Yahoo Finance I Retired Early: Here’s When I Started Saving for Retirement
Retiring early is a dream come true for many people. The earlier you can retire, the sooner your time becomes your own — and the sooner you can start pursuing other interest or goals without the burden of work.
But being able to retire early isn’t always easy. Some people strive for this goal for years only to end up working until their 60s or beyond. And in some cases, such as when there are debts to be paid or they don’t have enough retirement savings to leave the workforce, this makes sense.
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For those who do manage to retire early, there’s a good deal of financial planning — and saving — involved. GOBankingRates spoke with two individuals who retired early — Paul Lawrence Vann, owner of Wealth Building Academy, LLC, and Mathew Pezon, CEO of Pezon Properties — about when they started saving, when they retired and how they did it.
Here’s what they said.
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When They Retired
Pezon retired early from his corporate job to focus on his real estate investments.
“I ended up retiring from my corporate engineering job at age 33,” he said, adding that this enabled him to focus on two things: growing his rental property portfolio into a privately-owned REIT (Real Estate Investment Trust) and spending more time with his children. “I wanted to retire by 35, so I exceeded my goal!”
As for Vann, he retired as a Lieutenant Colonel with the USFA in his early 40s.
“I was forty-three years old when I retired from the USAF. I could have retired at the age of forty-one, [but] I separated from the USAF in 1988 after eight years of duty to pursue a Fortune 500 opportunity with Mobil Oil Company in Beaumont, Texas,” he said.
After a two-year stint with Mobil Oil Company, Vann was recalled to the USAF, where he served an additional 12 years in the Pentagon before officially retiring in his early 40s.
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When They Started Saving for Retirement
Pezon started saving for retirement right after college.
“I kickstarted aggressive savings and debt repayment of my $50,000 of student loans immediately after graduating from college in 2010,” he said.
“By paying off all debt within three years through extreme frugality, I boosted my credit score and qualified for a mortgage for my first rental property investment in 2014,” Pezon continued. “The frugal, do-whatever-it-takes mindset and relentless funneling of funds into assets allowed me to achieve financial independence in my early 30s.”
As for Vann, he didn’t start saving until after returning to the USAF — when he was about 31 years old.
Real Estate Investments Were Vital in Retiring Early
Both Vann and Pezon said they used real estate as a way to build wealth and retire early.
“I purchased a house while living in Texas, and ultimately, I hired a property management company, and it played a role in me building up my financial portfolio,” said Vann. “After several hurricanes in the Texas region, I sold my house in Texas, and it was a six-figure return on investment; thus, it represented the foundation for my retirement funds.”
Vann also bought a home in Maryland, which gave him two properties for several years and allowed him to continue building his retirement savings.
As for Pezon, he said he kept working full-time at his corporate job while building his portfolio of rental properties into a successful real estate business. He also focused on purchasing deeply discounted multi-family buildings that he could renovate and rent out at higher prices.
Along with this, Pezon said that he has regularly invested over 85% of the profit from his rentals — rather than spend it — into purchasing additional real estate. Like Vann, he’s also worked with professional property managers to handle the everyday operations, so he can focus on building his business.
But all of this didn’t happen overnight.
“By starting small, then systematically expanding into more properties while keeping expenses low, being disciplined and making intentional efforts towards my goals… I had accumulated over 210 cash flowing rentals [within 13 years],” Pezon said. “The exponential growth and passive income allowed me to cover living costs by 33 and retire decades early to focus on my growing family and new business ventures.”
Being Debt-free and Living Within the Margins Also Helped
Debt is one of the biggest reasons why so many people can’t retire early or even on time. But for Vann, this hasn’t been a problem.
“The key for me was being debt-free,” said Vann. “I live within my means, and I continue living debt-free, especially during the inflationary economy that exists today.”
Pezon also said that he aggressively slashed costs so that he could save more money, build his financial portfolio and get to where he is today.
Financial Independence, Retire Early Isn’t Just a Dream
Everyone’s journey to retirement is different, but as both Pezon and Vann have shown, it’s entirely possible to retire early — sometimes even decades before your peers. It just requires some financial planning, discipline and maximizing savings early on.
But even if you start saving later in life, you could still achieve early retirement. It’s all about the decisions you make, building your financial knowledge and setting — and pursuing — goals that will ultimately get you there.
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This article originally appeared on GOBankingRates.com: I Retired Early: Here’s When I Started Saving for Retirement
