Financial Independence: How I Plan to Retire in 10 Years (at 39!)

Financial Independence; How I Plan to Retire in 10 Years (at age 39!) --

Wikipedia defines financial independence as “the state of having sufficient personal wealth to live, without having to work actively for basic necessities.  For financially independent people, their assets generate income that is greater than their expenses.”

For me, the goal of financial independence represents a point in time where I will have the freedom to choose on any given day whether I want to work (and what kind of work I do),  go for a hike, volunteer at a non-profit, or get on a plane and travel somewhere new.  It means complete independence from the structured life that most people live.

Financial independence is a state of fiscal freedom that can be measured.  You can set concrete goals, you can track your progress against your goals and there’s a pre-defined achievement at the end of the journey.  There is a wide range in the amount of yearly expenses you could budget for and how quickly you can increase your net worth to reach your goals.

The Numbers

After reading through several resources on the topic, my husband and I took a detailed look at our finances.  I built a very basic spreadsheet to predict our yearly income and yearly expenses for the next 15 years.  I listed out our financial assets and applied conservative growth rates.  I tallied our yearly savings and added them to the asset columns for the following year.  At the end of each year I calculated how much we could pull from our investments if we applied the 4% rule to see at which point our investments would generate more return than our expected yearly expenses.  According to the calculations, with a few minor changes to our current lifestyle we can expect to be financially independent in 10 years.  With a few more targeted changes to our spending, we could cut that down even shorter.

10 years?  Is that really possible?  Yes it is!  People all over the world have run similar calculations and have been just as surprised at the results.  There is a growing movement of people that are on track to or have already completed their goal of financial independence far earlier than the target retirement age of 65.  For many people, financial independence is synonymous with early retirement but I find the term “financial independence” is easier for people to wrap their head around.  Explaining to someone that you think you can retire before you turn 40 can be difficult and is often met with quizzical looks or general non-belief.

How is it possible to retire so early?

You might feel like you’re living paycheck to paycheck but at almost every income level there is room to make a plan and reach your point of financial independence sooner than you think.   It comes down to balancing instant gratification and delayed gratification.  If you’re committed to the idea and open minded enough to consider changes to your lifestyle, you can cut your expenses and improve your income potential more quickly than you think.  Here are a few changes we’ve made just in the past few months:

  • We’ve cut back on non-essential services
  • We don’t dine out as much
  • We’ve adopted a more minimalist approach to possessions and have started the process of decluttering our home
  • We’ve replaced expensive entertainment choices with low or no-cost options like a family hike, a picnic in the park or visiting family and friends in their homes (vs. restaurants or malls)
  • We utilize our Buy Nothing Community to curb our spending
  • We’ve cut back on purchasing toys for our kids, we find that family and friends provide plenty at birthdays and holidays
  • We traded in our gas-guzzling SUV for an all-electric Nissan LEAF
  • I’ve switched to a capsule wardrobe and have not spent any money on clothes in the past 6 months (more on that later!)
  • We plan to downsize our home in the next 2-3 years
  • We’ve educated ourselves on our investments and are now maxing out our HSA, and 401K


Want to feel inspired by the successes of others?  Read more here and keep in mind that not everyone has to make big lifestyle changes to achieve the same result:

An Interview with the Lawyer Who Retired at 33

Jeremy & Winnie of Go Curry Cracker

Early Retirement at 33: An Overview

Tales of Early Retirement: The Paths 3 Happy People Took


Check out these resources to learn more about calculating your financial independence date:

The Shockingly Simple Math Behind Early Retirement

Retire Even Earlier Without Earning More or Spending Less

The FI Laboratory



Two of my favorite books on the subject:

Your Money or Your Life

The Millionaire Next Door


If you’re really serious about getting your finances in order and expediting your FI timeline, check out my favorite blogs on the subject:

Mr. Money Mustache (Also check out the forums!)


Go Curry Cracker

Root of Good


And find many more relevant blogs here.

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    1. I’m glad to hear that! It radically changed my perspective on spending and saving and has generally made me a happier person knowing that I have an attainable goal. Sounds crazy but it’s true.

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