Feb 22, 2013 328 comments

Getting Rich: from Zero to Hero in One Blog Post

Hi there. If we haven’t met, my name is Mr. Money Mustache. I’m the freaky financial magician who retired along with a lovely wife at age 30 in order to start a family, as well as start living a great life. We did this on two normal salaries with no lottery winnings or Silicon Valley buyout windfalls, by living what we thought was a wonderful and fulfilling existence. It was only after quitting the rat race that we looked around and realized why we had become financially independent while most people, even with higher incomes, end up stuck needing to work until age 65 or later.

I’m writing this post to use as kind of a permanent “Hello!”, since at any given moment in time, about half of the readers of this blog are pretty new, and casting around wondering where to start on a giant site like this with over 500 published articles. Most people arrive with the same question:

“I hear Mr. Money Mustache writes some useful stuff and many people are building happy, wealthy lives for themselves using his advice”, they are saying, “but I am a busy person. How can he make me rich Right Now!?”

Great question. Let’s begin.

We’ll start with a rant, which links to a bunch of other stuff. You can right-click any of those links and open them in a new tab for later. If you get through every link, you’ll be well-equipped to fix most of your life – just like that.

For almost nine years, I’ve been preaching a different brand of financial advice from what you see in the newspapers and magazines. The standard line is that life is hard and expensive, so you should keep your nose to the grindstone, clip coupons, save hard for your kids’ college educations, then tuck any tiny slice of your salary that remains into a 401(k) plan. And pray that nothing goes wrong in the 40 years of career work that it will take to get yourself enough savings to enjoy a brief retirement.

Mr. Money Mustache’s advice? Almost all of that is nonsense: Your current middle-class life is an Exploding Volcano of Wastefulness, and by learning to see the truth in this statement, you will easily be able to cut your expenses in half – leaving you saving half of your income. Or two thirds, or more. Sound like a fantasy? Not to readers of this blog.

What happens when you can save more of your income? As it turns out, spending much less money than you bring in is the way to get rich. The ONLY way.

And the effects are surprising: if you can save 50% of your take-home pay starting at age 20, you’ll be wealthy enough to retire by age 37. If you already have some assets now, you’re even closer than that. If you can save 75%, your working career is only 7 years.

So remember my freaky magician story up in the first paragraph? There was not really any magic – my wife and I just saved about 66% of our pay without really noticing it, and in under ten years we woke up and realized we didn’t have to work for a living any more. Our son was born shortly afterwards, and he’s about to have his eleventh birthday party. And we’re still going strong.

But how can you save so much?

The bottom line is this: by focusing on happiness itself, you can lead a much better life than those who focus on convenience, luxury, and following the lead of the financially illiterate herd that is the TV-ad-absorbing Middle Class of the United States (and other rich countries) today. Happiness comes from many sources, but none of these sources involve car or purse upgrades.

No matter what the herd or the TV set tells you, this is the truth. Far from being a social outcast, this new perspective will make you a hero among your friends. This is not a fringe activity anymore – millions of people are fixing their lives these days. And the earlier you can accept it, the sooner you will be rich.

Is that all too fluffy and philosophical? OK, fine. Here’s how to cut your life costs in half. Start by getting rid of your Debt Emergency if you have one. Live close to work. Move to another city if you enjoy adventure. Don’t borrow money for cars, and don’t buy stupid ones. Ride a bike wherever you can. Cancel your TV service. Stop wasting money on groceries. Give your kids the opportunity to achieve greatness without being pampered. Lose the overpriced cell phones. Learn to appreciate the life-boosting joy of using your own body to get things done. Learn to mock convenience. Practice optimism.

That should do it – about half of your expenses, gone in one paragraph. Keep going, as many readers do, and you can save closer to 75% of what you make – especially for those with above-average incomes.

But then what do I do with all the money?

You invest it. In stock index funds, in paying off your own house, in rental houses if you are interested in local real estate, and in other sources as you continue to learn about making money work for you. As of 2016, my own retirement income comes from a dead-simple asset allocation: a bunch of index funds at Vanguard and Betterment which pay quarterly dividends.

How long will the money last?

If you can get 25 times your annual spending saved up and working for you, that is enough to live off – forever. Don’t worry about the details – just do the saving for now, and watch as your lifestyle transforms and your worries about safety melt away. This blog is not so much a financial nuts-and-bolts blog as it is a story about lifestyle and attitude transformation. And believe it or not, your attitude determines your lifetime wealth much more than your knowledge of financial nuts and bolts.

So welcome! I’m glad you’re here, and let’s get started. For the long-time readers – let’s keep going!

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Want More?

ed March 9, 2015, 4:17 pm

I dont know where to start with this. Is this really possible for everyone? We all have different mindsets and life situations. I have struggled to pay debt since as long as I can remember but thats because I have a house which I now half own. Im always hovering around 8 thousand to 10 thousand debt and about 200 a month is servicing that debt. I live pretty frugally – dont drive, cycle to work, dont buy clothes often, dont eat out, dont order takeaways, rent a room out, work in web development. I just dont understand how this works. To me its about getting to 60+ with the roof over my head paid off and that 10k debt finally down to nothing. Most of my spare money goes into servicing my asset – the house i live in.

Reply
- Mr. Money Mustache March 11, 2015, 8:00 am
  
  Hey there Ed,
  
  I think you need to start by getting your world into more concrete terms – figure out exactly how much you take home every month and track where every dollar of it goes. Figure out the leaks and plug them. Optimize the recurring expenses. Find out what your savings rate is as a percentage of take home pay. Then increase your income if that will provide a worthwhile boost to the freedom-earning activities.
  
