The Art of Manliness Podcast: Retiring at 30 with Mr. Money Mustache

7/10 microphones

Listen to the Podcast, Find Mr. Money Mustache at his website

How to retire at 30 by just mainly spending less, AKA “Financial Baddassery”

  • Change your mindset/goals: Mr. Mustache focused on retiring by 30 to spend time with kids
    • Saved through 20’s by earning 2 incomes, spending <50% of post-tax income, paid off house/mortgage, invest in index funds, couple rental houses
  • Changing your money mindset/philosophy
    • You win the game by keeping as much money as possible and accomplishing as much stuff yourself (not buying as much stuff as you can), combined with earning/saving money
    • Accomplishing/learning leads to much more happiness than buying a big TV
  • Avoiding pressure to be like everyone else in the US
    • “We are bat-shit crazy in this country, and a lot other countries don’t have this consumption disease”
      • Everyone is out of shape, health problems, etc because of indulging in immediate desires
    • “You can go really far by doing the exact opposite of everyone else”
    • You actually get more respect this way
  • Not being a consumer:
    • Separate men from boys: Producers are Men, Consumers are Boys
    • When indulging in consumption like a fancy vacation I just got bored and didn’t get much fun out of it
    • This is actually very American up until WWII, but still a lot of production going on in the US
      • What you produce matters too (e.g. solar panels lead to long term value vs. disposable junk that lasts a few years)
    • Financial Independent/Retirement = Never HAVE TO work for money again, but you do want to and get to work on what you want (no need out to sell to highest bidder)
    • Savings Goals: 50-70% of post-tax income
      • People can live non 4k/year in the US if they have to, so this isn’t impossible
      • Saving Money:
        • Car costs: live close to work, small car, good mileage, buy used
        • Food costs: Cook your own, keep social by having people over
        • General Leakage: Reform your day to avoid random shopping/malls that you don’t need / Be Mindful of what you are spending (e.g. cancel cable)
        • Kids are actually not that expensive:
          • Healthcare/food are required
          • If you are home, save on day-care
          • Less travel sports, more running around neighborhood
          • Use hand me down clothes
          • Live by example as parents
          • Avoid malls, just necessities from Amazon = no retail therapy
          • Teach kids about saving in the “bank of dad”, include 10% interest in the bank to create incentive to save
        • What to do after quitting day job:
          • Keep side jobs (e.g. carpentry), Etsy, real estate, etc. – working is still good and you’ll enjoy producing
          • You often earn more after quitting than before
        • How much to save before you can retire?
          • Ignore Fidelity, it’s about how much you spend, not what you earn
          • You’ll need 25-30x your annual expenses to live off dividends/etc. plus value of your house
            • While working keep investing in index funds, etc. as you get the most out of deduction when income is high
            • Once you quit, then pay down the house as you income is lower and deduction worth less = lower monthly expense costs
          • Index funds are easy/safe way
          • Rentals can be effective if you have some expertise
        • How to begin your journey:
          • Start learning about it
          • Start taking action, replace a car with a bike as a challenge/changes your mindset (do hard things)