The Ten Commandments of Early Retirement

Welp…the title is self-explanatory, and for clarity’s sake I’ve organized these commandments into loose categories.

Please let me know in the comments what your own thoughts on these are, any questions you might have or clarifications I could make, etc.

Above all else:

1) Keep as mentally and physically fit as possible.

This makes everything else—everything—easier. And even if you fail to achieve financial independence and early retirement, mental and physical fitness can only serve to increase your quality and quantity of life.

The FI/ER mindset:

2) Be sure you’re not using early retirement as a kind of geographical cure.

In other words, be sure you understand that you take your personal problems with you wherever you go.

I learned that the hard way. I realized after retiring that I was using the pursuit of FI/ER as an attempt to get away from troubles that were more my own devising and perception than intrinsic to my surroundings. If I’d gotten some therapy and been more honest with my superiors, I might still be working—and enjoying—that job.

3) Those who can’t imagine what they’ll do after they retire, won’t.

Simple, really…If you don’t know where you’re going, how will you get there? And to this I’m convinced there’s a corollary: painful stimuli serve a purpose, but it’s better to move towards something positive than away from something negative.

4) Retirement <> idleness.

The most common question put to early retirees is this: “What do you do all day?” When contemplating early retirement you may be afraid you’ll be sitting around on your can all the time, bored, but after maybe a month when you’ve caught up on sleep and overcome burnout, etc., you’ll be surprised how much you’ll find to do.

Please check out this post: “The Purpose of Life,” for further thoughts on this commandment.

Money mechanics:

5) Work towards having something to sell besides your time.

I call that “Early Retirement’s Magic Bullet.” Take a look at my article of the same name for a full explanation.

This statement’s a bit like Einstein’s “E = mc2”. From this it’s possible to derive all other steps in the FI/ER process.

6) Use your creativity and energy at least as much to your own benefit as you do to your employer’s.

Remember that your job isn’t a personal relationship, but business. You may want to sell your time to your employer and your employer may want to buy it from you. Work smart and hard and well at your job, but work even smarter and and harder and better at your own life.

7) Investing: set it and forget it.

Many people micro-manage their money; I don’t, or at least not anymore.

Which is not to judge people who do. Tinkering around to optimize your financial structure can be a fun game, and I endorse any opportunity to increase your income/savings/etc. Credit card churning, for example, can be a great way to see the world on very little money, and there are a LOT of people who get off on it.

Where I’m coming from is this: set it and forget it has been very good to me, and I’m a strong believer in “dance with who brung ya.” Our financial structure has gotten so rigid that I don’t have any more room to optimize.

Although  maybe “set it and forget it” should be a long-term goal rather than a short-term tactic during the accumulation phase.

8) Not all debt is bad.

Show me a capital loan that carries a payment of two or three hundred bucks a month at an interest rate close to the rate of inflation, and I’ll likely take it because it’s essentially free money. The loan on our Prius, for instance, carries a rate of 1.9%—meaning the principal is very close to eroding during the life of the loan. True, the dollars I pay are also eroding, but across time there’s still an arbitrage of five-ish percent between the interest rate and market returns.

9) Geographical arbitrage can make many years of difference.

A personal example: a key component of our FI/ER plans was living and working in a very expensive (and consequently high-salary) northeastern city. While we were there we ran three rental properties, which when we finally ER’d we condo-ed out and sold before moving to a house in the southeastern Appalachians. The appreciation on the rental units paid in full for our new house, leaving what we otherwise would’ve been carrying as house equity free for us to invest.

Plus, there was the peace of mind that came from knowing that no matter what happened, as long as we came up with a couple of thousand bucks a year for property taxes, nobody could take our home away from us.

And finally:

10) Be very careful about sharing your plans.

In my experience if you divulge your FI/ER plans to others, you’ll find that the two most common reactions are incredulity and jealousy. The jealousy is especially toxic since people tend to keep resentment secret, especially in a work setting. Supportive reactions will be a distant third. Take that into account when you’re deciding who to tell.

And that’s it. Ten ER commandments to live by.

Again, these are crucial ideas and I’d very much appreciate it if you’d share your thoughts below.

There’s an endless list of hobbies you can explore in early retirement. Bass fishing is one: check out this post if you’re interested in trying it yourself.

24 thoughts

  1. Great list, ERD!

    Can I call you ERD? I’d say it’s too late, but you’re the one with an Edit button and mouse in your hand (or finger on a trackpad).

    If I could add an eleventh commandment, it would be to have a contingency plan. A way to earn income if you suffer from particularly poor sequence of returns in the early years. A Plan B if you’re struggling to find purpose without paid employment. A new goal or passion project if you find you’ve got more time than you know what to do with.

    I don’t anticipate any of these problems, but I was a boy scout for at least a couple months, so I prefer to be prepared.


    1. Good suggestion. Push up on your income or down on your expenses–definitely the way to weather bad returns, and if you can do so by finding a job you love, so much the better.

  2. I like tenant 2. Don’t use early retirement as an escape plan. If you have internal problems, they will remain even when you retire. I guess that is why some people say to figure out a way to enjoy your job instead of finding a way to get out of it early.

    I like a dual contingency plan where you both find a way to get out of your job and a way to enjoy it more.

