That means 70% of those surveyed are on a slippery slope to disliking their jobs. Even people who love their job usually become bored in 10-20 years, then dream of greener pastures. It’s much easier to change careers today than in the past. If you are not happy being an accountant, you can always go back to school to prepare for a new career.

DINK (Dual Income No Kids)

Previous generations had fewer choices here because most families had only one bread winner who bore the expectation of providing for their families. Now, many families have two income earners with better opportunities for saving and investing. Our generation is also having kids later and later. We were a DINK family for over a decade before having a child, which is quite different from prior generations.

More Disposable Income

I believe the basic necessities are also a smaller percentage of the middle class expenditures. Basic housing, food, transportation, and other necessities are much more affordable than in the past. We can see this by the decline in the poverty rate in the US. However, we spend a lot more money on luxuries and non essentials now than ever. In our case, we live a relatively modest lifestyle.  We saved most of our income over our DINK years and also invested in several passive income streams. Doing so enabled us to build a modest nest egg.  In the past, it was difficult to save much even if you lived a modest lifestyle.

us poverty rate time line


Pensions were much more common in our parents’ jobs. This enabled people to spend their income without having to worry about their old age. Of course, this also trapped them in the job until they were eligible for the pension. In the countries like China where pensions are rare, people saved a lot more of their disposable income for those rainy days. Nowadays, most of us do not have a pension, and social security is meant to be a supplement for retirees, not their sole income.

More Family Oriented

stay at home dad retire before 40The men of our generation are more family oriented. We don’t want to sacrifice family time for work. This is different than past generations where men were much more focused on work (I got this from watching Mad Men.) It seems men in previous generations were not very comfortable with kids and they’d rather spend their time with their friends and colleagues. The gender lines are blurring more and more and I think that’s a good thing. Women are doing very well in the workforce and men can be stay at home dads and change diapers today without crying about it.


Most importantly, it’s about the freedom to choose how to spend your life. Retiring by 40 is less about retiring and more about the freedom to pursue your passions and interests. Many of us are working in careers that are not fulfilling, but stay because it’s easier than changing our lives. Retiring from a career doesn’t mean leaving the work force forever. For some, it means taking a long break and then taking up a new career later. For others it could mean self employment, exploring their interests, or staying at home with the kids. The way to do this is to achieve financial independence or close enough to it that removing the paycheck from your monthly cash flow is possible.

Many of us don’t know what we want to do when we are young so we often just aim for a job that provides a good income. Some of us started out in a career that we liked, but it didn’t turn out as we thought or perhaps we just changed over the years. Saving and investing a large portion of your income will enable you to make changes later if necessary. Life is short and 40 marks the half way point. If you are not living the life you want, you need to make a change and do it soon.

Don’t ask yourself what the world needs. Ask yourself what makes you come alive and then go do that. Because what the world needs is people who have come alive.” Howard Thurman.

What do you think about the Retire before 40 Movement? Is it unrealistic? If you are financially independent, would you still be at work today? 

Read my follow up post – 3 Easy Steps to Retire By 40.

Everyone who is thinking about quitting your job should read Financial Samurai’s book: How to engineer your layoff.

make money quitting your job


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Joe started Retire by 40 in 2010 to figure out how to retire early. After 16 years of investing and saving, he achieved financial independence and retired at 38.

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.
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52 thoughts on “The Retire By 40 Movement”

  1. Sign me up for the movement! When you save and invest 50% or more of your income, retiring by 40 definitely becomes an achievable goal. It’s what I’m working towards right now, alongside my wife.

    I just have too much stuff I want to accomplish in my life. Being forced to work until I’m 60 is not one of those things I’d like to do. Financial independence by age 40 should be achievable, even on a fixed military salary. Hopefully I can share the lessons I learn in the next 14 years to share with other like minded servicemembers.

  2. I retired two years ago at age 43, after practicing law for 13 years with large law firms. It is amazing to me how so many well-educated people can make so many stunningly poor choices about how they live their lives. If you ever meet a biglaw lawyer who is over 50 and is still working full time, you have met an effing idiot.

    • Heh heh, thanks for the tips. I hope you are enjoying your retirement. What are you doing these days? Volunteering, some kind of part time work, or fully retired?

  3. This is the goal that many of us strive for. (Well maybe not at age 40, but hopefully sometime shortly thereafter).

    Many people start to get burned-out with the corporate world by age 40. We should all be saving more money. The goal of ‘Financial Independence’ will allow us to do whatever we want.

