Hello been working at CVX for about a year. I am a 23 yo engineer grad 2019. I paid off all my debt from school last year. I make 99k a year. Apart from saving my money how can I retire early. Any tips help. Thanks
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find an international assignment ASAP
Check out The Money Guy Show, specifically their concept of FOO (Financial Order of Operations)
Take the money and run, get on an aircraft and go to any other country but USA where you will be a lot safer from the Virus , how about Thailand? where you can live really cheap shack up with a really hot young Thai hottie who will treat you like King and be very happy. That's what I'm doing with my severance, no brainer really
Ask a company of engineers about how to save money and retire early and we have tons of advice with figures. The advice is all good here but I’ll ask, one year in are you thinking about getting out. I am about 12 years ahead of you with 7 figures net worth because of the recommendations here, money won’t make you happy. I have seen plenty of managers at a 28 or 30 psg with a terrible personal life because they sold their soul to Chevron.
Find a role that excites you and you feel productive in...get good at it
Find a spouse (assuming that’s your thing) and have lots of kids
Raise those kids, love your spouse, praise God for your blessings. Work is means to an end. Who cares if it’s 15 years or 40...life is the journey, not the finish.
Last but not least, be generous. Life figuring how to hold on a tightly to your money as possible is a miserable existence IMHO. Be a blessing to others.
Most folks in this thread are offering good advice, however I do not understand this "buy your house with cash, do not get a mortgage mentality".
30 year mortgage rates are 3% right now, and mortgage interest is tax deductible which matters particularly because you are/will be in high marginal tax bracket. Long term market annualized return can be conservatively viewed as 6%+. Opportunity cost must be considered.
Don’t pay an investment advisor for information that’s free on web sites like Vanguard. Fees can eat up returns that would have stayed in your account and continued to grow for decades. Invest your first million in ultra low cost indexed funds.
Get into teal estate, buy two properties ... first buy a house, and buy a 2nd one when possible...live in one and rent out the other one...for me , real estate has given the biggest return...
All solid advice given here. If you want a solid system to follow, which is consistent with suggestions here, look up Dave Ramsey. He has 7 baby steps to follow. You can listen to him for free on YouTube. He also has a few good books like “The total money Make over”. If you wanna get really serious you can take his classes known as financial peace university.
@1kwn sounds like they are joking but other than the great advise posted earlier it is critical that everyone in the family has the same financial end goals in mind, it is very easy for a spouse to derail an early retirement/savings plan if they don't have the same level of commitment to savings etc.
Suggestion: track your spending for a full year and see where you might be overspending or could do a better job. The EveryDollar app is one among many free apps that make it easy to consistently budget and track your spending. It’s not sophisticated, but sometimes simplicity makes it more likely that we will actually keep up with tracking. Good luck to you!
Invest your money with me.
1) max savings in S&P 2) manage expenses even small items like coffee and streaming services add add 3) bid out insurance and electricity annually 4) modest car and keep for 10 years 5) maintain your health 6) find inexpensive joys...little league baseball, or coaching a soceer team, music, reading, fantasy football, video games 9 (vs expensive travel) 6) Great friends and relationships with family 7) give to your church or charity 8) Have house paid off by the time your kids go to college with 15 year loan paid off in ten years 9) pay cash for cars 10) earn interest don't pay it. 11) pay college in cash. No expensive private colleges...state schools 12) educate your kids otherwise they will be a huge financial burden 13) Same with parents, leverage your relationships with siblings to share how your parents are cared for 14) be tax smart and honest
Wow I am very impressed by so many great advices here. I am also a big fan of living debt free and since you are so young, aim to save up and buy a house with cash (no mortgage). The grass under your feet feels different when the house is paid for. Also consider generating passive income (read Rich Dad Poor Dad). If you follow the advices here, you will end up with millions in no time. The big question then is what will you do with potentially 60-70 years left in your life when you are not chain to a job. What is your purpose here on earth and what will you do with all that time? Lastly, don't forget insurances and having at least a basic will especially once you start having a family. Go crush it!!!
Live debt free and you will not be chained to any job.
You see it here. Do not allow yourself to have debt. If you cannot afford to pay cash, you cannot afford it. Have a good cash emergency fund. Save, save, save. Feel free to get yourself something but make sure you pay cash and only if you have your established emergency fund. I personally try to keep 1 year of living expenses saved up. You never know what hiccups may occur.
I think the other posters nailed it, especially about driving paid for used cars.
With early retirement you will need a good chunk of cash to bridge the gap between the early retirement age and the age where your retirement account withdrawals won’t be penalized. Not having any debt will help.
My aiming point is 57. Here are my rules for getting there:
- Max out Roth 401(k)
- Max out non-ESIP Roth IRAs for myself and my spouse once I’ve maxed out my Roth 401(k)
- Don’t budget against salary increases
- Don’t budget against CIP
- Don’t plan retirement around pension estimates
- If you have a mortgage, extra payments to principal whenever possible
- If you have kids, 529s to avoid college debt
- Give generously along the way
I hate to tell you this, but this is a pretty boring approach. You need to allow yourself a treat every once in a while. Best of luck.
With a megabackdoor and a backdoor roth ira, you can save over 60k per year. Keep living like a student in a cheap apartment. Try not to compete with your friends in blowing money.
Marry well.
Save save save. The first poster nailed it. Avoid debt. Buy a house with cash when you get ready. Sounds crazy doesn’t it that’s what I though when I first heard about it but I did it. I am sub 40 with over 2.5MM in assets. Don’t buy new cars drive you car until they fall apart. Keep your eyes open For other jobs as this is a dying industry. Build skills and be ready to pivot.
Sound advice already, but I will add this, too: Don't forget the fundamentals. Live withing your means. Think long and hard before making big purchases. Avoid credit wherever possible, and be mindful of rates if you must use it. Buy property as soon as you can afford it; do research on the area and the builder, and get in as cheap as you can (often times a mortgage will be less than rent, and you will be building equity). Most importantly, save enough to get you by for at least a few months, and dont make any investment that is wholly dependent on your job and your income being secure. This is not the time nor the industry to be complacent; the bottom could drop out at any moment. These are all simple lessons I wish I had followed at your age.
Investing is 80% personal behavior and 20% asset performance. Consistently putting as much money as possible in tax advantaged retirement accounts, even if they aren’t the top performing funds will get you way further than someone who nitpicks for an extra 1% return but doesn’t actually save the money.
Put at least 15% away a year (not including company match). You are young so you should go for riskier growth mutual or index funds. Go for the Roth option so growth is tax free. Make sure you have 6 months of expenses in cash as an emergency fund. When you get a raise, just keep living the same lifestyle and bank the raise.
Starting at 23 if you save consistently, avoid debt like the plague, and avoid major lifestyle creep you will end up with more money than you know what to do with. The plan is simple, execution is difficult.