Recently, I ran across an article called the 5 Steps to Early Retirement. Written by a couple who retired at 38, here are they are:
- Track your spending.
- Save a lot.
- Invest wisely.
- Put peer pressure into perspective.
- Keep your eye on the prize.
At first glance, these steps may seem obvious and common sense. However, I would say there is a lot of hidden wisdom in the 4th step, in which they explain:
Social pressure to spend can be subtle and pervasive, and it can divert you from your commitment to retire early. Marketing specialists tell you that if you only buy this new product, car, house, or membership, your lifestyle will improve. It’s reasonably easy to tune out that marketing message, but you have to handle your friends with a little more tact. Trying to match the spending of our peer group is a surefire way to derail financial goals. Decide now that you don’t have to keep up with their consumption to fit into the crowd. The choice is yours — not theirs.
In other words, if you want to be different from everyone else – have more savings, retire earlier, whatever – then you have to act differently from everyone else. Here’s a quick anecdote. A friend of my wife recently told her:
“You make good money, you should stop buying your dresses from Target… Check out my new Louis Vuitton purse!”
The same friend later in the same week said:
“How the *%& do you have $100,000 (20% down) saved up already for a house?”
She didn’t make any connection between the two events. I’m not saying everyone should buy dresses from Target, but I do think everyone should pick their battles and be proud of them. Maybe it’s not leasing that shiny SUV or brown-bagging the lunch more often. Maybe I’m weird, but I love it when people judge me by my outward appearance. One day, perhaps that same friend will say:
“What!? You’re only 48 and you’re retiring?”