Fueled by the news of ballooning student loans and pernicious credit card debt, a small but growing group of Americans are taking control of their money.
Part of the financial independence, retire early or FIRE movement, they are committed to saving money from their corporate jobs… and even taking on side hustles to build additional income.
Their goal? Build a substantial nest egg and then retire. Although many end up working in what they call ‘retirement’ – running blogs or taking care of kids – the idea is to achieve financial independence, whereby they can choose their activities, rather than be tied to a workplace for a paycheck.
Inspired by the 2008 personal finance book “Your Money or Your Life” by Vicki Robin and Joe Dominguez, they promote what many Americans would consider to be unusual tactics to cutting costs – from driving 30 year old cars to living in 52 square foot room.
And while every FIRE practitioner takes a different tact, here are three of the bigger names in the movement on how much they’d saved by 30, as well as a tactic they used to up their savings rate.
Fidelity recommends that the average American to have one year of their salary saved for retirement by 30. So if you make $50,000 a year, you should have $50,000 in a retirement account. Here’s how these money experts in the financial independence, retire early movement compared.
Jillian Johnsrud of Montana Money Adventures
Saved (with husband) : $375,000, plus a pension valued at $400,000
My husband and I committed to saving half our income when we got married. Because we never earned six-figures that meant driving older cars, having a roommate even after we had kids and finding low cost meals. I was passionate about travel, so we accepted a duty station in Europe and were able to travel frugally by driving and camping. We also opted to buy a home that needed a lot of work and slowly learned how to fix and upgrade it ourselves, which came in handy in the rentals we bought next.
Julien Saunders of Rich And Regular
Saved: around $20,000
In 2010 I was 30, and I had about $20,000 saved, between a savings account, a traditional IRA carried over from my twenties and one year of contributions to a 401k. It was during this time, I realized how little joy I got from cable and decided to cut the cord for good.
I then took it a step further and downgraded my cable internet to a high speed DSL service which was significantly less expensive and worked just as well for my needs. I’ve not had cable TV since and didn’t regain cable internet until 2018. Every little bit helps!
Steph and Cel of Incoming Assets
Saved (together) by 30: $211, 658
The only expense we ever really curtailed was lifestyle inflation. When we first met our income was very low and our spending reflected that. Then as we went from poverty-level income to normal income, we just kept our spending the same. Early on we did cut out a weekly home grocery delivery service that we had been using for a few years, though that was also inspired by their warehouse getting a nasty aphid infestation.
