Stephen and Lauren Keys retired at the age of 29 thanks to making significant savings from an early age. The couple appeared on MarketWatch’s ‘FIRE Starters’ series to discuss the benefits of achieving early retirement.
FIRE is the economy given to the Financial Independence, Retire Early movement which has gained great traction among younger generations in recent years.
The couple, who are high school sweethearts from the Tampa Bay area, both ended up going to the University of Florida in Gainesville at the same time.
Planning their lives together post-graduation, the Keys realised that continuing to spend and budget money as if they were still in college would lead to greater savings down the line.
Furthermore, the pair were able to achieve an early retirement thanks to making smart investments, according to Stephen. It’s important to note that with investment, capital is at risk.
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He explained: “We retired at age 29 by keeping our expenses low and investing the vast majority of our incomes.
“We realised that there was value to having extra money and not spending everything you make at around the age of 22.
“We found out about investing at that time and it kind of changed everything because the default is when you make more money than you need to live is to just upgrade your lifestyle.
“If you find out about this extra thing you can do with your money, which is invest it and buy yourself decades off of work when you’re 22 years old, it’s really easy to do.”
According to the couple, this is easy to do as young people are more accustomed to living frugally and are unlikely to be required to make financial sacrifices.
While speaking to MarketWatch, Lauren shared that the pair’s preference for a minimalistic aesthetic means that they are unlikely to purchase expensive items for their home.
As well as this, she noted that they both use items, such as clothes, until they are “worn out” to make as much use of them as possible.
When the married couple graduated from university, their first dual full-time jobs saw them making around $40,000 (currently around £32,275.80) each a year.
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Stephen added: “Over the years, our expenses have ranged from $18,000 (£14,524.11 a year for both of us combined up to about $30,000 (£24,206.85) a year.
“Once we got up to about $500,000 (£403,447.50). In addition to our paid-off house, we started to feel like we were pretty much financially independent.
“With the four percent rule, four percent of $500,000 is $20,000 (£16,137.90) a year so we could afford to withdraw $20,000 a year, every year without running out of money. In reality, we’ve actually done some freelance work and haven’t withdrawn from our portfolio.”
Despite having achieved FIRE, Stephen still works part-time for his old employer while Lauren does social media marketing for a single client, which only takes up an hour of her week.
They spend the majority of their time participating in hobbies, such as hiking and kayaking, or visiting countries like Canada for a few months.
At the time of filming, the couple were planning their extended trip to Australia and were looking to sell as much “excess stuff” as they own.
Mr Keys said: “Probably the best part about early retirement is that any dreams that you had in your childhood or in your teen years, there’s nothing stopping you from pursuing them whatsoever.”