topics

I have been enjoying a budget blog called Early Retirement Extreme, written by Jacob – a man who semi-retired into financial independence at age 30.

How? Here’s a glimpse:

I don’t have a driver’s license, I don’t have any debt, I don’t live in a house, I cook everything from scratch, I cut my own hair, I practically never buy new or anything at all for that matter, I am not on any prescription medicines, and I am in great physical shape.

Essentially, he has eliminated the American addiction for conspicuous consumption from his financial diet, and it hasn’t left much else to spend on. I can definitely appreciate his no-frills approach to spending – even within my yuppy, metro life I’ve managed to live marginally.

For a more detailed analysis of how Jacob works his magic, see his recent post Your budget is like a sinking ship. He literally compares the average American budget to a ship, showing how you can plug the leaks. He also aggregates the spend on some common items – like clothing and furniture – across a lifetime, like so:

$2688 a year or a lifetime cost of more than $200,000 simply to have other people prepare your food. If the average income is, let’s say 40000 after tax, would you really want to work 5 years of your life just so you can eat a meal you didn’t make yourself a couple of times a week for the rest of your life?

While his simplistic living might seem beyond your ability to withstand, his bottom line can make sense for anyone – identify the quality of life that you want, and then plug the leaks.