How to retire young and weatlhy

Written by Mike

Topics: General

Here is my entry for Problogger’s “How to” competition, hopefull I am not too late.

How to retire young and wealthy:

I started my blog with this title nearly two years ago. Although, I am not quite there yet, I am fairly well done the path from where I was two years ago. Here are some of the principles I follow and have done pretty well for me:

– Save a part of your income every month. It sounds obvious, but often people kid themselves that by not buying cafe lattes everyday they will have this surplus income every month. Commit to a certain amount of money and put it away where you cannot touch it, at the start of every month.

– Invest your savings in quality investments that cannot easily converted back to cash. Personally I have done well investing in property – steady income, nice capital gains.

– Create multiple sources of passive income. With a little bit of effort, this can be done while you are still working, so you are not totally reliant on investment income. Ebooks, affiliate income and Adsense are all good potential sources.

– Only use a credit card to pay for web hosting and emergency purchases. Wait at least a week before buying any new gadget to think over if you actually need the item.

– Live a relatively frugal life, but don’t skimp on self-education, hobbies, books, socializing with people with similar goals and travel!

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12 Comments Comments For This Post I'd Love to Hear Yours!

  1. Sound practical advice .. of course implementation isn’t always as easy as it sounds or should be. Hope you make it and retire young and wealthy! And so do I.

  2. Jersey Girl says:

    I’m in the multiple sources of passive income territory now…it’s been helpful to build income, small amounts from multiple sources equal larger amounts

  3. Solid advice, and I think your final point is especially important. Life is meant to be enjoyed.

    Regarding credit card use, I’ve found that charging *absolutely everything* to a rewards card has helped me save hundreds of dollars on things I actually need (like a new vacuum cleaner.) The trick is to be diligent about paying the full balance each month.

  4. I agree with The Domain Muse on credit card use. I charge even when I have the cash, because I earn a 1-2% rebate by doing so.

  5. MamaDuck says:

    Very useful indeed! Our how-to is up as well if you’d like to check it out!!

  6. Matt says:

    Great how to! I love this stuff! Thanks for participating in the Group Writing Project. My How To is up also.

  7. These are some very good points, although I tend to agree with the others about using a credit card to your advantage to earn rewards.

    As noted in your last item, living below your means is an important element but you have to give attention to the “living” part as well. I think you have summarized that nicely.

    My how-to post is up as well, check it out if you get a chance.

  8. Mike says:

    Thanks for everyone’s comments. The power of putting something on problogger!

    I have to agree, some people handle their credit cards well, but the majority of people don’t. I find that it is just too easy to buy stuff, especially now with internet shopping, so I try only to use it for essential purchases.

  9. mrmike says:

    Good advice. It’s sometimes a slow process, so you may as well enjoy the ride. Be happy now.

  10. Jennie says:

    Great howto, It makes a lot of sense.

  11. Shuchetana says:

    Love your post! I especially like that last point about living frugally, but not skimping on things like socializing and travel. That’s one thing I mentioned in my own how to post, How to “buy” happiness .

  12. I’m deflinitely going to make it happen. 🙂 My how to is up.

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