To retire early, unless you inherit a great deal of wealth or win a lottery, you’ll need to have a frugal mindset, a solid plan, and the determination to follow through.
Here are some books and online resources that have helped us in our early retirement journey. I’ll keep adding to the list as we discover new ones.
The Frugal Lifestyle
The Millionaire Next Door: The Surprising Secrets of America’s Wealthy by Thomas J. Stanley and William D. Danko
When most people think of millionaires, they think of someone like Thurston Howell from Gilligan’s Island or a high-powered executive driving an expensive BMW. In this book, the authors report on their efforts interviewing real life millionaires and find that many live modest lifestyles well below their means.
Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence by Joe Dominguez and Vicki Robin
This is a classic book on anti-consumerism. The authors hammer home that every dollar you spend is paid for in hours of your life. If you want to buy that latte for $3.50 and you make $10/hour after tax you it will cost you 21 minutes of your life. Since you trade your life for money, you had better keep careful track of how it is earned and spent. You become financially independent when the income from your investment portfolio exceeds your expenses.
Saving and Investing
If You Can: How Millennials Can Get Rich Slowly by William Bernstein
If you read only one thing on investing, read this book. It’s only 16 pages so even the busiest among us should find time to read it. On the frugal side, the book is free if you get the electronic version, so it’s a great deal. If you prefer, you can purchase a hard copy here: If You Can: How Millennials Can Get Rich Slowly
The Bogleheads’ Guide to Investing by Taylor Larimore, Mel Lindauer and Michael LeBoeuf
A great starter book for beginner and intermediate investors.
A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing (Eleventh Edition) by Burton Malkiel
The book leans to the academic side but is a classic and should convince you of the benefits of diversified investing in passive indexes as opposed to trying to beat the market by stock picking.
Canadian Couch Potato
This is a blog written for Canadians who want to invest in low cost index and mutual funds. I recommend this site to my Canadian friends and relatives as it address some unique issues, such as higher management expense ratios (MER) for funds or the Canadian market being much less diversifed due being to a smaller and heavily resource driven economy.
Managing Income in Retirement
This site helps you determine how much you can withdraw from your investment portfolio to fund retirement. It runs simulations based on historical stock market data and tells you whether your plan would have succeeded or failed in the past. While the future isn’t going to be exactly like the past, the simulations can help you set expectations as to what’s reasonable to spend and how much volatility you might experience.
Unveiling The Retirement Myth by Jim Otar
This is an ebook that discusses how one can pull a steady stream of income from an investment portfolio to fund retirement. The book is over 500 pages and doesn’t shy away from equations. While there is some good information in here, I found the writing dry and boring. The book was self-published, and lacked the touch of a good editor who would have forced Otar to tighten his writing.
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