    You have done well, Joe. Congratulations.

    • Thanks for your comment. I really got burned out with the corporate world. It’s not for me. I’d rather be self employed or work for a privately owned small business.

  4. I don’t think it’s unrealistic, but it entails a different set of life choices and sacrifices. If I could be prepared to retire at 31 that would be super cool… doesn’t mean I’d actually do it. Just having that option would be great, though.

  5. Baby rb40 is getting so big!

    I think 40 is also that age where career progression often stagnates. In your 20s, you are like a sponge, learning lots of stuff, building experience. Life is exciting and you have lots of goals and debts to pay. In your 30s, you start to see the fruits of your labor and hard work. By the time you reach 40 (and I am 39 this year) many people are burnt out and tired. Its also the point where you realize working hard will only yield even harder and more stressful jobs and longer hours and sometimes at the same pay rate. It’s a decision point. Up or out Do you keep going til you have a heart attack and drop dead at 50 or do you make a life change and bring balance back to your life?

    I am glad I worked as hard as I did and now am ahead of the game because my pace has slowed. I can’t and dont want to work at that intensity anymore. I am not at the point where I want to exit the workforce at 40, but have achieved the level of financial freedom where I could quit my job tomorrow and be ok for a while until I found something new. I call it my F-you fund. If things ever get really bad, I can just say F-you job and walk out the door. That feeling is priceless.

  6. It’s funny; you mentioned employee engagement being so low. I was in a call today with an executive from our company and he was lamenting the low engagement survey results within our company. I couldn’t help but laugh when he actually said he didn’t believe these results and felt it was a function of an employee having a bad day or the format of the survey, not that they actually weren’t engaged. Aside from first, penalizing us in our metrics for scoring low on engagement, now sr management is denying the results. It’s truly laughable.

  7. I am not really looking for retirement, since I am already building the incomes that I love working on. But you are right though-it takes aggressive savings and investing in order to be able to get an earlier retirement.

  8. I like to joke to my mom that she retired around pregnancy time, but she tells me that raising children wasn’t exactly retirement! She’s definitely retired now that both of us are out of the house and graduated from college though.

    The power of being DINKs is amazing and I don’t think enough people take advantage of those days. I hope that I too can retire by 40 and I think it’s definitely do-able with my 60-70% savings rate 🙂

  9. The movement is realistic only to a certain group of people, those who can afford it. 🙂 The rest of us happy to have a job, and work towards our retirement that is far away. I will be forty next year and unless I win a lottery, I would not be able to retire. I’ve been in the US only twelve years, so I have a long way to go. I think Retire By 40 movement is more realistic for those who are just starting out with their careers.

    • I agree. It’s best to start early so you can have a chance at freedom. It’s much more difficult if you start later because most people are already accustomed to the inflate lifestyle by then.

  10. Nearly all of the reasons that you suggested for early retirement resonate with me. My job is just a job… sometimes I find myself motivated enough to call it a “career”, but it’s certainly not a “calling”. I want the freedom and flexibility to stay at home with my kids when they are young, try to find my calling (whether paid or unpaid), etc. For me, the target age is 35, because my husband and I are willing to be a little more “extreme” (by the average definition, not by our definition).

  11. I wouldn’t want to traditionally retire by 40 but retiring from the rat race at 40 to pursue other projects that still make money that were more important to me would be cool. If you’re looking to traditionally retire at 40 it is aggressive but possible.

  12. I think it’s definitely possible to retire by 40, but the goal we really need to pursue is landing the job of our dreams by 40, or 30, or 20. You get the idea! If you’re doing what you love, and you’d do it even if you weren’t getting paid, that’s true retirement to me!

  13. Great thoughts joe – i’m honestly not to sure if I want to retire at 40 – it seems like ages away, even though it’s less than 15 years! I do know that i’d like the freedom at some point, and while im not on track for 40, I think my pension will kick in at 45 or 46!

  14. God, it’s the FREEDOM for me. I feel so trapped in my job and there’s so much that I’d like to do. I don’t know if I’ll even live until 67 when I’m supposed to retire and who says that I’ll even be in the right mind to do the things that I’d like to do then? Remember, ever second that we live is one step closer to the moment that we die.

