23 y.o. planning for the ability to retire at 35

[Poopsio]

Hey all,

I'm a 22 YO predental student. I plan to be a dentist, specifically an orthodontist. It's my dream to provide high-quality care. It's a stressful profession but I think the rewards make it worth it. Money-wise, it's kind of hard to adopt a mustachian ethos but I think it's possible.

I currently have loans in the amount of 30K and I anticipate them to be close to 250K by the time I am done with my training.

I currently have my expenses close to 1k/month and that includes transportation, rent, insurance. I don't have a car and don't plan on having one for as long as possible because I live where there is great public transport where I'm at.

I have a sizable (by no means .1% status but well above average) inheritance and family assets that I am doing my best to act like I'm never going to get because it distracts me from my goals. I don't want to include that in my plans here. My plan is to minimize the costs of my education while getting the most from it.

So that's it. I'm posting this on December 1st, 2014, as throwing down the gauntlet. I will be able to retire at 35 if all goes according to plan.

Let's do this!

[marty998]

13 years? I will be just over 40 by then.

Assuming I can continue to save at my current rate + pay increases I could see myself amassing a further $800k excluding investment returns in that time.

Will take your gauntlet and run it. Here's to MMM site still being around in 2027.

[Pooperman]

I just had to post 'cause I saw your name. Good luck!

[boarder42]

wow thats a ton of schooling to then retire so fast best of luck. 

[Gone Fishing]

Congratulations for maintaining your drive and ambition despite having what sounds like an inheritance that may be enough to check out before ever having done anything.  While your working years may be hard, they are what gives color to the rest of your life.  In college, I knew three young boys that were slated to get $1 million each at 18.  I almost felt sorry for them as they would not be able to "learn" their way into it.

Along Boarder's point, and not to bash your plan, but I would think orthodonics would lend itself very nicely to some part time work post FI.  Given the time and money you are investing in your profession, it might feel like a waste just to walk away.  If nothing else, you could perform orthodontics for disadvantaged children or the like.  Just a suggestion.     

[Davids]

Good luck poopsio.

[Bob W]

Sounds like a plan!

A couple of questions?

If you have "family" money can you not ask that the money be diverted to pay for education rather than borrowing?

Second,  We know that dental school can be very difficult and time consuming but wouldn't it be better to pay as you go and retire 3 years after graduation?  Without the fam paying this would require a part time career/job that pays very decent.

For a motivated person, like you,  I might suggest looking into the final expense insurance field.  You could earn 75K per year working 25 hours (flexible to your schedule) per week.   You would feel so much better graduating without debt.   It would also fit well into your paradigm of helping people who are in need of your services. 

In short,  final expense insurance is a reasonably priced product that pays for burial/debt/inheritance upon death.  Policies range in the $50 per month area and are marketed to people 55 and above who have little savings.   Since a funeral can easily be 10K this is a good deal for them.

A full time guy can average 8 policies per week with net commissions of around 4-5K per week.  The problem is that if you're good at it you would probably decide to go full time,  forego school and retire by 28.    (residuals average 10% of net under contract, so if you sold 1000K in 5 years you would initially have 100K in income just off of residuals plus 40K in investment income)  Really a guy of your caliber could retire in less than 3 years if that was the goal.   Sorry for diverting. 

[Chranstronaut]

Nice.  I'll pick up your gauntlet.  I'm currently 24 and aim to be FI at 33, so nearly the same timeline that you're on.

I can understand a desire to be FI or even RE shortly after completing complex education.  It doesn't seem like a waste to me, as long as you actually enjoy what you are learning.  I'm working on grad school in my spare time because I like it and think it's fun.  But I'd like it a lot more if I were FI and not working full time :)

I think making your dental education as cost effective and Mustachian as possible is a great suggestion by the other posters.  This will give you a lot of freedom even before you achieve your RE date.  The interest you'd pay on $250k in loans would be about half my retirement income.  Good luck!

[BBub]

Sounds like a plan!

A couple of questions?

If you have "family" money can you not ask that the money be diverted to pay for education rather than borrowing?

Second,  We know that dental school can be very difficult and time consuming but wouldn't it be better to pay as you go and retire 3 years after graduation?  Without the fam paying this would require a part time career/job that pays very decent.

