19 Steps I Took to Retire in My 40’s

Last year I asked myself, “Why are you still working?” So I retired and haven’t worked a job since. Here’s what I did…

(This article was previously posted on Buzzfeed and Journal.Media)

These are the steps I took to retire at age 44, but every person has a different set of circumstances. Therefore you must customize these steps to your own situation!

That is why the point of these steps is not to feed you every single detail, but rather to provide bullet points to think about.

What do these items mean to you?

How would you go about making them a reality? 

The possibilities are endless; the choices are all yours.

For me, the main two things required to retire mega early were to:

Set up a meager but constant passive income stream.

Move someplace nice yet relatively cheap…(and if overseas, get your income in the higher currency).

The main philosophy to keep in mind is:

Human beings were NOT designed to spend their whole lives working. So put effort into your early retirement plan, then implement the plan and kick back!

STEP 1: Don’t listen to people who say you can’t do it. They’re wrong.

STEP 1: Don’t listen to people who say you can’t do it. They’re wrong.

Don’t let people demotivate you from your dream of early retirement. There are far too many folks retired in their 30’s and 40’s to believe it can’t be done. It absolutely can…but until you are committed, the other steps won’t matter. You have to believe the dream is attainable, and ignore the naysayers.

What one man can do, another can do! – David Mamet

STEP 2: Don’t listen to yourself if you say you can’t do it. You can!

STEP 2: Don’t listen to yourself if you say you can’t do it. You can!

We tell ourselves what we can’t do, when we should be saying the opposite. Some folks want be the dancers, and they learn how. Some want to be Senators, and they run for office. Some just want to retire…but most postpone it and postpone it…we tell ourselves the time isn’t right, or we cannot afford it.

To retire mega early, you’ve got to want it and to make it happen; it won’t happen by itself.

Ask yourself:

What would I do if I could do anything I want?

Tell yourself:

I CAN do anything I want!

I can do anything I want and nothing can stop me.

STEP 3: Find your motivation. Or you won’t have any.

STEP 3: Find your motivation. Or you won’t have any.

Remind yourself:

Work does not make me ‘who I am.’

A person can do anything they want, just not everything they want.

Without a clear motivation to keep in mind, it will be hard to get through the remaining steps… So why do you want to stop working? Clearly you are thinking about it; you are reading this article, aren’t you? So what is your answer, hmm?

What’s your motivation? Mine was to relax and enjoy time with my kids while they are young.

STEP 4: Find your source of passive income. Or better yet, several.

STEP 4: Find your source of passive income. Or better yet, several.

As mentioned, the point here is not to feed you every morsel but to give you the idea that what I’m suggesting is even possible! It is; I’m doing it.

Research which methods will work best for you to set up your passive income stream. There are several to choose from. If your company offers a pension, take it! What are you waiting for? If you enjoy working online, folks are making a ton of money with affiliate marketing websites, monetizing YouTube videos, etc. It takes time to set it up, but many folks hire others to do the work for them. You see it all the time on sites like Upwork; clients hire freelancers to build sites then fill them with SEO-laden content, pulling views and hopefully ad-clicks to generate revenue (i.e. passive income!)… The key to making money in online ventures is quantity. You need a lot of content and lots of views. 

If you have money to invest in real estate, renting out properties is a means of generating passive income, so long as the rent surpasses the mortgage, property management fees, etc. Therein lies the rub, but it is doable!

STEP 5: Live someplace really affordable. Even if it means leaving the country.

STEP 5: Live someplace really affordable. Even if it means leaving the country.

Reminder yourself:

At the end of the day, that’s what life is all about. Not working. Living.

We live overseas in an area where $2,000 pays for a comfortable life for a family of four. A single person could get by on far, far less! There are many gorgeous, cheap places to live on Earth…All it takes is a plane ticket and someone to help you get set up.

Of course many folks don’t wish to leave their home country, and I can’t blame them. Just depends on how much you have to live on, and if you can find a place you like which is really affordable. Many folks move to more expensive areas in order to get higher-paying jobs. We moved someplace cheap, in order to have no jobs! 