  In general, a frugal bike-rider who works anywhere near a computer will probably have enough to retire well before age 60.. but the numbers matter. You might start by reading all the articles linked from this one.
  
  Reply
LizzyTissy June 24, 2015, 7:01 am

I found your blog from a random Facebook post from a friend….I was having trouble sleeping and was exploring whats usually mindless banter in Facebookland. Her post was different! I read it, and was intrigued, and the next morning I visited your blog for the first time.

My husband and I have been Mustachians before we even knew it was cool…. I am 29, he is 36. We live well within our means (we make about 200k a year and only spend about 60K of it!), we paid off our house that I bought in 2009 last year, and have been living mortgage free for an entire year! We have no car payments, own a totally kick-ass Scion xD, which I get a lot of shit for from my friends at work, and we recently purchased a Ford Focus all electric! A tiny part of my husband died when he traded in his 12 yr old BMW z4, but it was totally impractical and now we can be better to the environment, and never go to the gas station again! Most of our driving is done together, we work together, and only rarely will we have to use the gas car.

My husband is a bike fanatic, the spandex wearing kind, not the errand commuting kind. But none-the-less we see the intrinsic value of bikes!

I had read John Bogles book, ‘the little book of common sense investing’ a couple years ago, and since then haven’t really been tempted to ‘get rich quick’ on picking a single stock win. We invest smartly, but use more ETF’s than just one total stock market. We have a bunch covering many sectors…. If anyone can comment on that, I’d love to know your investment strategy!

We input our numbers on the MMM retirement calculator, and it says we’d only have to work for 7 more years if we wanted to! That seems crazy to me, one because we are both symphony musicians, and love what we do, but also because I’m not even 30 yet! Its nice to know that we are doing the right things, and are setting ourselves up so well for the rest of our lives.

A HUGE THANKYOU to MMM!!! Thanks for preaching frugality, common sense, anti consumerism in this crazy want it all, want it now world. It was a breath of fresh air to find this blog, and realize that there are many like minded people out there! I can’t wait to spend my summer reading every single post, and devouring every single comment!

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- Mr. Money Mustache June 26, 2015, 7:52 am
  
  Wow, thanks for that great story Lizzy!
  
  Do you really make that much as a pair of symphony musicians? I am impressed. Although it sounds like your coworkers are pretty deep into insane consumerism: would anybody seriously give you shit over a Scion xD?? As in, alleging you should get an even NEWER/FANCIER car than that?
  
  I mean Holy Shit, the car only came out in 2008 – so it is impossible to have an “old” xD. And it’s one of the smartest car choices on the market. To express anything other than admiration over that car choice is an instant fail on the real-life IQ test.
  
  Reply
Felipe June 27, 2015, 10:43 pm

“Not to Readers of this Blog” link does not work.

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- Mr. Money Mustache June 28, 2015, 2:52 pm
  
  Thanks Felipe! Looks like that had been broken for quite a while but I fixed it (we changed Forum URLs a while back).
  
  Reply
Beatriz July 22, 2015, 1:07 pm

Interesting how the mustache style frees me much earlier. 25x the annual spending to retire around 35 years old, much better than 16x current earnings to retire with (more than) 65 years old:

“Yet even as financial literacy may have declined, the retirement bar has been raised. The Wharton School’s Richard Marston believes that the traditional rule of thumb that retirees need to save eight times their current income to maintain the same lifestyle is outdated. That number, Marston notes in an interesting podcast and in his book Investing for a Lifetime: Managing Wealth for the “New Normal,” should be more like 16 times”. – See more at: http://blog.betterinvesting.org/?p=9946&utm_source=MailingList&utm_medium=email&utm_campaign=BI+Weekly_7-20-15#sthash.oonZPBjT.dpuf

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Lisa July 31, 2015, 3:27 pm

About 25 years ago I read a book call “Your Money or Your Life” which is very similar in philosophy to Mustachianism. That book shifted my thinking and I have made some great choices and progress as a result. However, in some ways I’ve wandered out in left field (not too far) and your blog is bringing me back to what is really possible. Thanks for that.

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Homestead Girl August 15, 2015, 7:41 pm

Dude, I love your advice here. My husband and I left the rat race in our late 20’s and have been homesteading for 7 years now. We’ve learned to live with very little by making our needs few. Life is too good to waste on fretting over stuff and keeping up with the Joneses. Ditching convenience and learning to do more for yourself isn’t always easy, but it’s a thousand times more rewarding. And anyone can do it. You’ve just gotta be willing to let go of what we’ve always been told we’re “supposed” to do or have, and seek out what truly brings joy in life.

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Tim August 22, 2015, 3:06 pm

MMM,

I’m confused, with your Early Retirement Calcualtor, do I include the equity in my house in the “Current Portfolio Value” , or do I simply reduce the “Current Annual Expenses” value accordingly as I overpay the mortgage. If the later is the case, in the “Current Annual Expenses”, would I include both the interest and the principle on the mortgage, as they would both go down as the mortgage is paid off and the equity goes up accordingly? Thanks.

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Ishabaka September 17, 2015, 11:49 am

I think one of the main differences between the MMM approach, and other frugal approaches is the mind-set, and the internal chatter it engenders.

Internal chatter can be positive or negative.

I rode my bicycle to do two errands last week, and it was really hot and humid.

Prior to reading MMM, I might have told myself “I’m being hot and miserable, and saving money”.