This... it seems silly to plan on taking $250k in debt to fund dental school if you have significant family assets and/or the ability to keep expenses down and pay as you go.  $250k is no small debt obligation, and you'll likely have to get through 3-4 yrs of school then 3-4 yrs of residency before making a high salary and being able to both eliminate that debt and save significantly for FIRE.  I'd be thinking about every possible way to get through school with as little debt as possible.  Many families I know with significant assets willingly fund education expenses for their offspring, so it would be worth at least having the conversation with your folks.

[boarder42]

I'll take it i'm 28 as of Nov.  I plan to retire Jan. 2, 2024.  So 10 Years to go.

2014 Year end Total Saved 250k

[Poopsio]

Sounds like a plan!

A couple of questions?

If you have "family" money can you not ask that the money be diverted to pay for education rather than borrowing?

Second,  We know that dental school can be very difficult and time consuming but wouldn't it be better to pay as you go and retire 3 years after graduation?  Without the fam paying this would require a part time career/job that pays very decent.

This... it seems silly to plan on taking $250k in debt to fund dental school if you have significant family assets and/or the ability to keep expenses down and pay as you go.  $250k is no small debt obligation, and you'll likely have to get through 3-4 yrs of school then 3-4 yrs of residency before making a high salary and being able to both eliminate that debt and save significantly for FIRE.  I'd be thinking about every possible way to get through school with as little debt as possible.  Many families I know with significant assets willingly fund education expenses for their offspring, so it would be worth at least having the conversation with your folks.

I've never had to make these sort of decisions. The education in personal finance i'm getting with the interest I'm paying on these loans right now makes it worth it. In the future I'll get a windfall but I want to do this like I don't need it right now and act like I will have those big loans.

[BBub]

Sounds like a plan!

A couple of questions?

If you have "family" money can you not ask that the money be diverted to pay for education rather than borrowing?

Second,  We know that dental school can be very difficult and time consuming but wouldn't it be better to pay as you go and retire 3 years after graduation?  Without the fam paying this would require a part time career/job that pays very decent.

This... it seems silly to plan on taking $250k in debt to fund dental school if you have significant family assets and/or the ability to keep expenses down and pay as you go.  $250k is no small debt obligation, and you'll likely have to get through 3-4 yrs of school then 3-4 yrs of residency before making a high salary and being able to both eliminate that debt and save significantly for FIRE.  I'd be thinking about every possible way to get through school with as little debt as possible.  Many families I know with significant assets willingly fund education expenses for their offspring, so it would be worth at least having the conversation with your folks.

I've never had to make these sort of decisions. The education in personal finance i'm getting with the interest I'm paying on these loans right now makes it worth it. In the future I'll get a windfall but I want to do this like I don't need it right now and act like I will have those big loans.

One last comment then I won't keep harping on it.  That's a very expensive and risky way to educate yourself on personal finance.  Paying back your current loan of $30k will teach you everything you need to know about debt interest, the time it takes to pay back loans, amortization and the like.  Taking on another quarter mil just to learn how loans work doesn't seem like the wisest plan of action.  Moreover, student loans are not forgivable & you can't get out of paying them back while still alive.  In the event that some unforeseen circumstances reduce or eliminate your expected windfall, you will be stuck with a massive debt load.  Furthermore, if you wish to take on more debt in the future for a home purchase or investment you may have to settle for a lower amount or unfavorable rate & terms.   I'm guessing you posted here for feedback on your plan, and I'm just giving you some things to think about and potential pitfalls to possibly avoid.

[Retired To Win]

wow thats a ton of schooling to then retire so fast best of luck.

My same thought.  And sinking a quarter-million bucks to get the training, too.  If he is 22 and "predental", then he must have at least 4 or 5 more years of schooling to go.  That puts him at 27 or so when he starts practicing.  And then, in 8 years, he is going to liquidate that $250,000 school loan debt AND build a stash to become financially independent??

Hey... just how much moola do dentists make?!

[Fallenour]

Dentists make around 180-250k on average depending ont he region and the malpractice costs, and the amount they pay for supplies, overhead, and their number of average clients per year

[arebelspy]

Is that with your own practice?  I'm assuming since he's working such a short period he may just work under someone else.

Still, if he can earn 200k+, he should be able to wipe out the student loan and get FIRE money in 8 years without much trouble, if he doesn't fall into the expectations trap of what someone earning that "should" be wearing, driving, etc.