And actually, these days our passive income stream exceeds $4,000 a month, so we are able to sock some away for a rainy day!

STEP 6: Forget about getting rich. It’ll only drive you crazy.

STEP 6: Forget about getting rich. It’ll only drive you crazy.

Ask yourself:

What are the things you believe wealth will buy you, that will make you happy?

The trick is to find your minimal comfortable lifestyle, then make just enough money to afford it. You may find you are far happier spending your days practicing guitar, talking to relatives or friends, learning a new language, or developing forgotten hobbies. And hey, how about getting to the gym? I lost over 10 pounds since retiring, mostly through long walks and also because I stopped drinking beer. 

STEP 7: Stop buying stuff you don’t need—IMMEDIATELY!

STEP 7: Stop buying stuff you don’t need—IMMEDIATELY!

Nearly all of human history involved living a minimalist lifestyle. What happened? How did we get so brainwashed to consume, consume, consume?!

Working harder just to buy stuff you don’t need is a trap.

Going into debt to buy stuff you don’t need is an insidious trap.

Don’t fall into these traps! If you’re already in, climb out now!

STEP 8: Reassess what you want versus what you need. Then do it again.

STEP 8: Reassess what you want versus what you need. Then do it again.

The less money you spend, the more money you have to spend (or better yet, save!).

When you do buy, only buy things with intrinsic value.

STEP 9: Get the best bang for your buck. It all adds up.

STEP 9: Get the best bang for your buck. It all adds up.

Clearly the bigger the price tag of an item, the more vital it is to shop around. Don’t just impulse buy something!

Ask yourself:

What is the point of a $60,000 car if you can’t afford to put gas in the tank?

STEP 10: Have a backup plan. Or two.

STEP 10: Have a backup plan. Or two.

If you are really crazy enough to jump ship from the workforce (I was), make sure to have a backup. Do you have a little cash in savings? A place to stay if you get in over your head? A means to make a few extra bucks, if needed? Or a good resume, should things go awry and you find yourself in sudden, dire need of full-time employment again?

STEP 11: Make a budget… and make sure everyone is on board with it.

STEP 11: Make a budget… and make sure everyone is on board with it.

Don’t live beyond your means.

Make and keep spending plan. If you do, you’ll find that you are far better able to keep a handle on things. If you don’t, you’ll find yourself in the hole.

STEP 12: Keep an eye on exchange rates, if you move overseas.

STEP 12: Keep an eye on exchange rates, if you move overseas.

Getting paid in dollars but living in a country which uses a currency that trades 2-to-1 or even 3-to-1 is a great way to extend your purchasing power. Just make sure to keep an eye on the exchange rate; those things can fluctuate quite a bit. ‘Nuff said.

STEP 13: Pay off your debt. Then keep it paid off.

STEP 13: Pay off your debt. Then keep it paid off.

The point of retiring early means not working. But if you are living off credit cards, then not working isn’t working. Either reign in the spending, or get back to work until you can get out of debt.

STEP 14: Keep saving. Forever.

STEP 14: Keep saving. Forever.

If retirement is your goal, you must be savvy on your spending habits, AND your saving habits!

Whatever your reason for saving, just be sure to have a nest egg.

Saving is always a good idea. Not a fun idea, but a good one. Save up; you never know when you’ll need a quick stash of cash for an emergency!

STEP 15: Research other ways to generate passive income. The more, the merrier!

STEP 15: Research other ways to generate passive income. The more, the merrier!

So you are generating a nice stream or two or three of passive income. Nice! Great job. But don’t rest on your laurels. If one of those streams were to run dry tomorrow, would you be able to absorb the blow…or would you be running to the soup kitchen?

That’s what I thought.

STEP 16: Keep learning! No one knows it all…

STEP 16: Keep learning! No one knows it all…

Going hand-in-hand with Step 15, I think it’s vital to read traditional books on retirement, investing, business…anything to add a few tools to your growing knowledge base! Why not? You’re retired, so you should have the time to read. Just make sure to try and get the books free from the library if ya can!