  3. Great list
    I think numbers 8 and 9 are often overlooked by FIers.
    Not all debt is bad, don’t avoid it like the plague.
    The world’s your oyster! Sometimes travelling can be cheaper than living at home. You don’t need to relocate permanently. 3 months here, 6 months there is just as good and longer stays in places means you can keep costs low and learn to live like a local rather than a tourist.

    1. I have friends who use co Sumer debt as a sort of savings account slash emergency fund, which always struck me as reckless. But there’s definitely a smart play or two. Thanks for the comment!

    2. >I think numbers 8 and 9 are often overlooked by FIers.

      Right on…and it seems like the philosophical side of FI/ER is just as important as the technical side.

  4. I think the last commandment is interesting. I’ve actually been very open about my pursuit for FI. While people may hold resentment to themselves and not voice it out loud, I have found that the majority of people who are aware of my goals, tend to be curious about how they can implement a similar plan. I have been able to help several people start on their path to FI and greatly improve their finances. Even if there are 5 people behind the scenes who are jealous/pissed off at me for being able to do what I’m doing for every 1 person I can help, I’m all for it.

  5. These are great! 🙂

    #10 is always a tough one for me. I’ve kept our plans pretty quiet from friends, but it’s those same friends who I want to inspire and let them know that it’s possible to become FIRE.

    As you said, though, they either won’t believe you or will be jealous of your game plans.

    — Jim

    1. If it’s a matter of losing even one friendship, I’d rather not go there. You have to wonder: in life how many potentially close friends have you lost because of an unintentionally negative first impression?

  6. Hi ER Dude,

    Loving the list.

    Retirement idleness solution #1

    – launch a blog
    – get a matching Twitter account
    – join a community
    – share and have fun
    – make a little money

    I see a lot of people in retirement struggling with their new life. The ones that seem to do the best find some kind of hobby or passion that they can obsorb themselves in.

    Great blog.


    1. Back when I was working, part of my responsibility included cost account management for a few contract line items. We would detail plan “work packages” for the next six months, leaving the remainder in “planning packages” to be detailed planned later (in about four months). The overall project schedule was handled the same way, because, let’s face it, on a technically complex project you simply can not predict in advance every technical challenge or complication you might encounter. When people would ask me, “What will you do in retirement with all that free time?”, I would tell them, “I don’t know, but I’ll figure it out – just like we do with our project planning packages.” LOL

      After being asked this same question so many times (I informed my boss of my retirement date three years in advance due to health reasons) I finally reached the point of developing a daily retirement schedule and posted it outside my office. It included things such as “sleep a full eight hours”, “read the entire newspaper at breakfast” (back in the day when I had a hardcopy printed paper delivered to my driveway – now I read FIRE blogs), and “go for a walk in the park.” Everyone got a laugh out of it, but at least they stopped asking me questions about what I’d be doing with all that free time in retirement, once it sunk in that, yes, I really was planning to do the things on my daily retirement schedule. 🙂

      The point is, don’t worry about what you’ll do in retirement. You’ll figure it out once you get there. It’s no different than having to plan out how to accomplish a work project. The sad thing is many wage slave worker bees can’t see that connection, and can’t even imagine they have that option.

  7. Not a day goes by where I don’t ask myself “How do people with a job get anything done!?” I haven’t worked for an employer (other than my husband and kids) since 2005 and I’ve never found myself wanting for things to do. That doesn’t mean that my days are filled with things, in fact, quite the opposite. We try and leave our day open-ish so that we can embrace and take advantage of anything that comes up and a lot comes up! Life happens no matter what your plans are.

    Congratulations on your progress to FI. Thanks for sharing your journey with us.

    Besos Sarah.

    1. Re: “Life happens no matter what your plans are.”


      Upon learning I was retired, someone asked me, “What do you do all day?” I answered, “I don’t know, but the days sure go by fast!” I think a better answer would be, “Anything I want to!” 😉

      No one ever asks a stay at home parent what they do all day. 🙂

  8. Great list. I was expecting the usual buy as little house as you need, which is good but I think this gets more to the root of it.

    I like the one about how you should value your own time as much as that given to your employer. I know many people, myself included that give so much time and energy to their job that there’s nothing left over for themselves. No wonder why when people lose their jobs it’s so devastating.

    1. Thanks! I try to write more about the lifestyle and philosophical components of financial independence and early retirement, as opposed to the actual mechanics of managing money, so I’m glad you like the approach. I think you’re absolutely right: when you define yourself as your job, and your job goes away, so does your self. Terrible predicament to be caught in.

  9. I’m spending my money during my retirement, and if I run out then I’ll spend less I guess. I’ve paid off an insurance policy for my only son and have a trust that will leave him a bit more. I struggle somewhat with getting old and the inevitable dying part but that we can’t change. Often I just go fishing and enjoy my time on the water. I get home clean the boat and have a few stout drinks 🍷

  10. Interesting commandments and completely differnent than the others out there. I currently live in a city now and cannot imagine moving somewhere remote. Do you ever miss the city?

    1. Funny you should ask. Not so long ago we realized that being way out in the sticks was no longer for us. Totally missed the city, but our daughter also needed better schooling than our area could offer. So we moved to a local mid-sized city that has a great vibe, and it’s worked out well.

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