Blogs & Comment

Financial independence at 30

Jacob Fisker became financially independent at the age of 30, worked another three years andleft the work force at the age of 33.
He did notdo it by buying and selling real estate at the right time or putting all his money in some hot stock. Nor did he have a six-figure salary: in fact, his income was more in line with what a long-haul trucker earns, he reports.
He simply saved more than three-quarters of his income for the three years leading up to his PhD degree and the five years afterward working as an academic researcher. The result, in Finance 101 terms, could be called a 35+ year emergency fund, he quips. What I do now is invest in dividend-paying companies and live off the dividends.
How did he save so much? For one thing, he has chosen to live within walking or biking distance of important amenities and places of employment, so he did not own a car. Furthermore, he rented inexpensive accommodations: a dormitory in grad school (with shared bathroom) and later, in the work force, a room on the top floor of a rooming house for students. Out of the 9-5 routine, he has been living with his wife in an RV, mainly as part of fun experiment. They are looking to buy a house soon, in cash of course.
He likes to cook from scratch. At one time, his dinners consisted of lentil soup and tuna salad, cooked up in 6-day batches. For breakfast he ate oatmeal, seeds and raisins, and for lunch, it was a couple of bananas.
He rarely buys anything new. If something breaks down, hell repair it himself rather than rush out to have it fixed or go shopping for a new one. He now has a TV, but not cable (we have Netflix and the library). He once worked part-time copy-editing scientific papers but no longer does that.
Expensive hobbies were traded in for free ones. That meant no more buying the latest electronic gadgets or gym memberships. Instead he became interested in learning about things like Linux and geopolitics. He also writes the Early Retirement Extreme blog— and has just written a book under the same title as his blog.
Whats next? If the book does really well, I might set up a small business to handle its publication and write another one, he replies. I have also thought about becoming a machinist or carpentry apprentice. I have never worked seriously with my hands, but I like to build stuff. On the other hand I enjoy coming up with big ideas, so I’d also join the right think tank, hedge fund, or nonprofit. A long sailing cruise (San Francisco to Hawaii) is also on the list, along with hiking the Appalachian Trail. ___________________________________________________________________________________________