What is keeping you from a life of financial independence?

Off the top of my head I can think of three things to facilitate relocation.

Multiple streams of income and a freelance lifestyle keep you from being stuck in one place.

Living below your means - specifically, buying less house than you can afford - allows you many more options when considering lifestyle changes.

For example, if you own less house than you can afford, and are at least several years into a mortgage, it's likely you have the option of relocating AND keeping your home. Since your mortgage payment is based on a historical purchase price of X years ago, and rents are based on current prices, you can probably generate a positive cashflow by renting it out. If you relocate to a distant area, just have a good property manager handle the details and send you checks. Of course, you could just sell the house and use the equity to buy another one, or start a business, etc. The important thing is that you have many options.

Regarding billionaires/multi-millionaires who slave countless hours each day - my experience is that in the main, it's because they're people who genuinely like what they're doing, they're really driven people, or they're people who don't know what else to do with themselves. I have known some who cashed out stock options, left with great fanfare, played golf (or the equivalent) for six months, then came back to work because they were bored stiff. I've known fewer still who were really "grounded" and had goals and a well-rounded life apart from their careers.

And yes, as you say, there are also those who've fallen into the trap of not ever being satisfied with the level of wealth they have. I've seen many people fall into the "millionaire lifestyle", sort of brainlessly buying a more expensive house and cars simply because that's their idea of what millionaires do. Unfortunately, that kind of behavior can become a kind of treadmill in and of itself.

As others have observed, I have no desire to be entirely free of work. Interesting work is a blessing. However, the advantage of having a stash of money is that one has more choices about one's work, both the nature of it and how hard one works at it. When one doesn't have to work for financial reasons, work can become more fulfilling and fun.

Retirement, in the sense that most people use that word, requires a huge amount of capital--so much that it's very difficult to accumulate while you're young, even if you're well-paid and live frugally.

But I don't think "retirement" is really such a hot goal. What most people want, if you talk to them in some detail, is less drastic than that:

1. They want to quit a job they hate.
2. They want to have a schedule that lets them spend more time with their family.
3. They want to have a schedule that lets them travel.
4. They want to be free to do work that interests them, even if it doesn't pay well.

That sort of "retirement" is much easier to come by than the regular sort. In fact, if it weren't for the way health insurance works in this country, it would be easily within the grasp of any person who lives frugally.

Really interesting replies.  Encouraging to hear positive people with positive thoughts... and fascinating to hear such a wide range of feelings about retirement.

Am just entering year 19 of a very happy retirement that started at age 53.

For my own part, retirement is a balance of being "free", and having to be somewhat... no.... a lot frugal. 

I'm mostly in agreement with Zin Lu's observations... Looking back, almost all of the points played a part in my decision to retire, and ability to stay retired.

On of the most interesting points was the cost of having children... While I wouldn't change it for the world,  having four children was a major expense... (I figure about $250,000 each in today's $$$).

The only caveat about early retirement, is the possibility of an upsetting major life event... health, wealth, or life altering.  With a basically stable economy since retiring in '89, the financial status has been surprisingly predictable, and the early planning is pretty much on schedule in a "macro" fashion.... though not exactly according to plan.  One can plan for "some" unexpected events, but that planning should be substantial.

Retirement early years are easy, since the ability to go back to work is there as a cushion.  As one ages, the inclination and ability to physically handle work (even mental work) seems to lessen.

A last thought about  Financial Planning.  I believe that many would-be retirees are put off, by the financial planning formulas that exist everywhere.   All that I have seen project income needs and expenses on the basis that the basic capital (nest egg)  should be preserved, and that one should leave that intact, and live off the income.  In order to have done that, I would have had to work an additional 7 years.   Certainly an individual matter, but a plan that "spends down" capital should be considered.

By the way... my own planning was not on a wish and a promise, but resulted from many, many spread sheets, and included highly detailed  budgets, expected costs. inflation, and income projections.  As we went along the retirement path, the planning gave a framework for guaging our progress, and helped in making any necessary adjustments.

Advice?   Go for it!

my opinion only

I was kinda surprised to see that Xin Lu was the author of this (BTW, I really enjoy reading your articles).

I can retire now but haven't. The reasoning isn't because I love my job (I like it) but I think there are 3 areas that need to be contemplated.

Money: For some, the opportunity to gather more wealth is too great an attraction and they will work as long as they can to pad their nest egg. For others, the amount needed to live off a 4% return is staggering. I think most realize that there is a trade off and when they are at a comfortable place, they retire. Some are able to estimate a "critical mass" number and retire the day they hit that number. One of the benefits to living frugally is that it lowers this number quite a bit.

Medical: In some ways related to the above topic but medical coverage for you and your family is another reason to work. You can buy your own coverage but it can be a hefty expense. In my case, a few years will result in a lifelong medical benefit (til 65 when Medicare kicks in). Unfortunately, this benefit is disappearing in many companies and isn't guaranteed in those where it is still offered.

Mind: What are you going to do that gives your life a sense of purpose and meaning. I haven't really figured this one out at all yet. Some people are content to do activities they love, some volunteer, some return to education... I'm still working on this one and hope that in the final 3 years of so that I have left in my career, I find the answer.

I remember thinking the way you do. The older I get, the more I understand why the older folks I knew didn't even want to talk about retirement. I'm 53 now and don't know one retiree who is genuinely happy about having so much free time, it can hang heavy, even for those who can afford to do whatever they want. Yes, you can volunteer, travel, etc. But personally, the older I get the less brave I get. I look forward to maybe working half the hours I work but sure plan to keep on doing what I do after I reach my 60's and beyond. Move to another place? Maybe but yes, you get used to your own little neck of the woods. I have plans still, but the older I get, the less exotic they are.

These commenters who have commented on how they never want to retire because it would be boring seem to be suffering from a failure of imagination.

I intend to retire at 40 (hopefully) at which time I will travel frugally, read books, be with family, volunteer, play poker and watch tv.

I don't need to be forced to work in a labor camp (no matter how nice a labor camp) just so I will have something to do. These people who can't think of things to do should try to recapture some of their childhood dreams and desires. It's never too late to live your life!

Btw: I don't think it's an accident that surveys of happiness consistently show that older people (aka retired people) are more happy than people who have to go to the labor camps every day.

As a young kid still struggling to plan out the rest of my life, I'm really inspired by your article. But I'm still worried about many things. Is it logical to think that working for about 13 years will pay for rent, medical bills, groceries, gas, car payments, for about 60 years?! Being frugal is great, but that's quite a ratio...

Good planning and confidence are great, but do they pay the bills?

Personally I plan to work for as long as I can. Maybe in the far future i could think of reducing my working days but frankly i cannot think of a better way to spend my days than working in my projects. (I'm an engineer)

I am making a big cushion for the case where i would be forced to retire but it is not an appealing idea to me.
Maybe I will change my mind once I am in my seventies but the words "early retirement" scare the @@# out of me.