STEP 17: Stay determined and focused on the end goal, not on the obstacles.

STEP 17: Stay determined and focused on the end goal, not on the obstacles.

Remember:

Make sure you are not working!

As I finished this, a song came on the radio, with the lyrics, ‘I don’t need no money, as long as I can feel the beat.’ Stay focused on your dream, of being retired…which means following the above steps!

STEP 18: Find the free money.

STEP 18: Find the free money.

Whether it is college scholarships, grants, or even things like Department of Labor disability claims if you are rightfully entitled to such benefits, do your homework and find areas where you are entitled to monetary benefits. They aren’t going to find YOU! You have to find THEM!

STEP 19: Don’t panic!

why-are-you-still-working-cover-new

If you fail to plan, you are planning to fail.

Tired expression, but very true! But even if things start to look worrisome, stop optimistic and take the needed steps to get back on track. You will succeed if you don’t allow yourself to fail!

All these steps are outlined and fleshed out in my Amazon eBook, “Why Are You Still Working?,” from which this content is taken. I put a tombstone on the cover as a warning, that we should not have to work until the grave…that we should ask ourselves this question before it gets to that point!

I hope the ideas are of value to you! Best of luck!

why-are-you-still-working-cover-new

Blurb from my eBook, Why Are You Still Working? 

Have you lost your mind? You want to quit work and retire…at YOUR age? Who said you could do that?
Get up and go to work, you bum! Go every day until you die!
Or…don’t.

After all these years, aren’t you bored to death of the daily grind, of your boss, of the commute? Don’t you really, seriously think you could find SOMETHING better to do with that 40-plus hours of your week?

Hmm, you may be on to something.

Because you know in your heart, life doesn’t have to be like this; it SHOULDN’T be like this!

Don’t work yourself into the grave. We all deserve our freedom at some point… So why not now? Right now!

So many of us are MUCH closer to being able to retire than we realize. In some cases, we are capable of it right this minute…but we feel like we’re not prepared to make the leap. For me, it took a year to decide, but once I did there was no going back.

Here, in this book, is how I did it. There is no great secret to it. The only mystery is, what took so long!

At 44 years old, I left a good-paying job, packed up the family, and have been living a dream life on the Aegean Coast ever since…all the while NOT working, but instead focusing on taking things easy, spending lots of quality time with my family, and just plain old goofing off! (Yes, I did write this eBook in my spare time; I have lots and lots of spare time!)

You, too, have the ability to live life on your own terms, to ‘do it your way.’ But only if you really want it! You have to act; you must make it happen, because it won’t happen on by itself.

‘Why Are You Still Working?’ clearly outlines the exact steps I took to go from living and working in one of America’s most expensive areas to reassessing my priorities, downshifting and downsizing, and resettling in a place others only get to visit on vacation while paying the bills as a digital nomad with a pension. Not every tip will apply to every person; I realize that. Every situation is different. But most will apply, if we’re willing to keep an open mind.

In this updated version, I’ve hyperlinked to the new Why Are You Still Working website, which offers even more in-depth tips and insights. There’s no magic to it, and no schemes or tricks, and I’m not selling any over-priced online courses or trying suck anyone into a ‘customer funnel.’

It’s just down-to-Earth, common sense advice that any person can apply, plus tips to help anyone go from burnt-out employee to blissful beach bum… It’s easier than you think–the hardest part is just doing it!

The second hardest part? Sticking to it! But trust me when I say, every day of my mega early retirement is better than a day on the job!

But Why Are You Still Working isn’t only about retirement. It’s about independence!

Maybe you still want to work, but haven’t considered all the options…like working from home, working freelance, working online, working as a digital nomad selling your services and products on your own time, from anywhere on Earth! This book explores a few such concepts, and links to resources to dig in deeper.

Give it a try! You’ve got nothing to lose…and a whole new life to gain!

Read the first chapter free right here! 

Matt Cates

Matt Cates is the co-founder and creative director of Mad English Lab.

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