    I need to retire earlier so that I can live life exactly the way that I want to.

    • I know what you mean. Even if you make a lot of money, it’s not worth feeling that way.
      It’s too bad that most people compensate by spending more money instead of more saving.

  15. I like the retire by forty mindset, but I also agree that it is more about working toward a goal of sustainable living sans traditional work. Whether that means never working another day in your life of working on a hobby that brings in a little dough and a lot of happiness, retiring by a certain age is possible with hard work.

  16. Quick question — would you consider it retirement if Mrs. RB40 quit? Or, how is what you’re doing different from what happens to many women when they realize the importance of families and bow out of the workforce? They’re not retired, they’re stay-at-home parents.

    • I think the main difference is that I’ve been working toward this goal for a long time. I didn’t just woke up one day and realized that I’d rather be a stay at home dad. It took a lot of efforts to save up and invest in passive income streams.

  17. I did not know it has become a trend! When I reached retirement (financial freedom) some 27 years ago, it was just a goal. It changed my life because I was able to do what I enjoyed vs. what I needed to do. Since then I probably changed my goals several times, but stayed true to my original values. I love the freedom of doing what i like to do. I expect there will be new opportunities to engage and enjoy.

  18. I think I remember reading on your site, or maybe someone elses, how people complained that working after retirement doesn’t count as retirement. My definition of retirement is the freedom. I can’t just play golf all the time. So my retire by forty plan is to quit my job, spend lots of time with the family and getting experiences, but it will be also about doing what the work I love. Hopefully I get paid, maybe more even than when I was working.

    • Most people are stuck on the traditional definition of retirement. That’s too bad because it limits what they can do. Hopefully a few people are reading this and this movement can grow even more. 🙂

  19. Since I’m so young, I don’t really know what age I want to retire or start pursuing another career.

    I do know I want to develop passive income and build up my retirement funds, which is why we are so aggressively saving money to invest. My husband wants to own his own small business in the future, and he already has ideas, but we will need capital to get started.

    What I really want is to be financially secure. To know I have enough passive income, assets, and savings, that I don’t really have to go to work anymore. Working for the purpose of earning a paycheck to pay for your life is so dissatisfying.

    • You are doing a great job for such a young person. At least you realize what’s really important and you both are working toward that goal. You might like your job over the long run and that’s a good reason to keep working. Everyone has to find their own path.

  20. I agree, “freedom” is where it’s at. To me, little is more important than the freedom to pursue what interests me and spend my time as I choose, mostly. Maybe this is selfish and immature, I don’t know, but it’s been a driving force in my life.

    Love to see you with Baby RB40. 🙂

    • It’s too bad most people don’t realize this until they built up debt and got used to the consumption lifestyle. That picture is a little old, but it’s a great picture. 🙂

  21. I think this is a great plan/opportunity! If you plan it out right (like you have done) and know that you can support your family than why not retire by 40. When it really comes down to it, those memories spent with babyRB40 will be way more valuable than a larger disposable income to buy “stuff” with.

    There are far too many people who aren’t apart of their children’s lives…Keep being a great dad!

    • Thanks. Family is what matter most to me. Some people realize that too late and never get to be a big part of their children’s lives.

  22. 40 so happens to do be the halfway point to death.

    I think as we approach that point, we realize our life has flown by and we need to do as much as possible before we become disabled.

    I felt that way at 30…. and I might be more aware of my body than others since I play a lot of competitive tennis and need to stay in shape. Getting old sucks!

  23. I think 40 is about the earliest a person can reasonably expect to retire at. Mr. Money Mustache was able to do it at age 30 so earlier is possible but even fewer people are able to achieve that. I’d love to retire soon or at least pursue some other career that I love and not have salary be a huge factor.

    • I agree. That’s more realistic to most families. MMM cut cost aggressively and he was able to do it earlier. Everyone will have to find the right balance. Good luck!

  24. Pingback: The Retire By 40 Movement | Passive Income Stream
  25. It sounds perfectly realistic to me, if you have the will to do it and are aware of it since college, so you start saving aggressively very early. I see many people opt for a new career around 35, making less money but being passionate about their new field. Technically they are not retired but they don’t feel like they are working!

    • Aggressively saving and investing when you are young is the key. That way, you’ll have a modest nest egg early on and it can use the next 20 years to grow. After switching career to something less well paid, you don’t have to contribute to the retirement as much.


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