After “I’m being bad-ass, riding in conditions most people wouldn’t even consider, and saving money”.

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Peter Johansson November 2, 2015, 5:15 am

Hi,
you might have answered this is some of your newer post but I haven’t been able to find the answer. You state “If you can get 25 times your annual spending saved up and working for you, that is enough to live off – forever.”

My question is it in what way does correlate to my age, I assume the older you are less should be needed since you can live of the capital itself also? Any good formula or graph showing the corralation?

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Teresa November 16, 2015, 2:20 pm

I don’t own a cell phone. What I do own is my home and 50 acres of land. No debt and a sizable retirement fund. My husband and I grow most of our food. We cook every meal at home and feed several others at times. We live on $12,000 a year and still save money. We volunteer in our community and are very busy and happy. Money and things do not = happiness, but its nice to know that we took care of both years ago and can now enjoy our days doing what we love to do. Early in October we were driving the Blue Ridge Parkway and stopped 2 different days to have a picnic at one of the overlooks. We sat and took in the beautiful sight in front of us. Several people asked us if we wanted them to make our picture. When I told them that I didn’t own a phone or have a camera with me they seemed dumbfounded. Most of the people we saw would jump out of their cars and take a quick photo or short video and jump back in the car and leave. I saw this happen all the way dawn the Parkway. I don’t get the obsession with the phone.

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Diane Warren February 7, 2016, 10:01 pm

I have been volunteering with a group committed to making a big difference with global warming. The lifestyle you suggest is one of the best things we can do. Consumption of new things is the biggest cause of emissions, which are causing climate change. I am inspired to see how I can cut down spending, share that, be happier, and make a big impact.

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Shannon February 10, 2016, 11:56 am

Hi MMM,

I found your blog last week and have been reading like crazy ever since. One thing that I can’t seem to understand clearly. If you are saving in indexed funds under a 401(k) or IRA/Roth tax umbrella, how do you live off the income prior to the government-mandated age? Are you investing a significant amount of funds directly without a tax shelter?

On a different note, I am currently saving around 50% of my income, but am at a loss as far as where to put it. What percentage should I focus on indexed funds vs. saving on a downpayment for a home?

Thank you so much for any responses; your blog has been immensely helpful to me thus far, even just in realizing that early retirement through a frugal lifestyle (which I already live) is possible!

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- Matt (Semper Fi) September 22, 2016, 8:17 pm
  
  Shannon, I can’t remember exactly which post it is (from like 2011 or 2012), but MMM lays it out pretty clearly where he invests his money. It sounds to me like he put a truckload of money into retirement accounts (tax-sheltered), but also into taxable accounts. From what I have learned from several blogs, you can roll that retirement money in your 401K into a Roth, and use it penalty-free from there (though you would have to pay taxes on the withdrawals). Also, the money that you initially put into a Roth can be used penalty-free, but it will eat away at your compounding interest. Anyone reading this, please correct me if I am wrong — I’m a little bit new at the investing side of finances.
  
  Reply
Ufaq Ashfaque March 30, 2016, 12:13 pm

Hi Mr. Money Mustache

I wanted to share my financial situation with you and wanted a little guidance because I am heavily struggling with the things that are currently affecting me. I live in a third-world country and working here is immensely demanding. My salary is $432 per month and I live with my mother. Could you please guide me?

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Quint April 12, 2016, 11:23 pm

Hey… I was reading your article on “Killing Your $1000 Grocery Bill” and I was curious about something you typed…

“…that attempts to imitate Whole Foods. It seemed like a friendly place, where the customers are unsually slim”

Are they usually slim, or are they unusually slim? I would like to see a grocery store full of unusually slim folks.

Great articles… I think that the thing people like most about reading you is that you encourage them, and you tell them some of the realities about what to do and expect.

I am not super frugal like you, but I am a bachelor so I don’t have some of the expenses you do. I am getting more and more tight though… I have a plan for early retirement too but I didn’t start on it until my mid 40’s. I make good money and I am able to invest a great deal every month toward the option of working versus the requirement. One of my spreadsheets is entitled “Retire poor at 49” where I maintain adequate income but nothing fancy. Another spreadsheet is entitled “Retire rich at 54” and is self explanatory. I was just shocked and pleased to see that I could entertain the option of retirement in just 5 years after earnestly FOCUSING every extra dollar on that goal.

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Tony May 3, 2016, 11:59 am

How much money do you require to buy stock index funds?

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- Matt (Semper Fi) September 22, 2016, 8:21 pm
  
  Tony, if I remember correctly, it seems like you can get some Vanguard index funds for an initial buy-in of 2k or so. But I think that once you own the fund, you can add whatever you want per month (100 bucks, whatever).
  
  Reply
Matheus Hobold Sovernigo May 14, 2016, 6:32 pm

I stumbled upon this blog today while trying to find out if I was a crazy exception to retire at such age. Then I swiped through all 39 pages of posts and found a lot of meaningful information to help and endorse my thoughts about this lifestyle. Congrats on that and best regards from a Brazilian soon-to-be retired ;)

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william May 17, 2016, 2:24 am

Stumbled upon your blog from hackernews. Your ideas echo sentiments I’ve had for a long time so I think its best to pull up a chair and make reading your blog a daily habit.

I’m building my own home, can pay off credit card debt in 2 months next year, and can probably pay for an entire year’s worth of basic expenses in 3 months worth of work. I hope other people reading your blog come to understand that being financially stable is accessible to everyone and not just pioneering living-off-the-grid types or people with fantastic jobs. Everyone has overhead that they can reduce.

