I’m on Track to Retire Early (Can I Slow Down Investing?)

April 2, 2023

How do you know when it is okay to start pulling back on your savings rate? In this highlight, Brian and Bo give advice on how to know if you should cut back your savings rate and explain which pitfalls to watch out for in this unique situation.


Want to know what to do with your next dollar, you need this free download: the Financial Order of Operations. It’s our nine tried-and-true steps that will help you secure your financial future.


Jake Glover, he has a question. A question on younger high-earning individuals. I am 28 years old making 200 to 250k. Wow, I am on track to retire early by saving only 15% due to starting early. Is it cool to start pulling back? What do you guys think? He should consider when thinking about this question?

Okay, all right, okay, all right, here we go. But can I ask something that sets the stage for you, Jake? If you’re only saving 15% and you’re 28, where’s the other 85% going at that level? And then I’ll let you add the rest. Well, I don’t know, Jake, your situation. I don’t know what your goals are, what retirement looks like, what financial independence looks like. I know for me personally, and let me just go and throw my personal bias on to you, myself today looks very different than my 28-year-old self. The things that I aspire to do are very different than my 28-year-old self, the things that I want to accomplish are very different than my 28-year-old self, so I love that you were like a high earner and you’ve probably done some mathematics, figured out what your living expenses are today, and you’ve extrapolated that out to figure out what they’re going to be when you hit financial independence, and you’re kind of doing this sort of linear calculation to do that, and that’s awesome. I just know that life looks a lot different for me now than it did then, and I think a lot of people would probably say that that’s the truth, that’s what actually happened.

So what I love to see my young high earners doing is I love to see them saving that 25%, because even if you’re ahead of the curve and even if you’re showing you’re on track, by saving 25%, all you’re going to do is get more ahead of the curve and farther out on the track, which is ultimately going to give you flexibility. I’m kind of with Brian. If you’re only saving 15% and you’re thinking about backing that down, I can only assume that that money is going to go to lifestyle. Well, the more expensive your lifestyle is now, the more expensive that’s going to be to replace whenever you get into Financial Independence. So I would be thinking, okay, if I squeeze the balloon, save less now, live more now, I’m also expanding how big the balloon needs to be when I get to financial independence. I love seeing my young folks, even my high-income earners, even folks in your situation, hitting that 25% number, at least until the foundation gets so big they say, “Okay, now I can back off.” Backing off is not a matter of being ahead of the curve based on the trajectory you’ve plotted out, it’s about actually arriving at the destination where you are ahead of the curve. And I think, unfortunately, for most folks, that’s not until you get into your late 30s, early 40s, mid-40s, before you can actually start recognizing that.

Yeah, I’ll put the things I quickly jotted down. I practice what I like to call force scarcity, which is that I have tried to figure out I’ve curated what my spend rate is so that I don’t get out above my skis because just because my income has gone up. I’m worried. At 28, do you have the spousal situation? Do you have the houses? Do you have the kids? There’s just a lot of life that’s going to come at you that’s going to change all the dynamics. So, you know, I know we’re running along with this. I had a special needs child that blew up a lot of my basic planning because now instead of one retirement, I have to have two retirements. Pay attention to those things, Jake. You know, you’ve been given an incredible opportunity here. It’s a blessing. Just make sure that you are very responsible and don’t get out ahead of your skis. I know you could look so cool, but most people don’t care what car you drive, they don’t care what house you live in. They’re more worried about what they’ve got going on. Don’t let pride, don’t let the influencers lead you to think something else.

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