15 Years to Financial Independence

How to Retire Early

This story of financial independence is one that could apply to anyone who can focus on a goal and work toward it. Although the individuals depicted herein are fictitious, the financial dream outlined below is realistically achievable for many.

In 1992, George and Sandy Ravengroff bought a fix-it-up home on the outskirts of town for $54,000 while both had jobs making $30,000 and $35,000 respectively. They were in their early 30s with 2 children (11 and 12). Their "take home" pay was $4,063 monthly, and their monthly expenses included: a $539 mortgage payment (with property taxes and insurance), utilities, car-related costs, groceries, and miscellaneous expenses (clothing and other necessities, etc.), which all added up to $1,749.

They were free to do as they pleased with the remaining $2,314 monthly cash. Therefore, $1,200 went into a "hands off" savings fund that paid 3.5% annually. The remainder, $1,114, went toward home repairs, college tuition, family vacations and/or entertainment. The children earned money with paper routes, lawn care, and other services that were needed throughout their community. In addition, the whole family learned to become successful at selectively shopping at yard sales and reselling items on eBay. They lived frugally. Being vegetarians, their monthly grocery costs were far less than carnivorous families, and they bought items in bulk whenever possible and reasonable.

George and Sandy both shared a common goal of becoming financially independent as soon as possible so that they would have more years to enjoy a leisurely lifestyle together. Thus, they considered their home an investment that they could grow, and in their spare time, they refurbished the home and landscaped the grounds.