Thank you for the posts. I’ll be reading them intently for some time to come.

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Jimmy June 11, 2016, 9:49 am

I stumbled across MMM through a YouTube-video. Felt like it was something worth checking out. I’ve read the one article, but nothing else yet. And only a few of the comments. But I think I should share of my own experiences.

So as it turns out, I already follow most of MMM’s advice. I came to where I am partly because who I am, partly because of life. I’ve always been pretty good with money, never a big spender. At least not compared to most. So I had a lot saved up when I quit working to study creative writing, because I want to be a writer. My savings financed the first 1,5 years, then I started taking student loans. But I live in Sweden, so it’s no huge sums. I could pay them back, but the interest is so low so it doesn’t make sense. Anyway, when I wanted to get back to working, the financial crash had hit, and I couldn’t find any work. So I spent 2 more years in school, making it 4 total. After that I got a job. It didn’t last longer than a few months though, and then I was unemployed. And I was forced to survive on far less than I had even as a student. I had to rely on welfare for some time. This taught me what the essentials were. I had to cut my expenses a lot. Finally I had nothing but the essentials.

Then things turned around. I got a job in Stockholm. I moved basically over night and started a new life. I had to work really hard those first weeks, moving from place to place, and even changing job. I had to take a loan from a friend to be able to afford housing. And I had to rent a room. But when the paychecks started rolling in, things calmed down. I swore I’d never be that broke again, so I started saving up money. There were really no expenses to cut, because I couldn’t cut down on food. So all I had to do was to not add new expenses. And I didn’t. And I could save 50% of my income.

Then I started looking at the housing market. It’s booming here in Stockholm. Prices have gone up 10-20% the last few years. And I had just a room, it was enough. I’d been living in a room for years, both as unemployed and as a student, when I shared an apartment with classmates. So I though – why not own the apartment, and rent out rooms? So I bough my apartment 10 months ago, and rent out a room. I live basically free, and the interest on my loan is just 1,5%. And I’m 6-8 months away from upgrading to a bigger apartment. Then I will be able to rent out 4 rooms. I will be making a profit from my housing. Sure, I have to share my space with others, but it’s just for a few years. Eventually I’ll get another place, but keep the first apartment and keep renting it out.

So that’s my plan. I’m 32 right now. I think by 40 I could definitely stop working. But I might instead go down to half time for some years. I think that’s pretty remarkable, considering 2 years ago I had nothing.

I should say though – I have no children, and wont get any either. That makes it easier. I’m also single, which will change someday. I don’t know what effect that will have on my plan. But the further I go down this path, the more convinced I become. Working to 65 is madness. I want to live!

Comment if you find this interesting. I haven’t really met a lot of people who share my ideas. And I don’t go around preaching either, for fear of appearing crazy. Not that I mind much about being perceived crazy. But I’m a pretty low profile guy.

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- Dan June 27, 2016, 11:00 am
  
  Jimmy- You’re doing great! You are maintaining the student/unemployed lifestyle while working- if you can keep that up you will be far ahead of your peers. Things may change if and when you get married and have kids, and the key would be to marry someone who shares your goals and values. You will gain some peace of mind when you are able to pay off all your debt. Keep up the good work!
  
  Reply
- MamaTeresa June 27, 2016, 5:39 pm
  
  Jimmy, great job on renting out a room and planning to eventually make a profit on your housing! I too rent out part of my home, just a couple rooms, and I end up still needing to pay USD $417/mo for a huge 5 bedroom, 3 bath house. I could make more, but my family and I don’t want to rent any more rooms out!
  
  Welcome to MMM; you will learn so much here and find lots of people who think like you (and sometimes challenge you too). I’ve been here for years, it’s a wonderful place to learn and share.
  
  Reply
Financial Canadian June 26, 2016, 2:31 pm

MMM,

Great post, and I love the point you made near the end about this blog being about attitude just as much as it is about finance.

I’m puzzled by something, though. You are obviously a very financially savvy individual, but you’re making no use of leverage. Why is that? I’m sure you have reasons. As someone who employs leverage in their own portfolio, I am definitely a proponent of i, and would love to hear why you avoid it.

Thanks.

Reply
- Mr. Money Mustache June 26, 2016, 3:01 pm
  
  That’s a solid question, FC. In the past I have used leverage in the form of keeping a mortgage on a house in order to leave more money invested in stocks. I never got so fancy as to buy stocks (index funds) on margin, since I think it’s a bad idea.
  
  But once we reached the point of “enough”, I de-leveraged and just have a straight balance sheet. Extra money, beyond the level of what you can actually use, has very little value, whereas reduced stress and complexity has huge value to me.
  
  Reply
Lady Locust August 4, 2016, 5:31 pm

Hello MMM,
This is fabulous. I am doing many (but not all and not enough) of the things you suggest in order to save. My husband and I have recently “simplified out finances,” without divulging too much, and are now seriously shooting for the early retirement target. I just found your blog and wish I had several years ago. I was already headed in the right direction at that time, but it was sure discouraging at times. The encouragement and positivity do help! It’s also helpful to learn the little tid-bits that add up or ideas we hadn’t thought about (like the article about mpg, coasting in gear vs. in neutral.) Will definitely have to continue browsing former posts.
Thank you.

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Rick Smith August 16, 2016, 7:57 am

My wife and I got married just last year and have baby boy. We were and are extreme savers and investors. We have both save close to $500,000 combined. I have $265,000 and my wife has $229,000. We are both 31 and 30.

