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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