If you are just starting this, I suggest you start at The Introduction - Part 0. Alternatively, you can jump to Our Early Retirement Plan: Where We Are Now (Part 1), Our Early Retirement Plan: My Personal Income (Part 2), Our Early Retirement Plan: My Wife's Plan (Part 3), or Our Early Retirement Plan: Obstacles and Expenses (Part 4).
In the end, for us to succeed, we are going to have to continue to be motivated towards our goals, continue to learn about better ways to reach them, and act on the things that matter.
Part of the learning and motivation come from reading articles like the Money Magazine one that I highlighted in the beginning. Still others may come for friends and peers like My Dollar Plan's escape from the rat race.
In part 2, I mentioned that retirement planners suggest that you can withdrawl 4% of your retirement nest egg each year and still maintain the principle. When I looked at our finances, we aren't close to having the funds to live off of that. However, when you add my alternative income from "retirement lifesytle jobs", an inflation-adjusted pension, two modest retirement nest eggs (and time to grow them), two investment properties, it may turn out to be a decent income. If we continue to practice our frugal lifestyle and catch a few breaks (me doing the child care while working - if possible, and getting cheap health care from the military), I think the plan is entirely possible. It's easy for me to sit here and speculate, but what about a real world test? Glad you asked.
One of the most useful pieces of software is Bill Sholar's FIRE Calc. I ran some rough numbers through there to see how we'd do. Looking at the publically available military charts it like my wife should have a military pension of around $50,000 in today's dollars indexed for inflation. At the same time, my websites and businesses should be at least at $48,000 in annual income in 11 years. This is an extremely conservative estimate as I should make $40,000 this year - and I see a lot more growth on the horizon. Next we looked at what our expenses might be. Our rent, our biggest cost, is $24,000 this year. I suspect that we could easily get by on $50,000 given our frugal lifestyle. Just to build plenty of wiggle room, allow for some great vacations, or save some money for the potential children, I estimated that we'd need $80,000 a year. These numbers disregard any potential income from social security, our investment properties, or savings my wife might make until she retires. The calculator says that we could live until age 100 with around 11 million dollars. That might sound like a lot, but it is closer to $1.5 million in today's dollars - still not chump change.
My hunch says early retirement is possible. The FireCalc tool seems to say it's possible. It's going to be something that I'll have to look at every year, but at this point it looks like we are on track.
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