These investments which is $480,000 are in RRSP’s, TFSA’s and non-registered accounts and are all in long term zero coupon bonds ranging from 4.5% to 4.75%. These will mature in 2035 to 2040 being worth $1,214,396.

We have no debts and paid off $350,000 house. We work only by contract 4 days a week, 30 hours a week and are pulling in $9,000 a month and we are doing our plan since last month to contribute yearly the max to RRSP’s, $17,300, TFSA’s $11,000, short term savings, laddered GIC’s etc, $10,000 and $20,000 a year in dividend-paying ETF’s.

We will have around another $315,000 in 5 more years in our mid 30’s or so and what to do by then. We have about $14,000 in cash reserves, cashable GIC’s today. We will continue to work 4 days a week and enjoy 3 days a week off spending much needed time with our baby boy.

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JC Heinen September 10, 2016, 12:27 pm

I live in a 100% Passive Solar house in the SW part of the United States 12 or so miles East of Albuquerque, New Mexico at about 7000 ft. in elevation. This house has all brick floors with 2.5 ft. of sand under the bricks. The entire house is only around 900sq.ft. and I only need to heat around 600sq.ft. of it. I’m looking to improve the heating with underfloor hot water radiant heating for a minimum of cost and disruption. Is there a way to feed PEX tubing under the bricks and through the sand in an economical and easy fashion?
I was thinking of using a fine, slow spray of water out the end of the tubing to do a controlled boring through the sand for the tubing to pass through. I’m not sure how I would guide its path yet. Does this sound like a viable method for installing PEX tubing under the bricks?
I have a 1500w electric tankless heater I would probably use to heat the water that would be circulated under the floor. Have thought about supplementing it with a solar water heater, but haven’t thought about the details.
Thought I would throw my idea(s) out there and get feedback from others. Any sincere thoughts on this subject would be greatly appreciated.

Thanks!
JC Heinen

Reply
- Mr. Money Mustache September 11, 2016, 10:30 am
  
  Hi JC,
  
  I don’t think the spraying-tube method of tunnel boring would work in this case. I’ve done that to get, say, a 6′ length of rigid tube through the soil under a sidewalk when installing a sprinkler system, but it would not work well for a longer, flexible tube.
  
  I’d suggest just using baseboard radiators if you have electric heat. Or if you’re lifting up that brick floor in the future, you could run the tubes at that point (preferably with a solar-powered water heat system to run them).
  
  Reply
- Mark December 9, 2016, 10:46 am
  
  Hi JC,
  That’s pretty neat. I live in Phoenix, AZ, and am a thermal engineer (teaching & working at ASU), so I hope my comments are helpful.
  
  1) MMM has metal radiation shields + blanket/batt underneath his radiant system, then an air gap, then the ground. You would not be in such a good place, with your PEX in direct contact with the sand layer – you would be bleeding much of your heat to ground.
  
  2) Water-tunneling (a.k.a. deliberately partially collapsing) your sand layer under a brick floor is probably not a good idea, unless you want some funky flooring.
  
  3) Passive solar houses take full advantage of thermally massive materials in the innermost layer of the building envelope (see also Taylor & Miner, “A metric for characterizing the effectiveness of thermal mass in building materials”, Applied Energy, 2014). Your best bet would be a radiant water system completely inside the building envelope, as MMM’s hot water system *almost* is. There are ceiling-mounted or wall-mounted radiant heat panels (see also http://www.ecosmartus.com/blog/post/2014/11/17/should-you-install-radiant-heating-in-floors-ceilings-or-walls-.aspx). However, the big caveat is to ensure that you don’t overload ceiling structural elements! And to do it really right, so a leak doesn’t take down your library or computer desk…
  
  The other deal with inside-the-walls panels is that they’re not beautiful. But maybe you’re an artist, and can surface them with some antique-washed copper or something…
  
  In short, your house is designed completely different from MMM’s (cold climates = insulative house design, hot climates = massive house design), so you’ll have to think of a bit different solution to work with your design. Radiant can sure be part of it, but it has to be inside the massive envelope.
  
  Good luck with your project! And I (a suburban ranch-house dweller) am a bit jealous of your passive house… Have fun!
  
  MJM
  
  Reply
Michael November 25, 2016, 7:18 am

I think I was fortunate … a retired missionary from OMF talked to a group of us seminary students about committing to China for life … So I thought that was cool and came here in the late 90’s … met my wife here … bought some properties when things were very cheap …. then real estate began to go up, and up and up and up … between 1000 and 1500% …. so now I can sell out if I want and retire anywhere on the planet … if I so desire … we will probably stay in Beijing for now …. but Canada … home … it still an option … our daughter is going to a local school which is free … we did a month long trip to Switzerland, South Germany, Austria and Lake Annecy France this summer … loved Lake Zurich the best … maybe I will take on your ideas more and head there for 3 month stints while doing church work …. thanks for sharing your experiences and advice … God Bless, Michael and Family, Beijing, China :)

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pierre December 8, 2016, 3:15 am

I totally share the philosophy and I myself live a simple life and save a lot but this 4% rule is ridiculously optimistic. Where do you find a 4% return post inflation these days ? Plus the rule says your net worth will last 30 years if you withdraw 4%/year. So if you want to retire at 30 what are your plans for when you are 60 ?

