We retired at 52 and 55 (DH stayed the extra three years so we could stay on the health plan) and had several friends who retired at that age. I know that is not extreme early retirement, but better than most.
So since retirement we have met lots of other early retirees as we are very active in a long distance bike group, canoe group, masters swim team and volunteer for habitat. So while there are many exceptions I have noticed many things we have in common. This is a totally observational non scientific study.
1. Limiting family size. Many are childless, or have one or two children. One exception, who has five children graduated college with money in the bank ( lived at home and commuted) and to this day lives in an old city house he bought cheap and renovated himself.
2. Modest homes. The average home price where I live is around $300,000. We all tend to live in the more modest homes worth $175,000 -$200,000.
3. We were not saddled with huge student loans. DH had big loans for the day, probably equivalent to about $40,000 in today's dollars, but he was an exception and attended a good engineering school. His starting salary was more than that. Most of our friends had little to no college debt. I had none. I am not sure how it came to be that these gigantic student loans I see posted here are the norm.
4. Eating out is an occasional luxury. It is normal at the habitat worksites or on our various canoe and biking outings for people to show up with a lunchbox. Scoping out the local farmers markets and ethnic food stores is the norm.
5. While appropriate gear is the norm at these activities, all the latest gewgaws and gadgets are not.
6. People seem to realize that it is not things that make you happy.
7. We were talking about a rash of home break ins in our town. One guy said it all when he said his important papers were in a safety deposit box. He had very little worth stealing - after all if you spend lots of money on stuff you have to keep working to maintain it all.
Yes, I think this is a pretty good description of the people I know who've retired early (and successfully). I'll add two more:
8. Most are married, and still married to the original spouse. Even setting emotions aside, few things in life set you back as badly as divorce.
9. Most travel, even splurge-travel occasionally, but they do it "on the cheap" -- that is, using Priceline hotels, or staying with relatives.
Interesting observations and principles to live by!
One thing I wanted to comment on...
I am not sure how it came to be that these gigantic student loans I see posted here are the norm.
While I think it is true that people have become more comfortable with the notion of debt, I think the bigger issue is that the cost of college has far surpassed people's ability to pay as you go. College costs are inflating far beyond wages, so anyone who went to college 25 or 35 years ago was at a significant advantage compared to today's students. I read somewhere that 30 years ago, average summer wages were enough to pay for a year's tuition. That is nowhere near the case today.
As someone who teaches the occasional class at our local university (where I graduated in 1993), I have access to things like student wages, so I was able to calculate how things have changes since I went there:
- Student wages (work-study, campus jobs) have gone up 45%.
- Tuition and room and board have gone up over 350%.
It was really eye-opening for me. And while I will counsel my own children to avoid student loans like the plague, I am much more sympathetic than I used to be towards today's college students. It's crazy what a degree costs these days, especially since they seem to have less value than they used to.
What you say is true, but incomplete. I've been out of college -- can it be true? -- 25 years, so I'm not quite in the "30 years ago this was possible" generation, but I can make a couple comments on my own college experience vs. my daughter's current college experience -- some that support your point, some that are argumentative. I think the whole situation isn't all that clear cut:
- Yes, tuition and other costs are higher; that is undeniable. Her tuition is roughly 12Xs higher than mine was in the 80s, and it's impossible to pretend that doesn't matter.
- I don't remember my friends particularly searching out THE COLLEGE EXPERIENCE. I know I personally was not in a financial position to do so, but today most of my high school students are very, very interested in attending THE SCHOOL, and in their minds it goes beyond the academics. It's a social thing, a first-step into adulthood thing, and they're much more willing to pay big bucks to go out of state, etc. I can understand that an 18-year old might not have the understanding of what it'll mean to their future to pay back these loans, but their parents are going along with it, heads a-waggin'
"Yes, yes, borrow, borrow." I rarely hear much talk of accepting what one can actually afford. Even the kids who attend the university 20 minutes down the road
tend to move into dorms or apartments, which negates the benefits of "staying local".
- Scholarships are down. Down in number of recipients, down in dollar figures. I've been teaching high school seniors for years, and these days practically no one (except military) gets a full-ride scholarship. My daughter was the #2 scholarship recipient in her high school graduating class, and she got about 50% of her costs paid -- I was thrilled. If she were ten years older, I'm certain she'd have had a full ride AND money back on top.
- We had exactly one spot in which to buy our books (unless we were fortunate enough to find a girl down the hall who'd sell her old math book), and that was the high-priced book store: They have the internet to help them find inexpensive copies.
- When I was a student everyone worked in the summer (multiple jobs often) and almost everyone worked during the school year (part time). Today most of my daughters' friends aren't working during college -- at all. You might argue that jobs are more difficult to find today, but that wouldn't be true in my very touristy home town.
- We had a sense of "loans are dangerous, don't sell your future earnings". Today's students seem to accept that loans are a necessary evil, something everyone has. And if you're going to have to pay back something, why not make your life just a little easier today -- don't scrimp on things, borrow enough for a few splurges! They also buy into the concept of "good debt", which makes no sense.
- Today's college students have more stuff. Most of my friends did not have personal cars on campus when I was a student; my daughter is almost alone in being car-less. No one had a cell phone (about 1/3 of us didn't have phones in the dorm and were confined to using the pay phones in the lobby). In my last year or two of school, a small smattering of students owned computers. Girls decorate, decorate, decorate their dorm rooms, then toss it all as they move into an apartment the next year.
- Today's college students go out more often. We went out to dinner only occasionally -- the night of a dance, Valentine's Day. In contrast, most of my daughter's friends go out multiple times a week. It's also "expected" that they're planning some sort of a trip (many of them cruises) for Spring Break . . . and a summer vacation too. That's something I did exactly once in all my college years.
So, yes, college costs ARE skyrocketing, but I also don't think the average college student is really doing all that much to help himself get through "on the cheap". It's something of a double-edged sword.