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How to Become FI by Age 25: Lessons From Early Retirees


The typical retirement age is around 65. But through careful planning and hard work, you can obtain financial independence much earlier than that — even by the age of 25. 

Four fundamental rules will help you achieve financial independence by the age of 25, according to early retirees:

  • Track your spending and saving and determine what you value.
  • Invest strategically with time-proven methods.
  • Maximize and accelerate your education.
  • Launch a profitable side hustle. 

By harnessing the experiences of people who have actually achieved early financial independence, you can implement the following proven, successful patterns in your own life and launch yourself into financial freedom.

Analyze your Spending, Saving, and Happiness

Vicki Robin is often thought of as the godmother of financial independence. She and Joe Domiguez wrote the classic financial freedom book in 1992 titled Your Money or Your Life: Transforming Your Relationship With Money and Achieving Financial Independence, which has sold over a million copies. As someone who retired young and quit her job to adventure across North America, she has timeless advice for anyone looking to reach financial independence by the age of 25. She suggests tracking and understanding your spending as a critical part of early financial freedom: “I would say the one thing you can do is track all the money that comes into and out of your life for one month and see what happens.’” An easy place to start is to try this for a week or a month. Monitor both your income and your spending to identify where your biggest costs are and what your savings rate is (savings rate = the amount of money leftover after paying for all of your expenses, divided by your income). Robin also suggests seriously contemplating the value you derive from all of your purchases.

“You will have momentary experiences of what do I think I’m buying when I’m buying this ice cream bar. What do I think I’m buying here? Is it making me happy?”

– Vicki Robins

Quote taken from here

By learning to understand how much you spend each month and how much you save (and the associated savings rate) as well as the value you derive from purchasing, you will be able to eliminate all useless spending. Doing so will increase your ability to save, launching you on your way to achieving financial independence by the age of 25.

Invest Strategically by Investing the Boring Way

Pete Adney (more widely known as Mr. Money Mustache) retired at age 30 after working in software engineering. He is a firm believer in spending and owning less, as well as utilizing the 4% rule, which is a fundamental financial independence principle stating that a retiree should save enough money to be able to withdraw 4% of their portfolio’s initial value each year and then be able to live off of that amount. Adney highlights that strategic, basic investing is a key to building a portfolio you can live off of.

“Investing is pretty simple at least if you do the stodgy old man way, which is basically you don’t buy Apple stock, you don’t buy a Facebook stock, you just buy a big index funds from the Vanguard Company where you’re basically buying a huge slice of the US economy and then you buy another huge slice of the European economy. You’re not trying to predict ups and downs. You’re just throwing all your money in there. It grows by itself. It’s very stable. You get dividends from it. The funny part about that style of investing is that it’s the easiest kind. From an academic perspective, people who do studies on this, they prove that it’s also the most efficient kind in terms of risk versus reward ratio and stuff.”

– Pete Adney

Quote taken from here

Whether you’re looking to reach financial independence at the age of 25 or 45, it’s essential to understand the fees associated with the investment accounts you’re using. Adney continues, “Vanguard is, in my opinion, one of the best companies to do that because their fees are the lowest, so it ends up being hundreds of thousands of dollars that you save up for lifetime in investment management fees, which is pretty significant. It makes it really simple.” If you’re interested in learning more about calculated and proven investment methodologies, he suggests checking out The Four Pillars of Investing by William Bernstein and The Random Walk Down Wall Street by Burton Gordon Malkiel

Make More Money by Maximizing your Education 

J.P. Livingston is another early retiree who took advantage of her 20s to gain financial independence. She is adamant that single decisions are crucial to early financial freedom, and one of the decisions she credits her success to is how she maximized her college education.

“I discovered that graduating from college in three years instead of the usual four could completely pay for retirement. Between the cost of a year’s worth of tuition and the value of one year’s worth of income, the swing in my net worth was over $1 million if I set it aside and let it grow until I was 55. In other words, knowing about and employing that one strategy could pay for my entire retirement.”

– J.P. Livingston

Quote taken from here

Not only was a condensed 4-year degree undeniably key to her financial success, but choosing to enter a profession with high salaries and bonuses also lead to the quick compounding of her  financial net worth. She went from earning just over $100,000 a year to a mid-hundreds salary by the time she quit working. Like J.P., by taking advantage of education opportunities and pursuing a path that could lead to high returns on your educational investments, you will begin paving the road to achieve financial independence by the age of 25.

Increase Your Income by Picking up a Side Hustle

Grant Sabatier is another FIRE enthusiast who retired with $1.25 million by the age of 30 after having only $2.26 to his name just six years earlier when he was 24. He is the author of the book Financial Freedom: A Proven Path to All the Money You Will Ever Need, which documents his journey to achieving financial independence at such a young age. Sabatier emphasizes the power of side hustles to drive income growth, especially for early retirees.  “The recipe or formula is relatively simple,” he says, breaking down how to pick a profitable side hustle.

“Pick a side project that you are excited about and would do even if it didn’t pay you money. Do some research. Far too many people don’t spend the time researching. Doing 5-10 hours of research up front could save you thousands of hours of wasted time launching a side hustle that won’t work.”

– Grant Sabatier

All quotes taken from here

He also underlines the importance of doing the work yourself, rather than hiring someone else. “Do as much as you can on your own. Learn new skills; they will benefit you in your full time job as well and throughout your life. Skills are future currency.” And sometimes, it’s best to experiment with more than one side hustle to understand what works for you. “Try a few different side hustles at once… See what you like doing and what you don’t. Get a feel for it. Like any “business” some side projects, especially your first ones, are going to fail or be too hard or you won’t like them. This happens to everyone, including me!” To mitigate the possibility of investing in an unprofitable side hustle, Sabatier also recommends starting with a “proof of concept”. “Go out and start selling as quickly as you can so you can see if anyone will buy it and if not, why? Far too many people spend so much time and money planning to launch something. Get it out there.” If you’re interested in reaching financial independence by the age of 25, start brainstorming all of the ways you could make money in your spare time, pick one, and start earning!


If you’re wondering how to achieve financial independence by the age of 25, take a queue from these pros by tracking and analyzing your spending, investing early and simply, maximizing your education, and starting a side hustle. Or, if you’re looking to become financially independent in five years, check out this article.

Climb on, Finbase.


Picture of Bethany


Bethany works in technology when the sun is shining, but when the stars come out, she writes about personal finance, financial independence, and holistic living. She enjoys cooking, playing tennis, skiing, and floral design.
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