How I Reached Financial Independence By Age 40

Learning how to achieve financial independence and retire early (FIRE) is pretty simple in theory. I’ve covered some key technical concepts is past articles. These include the math behind building wealth quickly and simple tax planning strategies common in the FIRE community.

While the concepts are simple in theory, they are not always easy in practice. I’ve studied early retirees and discovered key strategies and patterns of behavior that separate them from those living a more conventional lifestyle. Continuing that theme, I have identified three actions that have been key in allowing for my own early retirement. Oh, and I’m only 41 years old.

I Wrote My Own Story

“The story you tell yourself becomes your reality” — Chad Kellogg, American alpinist

It is documented that you are more likely to obtain goals when you write them down. I propose you go one step further and write your own story.

In my case, I observed the happiest and most passionate people I knew were my “ski bum” or “dirtbag” climbing friends. However, most were living a life of financial risk with little security.

I also observed many on the other side of the spectrum: professional people who had money and prestige. However, they were trading away most of their time working while they still had the health, energy, and vitality to pursue their passions. At the end of the day, few seemed genuinely happy or fulfilled.

The common narrative is that you must choose between a false dichotomy of life focused on career and money or a life focused on things like passion, fulfillment, and family. I wasn’t happy with this choice, though. I wrote a simple essay about having the best of both worlds, which I titled “Dirtbag Millionaires.” Then, I started figuring out how to piece that life together for myself.

Who Writes Your Story?

This may all sound cliché, even a little cheesy. However, if we think about it, someone is writing each of our stories. It’s just a matter of who that someone is.

  • Do most people carry debt in the form of a car payment because it is a great financial decision, or even because cars bring us true happiness? Or do people make this decision because advertisers and car salesmen are writing their stories for them?
  • Are our ever-bigger homes, and the 30-year mortgages needed to pay for them, really the American dream? Or, are realtors and mortgage companies writing most people’s stories?
  • Do most people retire in their 60s or 70s simply because it is best to spend their younger years working? Or are government policies, conventional financial advice, and social expectation writing people’s stories?

It is important to realize we all have the ability to create our own narrative. And if you want to retire early, writing this story is mandatory.

I Defined Success Carefully

“…you should have a running list of three people that you’re always watching: someone senior to you that you want to emulate, a peer who you think is better at the job than you are and who you respect, and someone subordinate who’s doing the job you did…better than you did it.” –Chris Fussell, former US Navy SEAL officer

I recently came across the above quote in Tim Ferriss’ new book, Tools of Titans. It came in response to the question, “How do you define success?” Personally, I think this is excellent advice for those looking to do something extraordinary with their lives. Nearly everyone follows the same path: birth, school, work, retire, die. For those of us on a different path, though, it can be challenging to gauge how we are really doing. Having, and watching, these three people in our life gives us a yardstick against which we can compare our progress.

My wife and I worked with a conventional financial advisor for about a decade. He repeatedly told us how well we were doing. Compared to our peers leading a conventional lifestyle, he was right. However, following conventional financial advice meant massive investing and tax planning mistakes. This cost us over $20,000 in excessive fees, unnecessary taxes, and opportunity costs in just our last year of using his services.

Taking Control of Our Wealth

About five years ago, I’d had enough and took control of my finances. I began reading early retirement blogs like Early Retirement Extreme. Soon after, I moved to Mr. Money Mustache and The Mad Fientist. While each of these blogs was very enlightening and technically helpful, I found that their focus on the fastest and most efficient path to retirement was not consistent with my values.

Related: How to Build Wealth Quickly So You Can Retire Early

I became overly focused on money and retirement. Despite already having a very high savings rate, I began watching every penny we spent. I became excessively focused on regretting past financial mistakes and wanting a future of freedom from work.

For the first time in my life, money became a stressor. While my knowledge and wealth grew, I became less happy.

I needed better benchmarks to compare myself against… a way to define our success. So, I began to search for others whose attitudes and values better lined up with my own.

I Found My Peers

I continued reading early retirement blogs to find others who had already done what I wanted to do. Two that I found extremely helpful were Todd Tresidder at Financial Mentor and Darrow Kirkpatrick at Can I Retire Yet? They demonstrated a more sustainable path to FIRE and were living lives consistent with what I desired in my own retirement.

I then began connecting with peers who had comparable stories and were at similar places on their journey. This included the bloggers behind Our Next Life, who are on our same timeline to retirement and share our passion for the outdoors. I became friends with Chad Carson, who has taken a very different path to FIRE as a real estate investor, but has very similar values, interests, and family situation to my own.