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- Mr. Money Mustache December 8, 2016, 11:08 am
  
  Hi Pierre – The 4% rule is actually pretty conservative, and it’s based on a combination of expected long-term appreciation plus dividends of a stock portfolio. (However, to apply it strictly today based on current US stock valuations, you might use 3.7%). Here’s where that comes from: http://www.mrmoneymustache.com/2012/05/29/how-much-do-i-need-for-retirement/
  
  Reply
david s January 1, 2017, 3:11 pm

I don’t understand how the 25x rule accounts for inflation.
so if I live off of 45 k /yr now, i’ll be living of 90k/yr in 17 years.

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Ben January 31, 2017, 6:26 pm

Hey MMM,

I’ve been following your blog for the last two years. Thank you for inspiring me and my wife to pay off over $50,000 in student loans in 1.5 years and get on the right track toward early retirement! Thank you for challenging me to stop eating out at restaurants, spending a gross amount of money on groceries, and finding value in good ‘ol hard work. You’re the man!

warmly,

Ben

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Liz Blazina February 2, 2017, 3:32 pm

Dear Mr Money Mustache,

I am curious ( and maybe you can link me to the correct article in your blog) but how are you able to live off of your earnings at such a young age without paying excessive fees, ( early withdrawal , etc) as you would in most retirement accounts.. What have I missed here?

Thank you for doing this blog.. Such a great asset to all that find it!

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DB Cooper May 3, 2017, 9:13 am

I bumped into the concept of the “fulfillment curve” in the early 1990s. I’ve been trying to keep the family to the left side of the graph ever since.

https://postimg.org/image/t5yget5uj/

I started many similar strategies that the MMM uses 25 years ago. In 5 years, we quit the corporate world and in 10 years were financially set for life. We still work because it is fulfilling.

The main advantage of money is not the stuff you can buy with it, but the freedom you have! Money allows you to make your own rules.

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Bhuboy May 20, 2017, 12:35 am

Hi, I’m new to your blog, really impress when I heard you on Tim Ferris podcast, and thought this guy could be the one to help me reach my goal of retiring from work abroad and be with my home in the Philippines. Looking forward to more learning and bigger savings

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Mighty Investor June 6, 2017, 9:19 am

MMM,

You are right. It’s not that hard to get from zero to hero. The actions are quite simple.

The tricky thing is being willing to behave in ways that are outside the mainstream. This is quite scary to most people. I think it’s hardwired into our thinking. Underneath, there is this unconscious fear that if we get too far outside the herd’s behavior, and the herd might reject us…. Then we might starve.

Seriously, it sounds ridiculous, but that’s what is behind most people’s desire to stay well inside the bell curve of behavioral norms.

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Mark July 5, 2017, 4:02 pm

It’s important to realize there are trade off to reducing spending – many of which have already been discussed in the comments.. If all your friends have luxury cars and boats but you’re trying to increase your savings rate for early retirement, your perceived status will probably suffer among your social circle (though probably not for true friends).

Living below your means is not something many Americans do, so blogs like these not only offer actionable financial advice but moral support for those going against the wind. The social aspects of sustainable living are just as important as the numbers, and the more ways we can make living below ones means socially acceptable, the better.

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Shin280891 July 18, 2017, 1:34 am

But what about traveling to other countries and exploring other cultures? It enriches your life and to me is one of the top tings on the to-do list. Traveling may be cheap but it is still expensive compared to groceries and utilities.

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Mallorey November 5, 2017, 9:44 pm

I have been personally looking for ways to save on the purchases I already make. When you stop and think about how many different expenses were summed up and brought to my attention in one paragraph, its crazy! Can’t wait to give a few of them a try, and to start saving!

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Jim Powell November 17, 2017, 10:57 am

Glad I found your site through the many references of the other financial blogs that I follow. Great place to start.
Me and my wife, just past the 50 year mark, and are a 1 income family, but focusing on living a better and happier life. I’m looking forward to following along!

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Stoney December 3, 2017, 9:24 am

Pete,

The Mad Fientist put together a safe-withdrawal-rate tool when he wrote in his blog about what percentage withdrawal from your nest egg (at the value it is on the first day you retire) will last you through your lifetime. If you have dividend stocks that only pay 2% you can still eat into the principal to end up with a zero balance at the end of your life (at whatever age you estimate that to be). Right now, since valuations are high, and yields are low, the safe withdrawal rate is bottomed out around 3.5%. (see https://www.madfientist.com/safe-withdrawal-rate/).

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Sadie12 January 29, 2018, 7:21 am

I wasn’t sure where to put this reply, but I figured it could go here, on the first MMM blog post I ever read, likely to be seen by no one :)

I do not have a bike. I have been known to eat out whilst simultaneously carrying a credit card balance. I have made a recent vehicle purchase, and it wasn’t electric. Therefore I either deserve many throat punches…or I am simply not a Mustachian. I favor the latter explanation since I’m not inclined to receive said throat punches. However…MMM’s story and blog have GREATLY influenced my life, prompting many financial changes for me over the last year.

