Early Retirement Advice
Today I’m going to offer you hands down the best early retirement advice you can find.
It is the book Work Less, Live More-The New Way to Retire Early by Bob Clyatt. I read the first edition of the book in 2005. This was eight years before I declared my early retirement and financial independence day. Now in its second edition, Mr. Clyatt changed the title to “Work Less, Live More-The Way to Semi-Retirement.
THE MILLIONAIRE NEXT DOOR
Like many of you, I loved the iconic book The Millionaire Next Door by Thomas Stanley. I read it twice after it was published in the late 1990s and refer to it periodically. It was entertaining to learn about the true lifestyles of millionaires. Basically, millionaires manage their money by living below their means, working hard, and stay outside the “limelight” of society. This is great advice for someone looking to build their wealth. But it was short on actionable advice to achieve and live a life of financial independence early retirement. Also known as FIRE.
WORK LESS LIVE MORE
In contrast, Work Less, Live More focuses on FIRE. And a whole lot of early retirement advice. It introduced me to the term FIRE by recommending the retirement financial planning calculator called FIRECalc.
These days, you see the term FIRE plastered all over the internet. In contrast, back in 2005 it was more of a curiosity. I’m only guessing, but FIRECalc may be the origination of the term FIRE. If there are any FIRE historians reading, please leave a comment and let us all know.
Most noteworthy, this book had a profound effect on my thinking about money, happiness and the possibilities life could offer. As a result, I highly recommend Work Less Live More for early retirement advice and achieving FIRE. Also, it is full of entertaining stories and actionable advice. There is even a companion work book available to help you plot your own FIRE strategy. So with that build up, I would like to provide a brief book review.
First of all, the book is organized in eight chapters. Each chapter explains one of the eight principles related to early retirement.
CHAPTER 1 – WHY DO YOU WANT TO DO THIS?
More that just “what’s your why”, the book explores other times and places with more sensible work-life balances. You will also find several exercises to clarify your own personal goals related to FIRE.
CHAPTER 2 – LIVE BELOW YOUR MEANS
The author references The Millionaire Next Door in this chapter. It delves into the budgeting and spending side before and during early retirement. Another area covered is combating the consumerism culture we live in. Also, different spending issues are addressed like paying for kids college tuition. Finally, different cost cutting options like retiring in a lower cost country are considered.
CHAPTER 3 – PUT YOUR INVESTING ON AUTO PILOT
This chapter covers some very sensible investing advice referred to as rational investing. Simplicity, asset allocation and basic portfolio design are discussed. The content is focused specifically for those pursuing early retirement.
CHAPTER 4 – TAKE 4% FOREVER
The rule for annually spending 4% of an investment portfolios value is explained and rationalized. Recommendations are tailored for early retirees who may need to make their money last for many years.
CHAPTER 5 – STOP WORRYING ABOUT TAXES
This one really hit home with me. I used to pay a small fortune in taxes as a working salaried employee. As an early retiree, with an appropriately structured portfolio, your tax rate drops significantly. Knowing this will help you fine tune your finances for maximum tax efficiency.
CHAPTER 6 – DO ANYTHING YOU LIKE, BUT DO SOMETHING
I am a big believer in this concept. I call it Work, Save, Invest, Build Wealth, but Never Retire. Furthermore, my twist on not retiring is doing something you love to make money instead. And the book is aligned with this philosophy.
Also, a little extra part-time money can accelerate your own independence day. Finally, the book provides a rich assortment of thought-provoking ways to spend your time after you are done with the daily grind of 9 to 5.
CHAPTER 7 – DON’T BLOW IT
There is some great coaching here on maintaining a positive mental state in early retirement. Because feelings of laziness, boredom, panic or guilt may set in. This chapter will help you move to a sustainable fulfilling lifestyle.
CHAPTER 8 – MAKE YOUR LIFE MATTER
The final chapter points out the impact your life can have when you start doing things you love. Also, some simple rules for creating a life well-lived are presented and discussed.
Follow this all up with an appendix chock full of investment portfolio options and resources that cover the subject matter, and you can’t go wrong.
EARLY RETIREMENT ADVICE – WRAP UP
There you have it fine readers. A quick run down on the book that had a huge impact on how I think about work, my life and FIRE.
What are your thoughts? Have you read Work Less, Live More? Does it look like good early retirement advice to you? If you pick up a copy in the future be sure to come back and let me know how you liked it!
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Gentleman's Family Finances says
The Millionaire Next Door is such a good book – I read parts of it years ago but I think that the main message of not trying to impress anyone really struck a chord.
Tom says
Hi and thanks for the comment. MND was a great book. Check out Work Less Live More. I think you will like it too. Tom
Helen says
Hi Tom, after you mentioned about the book “The millionaire next door” last time, I read it. It’s a cool book, and provides lots of insights how those millionaires made it, and what they are concerned about.
This book “Work Less, Live More” sounds even better. I’ll read it next month. Thanks a lot for the great information.
Tom says
I hope you enjoy it Helen. Let me know after you read it! Tom
Helen says
Hi Tom, I just finished reading this book Work Less, Live More. It’s a very good book, and explained very well about the way to semi-retirement.
I like his thoughts about the 4% withdrawal rule, and the 95% rule when the market takes a hit.
What I like the most is Chapter 7: Don’t blow it. That’s what I should caution myself. I wish the author could write more about this topic. Overall, a great book. Thanks.
