I think about this scene at least once a week

There are a few perspectives to take on this meeting. If you found the pitch interesting. Congratulations! You’ll be on the fast track for middle management in no time. If you are anything like me, the idea of getting up and leaving a boring job is a fantasy one can only dream about. I intend to fulfill this dream. However, there is a right way and a wrong way to do this. Sure you can tell your co-workers how you really feel and end up on the couch sending out resumes. Or like Don you can go out without a care in the world.

The financial independence retire early “movement” or FIRE is a personal finance philosophy that has been gaining a lot of traction with young people who want out of the standard life plan. Fair enough but to achieve such a lifestyle is going to require a plan of corresponding boldness.

Basic Outline from Reddit

1. Reduce spending
2. Increase income
3. Investing

Some aspects of these plans I see that I got a problem with is their focus on salary, misery, and public equities. While this is good advice for retiring regularly, you wont be able to retire early.

At the risk of being pretentious, I am going to refer to the plan I use as the Don plan. Below are the key points:

1. Avoiding “Golden Handcuffs”
2. Owning a business
3. Don’t forget to live

Personal finance is more about avoiding bad decisions than making good ones. The “Golden Handcuffs” refers to financial obligations that are significant enough to limit your lifestyle choices. Here’s a few examples: buying too much house, BMW’s, extravagant vacations, Grubhub. You get the idea.

You will never get rich trading your time for money. I’m also told that you have to work really hard in order to not have a job. So why not work for yourself? I would much rather work 80 hours a week for my own business than 40 hours for someone else’s. This leads to an important question: why are you trying to be financial independent?

Financial Independence for me is the ability to support myself while pursuing my own projects. Although, nothing is stopping me from working on my own projects right now. The process towards financial independence is a end state in itself. It forces you to look at your life, decide what you want, and make choices on how to get there.

Finally, it is important to not forget to live. All those personal finance “gurus” will tell you not buy coffee, eat rice and beans, and move into your parents basement. If your plan to retire early is dependent on being miserable than you have missed the point. The whole point of this exercise is that you are responsible for your own happiness and no one is going to give it to you.

Additional Resources

How to Get Rich (without getting lucky):

— Naval (@naval) May 31, 2018

This blog is for entertainment purposes and should not be considered financial advice. Consult a licensed professional before making financial/investing positions.