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Here's an email I recently received from a reader:

In an attempt to combine Dave's (Ramsey) 15% savings solution with an early retirement I'm stuck with a dilemma.  

If I put 15% into retirement accounts, then I will not be able to touch until I am 59.5 without penalty.  And that is presuming the government doesn't change the rules in the next 28 years.  Likewise, if I don't put anything into retirement accounts and do only investment accounts, I'll have a potentially inconvenient tax burden.  So the question is, how should I divide up my investments between traditional retirement accounts and early retirement accounts?

My employer matches 75 cents on the dollar for the first 8%, so into the 401K it goes.  Take the free money.  The next 2.5% would go to Roth IRAs.  The remaining 4.5% goes into my traditional investment account.  Is that prudent?

What's your advice for him?

The following is an update from reader CM. He shared his reader profile with us last year.

Since this post, quite a bit has changed.  Most notable difference has been that I have a daughter now that will turn 1 at the end of this month (crazy how quickly that happened).  Having a child has definitely been awesome, but it has certainly affected the finances and our priorities going forward.

Lifehacker shares a post from Budgets are Sexy (a site I love, BTW) that guarantees you'll become wealthy if you just take one of these simple steps:

1. Max out your ROTH IRA every year ($5,500)
2. Max out your 401(k) every year ($17,500)
3. Max out BOTH your IRA and your 401(k) every year! ($23,000)
4. Pay off your entire mortgage and save the future payments

And here's the thinking behind this:

You do any of those on rotation year in and year out, and I guarantee you'll reach financial freedom in 20-30-40 years from now. All depending on your expenses, and lifestyle, yada yada… (And if you're not in a position to invest large amount of money every month/year, at least start with SOMETHING. Even just $100 or $200 a month can do enough to snowball you towards your goals faster!)

My retirement plan is based on my assets generating enough income for me to live off without having to spend any principal. To do this, I need to save up a good amount of assets plus earn a good amount of income on them. These two are inversely related -- the more assets I have, the less I have to earn on them. Likewise, the fewer assets I have, the more I have to earn on them to make ends meet.