Tom says
Hi Helen. I’m glad you enjoyed the book. Chapter 7 is a good one. You seem pretty well grounded and I doubt you are going to blow it. I’ve found that I keep myself so busy I don’t have time to mess up my early retirement. With teaching and blogging, for better or worse, I’m almost as busy as my professional career. It’s just that it is almost entirely on my terms (and pays a lot less). I would be curious what your concerns are? Financial, psychological or both. Maybe I could take your thoughts and write about it more. If it’s something you are thinking about, I’m sure others are as well. Tom
Miguel (The Rich Miser) says
Hey Tom,
Thanks for the recommendation, I really love roadmap-type books with actionable advice. I read most of “Your Money or Your Life”, and will put this one on the list as well.
Cheers,
Miguel
Tom says
Thanks Miguel. Hope you enjoy it. Tom
GYM says
I have never heard of this book! I’ll be sure to add it next to my books to read, especially if TOM recommends it!
I think a lot of people who are into FIRE have read:
Your Money or Your LIfe
by Vickey (forgot her last name)
Tom says
Hi GYM. I do not read a lot of books, but I really liked this one. I tend to operate a little off the beaten path and have not read Your Money or Your Life which I know is very popular. Tom
DivvyDad says
I haven’t read this one but will add it to my reading list. Almost done with the current book I’m reading—Invested by Danielle Town—so I’ll check if the library has this one when I return my current book.
Earlier this year I started making a concerted effort to read more often and have been getting through a book every three weeks or thereabouts.
Look forward to giving this one a read, thanks Tom.
Tom says
Most welcome DD. You have an aggressive reading schedule. Not being a big book reader, I admire that. Tom
Kody says
I haven’t heard of this book before, but I’ll have to add it the list. Admittedly, I don’t read many books or ebooks. The last ebook I read was 5 Steps to Retire in 5 Years by Jason Fieber, and that was a month ago.
Tom says
It’s a good, easy and informative read Kody. I think you will like. I’m similar to you and I do not read a lot of books, but this one really hit home for me. Tom
HP @ FTD says
Oh nice. I really want to read this book now – you’ve successfully convinced me with this post. I follow many of the steps to get to FIRE now and they are all tried and true concepts. In these past 2 years of taking a mini-retirement, I’ve learned so much more of what I’m looking for in the future. Either way, I’m planning for what I can and letting the rest play out. Going to add this book to my library app before I forget!
Tom says
Hi HP. Glad you think it looks like a good read. I think you will like it, let me know. And I’m really glad your mini-retirement has helped you with your vision for the future. It’s really important to be at peace with the direction you are heading. Tom
Simple Money Man says
I feel like I got a great synopsis of the book; thanks for sharing! It looks logical and a well read. I’ll look for it in my local library.
Tom says
Sounds good SMM. Hope you enjoy it! Tom
Caroline says
The book sounds great, I will check if they have it at the library. I may have a lot of time on my hands for reading shortly:)
I started the book Your money or your life but didn’t finish yet. I did read the Millionaire Next Door but it was ages ago.
Tom says
MND was entertaining, but this book has more actionable advice Caroline. I think you would get a lot out of it. Fine tuning what you already know, especially with a transition on the horizon. Tom
swedendivin says
Hi
Thanks for the advice i will check it out 😉 and hope it give me a better perspective in life.
Greetings from a Swedish Dentist
Tom says
Greetings to you and thanks for stopping by and leaving your thoughts. I hope you find the perspective you are looking for! Tom
Sean @ Frugal Money Man says
It’s already in my Amazon cart for when the new budget starts next month!
Thanks again for the synopsis and recommendation!
Tom says
Hey Sean. That is quick action. September is right around the corner. And congrats to you and your wife. If my memory is correct, you just got married. Tom
lukas says
Great article, Its sounds that The Millionaire Door sounds to be an worth reading book. I will definitely going to read this book. Thanks for sharing this article.
Tom says
Thanks Lucas. Glad you liked the article and hope you enjoy the book. Tom
The Poor Swiss says
This seems like a very good book to read! I’ve put it on my list to watch for buy it.
Thanks!
Tom says
Hope you enjoy it. I got a lot out of when I read it. Tom
DivvyDad says
Finally finished reading this book…overall, I really enjoyed the read and it has opened my eyes to the idea of the semi-retirement in more ways than one.
While I have certainly planned to pursue a few projects I have been mulling over once I reach our FIRE goals, reading this book has encouraged me to think about possibly stepping away from the standard full-time employment a little earlier than currently forecast and pursuing something part-time as more of a transitory period.
I felt the book was a little repetitive in some parts, and the plugs for the accompanying workbook were a little much at time (to be fair, I can’t blame the author though). However, I really enjoyed the examples and stories about some of the semi-retirees and how they have managed the topics of the given chapter.
Thanks for mentioning this book, as it has given me some new things to think about as we continue on this journey.
Tom says
Glad you liked it DD. In the first edition which is what I read, the author barely mentioned the work book. Although my brother made me aware of it and he got it and liked it, I never bothered. I do think part time work has a lot to offer not only financially, but mentally. That is what I’ve been doing the last 5 years as a part time university teacher. My brother on the other hand retired about the same age as me and has never worked since, about 10 years. And that has worked okay for him. I just think it’s fun considering all the possibilities and creating a new life. It’s like being a kid again, but better knowing yourself and without all the pressure. (Congrats on being part of div-net) Tom
DivvyDad says
Thanks Tom, happy to have joined that great group of bloggers.
On the part time work front, I’ve started exploring taking courses to prepare to take the CFP. A couple of my projects that I’d like to pursue in retirement would benefit by being a CFP, plus it could give me more options to pursue PT work in an area I’m passionate about.
Tom says
Yes. Based on what I know about you that seems like a great fit. Tom