I moved to town and my 110 mile daily commute decreased to 8 (round trip). I sold my mid-sized SUV on Craigslist for a good profit and paid cash for an old but well maintained Scion xB. I got a roommate with whom I now share expenses. I have cut my (significant) credit card debt in half and I am being savvy with my remaining cards, rewards and introductory balance transfer offers. I have increased my 401K withholding from the minimum 6% for matching up to 10%, and diversified my portfolio. I have enlisted my 13 y.o. daughter in managing the finances. We agree on the budget together and track it together. I put the price of her phone bill and clothing allowance in her youth spending account, and she is responsible for paying her bills and buying her own clothes, shoes and toiletries. (You want designer jeans? Then you can’t afford those shoes. You don’t want to do your housework? Then you don’t get paid.) I have shed some luxuries such as mani/pedis, salon hair coloring and my amazing and wonderfully awesome clothing rental service (/sobs/). I have moved my service providers like hair dresser, mechanic and grocery store to my neighborhood within (conceptual) walking distance, instead of 30 minutes across town. We have gone from eating out most nights, or getting take-out, to eating out once or twice per week. We have found ways to cut back on our grocery bill, such as using the ClickList, and instituting a vegetarian night. Our phones are older models and reconditioned, and our plans are cheap (Republic Wireless FTW!). I use MeetUps to find free activities, such as Game Nights and outdoor movies. Our vacations are day trips and “staycations.”

But. By the social norms of the Mustachians subculture, I am a total failure because I HAVEN’T DONE MORE! I accept this failure, and salute everyone who has donned the mantle of EXTREME THRIFTINESS. Truly, well done. But right now I am also saluting the lurkers like me – the half-assers – who have DONE A FRICKING LOT to improve your financial health. I am proud of you too, because any steps you take to loosens the shackles of consumer dependency and debt and are laudable. Highly laudable! In fact, I am instituting a new thing. A golf clap. A solid round of golf claps to all the lurking half-assers like me who never dare to speak up for fear of throat punches. I see you…you have done a thing.

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- Mr. Money Mustache January 30, 2018, 9:32 am
  
  Congratulations Sadie! This is all stuff to be incredibly proud of, and your future YOU is thanking you immensely.
  
  The only thing I encourage you to let go of, is the assumption that Mustachians are at ALL in the spectrum of extreme thriftiness. We are not. We are “slightly less ridiculous than average”, but still deeply in ridiculous luxury territory. And you’re just a bit further up that spectrum.
  
  It’s a skill set rather than a deprivation. You will find that as time goes on, efficiency becomes easy for you, and you can get more enjoyment out of every dollar (and build a greater surplus), while FEELING like your life keeps escalating in joy and luxury. So, welcome!
  
  Reply
- Catapult January 30, 2018, 5:16 pm
  
  Stories like these are why this blog is worth every byte of its existence on the Internet! Kudos Sadie12!
  
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- Sadie12 January 31, 2018, 8:33 am
  
  Wow, well said. I admit I was a bit nervous – but the affirmations are gratefully received. I will continue to pursue the skills and reap the rewards of Mustachianism.
  
  Reply
  - Kathy O January 31, 2018, 11:47 am
    
    I admit to be a partial Mustachian too. I love going out to eat once or twice a week and buying the occasional cashmere sweater from Nordstrom’s. But even as a Mustachian-lite I was able to work part-time in a job that I loved beginning at age 45. Now at 56 I am the first of my friends to retire. Frugality for me is more about not buying the car everyone thinks I should have or the biggest house the real estate agent says I can afford. Congratulations on the changes in your life. They will pay off.
    
    Reply
Cole Cotton April 23, 2018, 12:25 pm

Staying on the topic of different forms of taxation across different government, whats the most unorthodox system of taxation you can think of and is it effective?

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Ahalya August 3, 2018, 9:21 am

I am 43 and just started on paying off my debt. I wish I knew about financial planning, retiring early etc in my 20s. I wasted so much time and money. Although I am envious (almost on a daily basis) of people who have retired early, are financial free and debt free, I am glad I found out about this concept now at 43 instead of at 50, 53 or 65. I have to first pay off my debt and then start on my savings and investment journey. Thank you for creating this blog!

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Jasmine September 6, 2018, 2:39 pm

This phrase changed everything about how I’ve been thinking about money —

“The money I don’t spend makes me rich.”

I’ve always been a responsible spender, only making purchases if I have the money in my checking account for them. I’ve been ok at saving, but I have had a bad habit of spending any savings I’ve built up if it’s easily accessible. I’ve started to see that it’s two sides of the same coin. If I save up enough, I eventually convince myself it’s ok to spend that money on an expensive item. This habit is not helping me increase my net worth and gain true financial independence.

So, for the past 2 months I’ve tried a new approach. Every time I convince myself I want something new (clothes, trips, fancy things) and I know that I have the money in my account to buy them, instead of buying the thing, I put that money into a difficult to access savings account (RRSP or TFSA – I’m Canadian btw).

Now that I’ve “spent” the money on an investment, I don’t have enough to buy the thing I wanted. I saved myself from buying a Fitbit this morning, that I had convinced myself I neeeeded. So far, I’ve saved about $820 using this strategy. It’s not the 70% of my income that MMM says is the best strategy, but I think I’m kicking my “stuff” habit.

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Jo November 20, 2018, 11:10 pm

Hey, found this website via Tim Ferris book on mentors. Wish I would had, understood and adopted this earlier in my life but there’s no time like the present.

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Fishermanswife February 18, 2019, 2:59 pm

I feel like I’ve been lied to all these years about shares. I was told they were too complicated. And that shares are for when you have ‘spare’ thousands of dollars to invest. Who has that?! After reading your blog and now studying the index funds route- I wonder why we don’t teach this at school??? I’m now teaching my kids.