Learn More: How to Make Money Blogging

I also connected with the bloggers behind Slowly Sipping Coffee after reading their description of a “fully funded lifestyle change,” which was more in line with our values than a traditional retirement. More recently, my wife and I joined a mastermind group of similar couples. Having peers on a similar journey has been very helpful. We are able to share the triumphs and discuss the challenges of this unusual lifestyle.

Finally, I began connecting with those behind me in their journey to FI. This includes Jared Casazza, who writes the blog Fifth Wheel Physical Therapist about his journey from 6 figure debt to FI in 5 years. It also led me to connect with a Dough Roller reader/listener Andrew, who I have been coaching for the past few months.

Helping those behind me has forced me to develop a deeper understanding of our own ideas, theories, and processes. Learning their stories has made me appreciative of how far we have come on our own journey.

I Redefined Retirement

“…the old story was freedom from: freedom from work, freedom from having to get up in the morning, freedom from lots of things. The new story is freedom to.” –Richard Leider, Author of “Life Reimagined”

Many people think early retirement is difficult, if not impossible. They think it is too hard to save enough money to support them indefinitely. Following the 4% rule seems like it would be stressful. They do not know how they would ever pay for health insurance. They think they would get bored.

I agree partially (or fully) with all of the above sentiments if retirement is defined in a traditional sense. Worse yet, retirement often deviates from the happy, carefree time so many imagine. In fact, retirement is associated with an increased risk of anxiety and depression! This didn’t sound like anything I wanted for myself, so I simply redefined retirement.

I stopped worrying about trying to save every penny, with the idea that retirement meant never again making money. I have accepted that the future is always uncertain, so I focused on building a substantial nest egg while also building great flexibility into my plan. This allowed me to reach a point where earning money will never again be the central focus of my life. Going forward, my life may, at times, look very different. It may look like that of a part-time or seasonal worker, stay-at-home dad, entrepreneur, ski bum, freelancer, student, teacher… or any combination of the above.

Related: Is the RAM Better Than the 4% Rule?

Building the Life I Want

Seth Godin has a great quote: “Instead of wondering when your next vacation is, maybe you ought to set up a life you don’t need to escape from.” I chose to apply this idea to retirement planning.

Not needing to make money will give me freedom with my time. Building in a plan to also do some paid work will give me the opportunity to live a lifestyle of abundance, rather than one focused around a strict budget. It will also allow me to continue to build social connections and live a purpose driven life.

There are probably some of you who would criticize this plan as “not really retired.” However, this definition of retirement is in alignment with the principles of the “Life Reimagined” program, developed by AARP to address the many challenges and downsides of traditional retirement.

Taking Your Own Action

When I started getting serious about early retirement, I became obsessed with the technical how-tos. I needed to plan out where my financial threshold was — how much did I need to save now, in order for this flexible plan to really work? While I don’t have every step planned out and I don’t know exactly what my retirement will look like down the road, I know that I am happy with the freedom and flexibility it provides me. It’s important to realize just how possible it is for you to achieve a similar outcome, too.

Write your own story; develop systems to measure your progress, and define what you want for your life. You may be amazed by where you find yourself in just a few short years.


Topics: Personal Finance

6 Responses to “How I Reached Financial Independence By Age 40”

  1. Chad Carson

    Well done, Chris! I think this is your best work since Dirtbag Millionaires. I really resonate with the idea of defining retirement for yourself. Rigid definitions and approaches limit the very purpose of pursuing your lifestyle goals in the first place! As long as you are progressively getting more and more financial independence over time and as long as you are doing the activities that fulfill you, that’s the point!

    Thanks for sharing your story and insights.

    • Chris Mamula
      Chris Mamula

      Thanks for commenting Juan. It really is true that many people make the vast majority of their decisions without any true thought as to the reasons why they do things or the long-term consequences. I am no conspiracy theorist or anything, but if you follow the money to what advertisers want us to do and what government is trying to influence us all to do it is pretty easy to see why people follow a pretty standard path in life.

  2. Dave R

    Chris,
    Great work! I enjoyed this read. Sitting on my porch enjoying a (rare) cigar and a beer, it was enlightening. What I liked the most was how your understanding and feelings concerning your path to FI changed. It went from one of pressure, stress, and over-analysis to a separate theory centered on flexibility, opportunity, and acceptance of the unknown.

    Awesome! I have enjoyed connecting with you. All the best!

  3. Joyce

    Chris:
    I enjoyed this so much I had to re-read it. I related to you in so many ways it is a little scary. Your envision has inspired me even more. We all have a story to write and what better time than now to write mine.
    Thanks so much. You can coach me any day. 🙂

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