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Man who retired at age 30 says this is how he teaches his kid about money

Kathleen Elkins

Peter Adeney, better known as "Mr. Money Mustache" in the early retirement community, worked as a software engineer for just 10 years before retiring comfortably and debt-free at age 30.

He and his wife Simi did it "simply by living a lifestyle about 50 percent less expensive than most of our peers and investing the surplus," Adeney writes on his blog.

The couple retired in 2005, shortly before their son Simon was born.

They have now been retired for more years than they spent in the working world, and Simon has grown up surrounded by the concept of financial independence. He's learned some valuable money lessons along the way.

"In our household, money is an open subject without any attached baggage or taboos," Adeney shares in a 2015 blog post. Simon, now 11 years old, "knows exactly how money is earned, what happens when you spend it (it's gone), and what happens if you invest it instead (it works for you, for life)."

To hammer home the importance of investing and the power of compound interest, Adeney created his own bank for Simon: "Instead of a physical piggy bank, my boy prefers to keep his money in the Bank of Mr. Money Mustache, a spreadsheet that contains every transaction he makes with money.

"To make a deposit, he just hands me some cash. To withdraw, he asks me for cash or has me buy something for him online."

Simon's savings grow at a competitive annual interest rate: 10 percent.


The system is effective for a few reasons, says the early retiree: "It shows him that his money is finite [and] not just a limitless pool that you tap by nagging parents to buy you stuff, keeping the money invested is profitable … and an account like this of sufficient size means lifelong financial freedom."

Simon's funds are earned, in a way. "Adeney pays Simon 10 cents for every mile he rides on his bicycle," Nick Paumgarten of the New Yorker reported in February 2016. As of last year, Simon had logged thirteen hundred miles and accumulated $700, which puts him in a better financial position than the 39 percent of Americans with nothing in their savings accounts .

Ultimately, if Adeney had to instill one money lesson in his son, he writes that it would be that "money is something you can master and control, rather than letting it control you."

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