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Nathan May 22, 2019, 3:34 pm

In 2017 we purchased a used 2013 Nissan Leaf for around 7k. It had 22,500 miles and 82% capacity on the battery. Your article about the Nissan experiment really hit home with us and the price was excellent for the utility we needed in the car. We used the car mostly for our shared commute to work and for 30-mile radius drives. This saved us several hundreds in fuel every month that our other cars were using. In the just over 2 years of driving, we have only had the cost of a transmission flush and brake flush plus a cabin air filter. Fast forward to March 2019 and Tesla decided to lower the prices on all their Model 3’s and they still had a big tax incentive and our state has a $2500 cash rebate on the vehicle. We decided to take the plunge and get a Tesla and sell our last gas vehicle. We could not be happier with both of the vehicles and we swear to never purchase gas cars again. We even decided to put money down and support the new Rivian Truck platform because of how much we support innovation. We did this with proper planning and this also does not reduce our savings rate or early house payoff strategy or even purchasing Real Estate investments in the future. It’s all about where you want your money to go and what you value. To each their own for what they value, but we value innovation and tech while having a goal of early retirement in the future.

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- Mr. Money Mustache May 22, 2019, 4:48 pm
  
  Wow, that sounds like a luxury electric auto adventure for sure – you are the first person I have heard from who is thinking of buying the Rivian electric pickup. But I agree that it looks like a massive improvement on existing trucks.
  
  Reply
  - DuckReconMajor April 28, 2020, 8:42 am
    
    Do you have an opinion on VIA Motors? I had no idea about them until a coworker showed me several months ago https://www.viamotors.com/
    
    Reply
Erik Stockton June 25, 2019, 4:03 am

MMM,

Your first topic in this post is about your house and how the location, lower than market price, etc. helps you live on $27K / year. Can you speak to how you paid off the mortgage so as not to have a monthly mortgage payment? This seems like a key ingredient to your low need for cashflow. You’ve probably addressed this somewhere else but a small blurb in the “house” section would be helpful for future readers.

Thanks

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Brooke July 19, 2019, 1:20 pm

My question, which maybe you talk about somewhere on your blog, is how do you save money when you can’t find jobs that pay enough to save? I’ve tried for years, with only rent to pay and I still haven’t managed to even have enough for that.

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K money in training July 31, 2019, 5:02 am

Do you recommend maxing out our traditional retirement accounts first then investing the rest in taxable accounts? I am a high income earner if that makes a difference in the advice.

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Drea August 22, 2019, 11:55 am

I have found this comment from the post to be very untrue: ‘Far from being a social outcast, this new perspective will make you a hero among your friends.’

If you’re not out spending money with people, you are largely forgotten about. Finding other mustacians on the internet is easy but IRL you don’t typically bump into them on the regular.

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Kyle September 24, 2019, 3:46 pm

What type of account are your investments in? I want to start investing for early retirement and cannot determine which account type is best for this.

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FullyBearded JuniorMustachian December 20, 2019, 2:41 pm

I’ve been working my way through all posts since the beginning of time for a month or so now and finally made it to what I would assume is probably the most-read article on the blog. I’ve already read it, but it was cool to arrive here chronologically and be able to read just the links and think to myself “heh, I don’t have to click ANY of these. I’ve already read them!”
My wife and I have been putting a lot of this into effect. I’ve started fair-weather riding my bike to work with plans to get rain gear so I can ride year-round. (It doesn’t snow here, so rain gear and warm clothes are all I’d need).
We’ve so far cut our grocery spending by 25% and that’s just in about a month’s time, so I expect that to drop further. I just recently found budgetbytes website for ideas on how to cook cheaper meals at home.
We’ve drastically reduced one of our biggest sources of bad spending (going out to eat). Going from a shameful multiple restaurants a week down to a small number a month. (further reduction coming soon)
I’ve adapted vacation plans from lavish AirBnBs to cheaper accommodations and plans to cook meals while traveling.
I payed off some of my smaller debts and have escalated payments to the remaining ones.
I’ve never owned a TV, let along a TV subscription so luckily I was already ahead there :)
Also I started using Mint to put my financial picture together, I’ve become more mentally conscious of the purchases I make, and I am setting goals for retiring.

A lot of the value in this blog for me personally has been it’s ability to get me to think differently about money. Brought up in the USA means I was brought up in our culture of consumerism and the refreshing new perspectives that are written about here at MMM are changing my financial future for the better.
Only 6 years worth of blog posts left before I’m caught up, LOL.

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- Married to a Swabian December 21, 2019, 5:51 am
  
  You will want to be sure to read “The Shockingly Simple Math Behind Early Retirement”.
  
  That is a key post that should make the lightbulb go on!
  
  It did for me about four years ago and now we are getting very close to retirement.
  
  At 54, however, I’m calling it FIRALBE … financial independence retire a little bit early.
  
  Reply
MrBosski February 10, 2020, 3:50 pm

Processes over big goals is a good approach for everything in life.

You can control investing $X per month. You cannot control the stock market growing at 7% real every year during your accumulation phase.

Losing 50 lbs is something you can’t achieve in any significant time. Eating a 500 calorie deficit every day is something that you can achieve.

In both approaches, the process will eventually get you to the goal, it just moves the goalposts to something you have direct control over every day.

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Maggie April 28, 2020, 4:04 am

Hey Mr Money Moustache. This is the first day but not the last day I’ll be reading your blog. It has inspired me to do something about the slump I am in.
First, I have cut my private health insurance cost by $500 a year just by cutting down what I don’t need. There are so many things like that in my life that won’t bring me true happiness but yet we still keep paying for.
I want to have financial independence (not retire just yet) but I want it on my terms.

Bring it on 2020 and for the rest of our lives!

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